On September 17, 2014, the House Judiciary Committee approved the bi-partisan federal Trade Secrets Protection Act of 2014, H.R. 5233, which we previously wrote about when introduced in July, 2014 by North Carolina Representative George Holding. H.R. 5233 seeks to amend the Economic Espionage Act of 1996 to create a federal civil remedy for trade secret misappropriation. Regarding the importance of the Act, Rep. Holding and other supporters noted that “[a]s of 2009, the value of trade secrets owned by U.S. companies was estimated to be nearly $5 trillion. While current federal law protects other forms of intellectual property by providing access to federal courts for aggrieved parties to seek redress, there is no federal option to do so for trade secret theft.”
The version of H.R. 5233 approved by the Judiciary Committee remains unchanged from the July 29, 2014 version introduced. Under the Act, an action must be filed within 5 years of the date when the misappropriation is discovered or should have been discovered. The Act permits the court to seize property necessary to preserve evidence or to prevent the dissemination of the trade secret, to issue an injunction, and to award damages, including treble exemplary damages in the case of willful and malicious misappropriation. There are provisions for the award of attorney’s fees in cases of bad faith claims of misappropriation, bad faith regarding termination of an injunction, and willful/malicious misappropriation.
H.R. 5233 was reported out of the Judiciary Committee to the Full House for further consideration on September 17, 2014.
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