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Protecting trade secrets is essential when running a business

On Behalf of | Jun 8, 2023 | Business Formation |

When operating a business in New York, it is imperative to know the value of innovation. People who have created a product or service might not understand how vulnerable it can be if they fail to take the necessary steps to shield their trade secrets and prevent others from using them for their own purposes.

Businesses should know how to protect trade secrets

Examples of what can and should be protected include a formula, a recipe, a product designed for a specific use and computer programs. When a business creates a product, there are strategies to protect it.

Even if a trade secret is not registered, it can be protected. Simply taking care to keep the information reasonably private is sufficient. For example, most businesses will have employees who are privy about a product’s development. Requiring them to sign a non-disclosure agreement stops them from sharing that information without consequences.

Other ways include having passwords. Many businesses have private communication systems that only some employees have access to. This too is a kind of trade secret protection. It is a form of data security.

A worrisome time for businesses with an interest in protecting themselves is when an employee leaves the company. An exit interview can be useful to inform them of their NDA and that they are obligated to keep sensitive information to themselves. These are fundamentals with business and commercial law.

Failing to protect trade secrets can cause extensive problems

There is a cohesiveness and an excitement that accompanies working with others to create a successful product. That familiarity could lead to errors that can be costly personally and to the business. Before putting a business at risk, having a protocol to protect trade secrets is a critical step to save time and money.

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