Former Employee's Use Of Memorized Client Information Violates Trade Secrets Act

On February 6, 2008, the Supreme Court of Ohio ruled that use of protected trade secret information by a former employee who had memorized it during his employment violated the state’s trade secrets law. The Court held that protected trade secret information does not lose its character as a trade secret under the Uniform Trade Secrets Act (UTSA) merely because a former employee memorized it rather than writing it down or copying it in some other tangible medium.

In its unanimous decision the Court noted that “[T]he UTSA…defines a ‘trade secret’ as: ‘[I]nformation, including…any business information or plans, financial information, or listing of names, addresses, or telephone numbers, that satisfies both of the following: (1) It derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use. (2) It is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.’”

The Court wrote that no provision of the UTSA suggests that, for purposes of trade secret protection, the General Assembly intended to distinguish between information that has been reduced to some tangible form and information that has been memorized.

The Court also acknowledged that employees who leave their jobs inevitably have “memories casually retained from the ordinary course of employment,” and noted that the use of memorized information pertaining to a former employer that is not a trade secret is not actionable under the UTSA.

For the full opinion see: http://www.supremecourtofohio.gov/rod/newpdf/0/2008/2008-Ohio-292.pdf

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