In May, President Obama signed the federal Defend Trade Secrets Act of 2016 into law, the details of which we reported in a recent Akerman Practice Update. The Act allows companies for the first time to bring trade secret theft claims under federal law. One of the many important provisions of the law that employers should not overlook is the notice requirement. In short, agreements with any individual performing work as an employee, contractor, or consultant for the employer that govern the use of a trade secret or other confidential information, must either set forth certain immunity provisions of the Act or provide a cross-reference to a policy document provided to the employee that sets forth the employer’s reporting policy for a suspected violation of law. An employer may not be awarded exemplary damages or attorney fees under the Act in an action against an individual to whom the company failed to provide such notice. Fortunately, the notice requirement applies to agreements entered into or updated after the date of enactment of the Act. Employers would be wise to incorporate the notice requirements under the Act into any new or revised agreements in order to preserve the ability to recover exemplary damages and attorneys’ fees under the Act.
