The Defend Trade Secrets Act (DTSA) enhances the protection of your company’s trade secrets by permitting federal civil lawsuits for misappropriation of any of those secrets. But significantly, the DTSA also provides whistleblower immunity to employees and former employees who disclose trade secrets to an attorney, government official, or in a court filing.
The DTSA mandates that employers notify employees of this immunity in any agreement related to trade secrets or confidentiality, such as employment agreements or NDAs. The term “employee” under the DTSA also encompasses consultants and independent contractors.
Failure to include the immunity notice in such agreements can result in the loss of eligibility for exemplary damages and attorney’s fees in a DTSA suit for trade secret misappropriation.
Since your company’s agreements are intellectual assets, it is wise to periodically review them to ensure they align with current best practices. For example, it’s a smart move to evaluate and ensure each of your employee, consultant, and contractor agreements addressing trade secrecy include the necessary immunity notice.