On July 29, 2014, a bipartisan group of members of the U.S. House of Representatives introduced a bill that would create a federal private right of action for trade secret theft. The Trade Secrets Protection Act (H.R. 5233) is a House version of the Senate’s Defend Trade Secrets Act (S. 2267), a bill introduced earlier this year.
As we discussed in a previous blog post, in the last couple of years, numerous legislators in Washington have made efforts to amend the Economic Espionage Act, 18 U.S.C. §1831 et seq. (which currently allows only prosecutors to pursue trade secret thieves), to empower companies and individuals who have been victimized by trade secret misappropriation to pursue their own remedies in federal court. If successful, these efforts would give aggrieved persons a more standard and straightforward path to sue violators than is currently available in the patchwork of state laws dealing with trade secrets.
This most recent bill was introduced by Rep. George Holding (R. N.C.) and co-sponsored by Jerrold Nadler (D. N.Y.), Howard Coble (R. N.C.), Hakeem Jeffries (D. N.Y.), Steve Chabot (R. Ohio), and John Conyers (D. Mich.).
The bill follows the model of the Senate’s Defend Trade Secrets Act, which was introduced on April 29, 2014 and referred to the Judiciary Committee, where it currently remains. The structure of the two bills is similar and many provisions in the bills are identical.
Several industry groups, including the National Association of Manufacturers, BSA/The Software Alliance, and the Information Technology Information Council, immediately came out in support of H.R. 5233.
We will continue to monitor these efforts to expand trade secret protections at the federal level, which now seem to enjoy bipartisan and bicameral, as well as business, support. Whether that support is enough to get the bills through Congressional committees to become law remains very much an open question.