LEGISLATIVE UPDATE: Senator Proposes New Bill To Create Civil Cause Of Action For Foreign Theft Of Trade Secrets

http://blogs.orrick.com/trade-secrets-watch/files/2013/12/5Dec13-Resized-200x150.jpgJust before the Thanksgiving holiday last week, Senator Jeff Flake (R-Ariz.) introduced the Future of American Innovation and Research Act, a new trade secrets bill that would allow American trade secrets owners to sue entities who misappropriate trade secrets outside the United States, or who misappropriate trade secrets on behalf of foreign entities.  The bill tracks the Uniform Trade Secret Act’s definitions of “trade secret” and “misappropriation,” and includes standard remedies of damages and injunctive relief.  One interesting addition is that it would also enable courts to seize property involved in the commission of the theft.  You can read Flake’s press release about his bill here.

This bill is just one more in a laundry list of pending bills related to trade secrets.  We’ve been tracking these proposed laws throughout the year and have updated our primer to include Flake’s new bill.  We’ve also updated the chart to include bill numbers and links to up-to-date status information via www.govtrack.us:

Bill Sponsor What’s It About? Status

Future of American Innovation and Research Act

(S. 1770)

Sen. Jeffry L. Flake (R-Ariz.)
  • First introduced on November 22, 2013, the act would allow trade secret owners to bring a civil action against a person who misappropriates a trade secret if that person is acting either outside of the United States or acting on behalf of a foreign actor.
  • The act would bring foreign actors within the jurisdiction of U.S. federal courts so long as the actors engaged in conduct that either takes place within the United States, or “causes or is reasonably anticipated to cause an injury” within the United States or to an American business or citizen.
  • Available remedies include damages, restitution, injunctive relief, punitive damages, and attorneys’ fees.  The act would also permit courts to issue ex parte seizure orders, allowing seizure of items (such as computers) used in connection with trade secrets theft, subject to certain procedural requirements.
Referred to the Senate Judiciary Committee

Private Right of Action Against Theft of Trade Secrets Act of 2013

(H.R. 2466)

Rep. Zoe Lofgren
(D-Cal.)
  • Introduced in the House on June 20, 2013, the bill would add a provision to 18 U.S.C. § 1832 that creates a private cause of action for the theft of trade secrets.
  • Under this amendment, reverse engineering is explicitly not actionable.
Referred to the House Committee on the Judiciary

Aaron’s Law Act of 2013

(H.R. 2454)

Rep. Zoe Lofgren
(D-Cal.)
et al.
Referred to the House Committee on the Judiciary

Cyber Economic Espionage Accountability Act

(H.R. 2281)

Rep. Mike Rogers
(R-Mich.) and Rep. Tim Ryan
(D-Ohio)
  • Introduced June 6, 2013, the bill broadly aims to secure the United States against cyber attacks sponsored by foreign governments.
  • The bill calls for the President to identify foreign government officials whom the President determines, “based on credible information,” are responsible for cyber theft of United States intellectual property.
  • The bill makes the identified persons ineligible to be admitted to the United States.
  • The bill directs the Secretary of State and Secretary of Homeland Security to revoke the visa of any such identified person.
  • The bill imposes financial sanctions, enabling the President to freeze property transactions by the identified individuals.
Referred to the Foreign Affairs, Judiciary and Financial Services Committees

Deter Cyber Theft Act

(S. 884)

Sen. Carl Levin
(D-Mich.)
et al.
  • Introduced May 7, 2013, the bill would establish a “watch list” and “priority watch list” of countries that facilitate or engage in cyber theft of trade secrets from the United States.
  • As we previously reported, the bill would also require the President to direct U.S. Customs and Border Protection to bar imports from foreign countries on the watch list.
Referred to the Committee on Finance

Strengthening and Enhancing Cybersecurity by Using Research, Education, Information, and Technology Act (“SECURE IT”)

(H.R. 1468)

Rep. Marsha Blackburn
(R-Tenn.)
  • Introduced April 10, 2013, SECURE IT seeks to, among other things, facilitate the sharing of cyber threat information and create new deterrents for cyber criminals.
  • For instance, the act creates a limited exemption from antitrust laws for the sharing of cyber threat information between private entities. It further provides that an entity may disclose cyber threat information to any entity to assist with the investigation of threats to cybersecurity. (This portion of the bill might face the same opposition as CISPA — see below.)
  • SECURE IT further requires that federal agencies be informed of significant cyber incidents involving their federal information systems and that agencies adopt technologies to detect and remediate cyber intrusions.
  • The bill aims to amend certain provisions of the Computer Fraud and Abuse Act to include new criminal penalties for “aggravated damage” to certain “critical infrastructure” computers, such as those that control water supplies, electrical power delivery, and financial transactions.
Referred to the House Subcommittee on Crime, Terrorism, Homeland Security, and Investigations

Cyber Intelligence Sharing and Protection Act (“CISPA”)

(H.R. 624)

Rep. Mike Rogers
(R-Mich.)
et al.
  • First introduced in the House on November 30, 2011, and most recently re-introduced on February 13, 2013, the act aims to permit information sharing about possible cybersecurity threats among government agencies and private companies.
  • CISPA has divided the House and Senate and has faced opposition by privacy and civil liberties organizations.
The bill passed the House and was referred to the Senate but has not shown signs of advancement.  We reported earlier that the Senate would not be taking up the bill and that President Obama threatened to veto the bill because of privacy concerns.