PRVT2652 Business Law

PRVT2652 Business Law

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PRVT2652 Business Law

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PRVT2652 Business Law

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Course Code: PRVT2652
University: United Arab Emirates University is not sponsored or endorsed by this college or university

Country: United Arab Emirates

Discuss about the Trade Secret Law for Software and Technology Startups. 

Any information which can be regarded as confidential is known as confidential information. A trade secret is a subset of confidential information. Confidential information has to be protected and is not required to be registered. The protection of trade secrets is done through the creation of confidentiality agreements (Clarke, Sweeney & Bender 2011). Confidentiality agreements function under the provisions of common contract law. Therefore in case confidentiality agreement is violated the aggrieved party is entitled to claim compensation for the wrongdoer under rules of damages in contract law (Milgrim, Roger and Bensen 2017). In the given situation in spite of presence of a confidentiality agreement between M and H ltd that the trade secret would be kept as confidential by the parties, the trade secret has been misused by H Ltd. This is a clear breach of contract under the rules of contract law. Therefore M is entitled to claim compensation for all the losses incurred by her in relation to the misuse of trade secrets by H Ltd. 
In the give situation it has been provided that Angela who is the marketing manager of Drinks Ahoy which specializes in manufacturing a special drink known as Liquifizz. In the given situation it has been provided that in order to meet the demand of the market she took Carl who is the MD of Boniface Bottling to a confidential room in the factory to provide him details about the formula of Liquifizz which is not patented and is protected through secret ingredients. it has been provided by the scenario that the Boniface have not signed the licensing  agreement according to which had provisions for confidentiality. The company has produced an identical drink few years later and claims that they did not steel any formula. In the given situation through the application of copyright law provided through the Copyright Act 1968 Section 31 it can be provided that Drinks Ahoy owns the copyright on the drink. This is because a copyright need not be registered and is created automatically as soon as an idea is brought into existence (Halt et al. 2014). Thus as the drink manufactured by Boniface is identical which means that the copyright of Drinks Ahoy have been violated, Angela can make a claim under the Copyright Act.
A restrictive covenant is imposed in an employee who has left the organization for the protection of business secrets and interest of the business. These terms are imposed on only if they are reasonably necessary for the purpose of protecting the interest of the previous employer. They can include terms like non completion and non dealing. However it is difficult to justify any covenant which is more than a period of 6-12 months (Menell 2017). In the given situation it has been provide that the manager was responsible for building the client base of the Wombat Ltd. He has access to all information in relation to the organization. Therefore the organization may impose the causes provided in the situation on the manager. However the clauses may not be possible to be imposed for a period of 12 months as the courts generally do not allow such long duration on covenants.
Clarke, B., Sweeney, B & Bender, M. (2011). Marketing and the Law. Lexus Nexus
Copyright Act 1968 (Cth)
Halt Jr, Gerald B., Robert Fesnak, John C. Donch, and Amber R. Stiles. “Trade Secret Protection.” In Intellectual Property in Consumer Electronics, Software and Technology Startups, pp. 25-32. Springer New York, 2014
Menell, Peter S. “Tailoring a Public Policy Exception to Trade Secret Protection.” Cal. L. Rev. 105 (2017): 1.
Milgrim, Roger M., and Eric E. Bensen. Use of agreements to protect trade secrets in the employment relationship. Vol. 2. Milgrim on Trade Secrets, 2016.

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