Trade secrets are a form of intellectual property that are governed by both federal and state laws in the United States. In Florida, trade secrets are specifically addressed under the Florida Uniform Trade Secrets Act (FUTSA), which is found in Chapter 688 of the Florida Statutes. The act defines a trade secret and sets out the legal framework for their protection and the remedies available in the case of misappropriation.
Definition of a Trade Secret in Florida
Under Florida law, a trade secret is information that:
- Derives independent economic value, actual or potential, 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, and
- Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. (Fla. Stat. § 688.002(4))
The definition is intentionally broad to encompass a wide range of information, including formulas, patterns, compilations, programs, devices, methods, techniques, or processes.
Legal Requirements for Information to Be Considered a Trade Secret
To qualify as a trade secret under FUTSA, information must meet two primary criteria:
- Economic Value: The information must provide some sort of economic benefit to its owner and be of value to others in the industry who do not have it. The value may be actual or potential, but it must be due to the fact that the information is not generally known or readily ascertainable by others. (Fla. Stat. § 688.002(4)(a))
- Secrecy: The owner of the information must take reasonable steps to keep it secret. What constitutes "reasonable measures" can vary depending on the circumstances but might include confidentiality agreements, restricted access, or physical security measures. If an owner fails to maintain the secrecy of the information, it may lose its trade secret status. (Fla. Stat. § 688.002(4)(b))
Protection of Trade Secrets in Florida
Under FUTSA, trade secrets are protected against misappropriation, which is defined as the acquisition of a trade secret by someone who knows or has reason to know that the trade secret was acquired by improper means. Improper means can include theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means. (Fla. Stat. § 688.002(2))
Remedies for Misappropriation
If a trade secret is misappropriated, the owner may be entitled to various remedies, including:
- Injunctive Relief: Courts can order injunctions to prevent actual or threatened misappropriation of trade secrets. (Fla. Stat. § 688.003)
- Damages: The owner of a trade secret may recover damages for the actual loss caused by the misappropriation and for the unjust enrichment not captured by actual loss calculations. In lieu of actual damages, the court may order the payment of a reasonable royalty. (Fla. Stat. § 688.004)
- Attorney’s Fees and Costs: If willful and malicious misappropriation is proven, the court may award reasonable attorney's fees to the prevailing party. (Fla. Stat. § 688.005)
Limitations and Exclusions
It's important to note that trade secret protection does not extend to information that is general knowledge, readily ascertainable, or not kept secret by the owner. Furthermore, trade secrets do not prevent independent discovery or reverse engineering of a product that is publicly available.
In Florida, the legal framework for trade secrets is clear and provides robust protection for businesses and individuals who possess valuable, secret information. However, maintaining the status of a trade secret requires diligence and proactive measures to ensure that the information remains confidential. Trade secret protections can get pretty complicated and protecting them can be crucial for the future of your business. If you have questions, contact the Florida business lawyers at MSD Business for a free consultation.
About the Author:
Chase Carpenter is a partner in the Business Division of Law Offices of Moffa, Sutton, & Donnini, P.A.. His practice revolves around business transactions and business litigation. Mr. Carpenter handles a wide range of cases including contract drafting, partnership disputes, commercial leases, and construction litigation. These cases encompass diverse industries, including healthcare, technology, real estate investment, and government contracting.
About the Firm:
The Law Offices of Moffa, Sutton, & Donnini, P.A., also known as MSD Business, is a local business law firm in Tampa, FL, serving clients throughout Fort Lauderdale and statewide. Our firm has a long history of helping clients navigate all types of complex legal matters, including local and state tax issues. In our business law practice, we assist clients with everything from mergers and acquisitions to contract disputes, business litigation, general counsel, and more.