Corporate Espionage, The Law:
Are your
competitors, foreign or domestic, stealing your designs, marketing plans,
manufacturing processes, prototypes, formulas or other company secrets?
Has your company protected valuable corporate assets?
On October 11, 1996, Former President Bill Clinton signed The Economic Espionage Act of 1996 into law.
The theft of trade secrets is a federal offense. The following summarizes pertinent sections of the law:
Section 1832 of the act makes it a federal criminal act for any person to convert a trade secret for his own benefit, or the benefit of others, intending or knowing that the offense will injure the owner of the trade secret in any way shape or form.
The act also makes it a federal criminal offense to receive, buy or possess trade secret information of another person knowing the information has been stolen, appropriated, obtained or converted without the trade secret owner's authorization.
The term trade secrets means all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs or codes, whether tangible or intangible, and whether how stored or compiled, memorized physically, electronically, graphically, photographically, or in writing; a federal offense has been committed if;
A) The owner thereof has taken reasonable measures to keep such information secret; and
B) The information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means to the public.
Reasonable measures, may also include establishing due diligence.
A TSCM survey can be essential towards establishing due diligence, and countering electronic efforts to obtain information.
More on the Law
Title I : Protection of Trade Secrets
Sec. 101. Protection of Trade Secrets
(a)
In General.-Title 18, United States Code, is amended by inserting afterchapter 89 the following:
Sec.
1831. Economic espionage.
1832. Theft of trade secrets.
1833. Exceptions to prohibitions.
1834. Criminal forfeiture.
1835. Orders to preserve confidentiality.
1836. Civil proceedings to enjoin violations.
1837. Conduct outside the United States.
1838. Construction with other laws.
1839. Definitions.
Chapter 90- Protection of Trade Secrets
Section 1831. Economic espionage
(a) In General - Whoever, intending or knowing that the offense will
benefit any foreign government, foreign instrumentality, or foreign agent,
knowingly -
(1) steals, or without authorization appropriates, takes, carries away, or conceals, or by fraud, artifice, or deception obtains a trade secret;
(2) without authorization copies, duplicates, sketches, draws, photographs, downloads, uploads, alters, destroys, photocopies, replicates, transmits, delivers, sends, mails, communicates, or conveys a trade secret,
(3) receives, buys, or possesses a trade secret, knowing the same to have been stolen or appropriated, obtained, or converted without authorization,
(4) attempts to commit any offense described in any of paragraphs (1) through (3), or
(5) conspires with one or more other persons to commit any offense described in any of paragraphs (1) through (3), and one or more of such persons do any act to effect the object of the conspiracy, shall, except as provided in subsection (b), be fined not more than $500,000 or imprisoned not more than 15 years, or both.
(b) Organizations - Any organization that commits any offense described in
subsection (a) shall be fined not more than $ 10, 000, 000.
Section 1832. Theft of trade secrets.
(a) Whoever, with intent to convert a trade secret, that is related to or
included in a product that is produced for or placed in interstate or
foreign commerce, to the economic benefit of anyone other than the owner
thereof, and intending or knowing that the offense will injure any owner of
that trade secret, knowingly -
(1) steals, or without authorization appropriates, takes, carries away, or conceals, or by fraud, artifice, or deception obtains such information;
(2) without authorization copies, duplicates, sketches,. draws,photographs, downloads, uploads, alters, destroys, photocopies, replicates, transmits, delivers, sends, mails, communicates, or conveys such information;
(3) receives, buys, or possesses such information, knowing the same to have been stolen or appropriated, obtained, or converted without authorization;
(4) attempts to commit any offense described in paragraphs (1) through (3); or
(5) conspires with one or more other persons to commit any offense described in paragraphs (1) through (3), and one or more of such persons do any act to effect the object of the conspiracy, shall, except as provided in subsection (b), be fined under this title or imprisoned not more than 10 years, or both.
(b) Any organization that commits any offense described in subsection (a)
shall be fined not more than $5,000,000.
Section 1833. Exceptions to prohibitions.
This chapter does not prohibit -
(1) any otherwise lawful activity conducted by a governmental entity of the
United States, a State, or a political subdivision of a State; or
(2) the reporting of a suspected violation of law to any governmental
entity of the United States, a State, or a political subdivision of a
State, if such entity has lawful authority with respect to that violation.
Section 1834. Criminal forfeiture.
(a) The court, in imposing sentence on a person for a violation of this
chapter, shall order, in addition to any other sentence imposed, that the
person forfeit to the United States -
(1) any property constituting or derived from, any proceeds the person obtained, directly or indirectly, as the result of such violation; and
(2) any of the person's or organization's property used, or intended to be used, in any manner or part, to commit or facilitate the commission of such violation, if the court in its discretion so determines, taking into consideration the nature, scope, and proportionality of the use of the property in the offense.
(b) Property subject to forfeiture under this section, any seizure and
disposition thereof, and any administrative or judicial proceeding in
relation thereto, shall be governed by section 413 of the Comprehensive
Drug Abuse Prevention and Control Act of 1970 (21 U.S. C. 8 5 3), except
for subsections (d) and 0) of such section, which shall not apply to
forfeitures under this section.
Section 1835. Orders to preserve confidentiality
In any prosecution or other proceeding under this chapter, the court shall
enter such orders and take such other action as may be necessary and
appropriate to preserve the confidentiality of trade secrets, consistent
with the requirements of the Federal Rules of Criminal and Civil Procedure,
the Federal Rules of Evidence, and all other applicable laws. An
interlocutory appeal by the United States shall lie from a decision or
order of a district court authorizing or directing the disclosure of any
trade secret.
Section 1836. Civil proceedings to enjoin violations
(a) The Attorney General may, in a civil action, obtain appropriate
injunctive relief against any violation of this section.
(b) The district courts of the United States shall have exclusive original
jurisdiction of civil actions under this subsection.
Section 1837. Applicability to conduct outside the United States
This chapter also applies to conduct occurring outside the United States if
(1) the offender is a natural person who is a citizen or permanent resident
alien of the United States, or an organization organized under the laws of
the United States or a State or political subdivision thereof-, or
(2) an act in furtherance of the offense was committed in the Untied
States.
Section 1838. Construction with other laws
This chapter shall not be construed to preempt or displace any other
remedies, whether civil or criminal, provided by Untied States Federal,
State, commonwealth, possession, or territory law for the misappropriation
of a trade secret, or to affect the otherwise lawful disclosure of
information by any Government employees under section 552 of title 5
(commonly know as the Freedom of Information Act).
Section 1839. Definitions
As used in this chapter,
(1) the term 'foreign instrumentality' means any agency, bureau, ministry,
component, institution, association, or any legal, commercial, or business
organization, corporation, firm, or entity that is substantially owned,
controlled, sponsored, commanded, managed, or dominated by a foreign
government:
(2) the term 'foreign agent' means any officer, employee, proxy, servant,
delegate, or representative of a foreign government:
(3) the term 'trade secret' means all forms and types of financial,
business, scientific, technical, economic, or engineering information,
including patterns, plans, compilations, program devices, formulas,
designs, prototypes, methods, techniques, processes, procedures, programs,
or codes, whether tangible or intangible, and whether or how stored,
compiled, or memorialized physically, electronically, graphically,
photographically, or in writing if
(A) the owner thereof has taken reasonable measures to keep such
information secret; and
(B) the information derives independent economic value, actual or
potential, from not being general known to, and not being readily
ascertainable through proper means by the public, and
(4) the term 'owner', with respect to a trade secret, means the person or
entity in whom or in which rightful legal or equitable title to or license
in, the trade secret is reposed."
Additional:
Federal Law: Unlawful access to stored communications
US Title 18,Part I Chapter 121
Section 2701. Unlawful access to stored communications (a) Offense. - Except as provided in subsection (c) of this section whoever - (1) intentionally accesses without authorization a facility through which an electronic communication service is provided; or (2) intentionally exceeds an authorization to access that facility; and thereby obtains, alters, or prevents authorized access to a wire or electronic communication while it is in electronic storage in such system shall be punished as provided in subsection (b) of this section. (b) Punishment. - The punishment for an offense under subsection (a) of this section is - (1) if the offense is committed for purposes of commercial advantage, malicious destruction or damage, or private commercial gain - (A) a fine under this title or imprisonment for not more than one year, or both, in the case of a first offense under this subparagraph; and (B) a fine under this title or imprisonment for not more than two years, or both, for any subsequent offense under this subparagraph; and (2) a fine under this title or imprisonment for not more than six months, or both, in any other case. (c) Exceptions. - Subsection (a) of this section does not apply with respect to conduct authorized - (1) by the person or entity providing a wire or electronic communications service; (2) by a user of that service with respect to a communication of or intended for that user; or (3) in section 2703, 2704 or 2518 of this title.