2009 California Civil Code - Section 3426-3426.11 :: Title 5. Uniform Trade Secrets Act

CIVIL CODE
SECTION 3426-3426.11

3426.  This title may be cited as the Uniform Trade Secrets Act.

3426.1.  As used in this title, unless the context requires
otherwise:
   (a) "Improper means" includes theft, bribery, misrepresentation,
breach or inducement of a breach of a duty to maintain secrecy, or
espionage through electronic or other means. Reverse engineering or
independent derivation alone shall not be considered improper means.
   (b) "Misappropriation" means:
   (1) Acquisition of a trade secret of another by a person who knows
or has reason to know that the trade secret was acquired by improper
means; or
   (2) Disclosure or use of a trade secret of another without express
or implied consent by a person who:
   (A) Used improper means to acquire knowledge of the trade secret;
or
   (B) At the time of disclosure or use, knew or had reason to know
that his or her knowledge of the trade secret was:
   (i) Derived from or through a person who had utilized improper
means to acquire it;
   (ii) Acquired under circumstances giving rise to a duty to
maintain its secrecy or limit its use; or
   (iii) Derived from or through a person who owed a duty to the
person seeking relief to maintain its secrecy or limit its use; or
   (C) Before a material change of his or her position, knew or had
reason to know that it was a trade secret and that knowledge of it
had been acquired by accident or mistake.
   (c) "Person" means a natural person, corporation, business trust,
estate, trust, partnership, limited liability company, association,
joint venture, government, governmental subdivision or agency, or any
other legal or commercial entity.
   (d) "Trade secret" means information, including a formula,
pattern, compilation, program, device, method, technique, or process,
that:
   (1) Derives independent economic value, actual or potential, from
not being generally known to the public or to other persons who can
obtain economic value from its disclosure or use; and
   (2) Is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.

3426.2.  (a) Actual or threatened misappropriation may be enjoined.
Upon application to the court, an injunction shall be terminated when
the trade secret has ceased to exist, but the injunction may be
continued for an additional period of time in order to eliminate
commercial advantage that otherwise would be derived from the
misappropriation.
   (b) If the court determines that it would be unreasonable to
prohibit future use, an injunction may condition future use upon
payment of a reasonable royalty for no longer than the period of time
the use could have been prohibited.
   (c) In appropriate circumstances, affirmative acts to protect a
trade secret may be compelled by court order.

3426.3.  (a) A complainant may recover damages for the actual loss
caused by misappropriation. A complainant also may recover for the
unjust enrichment caused by misappropriation that is not taken into
account in computing damages for actual loss.
   (b) If neither damages nor unjust enrichment caused by
misappropriation are provable, the court may order payment of a
reasonable royalty for no longer than the period of time the use
could have been prohibited.
   (c) If willful and malicious misappropriation exists, the court
may award exemplary damages in an amount not exceeding twice any
award made under subdivision (a) or (b).

3426.4.  If a claim of misappropriation is made in bad faith, a
motion to terminate an injunction is made or resisted in bad faith,
or willful and malicious misappropriation exists, the court may award
reasonable attorney's fees and costs to the prevailing party.
Recoverable costs hereunder shall include a reasonable sum to cover
the services of expert witnesses, who are not regular employees of
any party, actually incurred and reasonably necessary in either, or
both, preparation for trial or arbitration, or during trial or
arbitration, of the case by the prevailing party.

3426.5.  In an action under this title, a court shall preserve the
secrecy of an alleged trade secret by reasonable means, which may
include granting protective orders in connection with discovery
proceedings, holding in-camera hearings, sealing the records of the
action, and ordering any person involved in the litigation not to
disclose an alleged trade secret without prior court approval.

3426.6.  An action for misappropriation must be brought within three
years after the misappropriation is discovered or by the exercise of
reasonable diligence should have been discovered. For the purposes
of this section, a continuing misappropriation constitutes a single
claim.

3426.7.  (a) Except as otherwise expressly provided, this title does
not supersede any statute relating to misappropriation of a trade
secret, or any statute otherwise regulating trade secrets.
   (b) This title does not affect (1) contractual remedies, whether
or not based upon misappropriation of a trade secret, (2) other civil
remedies that are not based upon misappropriation of a trade secret,
or (3) criminal remedies, whether or not based upon misappropriation
of a trade secret.
   (c) This title does not affect the disclosure of a record by a
state or local agency under the California Public Records Act
(Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code). Any determination as to whether the
disclosure of a record under the California Public Records Act
constitutes a misappropriation of a trade secret and the rights and
remedies with respect thereto shall be made pursuant to the law in
effect before the operative date of this title.

3426.8.  This title shall be applied and construed to effectuate its
general purpose to make uniform the law with respect to the subject
of this title among states enacting it.

3426.9.  If any provision of this title or its application to any
person or circumstances is held invalid, the invalidity does not
affect other provisions or applications of the title which can be
given effect without the invalid provision or application, and to
this end the provisions of this title are severable.

3426.10.  This title does not apply to misappropriation occurring
prior to January 1, 1985. If a continuing misappropriation otherwise
covered by this title began before January 1, 1985, this title does
not apply to the part of the misappropriation occurring before that
date. This title does apply to the part of the misappropriation
occurring on or after that date unless the appropriation was not a
misappropriation under the law in effect before the operative date of
this title.

3426.11.  Notwithstanding subdivision (b) of Section 47, in any
legislative or judicial proceeding, or in any other official
proceeding authorized by law, or in the initiation or course of any
other proceeding authorized by law and reviewable pursuant to Chapter
2 (commencing with Section 1084) of Title 1 of Part 3 of the Code of
Civil Procedure, the voluntary, intentional disclosure of trade
secret information, unauthorized by its owner, to a competitor or
potential competitor of the owner of the trade secret information or
the agent or representative of such a competitor or potential
competitor is not privileged and is not a privileged communication
for purposes of Part 2 (commencing with Section 43) of Division 1.
   This section does not in any manner limit, restrict, impair, or
otherwise modify either the application of the other subdivisions of
Section 47 to the conduct to which this section applies or the court'
s authority to control, order, or permit access to evidence in any
case before it.
   Nothing in this section shall be construed to limit, restrict, or
otherwise impair, the capacity of persons employed by public entities
to report improper government activity, as defined in Section 10542
of the Government Code, or the capacity of private persons to report
improper activities of a private business.


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