You can sue a former employer for corporate espionage through a federal trade-secret theft lawsuit. Corporate espionage, in civil court, generally means stealing or misusing secret business information to gain an unfair advantage.
That option applies when you own the secret and the former employer misused it. According to the Cornell Law School Legal Information Institute, a trade-secret owner with a secret tied to a product or service used in interstate or foreign commerce may file a federal civil case under 18 U.S.C. Section 1836(b), including against a former employer, under the current text of the federal trade-secret law.
Table of Contents
- What counts as theft you can sue over?
- What can a court award?
- Can a court block someone from taking a new job?
- When and how should you act?
What counts as theft you can sue over?
Federal law protects only information you took reasonable steps to keep secret. It must also gain economic value because rivals do not know it or cannot easily figure it out. According to the Cornell Law School Legal Information Institute, both tests must be met under the current text of the trade-secret definition.
Common examples include a protected formula, source code with restricted access, or a customer list guarded by passwords and confidentiality agreements. General skill, public information, or material left unprotected does not qualify. Save proof of passwords, access limits, markings, training, and agreements.
What can a court award?
A court can order the misuse to stop and bar threatened misuse. It can also award payment for your actual losses and for unjust benefit gained by the other side.
According to the American Bar Association, willful and malicious theft can support double damages and attorney fees, as explained in its Business Law Today guide to the Defend Trade Secrets Act. Keep sales records, contracts lost, development costs, and evidence of copying or disclosure.
Can a court block someone from taking a new job?
A federal injunction can limit use or disclosure of the secret. It cannot directly bar a person from taking a new job.
Job limits must rest on evidence of threatened misuse, not mere knowledge of secrets. So a former employer cannot win a work restriction only by arguing you know sensitive facts. Courts look for plans, acts, or concrete risks of disclosure.
When and how should you act?
Act quickly because the filing deadline runs from discovery. The Cornell Law School Legal Information Institute states the federal limitations rule as three years after you discovered misuse or should have found it with reasonable diligence, with continuing misuse treated as one claim. Use this checklist before filing: Also weigh computer-access claims carefully.
After the Supreme Court decision in Van Buren v. United States, merely using already-authorized access for a wrong purpose does not exceed authorized access under the Computer Fraud and Abuse Act, according to a Brookings Institution analysis. Focus your case on trade-secret ownership, secrecy, value, and misuse.
- Write down when and how you learned of the misuse.
- Preserve secrecy proof, access logs, contracts, and messages.
- Separate criminal reporting from your civil case because only federal prosecutors bring criminal espionage charges, so report suspected crime to the FBI.
- Avoid suing over protected whistleblowing, such as a confidential report of a legal violation to a government official or lawyer, or material filed under seal.