USA – NEW JERSEY Trends and Developments Contributed by: Galit Kierkut and Martin C. Fojas, Greenberg Traurig, LLP
information learned from the previous employer and therefore creates a substantial likelihood of harm. In a recent trade secrets decision, the District Court reiterated that where a plaintiff can demonstrate a sub - stantial likelihood of inevitable disclosure, the plaintiff does not need to come forward with direct evidence of actual disclosure. The plaintiff demonstrated that likelihood by alleging that a high-ranking employee had access to the plaintiff’s trade secret informa - tion, including customer lists, pricing data, and other confidential business information. The plaintiff further alleged that prior to resigning to join a competitor, the former employee emailed this confidential information to his personal email account. In addition, the former employee’s role with the competitor involved work - ing on a project to directly compete with the plaintiff, which made it inevitable that the employee would use or disclose the plaintiff’s trade secrets in his new role.
Best practices when an employee leaves for competitor Once an employee leaves, the company should deter - mine its exposure to trade secret misappropriation as well as investigate potential security breaches. The company should at minimum: • determine whether that employee is bound by an enforceable non-compete agreement; • verify whether there is evidence of wrongdoing before the employee’s departure; • conduct a forensic examination of the employee’s devices; • identify all of the trade secret information to which the employee had access; • determine what can be done to protect the trade secrets from disclosure and mitigate harm from a breach; and • determine if there is particular concern that an employee’s new position would necessitate his/her use of trade secrets. Sometimes, a company can negotiate with the new employer and the former employee to restrict the employee’s role to activities for which they do not possess trade secret information. If such negotiations fail, litigation seeking injunctive relief may be the only option to prevent the disclosure of the trade secrets.
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