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How is misappropriation defined?

California law specifically protects many different types of intellectual property, including trade secrets, from improper use by employees and others who may profit at the expense of the owner of the property. With regard to trade secrets, in section 3426.1(b), the California Civil Code defines misappropriation.

Misappropriation may include the actions of a person who gained the knowledge from the true owner of the trade secret or the actions of a person who subsequently used the trade secret. Specifically, the statute defines misappropriation to include the acquisition of a trade secret by someone who knew or should have known that its conveyance was improper and the disclosure of a trade secret if the person making such disclosure knew or should have known that the trade secret had been improperly acquired.

Disclosure of information acquired by mistake or accident may fit the definition of misappropriation if the person making the disclosure knew or should have known prior to disclosure that the information constituted a trade secret. The term "trade secret" is defined in the statute to include processes, techniques, patterns, formulas, compilations, devices, programs and methods with regard to which the true owner has made reasonable efforts to keep secret and that derive their value from their not being known by others.

Each intellectual property case is unique and the rights and obligations of parties may vary based on contracts, joint venture or partnership agreements or other relevant documents. This blog post is not meant as legal advice. An attorney with experience in business and commercial law may be able to assist individuals who have questions about trade secrets or other intellectual property. An attorney may help draft legal documents to protect trade secrets from misappropriation or provide particularized advice regarding the application of California law to a specific situation.

Source: Findlaw, "CAL. CIV. CODE § 3426.1 : California Code - Section 3426.1", October 22, 2014

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