October 24, 2018

The Defend Trade Secrets Act Has Returned

Freedom to Tinker readers may recall that I’ve previously warned about legislation to create a federal private cause of action for trade secret misappropriation in the name of fighting cyber-espionage against United States businesses. Titled the Defend Trade Secrets Act (DTSA), it failed to move last year. Well, the concerning legislation has returned, and, although it has some changes, it is little better than its predecessor. In fact, it may be worse.

Therefore, Sharon Sandeen and I have authored a new letter to Congress. In it, we point out that our previously-stated concerns remain, both stated by a previous letter and in a law review article entitled Here Come The Trade Secret Trolls. In sum, we argue that  combined “with an ex parte seizure remedy, embedded assumption of harm, and ambiguous language about the inevitable disclosure doctrine, the new DTSA appears to not only remain legislation with significant downsides, but those downsides may actually be even more pronounced.” Moreover, we assert that “the DTSA still does not do much, if anything, to address the problem of cyber-espionage that cannot already be done under existing state and federal law.”

In the letter, we call on Congress to abandon the DTSA. In addition, we ask that “there be public hearings on (a) the benefits and drawbacks of the DTSA, and (b) the specific question of whether the DTSA addresses the threat of cyber-espionage.” Finally, we encourage Congress to consider alternatives in dealing with cyber-espionage, including much-needed amendment of the Computer Fraud and Abuse Act.