UK Law and Practice Contributed by: Nicola Dagg, Steven Baldwin, Rory Clarke and Ashley Grant, Kirkland & Ellis International LLP
which employees can access the information, this may undermine statutory protection as it could be perceived as a failure to take reason - able steps and make it appear for common law purposes as if the information did not have the
disclosure of trade secrets to a need-to-know basis is a potential reasonable step that can be taken to protect the secrecy of information. In general, owners of trade secrets should ensure all disclosure is accompanied by well- defined trade secrets policies, appropriate NDAs or other confidentiality terms, and clear param - eters and protections surrounding use and onward disclosure. 1.10 Licensing The owner of a trade secret has a right to com - mercialise the trade secret, including via licence. The trade secret owner needs to take reasonable steps to maintain the secrecy of the informa - tion. For example, licences should include care - fully crafted confidentiality provisions specific to the relevant trade secret. Furthermore, practical measures should be set up to ensure protection of the trade secret within both the licensor and licensee companies, including who has elec - tronic and physical access to the information. If there are a large number of non-exclusive licences, it is possible that even with the pro - tection of confidentiality clauses, the information will no longer be sufficiently secret to qualify as a trade secret. 1.11 What Differentiates Trade Secrets From Other IP Rights Trade secrets are more flexible and potentially broader in scope/subject matter than other IP rights. They can cover very commercially valu - able information that it is not possible to pro - tect (either at all or effectively) by patents (eg, algorithms) or copyright (eg, the recipe for Coca- Cola). They are also not time limited, unlike pat - ents, designs or copyright. The most significant
necessary quality of confidence. 1.7 Independent Discovery
Trade secret protection does not protect against another party’s independent discovery of the substance of the secret information or genuine reverse engineering. An element of misappro - priation is required – ie, unlawful acquisition, use or disclosure that constitutes a breach of confi - dence in confidential information. 1.8 Computer Software and Technology There are no computer/software-specific protec - tions for trade secrets in the UK. 1.9 Duration of Protection for Trade Secrets There is no limit on the duration of protection of a trade secret. It will retain its protection as long as it is kept sufficiently secret and, for statu - tory protection, reasonable steps to protect its secrecy have been, and continue to be, taken. However, information can lose its trade secret status by becoming out of date and/or ceasing to have commercial value. The controlled disclosure of trade secret infor - mation in a confidential setting – eg, in accord - ance with an NDA or appropriate confidentiality terms in an employee agreement – will not affect the existence or duration of the trade secret per se. However, in general, the more people to whom a secret is disclosed, the higher the risk that the information becomes generally known, with an accompanying risk of loss of trade secret protection. As noted in the foregoing, limiting the
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