Protecting Your Information Assets – Part II

by Ervin Cohen & Jessup LLP
Contact

Part II:  Taking Additional Precautions

In my last installment, I addressed the importance of an employment agreement or confidentiality agreement as an essential component of a strategy to protect the information assets of a business.  However, a business cannot stop there: proper protection of information assets involves not only implementing certain contractual restrictions with your employees, but also taking a hard look at the practical realities of how to best protect the information from disclosure or misuse in the ordinary course of business.

Put differently, it is essential that the employer whose business depends upon confidential information or trade secrets take steps to preserve the confidentiality of these valuable assets by implementing certain procedures to be used in everyday business transactions.  An employer should begin by noting that a vast array of information can be considered confidential and warrant protection.  Thus, you should reconsider all of your assets in light of their potential competitive value.  For example, pricing information, the names of suppliers, and the relative abilities of key employees may warrant protection along with more common trade secrets such as formulas, ingredients lists and designs.  Once you determine the aspects of your business that should be protected, the following steps should be considered to minimize the danger presented by unscrupulous employees and competitors.

  • Limit access to trade secrets and confidential information.  Access should be given to persons on a need-to-know basis only.  Documents should be kept in a locked filing cabinet or other secure place.  Access to computer databases should be restricted through use of an appropriate security software program.  Consider blocking inadvertent disclosure through metadata attached to electronic documents.
  • Emphasize the importance of your information assets and the need to maintain confidentiality.  Employees should be made aware of the company’s practices that are intended to maintain the confidentiality of its trade secrets and confidential information.  Periodically remind employees of the procedures to be used concerning the dissemination of this information.  In addition, as the nature of the confidential information and trade secrets change, the employees should be made aware of these changes in both the information that the company seeks to protect as well as any related security protocol to combat the inadvertent disclosure.
  • Maintain access logs.  A log or record should be kept of those persons in the company who have access to its confidential information or trade secrets.  Rules regarding check-in and check-out procedures should be established and enforced.
  • Limit access to the company’s copy machine.  For obvious reasons, a copy machine is a thief’s best friend.  Key codes and office devices which restrict a person’s ability to use the machine are good ways to limit unauthorized copying.  At a minimum, consider moving the machine to common areas to deter potential piracy.
  • Conceal confidential components.  Key ingredients or supplies that are essential to your business should be kept under lock and key.  Assuming these ingredients do not represent a danger to human health, you may want to keep these items in containers which are marked by code names only.  This process should begin with the supplier prior to delivery.
  • Use contractual safeguards with third parties.  Contractual safeguards should be employed in protecting trade secrets and confidential information disclosed to third parties such as your company’s suppliers, customers and independent contractors.
  • Perform a security check.  In addition to security guards and burglar alarms, the company should limit visitor access.  Visitors should be escorted and wear tags identifying them as visitors.  Further, visitors should not be given access to trade secrets or confidential information without appropriate contractual safeguards.
  • Clearly identify all protected documents as “confidential.”  Files, drawings and other items which are integral parts of your confidential information or trade secrets should be labeled plainly.  Email should include an automatic signature restricting use to the intended recipient.
  • Identify likely candidates for piracy.  The vast majority of incidents constituting unfair competition begin with disgruntled employees seeking to better their position.  Ensuring that key employees have appropriate benefits and wages may eliminate their motivation to contact a competitor or create a competitive business.  Interactive performance reviews are a good way to measure the morale of your key employees.
  • Conduct exit interviews.  Upon termination of any employee, it is useful to hold an exit interview.  The exit interview serves two purposes: first, it will serve to remind the employee of his or her obligations as set forth in the employment agreement and/or confidentiality agreement, as well as underscore the importance of these obligations; second, it will give you an early opportunity to investigate any activities the employee may have undertaken which might have breached these contractual obligations or otherwise be considered unfair competition.  The employment/confidentiality agreement itself can serve as a guide to the questions to be posed by the interviewer.  Example questions include: “Did you return your notes, drafts, laptop and cell phone?”, “Have you been contacted by any competitor?” and “What are your plans for future employment?”

Although no procedure can absolutely prevent the theft of valuable information, a program for preserving the confidentiality of your assets may greatly reduce the risk of these assets being stolen.  Further, should unlawful competition begin, the above steps can provide the tools necessary to assist your legal counsel in stopping it before any serious damage is inflicted upon your business.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Ervin Cohen & Jessup LLP | Attorney Advertising

Written by:

Ervin Cohen & Jessup LLP
Contact
more
less

Ervin Cohen & Jessup LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!