What is a Trade Secret?
A “trade secret” is defined as information, including a formula, pattern, compilation, program, device, method, technique, or process, that:
- Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and
- Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
An employee does not need to be expressly informed that certain information is a trade secret if, under all the circumstances, the employee knows or has reason to know that the owner intends or expects the secrecy of the type of information comprising the trade secret to be maintained. See Minn. Stat. § 325C.01, Subd. 5. If an employer’s trade secrets are misappropriated by an employee or another person or company, the employer may bring a cause of action to obtain injunctive relief or damages.
Takeaway: Employers who rely on valuable secret information should take reasonable steps to maintain the secrecy of that information so that it will be protected as a trade secret under Minnesota law. While it is not necessary to give express notice to employees that certain information is a trade secret, it is helpful to do so to prevent any misunderstandings.