Minimizing the Risk that a New Hire Will Lead to Trade Secret Litigation: Some Simple Preventive Steps

When hiring new employees, you can minimize the risk of inadvertently becoming embroiled in trade secret litigation by taking a few simple steps. First, new hires should be verbally instructed to be “good leavers” -- meaning that they should take absolutely nothing with them when heading out the door from their old job, and should return all property of their former employer at termination, including laptops, cell phones, Blackberries, thumb drives, and any property kept at home. Similarly, no e-mails or electronically stored documents or information should be retained on personal computers, thumb drives, etc. Second, because offer letters can become litigation exhibits, they should instruct new hires not to bring, distribute, or use any confidential information, trade secrets, or any other property of a former employer. Third, offer letters should require new hires to confirm in writing that the new hire has reviewed the duties and responsibilities of the new position and can perform them without using or disclosing confidential or proprietary information of another entity and without violating the terms of any applicable agreement. Finally, employee handbooks and/or confidentiality agreements/policies also should contain similar language prohibiting the use or distribution of confidential information or trade secrets of former employers. While such actions are no guarantee against trade secret litigation stemming from the hiring of a new employee, they will certainly lower the risks.