On April 27, 2016, Congress passed the “Defend Trade Secrets Act of 2016.” The Act (the DTSA) passed the House by a vote of 410 to 2. The bill passed the Senate April 4, 2016, by a vote of 87 to 0. Congress enacted the DTSA largely due to its concerns about Chinese espionage and online hacking by cyber-criminals.

The DTSA is expected to be signed into law promptly. Even before the Senate passed the Act, the Obama administration voiced strong support for it. The DTSA is intended to go into effect on the date of its enactment and applies to any misappropriation that occurs after that date.

General Background

The Act amends the Economic Espionage Act to create a civil cause of action for trade secret misappropriation. The federal statute previously provided only criminal penalties for trade secret misappropriation. Historically, trade secret misappropriation has been a matter of state law, commonly addressed under the Uniform Trade Secrets Act. The DTSA does not pre-empt these state laws. Instead, it leaves all state trade secret laws in place and creates the availability of an additional federal remedy.

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Photo of Richard C. McCrea Jr. Richard C. McCrea Jr.

Richard C. McCrea, Jr. (“Rich”) focuses on jury trials related to employment, civil rights, and trade secret and other restrictive covenant litigation. Board Certified in both Labor & Employment and Civil Trial, Rich has been repeatedly recognized as a premier litigator by various…

Richard C. McCrea, Jr. (“Rich”) focuses on jury trials related to employment, civil rights, and trade secret and other restrictive covenant litigation. Board Certified in both Labor & Employment and Civil Trial, Rich has been repeatedly recognized as a premier litigator by various independent legal ranking services. Key clients include Checkers and Rally’s, University of South Florida, University of Florida, and Pinellas County Sheriff’s Office.

Photo of Kurt Kappes Kurt Kappes

Kurt A. Kappes is the Managing Shareholder of the Sacramento Office and Co-Chair of the firm’s Labor & Employment Practice’s Complex Employment Litigation & Trials group. He has extensive lead trial experience in many complex litigation cases, including: class actions, commercial claims, trade…

Kurt A. Kappes is the Managing Shareholder of the Sacramento Office and Co-Chair of the firm’s Labor & Employment Practice’s Complex Employment Litigation & Trials group. He has extensive lead trial experience in many complex litigation cases, including: class actions, commercial claims, trade secrets and employee mobility, computer fraud, non-compete, unfair competition, and Business and Professions Code Section 17200 actions. He has also represented clients in labor and employment issues, including advisory matters, trade secret audits, contracts, discrimination claims, whistleblower cases, and wrongful termination litigation.

Recognized by Super Lawyers magazine, as one of Northern California’s Super Lawyers, Kurt has argued cases before the Ninth Circuit Court of Appeals, the California Supreme Court, and the Third District Court of Appeals. He has also represented clients before the United States Supreme Court, as well as in administrative hearings, arbitrations (single and panel), writ proceedings, jury trials, and bench trials.