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Theft of trade secrets can have dire consequences for a company’s customers, employees and investors. According to The Commission on the Theft of American Intellectual Property, losses to US businesses are estimated at more than $300 billion a year, considering revenue, licenses and jobs. The disincentive for innovation and new business formation caused by intellectual property theft is ultimately a threat to the health of the US economy.

The ability to protect competitive differentiators was expanded significantly this week with the passing of the Defend Trade Secrets Act. Co-authored by Senators Orrin Hatch (R-UT) and Chris Coons (D-DE), the bill met with unanimous 87-0 approval in the Senate on Monday. The legislation would enable companies to go directly to a federal court to recover damages or enforce injunctions for the theft of trade secrets.

Reuters describes scenarios beyond patents and trademarks that the new bill addresses:

“Trade secrets are confidential information that can give a business a commercial edge. They can vary widely depending on the industry, including manufacturing processes, formulas, computer algorithms, industrial designs, business strategies, and customer lists. Companies have become increasingly concerned about protecting themselves against threats, including hacking and rogue employees.”

For those in the competitive intelligence field, this legislation strengthens the ability to respond when acts of theft are discovered. Competitive intelligence professionals identify risks for intellectual property theft, train on best practices for protecting trade secrets and investigate cases of suspected theft. The Defend Trade Secrets Act offers a greater deterrent, as well as a path for faster resolution.

The new legislation also highlights the importance of ethical competitive intelligence, and developing formal corporate guidelines for information collection policies. Cipher Systems provides consultation to clients seeking best practices. For an overview, read our whitepaper, “Everyday Ethics: The Importance of Documented Guidelines.”