Theft of trade secrets is something you want to avoid, of course. When it is first suspected, the evidence is often sketchy, and often pivots on one person’s word. You may feel grateful to the reporter, who after all, may be saving you millions of dollars by reporting early. You want to act quickly – but not too quickly.
This article reports on a case in which the person who reported the crime turned out to be unreliable. After the defendant was acquitted of the theft of trade secrets, he found himself jobless and having spent all his money on a legal defense. He then turned around and filed defamation libel suits against his accuser, and now the appeals court is allowing the civil suits to move forward.
The article considers the issue of when an employee reports a trade secret violation, but does so not in the company’s best interest, but for personal reasons. There are repercussions for this, as the case shows. Investigate reports of trade secrets violations thoroughly, including the source.
Original analysis in Lexology, but Teresa M. Thompson and Kristen M. Barlow Rand.