04.05.16

Whitehouse, Graham Hail Senate Passage of Defend Trade Secrets Act

Washington, DC – U.S. Senators Sheldon Whitehouse (D-RI) and Lindsey Graham (R-SC) yesterday voted in support of the Defend Trade Secrets Act (DTSA), which creates a new federal right of action for trade secret theft.  The bipartisan legislation, which both Senators cosponsored, passed the Senate by a vote of 87-0. 

The version passed by the Senate reflects a number of changes made by the bill’s authors at the request of Whitehouse, Graham, and other Judiciary Committee members at a December 2015 hearing on the legislation. 

“This is important bipartisan‎ legislation to address a major threat to American companies and our ability to compete in an international marketplace,” said Whitehouse, who proposed a series of changes to the DTSA designed to protect property and privacy rights, ensure due process, and to provide better guidance to law enforcement officials charged with executing DTSA seizures.  Those changes were included in the version of the bill that passed yesterday.  “I am glad the bill included my improvements to help protect privacy and property rights.  Thank you to the lead sponsors for taking my concerns into account, and I look forward to this bill becoming law.”

“This is an important piece of legislation which will help protect companies from unscrupulous actors in the marketplace,” said Graham.  “At the end of the day, this is about American innovation and this legislation will help protect American jobs, workers, and companies.  It has strong bipartisan support and I hope it will become law this year.”     

Whitehouse and Graham noted that confidential trade secrets give businesses an edge in the marketplace.  Depending on the industry, trade secrets can include manufacturing processes, formulas, computer algorithms, industrial designs, business strategies, customer lists, and more.  American companies have become increasingly concerned about protecting themselves against threats, including hackers and rogue employees, who seek to steal this important information.

The highlights of the legislation, which will now be sent to the House of Representatives, include:

  • Granting companies the right to sue in federal court to recover damages, seek injunctions, and prevent the further dissemination of stolen trade secrets;
  • Creating a uniform standard for what constitutes trade secret theft. Under current law, if companies want to sue they are relegated to state courts, where slightly varied state laws apply;
  • Providing law enforcement additional tools for prosecuting criminal trade secret theft.

The legislation builds on Whitehouse’s growing portfolio of bipartisan achievements.  Recently, the Senate approved the Comprehensive Addiction and Recovery Act, a sweeping bill to combat opioid addiction authored by Whitehouse and Senator Rob Portman (R-OH).  Congress enacted a bipartisan long-term transportation funding bill that includes a program—the Nationally Significant Freight and Highway Projects program—which Whitehouse has long pursued to fund extremely overdue repairs to the 6-10 Connector.  The Every Student Succeeds Act, which contains Whitehouse’s provisions on innovation, middle schools, juvenile justice, civics education, and community partnerships, was enacted by Congress in bipartisan fashion in recent months.  Whitehouse has also succeeded in extending foreclosure protections for veterans and servicemembers and passing legislation to prevent diversion of prescription drugs.

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