Employers sometimes have legitimate complaints about employees taking truly confidential and protected information to a competitor. In many cases, however, an employer uses accusations of trade secrets theft as a weapon to wrongfully stifle worker mobility and punish competitors who hire away high-value employees.
Jawbone’s complaint alleges that employees who left the company to join Fitbit “gained access to and downloaded from their work computers information regarding Jawbone’s current and projected business plans, products and technology.” The complaint states that one employee “sought a confidential meeting with Jawbone to discuss all aspects of the future direction of the company, how it anticipated the market unfolding in the future, and its product designs and prototypes.” Other accusations include that employees used USB thumb drives to steal company information for use by their new employer, Fitbit.
Time will tell whether Jawbone’s allegations reflect legitimate grievances or phony accusations. In truth, the parameters of what truly qualifies as a “trade secret” are fairly narrow. Even when something qualifies as a trade secret, many employers fail to take the necessary steps required to maintain secrecy, thus losing their ability to protect the information from use or disclosure by former employees.
When allegations of trade secrets theft are made, it is tempting for the employee and the competitor to roll over and capitulate. The new employee does not want to “rock the boat” at his or her new company, and the new employer is faced with substantial legal fees just for taking on a new employee. Valid defenses may exist, however, and the law properly favors mobility and free market competition. Moreover companies who use extortionary litigation tactics can be made to pay the attorney fees of the former employee and/or new employer if the claims were made in bad faith.
At Wentzel Law Offices, we have successfully represented both employees and employers in trade secrets cases. If you are a business making new hires or an individual changing companies, give us a call at (312) 697-0500 to schedule a consultation.