We are looking back on our series where we spotlight international issues in trade secret law under the Belgian Trade Secrets Act.

To claim that major conclusions can be drawn from the dozen decisions handed down since the Trade Secrets Act came into force would not be serious. Nevertheless, listing and comparing these rulings has led to some striking observations.

The number of judgments that we found is limited. There are a number of possible explanations for this. A first explanation could be that some parties whose information has been misappropriated since the Trade Secrets Act have not (yet) determined this. This explanation seems to be confirmed by the fact that in several of the cases we have discussed, a period of three to four years elapsed between the facts giving rise to the claim and the first step taken by the claimant against the alleged infringer.[vii] The limited number of judgments may also be partially explained by the fact that even parties who have established infringement may have subsequently realized how many hurdles there are to bringing a successful claim under the Trade Secrets Act. Finally, it seems that there may well be a significant number of potential claimants who, though being aware of infringement and willing to overcome the hurdles, possess insufficient evidence to demonstrate that the infringer misappropriated their secret information. Although the possibility of a unilateral application through summary proceedings was discussed, a statutory scheme like that for intellectual property rights (the counterfeit search and seizure procedure) would probably allow for smoother gathering of evidence.

Continue Reading International Issues in Trade Secret Law Series: A Look Back at Issues Under the Belgian Trade Secrets Act

The Eleventh Circuit recently struck down an award of $4.5 million in damages after a jury determined that a manufacturer had misappropriated a shared trade secret.  AcryliCon USA, LLC (“AcryliCon”) and Silikal GmbH (“Silikal”) had a business relationship in which Silikal manufactured and AcryliCon distributed a proprietary flooring resin of superior compressive strength (1061 SW), and each claimed ownership of the 1061 SW formula trade secret to the exclusion of the other. While ownership of a trade secret is a critical issue in trade secret misappropriation claims, the Court did not address whether AcryliCon owned the trade secret because it determined that Silikal did not misappropriate the formula as a matter of law.

Continue Reading Trade Secret Misappropriation or Breach of Contract? It can be a costly distinction.

In our prior post, we discussed what constitutes unlawful use of trade secrets, who bears the burden of proof, and how evidence can be collected to prove trade secret misappropriation under Belgian law.

Today’s post, which is the fifth and last in our series where we spotlight international issues in trade secret law, looks at two final questions:

1) Protection of trade secrets during court proceedings: who is allowed inside the “confidentiality club”?

A “confidentiality club” may sound rather like a speakeasy, but it is not. For those readers who are not particularly familiar with this area, we will first explain the problem for which the “confidentiality club” attempts to provide a solution. A thorny issue during court proceedings to enforce trade secrets is that the holder of the trade secret sometimes has to reveal more than they would like in order to increase the chances of success. This is often the reason why claimants are deliberately vague about the exact contents of a trade secret, or about where exactly the trade secret value resides. This comes usually with the risk that the claim will be dismissed for failure to meet the burden of proof. It is, understandably, not an attractive option to draw up briefs providing detailed information about the trade secret when it is not clear how much secret information has actually been stolen or is in the possession of the defendant. This would simply provide the contested information on a silver platter to the defendant. A similar problem arises with the pleadings and decisions of the court. Because, as a general rule, court hearings are public in Belgium, interested competitors could be in the audience to listen to everything that is being disclosed about the litigated trade secrets. However, for judgments and decisions to be based on correct reasoning and, above all, for them to be intelligible to parties not involved in the proceedings, judgments will have to include minimum information about the trade secrets. When transposing the Trade Secrets Directive, the Belgian legislator tried to meet this sensible concern by setting out a general protection scheme in Article 871bis of the Belgian Judicial Code. Article 871bis of the Belgian Judicial Code can be applied not only in proceedings about trade secrets, but also in other proceedings where a trade secret is used as evidence and must be submitted for the assessment of the court. Among the measures listed in Article 871bis of the Belgian Judicial Code are the possibility to issue redacted versions of court decisions and, of course, to set up so-called “confidentiality clubs.” These refer to the limited groups of persons who are, in certain cases, given access to certain documents shared in the proceedings and/or at certain hearings (and the relevant reports) during which trade secrets will be discussed.

Continue Reading International Issues in Trade Secret Law Series: “Confidentiality Clubs” and Remedies for Trade Secret Misappropriation under the Belgian Trade Secrets Act

In our prior post, we discussed under what conditions business information could qualify as a trade secret under Belgian law (it must be secret, have commercial value, and be subject to reasonable protection measures).

Today’s post, which is the fourth in our series where we spotlight international issues in trade secret law, looks at two other critical questions:

1) Is the use of a trade secret per se unlawful?

Even if it can be successfully demonstrated that the information at issue meets the cumulative conditions of Article I.17/1 Belgian Economic Code and is thus protected as a trade secret, this does not necessarily mean that it has been used unlawfully. The owner of the trade secret must hence demonstrate that their trade secret has been unlawfully used by a third party. The discussion will often revolve around the unauthorized access to the trade secret, as provided for in Article XI.332/4 Belgian Economic Code. This is certainly the case when the party accused of misappropriation is an ex-employee or an independent service provider of the trade secret holder, who gained access to the information in question during their employment or assignment.

Continue Reading International Issues in Trade Secret Law Series: Unlawful Use and Burden of Proof for Trade Secret Misappropriation under the Belgian Trade Secrets Act

Today’s blog is the third in a series where we spotlight international issues in trade secret law, in particular, answering practical questions and providing insights into the application and interpretation by Belgian courts of specific aspects of the Belgian Trade Secrets Act. (See our first post here and our second here.)

Today’s post addresses two questions:

1) When does information have trade value?

Continue Reading International Issues in Trade Secret Law Series: Valuing and Taking Reasonable Measures to Protect Trade Secrets under the Belgian Trade Secrets Act

On February 10, the U.S. International Trade Commission (“ITC”) issued a final determination finding South Korean lithium-ion electric vehicle battery maker SK Innovation misappropriated the trade secrets of its Korean competitor LG Chem in violation of Section 337 of the Tariff Act of 1930.  The ITC issued a 10-year exclusion order blocking SK’s imports into the U.S. of lithium-ion batteries and related products, but with substantial exceptions: SK is permitted to continue importing these products specifically for Ford Motor Co.’s EV F-150 program for four years, for Volkswagen of America’s modular electric drive line for two years, and for the repair and replacement of EV batteries for Kia vehicles sold to U.S. customers.  President Biden and his U.S. Trade Representative—Katherine Tai has been nominated but not yet confirmed—now have 60 days to review the ITC’s electric vehicle battery exclusion order, an order that could be seen as in tension with the new administration’s promotion of green energy.

Continue Reading ITC Finds Trade Secret Misappropriation and Bars Electric Vehicle Batteries from SK Innovation—With Exceptions

2020 saw a marked uptick in unfair import investigations at the International Trade Commission (ITC), with an especially strong close to the year: eight new complaints in December alone brought the year’s total to 62 new complaints to the Commission, well above the ten-year average of 49. Complaints alleging trade secret misappropriation rose particularly, as the ITC becomes increasingly popular due to its speed, jurisdiction and unique remedies.  While just five investigations solely of trade secrets were instituted in the five years of 2011-2015, fifteen such investigations were instituted in the next five years of 2016-2020, including five in 2020 alone.[1]

Continue Reading Unfair Import Investigations Rise at the U.S. ITC in 2020—Particularly as to Trade Secrets

On January 11, Mayor Muriel Bowser signed “The Ban on Non-Compete Agreements Amendment Act of 2020” (the “Act”).  Though some other states and municipalities have restricted the use of non-compete agreements, the District of Columbia’s new ban – once it is applicable – will go further than similar laws in any other jurisdiction.  With few exceptions, employers in the District of Columbia will not be allowed to include non-compete provisions in employment agreements or maintain workplace policies that prohibit employees from simultaneously working for a competitor of the employer.  Employers with operations in the District of Columbia also must be aware of the notice and non-retaliation requirements, as well as the penalties for non-compliance.

Continue Reading DC’s New Non-Compete Ban Implicates Trade Secret Protections in the District

Today’s blog post is the second in a series where we spotlight international issues in trade secret law, in particular, answering practical questions and providing insights into the application and interpretation by Belgian courts of specific aspects of the Belgian Trade Secrets Act.

Today’s post addresses two questions:

Continue Reading International Issues in Trade Secret Law Series: Substantive Jurisdiction and Trade Secret Status under the Belgian Trade Secrets Act

Today’s blog post is the first in a series where we spotlight international issues in trade secret law, in particular, answering practical questions and providing insights into the application and interpretation by Belgian courts of specific aspects of the Belgian Trade Secrets Act.

On August 24, 2020, a dedicated few celebrated the second anniversary of the entry into force of the 2018 Belgian Trade Secrets Act.[i] With this new law, the Belgian legislator transposed the 2016 EU Trade Secrets Directive[ii] into national law. The Trade Secrets Directive is the result of a European Commission regulatory initiative, taken after a number of issues were revealed by studies conducted at its request.[iii] In particular, it was found that EU Member States lacked a uniform approach to trade secrets and that some of them had very limited trade secrets protection, which in turn hindered innovative cooperation between companies across the EU. In addition, trade secrets were perceived as important assets for companies in terms of innovation and competitiveness. This was particularly true for SMEs which, given their more limited resources, attach greater importance to trade secrets than to other, generally more expensive, forms of protection (such as patents). The need for effective and coherent protection had thus increased significantly in recent years, partly because of an increased risk of misappropriation and abuse of confidential business information. The Trade Secrets Directive aimed to harmonize the rules across the EU and to ensure that companies could rely on both substantive and enforcement provisions, with the ultimate goal of achieving an adequate and consistent level of civil measures to protect trade secrets throughout the internal market.[iv]  The Belgian Trade Secrets Act and its application in case law should be seen in this specific context.

Continue Reading International Issues in Trade Secret Law Series: Parties and Procedural Options under the Belgian Trade Secrets Act