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Unfair Competition

Theft Of Trade Secrets And Infringement Of Copyrights And Patents



The intangible assets of a business include not only its trade name and other identifying devices but also its inventions, creative works, and artistic efforts. Broadly defined as trade secrets, this body of commercial information may consist of any formula, pattern, process, program, tool, technique, mechanism or compound that provides a business with the opportunity to gain advantage over competitors. Although a TRADE SECRET is not patented or copyrighted, it is entrusted only to a select group of people. The law of unfair competition awards individuals and businesses a property right in any valuable trade information they discover and attempt to keep secret through reasonable steps.



The owner of a trade secret is entitled to its exclusive use and enjoyment. A trade secret is valuable not only because it enables a company to gain advantage over a competitor but also because it may be sold or licensed like any other property right. In contrast, commercial information that is revealed to the public, or at least to a competitor, retains limited commercial value. Consequently, courts vigilantly protect trade secrets from disclosure, appropriation, and theft. Businesses or opportunistic members of the general public may be held liable for any economic injuries that result from their theft of a trade secret. Employees may be held liable for disclosing their employer's trade secrets, even if the disclosure occurs after the employment relationship has ended.

Valuable business information that is disclosed to the public may still be protected from infringement by COPYRIGHT and patent law. Copyright law gives individuals and businesses the exclusive rights to any original works they create, including movies, books, musical scores, sound recordings, dramatic creations, and pantomimes. Patent law gives individuals and businesses the right to exclude all others from making, using, and selling specific types of inventions, such as mechanical devices, manufacturing processes, chemical formulas, and electrical equipment. Federal law grants these exclusive rights in exchange for full public dis-closure of an original work or invention. The inventor or author receives complete legal protection for her intellectual efforts, while the public obtains valuable information that can be used to make life easier, healthier, or more pleasant.

Like the law of trade secrets, patent and copyright law offers protection to individuals and businesses that have invested considerable resources in creating something useful or valuable and wish to exploit that investment commercially. Unlike trade secrets, which may be protected indefinitely, patents and copyrights are protected only for a finite period of time. Applications for copyrights are governed by the Copyrights Act (17 U.S.C.A. § 401), and patent applications are governed by the Patent Act (35 U.S.C.A. § 1).

Additional topics

Law Library - American Law and Legal InformationFree Legal Encyclopedia: Umpire to Very pistolUnfair Competition - General Principles, Interference With Business Relations, Trade Name, Trademark, Service Mark, And Trade Dress Infringement