The Common Law Protection Of Trade Secrets And The Need For A Statue

Dec 2022

Introduction:

A trade secret is anything you use in your business that gives you an advantage over your competitors. A trade secret can be a recipe, process, formula, strategy, technique or device that your competitors do not know, do not have, and cannot use.

With development in technology, as well as the ease of sharing, copying and storing information in the digital world, one of the biggest challenges that businesses face is the protection of their confidential business information.

There are three essential requirements for information to be classified as a trade secret:

The information must be secret. It is not generally not known among or readily accessible to persons within the circles that normally deal with that kind of information.
It must have commercial value
Holder must have taken reasonable steps to keep it secret.

Protection Under Various Laws:

Section 27 of the Indian Contract Act bars any person from disclosing any information which he acquires as a result of a contract. In India, a person can e contractually bound not to disclose information that is revealed to him or her in confidence.
Section 72 of the Information Technology Act provides for criminal remedies. If a person is found to have secured access to any electronic record, book, register, information, document, or other material without the consent of the person concerned and such first person discloses such information further then he may be punished with imprisonment for a term along with a fine.
In 2009, the Information Technology Act, under Section 43A provided for “Compensation for failure to protect sensitive personal data.” Sensitive personal data is further defined in the rules promulgated under this Act and include passwords, financial data, biometric data etc.
The Securities Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, renders the use and disclosure of confidential information by an insider subject to prosecution under the Securities Exchange Board of India Act.
The Copyright Act, 1957: In some cases, the courts have recognized client information stored in the form of databases as copyrightable material. During the course of their operation, businesses regularly collect data. Databases are protectable under copyright law. Section 2(o) of the Copyright Act 1957 defines compilations, including computer databases, as “literary works”.
Breach of confidence: According to Indian Courts, “routine day-to-day affairs of employer which are in the knowledge of many and are commonly known to others cannot be called trade secrets.” The requirements for a cause of action for a breach of confidence are as as follows:

the information itself must have the necessary quality of confidence about it;
that information must have been imparted in circumstances imparting an obligation of confidence;
there must be an unauthorized use of that information to the detriment of the party communicating it.

Even if there is absence of a contract, courts in India have still issued injunctions based on the rules of equity.

Trending Blogs

Need for Kashmiri Saffron to get the GI tag

The Kashmiri Saffron has been given geographical indication tag recently from Lieutenant Governor G C Murmu. The acquiring of GI tag is a step ahead in bringing the brand among the list of top ones. The tag has been given for the saffron grown in Kashmir. In this regard, it can be said that the […]

Early-Stage Intellectual Property to Raise More Money

What is Artificial Intelligence? Creation of innovative ideas is what matters the most in running a business. People were least bothered to patent the designs. But with increasing use of almost similar ideas in the businesses, it is of great importance to patent the ideas. This shall help in better growth of the business and […]

The Clash Of Jurisdiction Of CCI And TRAI

Overlapping Jurisdiction The Competition Act, 2002 read with section 18 of the legislation delegates to the Competition Commission of India (the “CCI”) the duty of “promoting and sustaining competition” in the Indian economy. This implies that the CCI will have principal jurisdiction to regulate conditions of competition in the relevant market of India. Whereas, Section […]

Drug Patents and Generic Pharmaceutical Drugs

When a drug is manufactured and released to the market in the initial period, it is sold under a certain brand names and can only be availed from a pharmacy after being prescribed by the doctor. The patent of the drug is owned by a few brands who are the only eligible brands to manufacture […]

PTAB Should Not Disapprove Claims on the Grounds of Indefiniteness in IPR

Federal Circuit has disapproved of arguments of claims that show any reason other than anticipation pertaining to party procedures. Federal Circuit has rejected the challenge shown by Samsung Electronics America, Inc. The company challenged that PTAB can disapprove claims that are considered indefinite in IPR. Samsung has been charged on the grounds of infringing U.S. […]

Artificial Intelligence and Intellectual Property Law

What is Artificial Intelligence? The division of Science which deals with making machines equipped with human-like intelligence to act in human-like fashion and the exhibit human capabilities is known as Artificial Intelligence (AI). Multiple disciplines like Computer Science, Psychology, Philosophy, Sociology, Mathematics, Biology and Neuron Science contribute to the development of AI. Benefits Of AI […]

Protection of Acronyms under Trademark Law

It is known that acronyms are the first letters of a long phrase of words combined together. On the other hand, trademark is about a mark that shall help distinguish the product or service of goods or service from the rest of the items. Therefore, it can be said that an acronym can be registered […]

Can Religious Symbols Be Registered As Trademarks?

Are you planning to register religious symbols as trademarks? Well, you should research thoroughly to understand the use of religious symbols as trademarks. You have to consider the sentiments of people before you plan to use regions symbol for your business. India being a secular country encourages different citizen follows different religions, practicing it and […]

Copyrights of Music in India

Music is an art more specifically an intangible form of art. Copyrighting a song or a melody protects the basic right of the creator. The copyright also assist the creator financially. In order to ask for copyright the creator needs to file a registration. Once the creator gains the copyright, any infringement to the copyrighted […]

Intellectual Property Glance

The discussion on intellectual property starts with distributing it into three categories for the same of convenience and clarity. The product of intellectual efforts: The product of intellectual effort could be tangible or intangible encompassing such outcomes as literary creations, artistic creations, books, music, song, dance, drama, sculpture, paintings and even computer programs. It must […]