Proving information is truly a trade secret is no easy task. In Structural Preservation Systems v. Andrews, the employer alleged that its former employees stole its “pricing structure, pricing knowledge and research, and established customer relationships." The Maryland Federal District Court (Judge Marvin Garbis) ruled, however, that the employer's allegation were too vague to form a valid claim for a violation of the Act. The Court relied on the Act's definition of trade secret. To qualify for protection, the information must "derive independent economic value . . . from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use." Pricing information is rarely a trade secret because it is rarely a secret (since prices are shared with customers). Ultimately, the Court dismissed the employer's trade secret claims.
Thursday, March 07, 2013
Vague Claims of Stolen "Pricing Knowledge" Do Not Support Maryland Uniform Trade Secret Act Claims
I often defend employees accused of non-compete violations. Tacked on to these claims are often alleged violations of the Maryland Uniform Trade Secrets Act (link to law review article). The Act allows a Court to award fees to an employer if it prevails (but apparently no reported decision has ever done so according to the article.)