Employees as Competitors
Companies’ information, both that relating to its products or services and that concerning its clientele, is becoming increasingly valuable in an increasingly competitive marketplace. While companies often protect this information from competitors, employees are the ones that most often misappropriate this information. Moreover, with today’s technology and the trend towards working remotely, company’s information is increasingly at risk to employee theft and/or improper disclosure.
Companies need to pay attention to their legal requirements to keep certain data confidential. Failure to do so can subject their businesses to liability to other businesses, either at law or by contract, that entrust them with this information. Moreover, if the data breach involves protected information of individuals, there can be substantial reporting and remedial measures that must be taken. Companies need to be aware of their requirements to secure their data, as well as how to secure and/or dispose of all forms of media which may contain legally protected information. This includes proper restrictions on employees’ copying, removal and use of such information outside of the workplace.
There are many laws both criminal and civil which protect employers from theft of their confidential information or trade secrets. The options available to the employer may depend on how the information was misappropriated. Additionally, in order to be entitled to the protections of the laws, an employer may be required to have certain practices and policies in place. Failure to do so can adversely affect an employer’s ability to later enforce its rights should information be improperly taken or disclosed.
Employers can better protect themselves from improper employee competition and misappropriations if they have strong contracts in place covering such issues. Employers can put reasonable restraints on employee’s post-employment competition, which will make employees less inclined to engage in unfair competitive activities. Additionally, employers may be able to expand the information that is protectable and/or the remedies for misuse of a company’s confidential information by addressing these issues by contract.
Our attorneys have extensive experience in employee’s theft of information and unfair competition with their former employer. We analyze the practices and policies a company has in place to determine where their vulnerabilities are and counsel them on how to implement proper protections. This includes advice on: how to protect the information from disclosure; how to limit employee’s access to and use of information away from the workplace; implementation of proper policies and practices in handling of the information to reduce the risk of misappropriation; resources to help a company protect media containing confidential information and handle disposal of media with such information; and how to improve the options at the employers’ disposal to to enforce the employers’ rights should information be improperly taken or disclosed.
Also, we work with companies to create contracts that restrict worker’s unfair competition and use of the employers’ confidential information. This includes drafting agreements which supplement the protections an employer has over such conduct and enhances the remedies available to the company should an employee breach his/her contract. We also work with employers to suggest practices that help protect them from unfair competition and related claims by other companies when employers make new hires – new hires that are increasingly subject to laws or contracts which limit what they can do for or disclose to their subsequent employer. Our attorney have experience consulting businesses on all of the legal issues they need to consider in order to properly protect themselves from misappropriation of company information and unfair competition by their former employees.
After an employee leaves his employ, companies often found the employee has gone to work for a competitor or is soliciting clients the former employee worked with while employed. We work closely with companies and the necessary experts to track down the scope of the former employee’s conduct. Many times there is extensive electronic evidence demonstrating how the employee took clients and information with him/her and how the employee achieved this. Employers may also be able to determine if others were involved, including the company that the former employee now works for. Once the scope of the conduct and those involved is understood, we work with employers to determine the best strategy to address the employee’s misconduct. Many times this will include determining whether it is best for the company to proceed criminally or civilly against its former employee. There are advantages and disadvantages to each alternative which will depend greatly on the circumstances surrounding the former employee’s conduct. Our experienced attorneys can guide employers through both alternatives and advise them which makes sense and may achieve the best end result for their company. Additionally, if a company proceeds civilly there are several alternatives on how to proceed. An employer may want to seek an immediate injunction stopping the employee’s conduct, based on the immediate harm or risk of harm that the employee’s conduct will cause it. Alternatively, a company may determine that it is primarily interested in monetary damages which make proceeding with a traditional lawsuit more advantageous to them. Our attorneys explore all these options with companies to determine the best way to pursue their rights based on their desired end result and their business needs.
On the other hand, where a business is being accused of being complicit in misappropriation of trade secrets or unfair competition, our litigators will work with the company to investigate and mount the proper defense. These cases may involve fighting against temporary restraining orders, requirements to turn over vast amounts of information and/or criminal investigations. We have experience navigating these actions on behalf of companies and keeping these proceedings from potentially causing substantial interruptions to the companies’ operations.