For trade secret and non-compete lawyers, it was a productive Spring Meeting at the American Intellectual Property Law Association (AIPLA). Here are some of the highlights from Thursday’s trade secrets track “The Internationalization of Trade Secrets: Big Cases, Big Verdicts and Big Challenges” presentation:
Protecting Trade Secrets Overseas. Beth Apperley, AMD’s Corporate VP of Legal, provided a number of practical pointers on structuring agreements and other safeguards for an American company in need of protecting its trade secrets overseas or in its foreign operations. In particular, Beth emphasized the importance of engaging capable foreign counsel conversant in the laws of that state at the outset so that a company can do its homework on the jurisdiction’s trade secret law and remedies. This analysis will allow a company to evaluate how adequately it can protect those trade secrets in that foreign state and decide which trade secrets it wants to use or disclose there. Beth also advised that once a company makes the decision to do business in a foreign country, it is critical to scrutinize and perform due diligence on your future foreign partners.
Challenges of Litigating Trade Secrets Disputes against Foreign Defendants. Mike Songer of Crowell & Moring spoke next. Mike was the lead trial lawyer for DuPont in its epic battle with Kolon, a case that resulted in a $920 million verdict last year (in my view, the most important trade secret case last year and a solid No. 1 in my Top 10 for 2011). He was able to share some of his experiences and provide practical pointers involving personal jurisdiction and the inevitable complications with personal service and discovery under the Hague Convention and other treaties. His advice?  Plan for a lot of time for those processes. Mike also emphasized the importance of translators and he shared that they can make or break your trade secrets case against a foreign defendant. For example, in the deposition context, Mike recommended selecting a translator who is not only capable but tough, as battles over what a foreign witness may have said will invariably erupt over key testimony (i.e., did the witness say that he “took” the information or that he “only reviewed” it as it lay in plain sight?).
Litigating Spoliation of Evidence Disputes. Griffith Price of Finnegan Henderson spoke next and he used Judge Robert Payne of the Eastern District Court of Virginia’s seminal ruling last year in the DuPont v. Kolon case as a template for examining the emerging issues in spoliation of evidence. For those not familiar with the ruling, after a number of Kolon employees deleted or wrote over approximately 17,000 files, Judge Payne sanctioned Kolon by providing an adverse inference in the jury instructions about the missing evidence at trial,  a ruling that Mike Songer agreed had an significant impact on the jury in the DuPont case. In a highly entertaining but substantive presentation, Griff also weaved the importance of litigation holds and what happens to data and information when a party or former employee tries to delete or write over it on a computer. Griff’s key takeaway? The cover up is always worse than the crime.
Managing Mobile Employees and Their Personal Devices. Ron Johnstone, Vice President and Associate General Counsel of Yahoo Inc! provided some sobering advise under the topic of personal devices. Ron has concluded that as a practical matter, it is nearly impossible in the present employment environment to completely manage employees who are using their personal devices to access work files and confidential information. He advised that, short of banning that practice outright, companies have to accept the risk of security breaches, prepare for the worst, and manage employee expectations. To accomplish this, Ron recommended implementing and reinforcing a culture of security, reserving the ability to “wipe” devices clean if any devices are lost or stolen, ongoing training and annual acknowledgements, and otherwise managing employee expectations about the privacy that they will have to surrender in exchange for the convenience of using their personal devices for work. Ron also raised an unforeseen issue that increasingly arises in the context of personal devices: recovering the information for possible litigation, an important reminder given the spoliation and preservation issues raised by Griff.
Litigating Trade Secrets Cases in the ITC and the Impact of the TianRui Group decision. Bryan Wilson of Morrison & Foerster’s  Palo Alto office spoke about the pros and cons of litigating a trade secrets claim before the International Trade Commission (ITC). It appears that the ITC is an under-utilized tool for trade secret plaintiffs, as Bryan’s research only revealed two previous reported trade secret cases before the ITC. While the ITC may only allow a litigant to bar importation of a foreign product into the U.S., it does provide significantly more confidentiality than traditional lawsuits because of the ITC’s presumption of confidentiality and the fact that many filings are under seal and not available to the public. As for the decision in TainRui Group (for more on the opinion, check out this post), Bryan wondered whether the decision really reflects what the Federal Circuit Court of Appeals really thinks is happenining in China, as the majority opinion seemed to reflect a “somebody’s got to do something about China!” theme and the minority opinion seemed to suggest “what did you expect to happen in China”?
Legislative Update. Peter Torren of Weisbrod Mateis & Copley provided a comprehensive update on the Economic Espionage Act, the pending Cyber Information Sharing and Protection Act (CISPA), the New Jersey Uniform Trade Secret Act and relevant recent decisions construing those and other federal statutes. As a former federal prosecutor, Peter was dismayed by the recent rulings in U.S. v. Aleynikov and U.S. v. Nosal, noting that one recent commentator had characterized the decisions’ combined effect as “disastrous” for the IP community and a failure by the legal system to adequately protect the software community. Peter said the pending civil amendment to the EEA is still in committee and he urged the Senate to adopt language to eliminate a future result like Aleynikov.
On behalf of the AIPLA’s Trade Secrets Law Committee, I would like to thank the panel for the outstanding presentation, their hard work and practical insights. The content provided by the speakers at the Spring Meeting was especially tremendous. AIPLA’s Trade Secrets Law Committee Chair, Dan Westman, and I are going to see if the Committee can make that content available to AIPLA Trade Secret Committee members in the future, perhaps through webinars and other media.