Protecting Trade Secrets in Oregon

In Oregon and most other places, a trade secret is anything that:

(a) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and

(b) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

Before getting to the two criteria, I should mention that stealing trade secrets is, of course, a bad thing and thieves are subject to money damages, attorneys fees, injunctions preventing further misappropriation, and/or criminal liability.


Valuable business information typically includes drawings, cost data, customer lists, formulas, patterns, compilations, programs, devices, methods, techniques or processes. Unlike a kid that knows what his sister is getting for her birthday, businesses can rely on trade secrets to protect valuable information for a very long time. Coca-Cola, Co. owns one of the oldest and most famous trade secrets–the formula for Coke.


The trick about trade secrets though, is that they have to remain secret or their power is gone. Thankfully, courts look to a specific set of factors when deciding whether or not a business acted reasonably under the circumstances to keep something secret:

  • The extent to which the information is known outside the owner’s organization;
  • The extent to which it is known by employees and others involved in the organization;
  • The extent of measures taken by the owner to guard the secrecy of the information (e.g., labeling the information “Trade Secret” or “Confidential,” advising employees of the existence of a trade secret, limiting access to the information within the company on a “need-to-know basis,” and controlling company access);
  • The economic value of the information to the owner and the owner’s competitors;
  • The amount of effort or money expended by the owner in developing the information; and
  • The ease or difficulty with which the information could be properly acquired or duplicated by others.

Businesses should use these factors as guidelines when developing policies and procedures to protect their trade secrets. Businesses can also guard against theft or unintentional disclosure of trade secrets by having reasonable confidentiality, non-disclosure, and termination from employment/severance agreements in place.

Sending a Takedown Notice? Beware §512(f).

The Digital Millennium Copyright Act contains many powerful copyright enforcement tools and is a beloved whipping boy among many on the internet. But, as someone famous once said, “with great power comes great responsibility.” Enter 17 U.S.C. § 512(f):

Any person who knowingly materially misrepresents under this section—

(1) that material or activity is infringing, or

(2) that material or activity was removed or disabled by mistake or misidentification,

shall be liable for any damages, including costs and attorneys’ fees, incurred by the alleged infringer…who is injured by such misrepresentation, as the result of the service provider relying upon such misrepresentation in removing or disabling access to the material or activity claimed to be infringing, or in replacing the removed material or ceasing to disable access to it.

Basically, a copyright owner may be sued for using the DMCA as an incendiary bomb rather than the laser-guided missile that it was meant to be. You’ll notice that this works both ways too; an alleged infringer may be sued for damages related to abuse of the so-called put-back system. Since it’s not that hard to identify the copyrighted work or learn the true identity of the alleged infringer, thanks to § 512(h), the real trap for the unwary lies in copyright owners’ overuse of takedown notices.

While the specifics of 512(f)’s knowledge requirement are still being worked out in courts around the country, the law clearly prohibits sending DMCA takedown notices in bad faith–i.e. to harass your competitor. The 9th Circuit has also said that copyright owners must, in their heart of hearts, believe that an alleged infringer isn’t making fair use of the copyrighted material. So, while you’re allowed to be wrong in your assessment of the situation, you must sincerely believe that your work is being infringed when you send a takedown notice.

Bottom line: do your due diligence and be able to document and thoroughly explain why somebody is infringing your copyright before sending a DMCA takedown notice.

Many Small Business Services Available Online

For a while now the State of Oregon has been a leader in embracing online access to government services. Included in this virtual buffet is a businesses’ best friend:

Maintained by the Oregon Secretary of State’s office, the site features business registry services (new registrations, renewals, name searches, etc…), UCC filing searches, notary public services, and live chat support to name a few of the many services available from the comfort of your office.

Overall, the SOS has done a great job of reducing the administrative burden on businesses for routine inquiries and basic filings.