Trade secrets and confidential information

Understanding and managing know-how, confidential information and trade secrets is an essential part of a successful intellectual property strategy for a business.
The combination of preventing unauthorised disclosure of valuable confidential information and trade secrets with effective exploitation of these assets can help a business looking to maintain their competitive edge over competitors. This is particularly so where such information cannot be readily protected by other intellectual property rights.
At Appleyard Lees, we field a dedicated, mixed-practice team of patent attorneys and solicitors that integrate their commercial and technical expertise to help you to identify, manage and protect your confidential information and trade secrets as part of a robust IP strategy.

What is confidential information and what are trade secrets?

Confidential information: information which is not in the public domain and has been communicated in circumstances creating an obligation of confidence on the recipient. An unauthorised disclosure of the information may give rise to a common law claim for breach of confidence.

Trade secrets: information which has a commercial value to a business because it has been kept secret and which has been subject to reasonable steps to keep it secret as defined by the Trade Secrets (Enforcement, etc) Regulations 2018.

Most, if not all, businesses have information that qualifies as confidential information or trade secrets.

Examples may include:

Technical information (whether a patentable invention or not), such as:
- products, including formulas (e.g. the recipe for Coca Cola or KFC batter); and
- manufacturing processes
Proprietary software and algorithms
Datasets (e.g. AI training data)
Standard operating procedures (SOPs)
Client lists
Product costings and suppler details
Business strategy

Identifying valuable confidential information and trade secrets

Identifying and categorising information as confidential or a trade secret can be essential to ensure that it is properly protected.
Appleyard Lees’ patent and trade mark attorneys develop deep working relationships with clients to build and enhance the value of their IP portfolios. We are well-placed to audit and classify valuable commercial information which may be protectable if managed appropriately, and to advise on appropriate safeguards for such information.

Management of trade secrets and confidential information

For information to be protectable as a trade secret, it must be subject to reasonable steps to keep it secret. It is important to consider and take advice on relevant organisational, technological and contractual measures that can be taken to ensure protection is in place. The aim of these measures is to provide adequate safeguards that do not unnecessarily encumber the business from its commercial goals.
When dealing with third parties, whether it be a customer, a potential investor, a collaborator in a research and development project, a supplier, or a contractor, it is essential to ensure that a non-disclosure/confidentiality agreement is in place and that any commercial agreements contain appropriately drafted confidentiality clauses.
It is typically a higher barrier for information to qualify as a trade secret compared to mere confidential information. However, trade secret protection confers several important benefits over confidential information, including in relation to employee obligations. Employees have an obligation to protect their employer’s confidential information during the course of their employment; however, absent any contractual provisions, post-termination that obligation generally only persists for trade secrets. It can therefore be important to ensure that suitable policies and awareness training are in place for handling confidential information for the current workforce, and appropriate restrictive covenants are in place to give maximum protection when an employee leaves the workforce.
Appleyard Lees’ trade secrets team includes IP solicitors with experience drafting a range of commercial agreements and can assist with ensuring suitable workforce policies and appropriately drafted IP clauses are in place to ensure confidential information and trade secrets are protected.

Protecting your information

In the event of an unauthorised disclosure of confidential information or trade secret misappropriation, whether by a business partner, ex-employee or other third party, it is essential to act quickly to protect against such information falling in the public domain. Once disclosed, the damage can be significant and difficult to quantify, and secrecy status cannot be restored. Taking immediate action to collect evidence of misuse is often key to effective enforcement.
Appleyard Lees’ litigation team has experience advising on and enforcing against unauthorised use of trade secrets and confidential information. Working with our network of partner attorneys, we have litigated cross-border disputes involving the tracing of assets and individuals across several jurisdictions.