While patent, trademark, and copyright cases have had a place in federal law and a home in federal court, trade secret law has been relegated to the jurisdiction of state courts. Until now. With the passage of the Defend Trade Secrets Act of 2016 (DTSA), which President Obama signed in to law on May 11, 2016, a plaintiff can pursue a trade secret claim in federal court. The DTSA amends the Economic Espionage Act, creating a federal cause of action for trade secret misappropriation. It is expected to provide uniformity to trade secret law, which should provide better predictability for litigants who seek to protect their trade secrets. It also opens the door to the federal courthouse for trade secret claims.
Despite the ability to sue in federal courts, it is not a sure bet that federal courts will experience a flood of trade secret claims. Certainly there are provisions of the DTSA that would appeal to plaintiffs, and litigants may benefit from the perceived sophistication of a federal court judge. But there are some key considerations that might cause plaintiffs to pause before filing a trade secret misappropriation action under the federal law. Continue Reading