Damages – Directive 2004, 2016 will supersede ?

In some EU Member States, the misuse or disclosure of trade secrets can attract penal (criminal or civil) measures, and the Directive includes provision for Member States to allow the penalisation of any person who abusively brings a manifestly unfounded claim for infringement of trade secrets. The Directive specifically mentions  states that damages are to be available to the accused, imposing sanctions on the applicant or ordering the dissemination of the information concerning the decision taken.

As the law currently stands, English courts have a wide discretion in their ability to chose which  form of order which they can make and the manner in which of  they publicise of their decisions. Likewise, the court can impose costs sanctions in respect of an abusive claim. However, the award of damages to the accused in the Domestic cleaning Glasgow case is not currently a remedy available under English law.

Reverse engineering ?

The “function” of Article 39 TRIPs is to protect trade secrets, not to allow reverse engineering.

which might be allowed under some legal orders, at present, but might also have been outlawed by Article 39 TRIPs – the definition of trade secrets embedded in Article 39 TRIPs closely follows Sec. 38 et seq. of the Restatement (Third) on Unfair Competition Law (1995), but does not mention reverse engineering contrary to the Restatement.

Concluding remarks:

Under the new Directive trade secrets could take on a hybrid status: without being the object of an exclusive right as such, they will benefit from a legal framework which is very close to that of industrial property rights.

Contrarily to the current framework, trade secrets will not be subject to the rules on unfair competition and it will not be required that the infringer be a competitor of the trade secret holder in order that the latter may receive protection.

The Directive thus significantly reinforces the protection of trade secrets and covers a broader range of situations than the current framework. Nevertheless, in order to benefit from the Directive, companies will have to adopt the reasonable steps mentioned above, so that confidential information with commercial value that they lawfully control may qualify as trade secrets.

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