JAPAN Law and Practice Contributed by: Makoto Hattori, Rikita Karakawa, Wataru Takagishi and Taku Shibazaki, Abe, Ikubo & Katayama
• Transactions of infringing goods – this covers the act of assigning, exporting, or importing products produced through the unauthorised use of a tech - nical trade secret. Actual Use vs. Unauthorised Access (Acquisition) The owner does not necessarily have to show that the trade secret was actually used. Under the UCPA, the act of acquisition (gaining access) by wrongful means is an independent grounds for a claim. • If the defendant has acquired the secret through theft or other wrongful methods, the owner can seek an injunction or damages based on that acquisition alone, even before the defendant begins using the information in their business operations. • However, for breach of trust, the focus is on the misuse or disclosure of information that was origi - nally accessed legally. Requirement of Unlawful Means The necessity of proving “unlawful means” depends on how the defendant initially gained access. • For “wrongful acquisition” – yes, the owner must show that the access was gained through a “wrongful method” such as theft, fraud, or duress. • For “improper disclosure” – no, the initial access itself may have been lawful (eg, disclosed by the owner under a contract). 2.2 Employee Relationships Under Japanese labour law principles, employees owe an ancillary duty of loyalty as an implicit part of their employment contract. This obligation dictates that, even in the absence of explicit confidentiality clauses in the contract or work rules, an employee is duty-bound to refrain from actions that unjustifiably prejudice the employer’s interests during their tenure. The scope of protection and the threshold for estab - lishing a violation differ between the UCPA and con - tractual theories as follows. • Breadth of protected information – the UCPA pro - vides protection only to information that satisfies the “three-fold test” (secrecy management, useful -
ness, and non-publicity), while the confidentiality obligations inherent in an employment contract can extend to a broader range of information. Even if certain data, such as information with insufficient secrecy management or internal sensitive matters that lack “commercial usefulness”, fails to meet the statutory criteria, it could still be protected under the contract. • Standards for breach – while the UCPA empha - sises the subjective requirement of “intent to obtain illicit gain or cause damage”, a contractual breach (non-performance of obligation) can be estab - lished on broader grounds. Liability for breach of contract may be affirmed simply by proving that the employee intentionally or negligently leaked or utilised the information, potentially offering a more flexible path for employers to seek remedies. 2.3 Joint Ventures Although the UCPA does not contain provisions exclu - sively tailored to joint ventures, the general framework for trade secret protection applies. Specifically, if a trade secret is disclosed within a joint venture, any unauthorised use or disclosure for illicit gain or to harm the partner would be captured under the “improper disclosure” category. In Japanese practice, parties primarily safeguard their interests by executing Joint Venture Agreements (JVAs) or NDAs that explicitly delineate ownership, permitted usage, and obligations While “industrial espionage” is not a technical legal term in Japan, such behaviour is primarily prosecut - ed under the UCPA. Recent updates to the legislative commentary have clarified the application of criminal and civil liability as follows. • Broad interpretation of “illicit gain” – the requisite subjective element – the “purpose of acquiring an illicit gain or causing damage to the owner” – is broadly interpreted. It explicitly includes cases where the actor intends to benefit a third party, such as a competitor or even a foreign government or its affiliates. • Extraterritorial disclosure and foreign laws – com - pliance with a foreign government’s data request upon the venture’s dissolution. 2.4 Industrial Espionage
113 CHAMBERS.COM
Powered by FlippingBook