OctoberReport - page 7

October 2013 CBA REPORT
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7
cover article
administered in connection with an on-
going investigation involving economic
loss or injury to the employer’s busi-
ness.
12
Also, private employers engaged
in certain security services also enjoy an
exemption from the prohibition against
the use of polygraph tests when such tests
are administered to certain prospective
employees if those employers have as
their “primary business” the provision
of certain security services and if the
employer’s function includes the protec-
tion of certain facilities or proprietary
information.
13
Protection Against Employee Theft
of Non-Physical Assets
Trade Secrets
In 1994, the Ohio General Assembly
enacted Ohio’s Uniform Trade Secrets
Act (“UTSA”), R.C. § 1333.61, et seq. In,
the Ohio Supreme Court established a
six-factor test in order to determine what
constitutes a “trade secret” under R.C.
1333.61(D):
(1) The extent to which the informa-
tion is known outside the business;
(2) the extent to which it is known to
those inside the business,
i.e
., by the
employees; (3) the precautions taken
by the holder of the trade secret to
guard the secrecy of the information;
(4) the savings effected and the value
to the holder in having the informa-
tion as against competitors; (5) the
amount of effort or money expended
in obtaining and developing the
information; and (6) the amount of
time and expense it would take for
others to acquire and duplicate the
information.
Common examples of trade secrets
include formulas, technical and business
information, and financial information.
Ohio has recently broadened the scope of
the protection offered to employers under
R.C. 1333.61(A). In
Al Minor & Associ-
ates, Inc. v. Martin
, the Supreme Court of
Ohio concluded that information com-
mitted to memory can be a trade secret.
14
Client Lists Under Ohio Trade Secret Law
Client lists may be trade secrets.
15
A
client list is entitled to trade secret status
only if the information is not generally
known or readily ascertainable to the
public.
16
As a result, a client list entitled
to trade secret status generally must
include information not available to the
public, such as business data related to
the client that is developed only because
of the relationship with the particular
client.
The protection of client lists as trade
secrets has become particularly impor-
tant with the advent of certain social
media websites. In
Sasqua Group, Inc. v.
Courtney
,
17
an employer claimed that
its LinkedIn contacts qualified as trade
secrets. The Eastern District of New
York found that the customer list and
information at issue did not qualify as a
trade secret because it could be found on
LinkedIn and other sites on the Inter-
net.
18
Therefore, the court held that this
information was readily obtainable. This
case indicates that contact information
which is largely available on the internet
likely won’t qualify as a trade secret.
There are several steps that a
company can take to increase its abil-
ity to protect customer lists as trade
secrets,including establishing ownership
of the lists, utilizing nondisclosure agree-
ments and limiting employee access to
sensitive files.
Computer Fraud and Abuse Act
The Computer Fraud & Abuse Act
(CFAA)
19
can be used in trade secret
cases involving electronically stored
information in federal court. The
CFAA can be used as an enforcement
mechanism against employees that have
improperly accessed a computer without
permission. The law prohibits “know-
ingly access[ing] a computer without
authorization or exceeding authorized
access” and thereby obtaining informa-
tion or any other thing of value. The
CFAA applies when the “…offense
caused…loss to 1 or more persons during
any 1-year period” which aggregates to
at least $5,000 in value.
20
The term “loss”
under the statute means “any reasonable
cost to any victim, including the cost of
responding to an offense, conducting any
damage assessment, and restoring the
Encourage your clients to bring hope where there is despair,
love where there is loneliness and faith where there is emptiness.
To learn more about legacy gift opportunities with
The Society of St. Vincent de Paul contact Kate Farinacci,
Relationship Manager, at 513-562-8841 ext. 259.
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