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UPDATE: Texas Uniform Trade Secrets Act Signed Into Law, Becomes Effective September 1, 2013

05.08.13

Governor Rick Perry has signed the Texas Uniform Trade Secrets Act (TUTSA), making Texas the 48th state to adopt the uniform law.  The bill becomes effective on September 1, 2013, and will govern the misappropriation of trade secrets on or after that date. TUTSA  provides meaningful protection to employers seeking to protect their trade secrets, and mandates a presumption in favor of granting protective orders to help limit the extensive damage that can result from the theft of valuable business information.  The law expands the remedies currently available for misappropriation of trade secrets.   Importantly, the proposed statute specifically identifies customer lists and potential customer lists as protected trade secrets—items previously evaluated on a case by case basis by Texas courts.

TUTSA authorizes courts to issue injunctive relief to prohibit disclosure or threatened disclosure of trade secrets, as well as to take any other reasonable steps to preserve the secrecy of the confidential information.  Notably, TUTSA empowers courts to compel affirmative action by a party to protect a trade secret in addition to simply preserving the status quo.  The statute also provides for damages in addition to injunctive relief.  Damages may be calculated by analyzing the actual loss or the unjust enrichment resulting from the misappropriation, or by imposition of a reasonable royalty.  In addition, the courts now have the discretion to award reasonable attorneys’ fees to a prevailing party. 

A copy of the final bill can be found here.

For more information, please contact Jessica Mason or any of the labor and employment attorneys at Gardere.

The publications contained in this site do not constitute legal advice. Legal advice can only be given with knowledge of the client's specific facts. By putting these publications on our website we do not intend to create a lawyer-client relationship with the user. Materials may not reflect the most current legal developments, verdicts or settlements. This information should in no way be taken as an indication of future results.

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