From: cigs13@vaxa.strath.ac.uk
Newsgroups: misc.legal,misc.legal.computing
Subject: Re: Trade Secrets Agreements
Date: 14 Dec 92 12:37:42 GMT
Organization: Strathclyde University VAX Cluster

Will - You replied...

So, all in all, you would just put in the clause on arbitration and just
leave out the nasty-sounding clause that follows simply because the
latter has no teeth? 

& Yep. - but not simply.  I think there is some potential for increasing legal
uncertainty... with regard to the statement of the "inadequacy of legal
relief".

 The one specific item in here that interested me
was the reference to injunctive relief.  Is it your view that by
including a phrase that says something like "if the trade secret agreement is 
violated we have a right to injunctive relief" doesn't really increase
or decrease their rights to injunctive relief?  

& Yup.  On further reflection, I suppose it may be possible - not to affirm a
positive right to an injunction - but rather for a potential defendant to waive
objections to an injunction being sought - but whether such an abnegation of a
legal position would be effective strikes me as doubtful.  The Court might take
a dim view of someone opposing an injunction after agreeing not to so do - but
then, the Court does not need to look to objections to an injunction when
deciding whether or not to grant an injunction.

The obvious scenario for these kinds of situations is something like
this:
	- party A examines technology belonging to party B
	- party A goes out and does a similar product on their own
	- party B decides the product looks too much like their own and
	sues and asks for injunctive relief to stop shipment of party A's
	product


&  Umm. Well, I'm not really an expert, despite some experience, but I don't
think this is the dangerous scenario.  Business A would rarely be dependent on
Party B for technology to launch a product (though it may have had plans to
ship something and then thought why not look at the competition first...) -
this kind of theft may be more common than I think, but somehow the issues
which strike me here are the ones of reverse engineering, not of an agreement
followed by this behaviour.  No, it is in the hidden technologies "production
not product" - where improved processes are ripped off, or in the situation
where it is the suppression of a technology which is the business aim, which is
where the danger lies.  And, IMHO, injunction cannot solve these problems.


So, in general, the court is going to examine the request for an
injunction to stop shipment of a product based on what?

& This is a bit of a long story.... _very briefly_ when the private interests
of the plaintiff would be irretrievably damaged and the private interests of
the defendant would not be, or where there is a compelling public interest.

As I recall, in US jurisdictions an injunction is not the immediate goal of the
action but is rather a final type judgement - a temporary restraining order would
be more likely to be granted.

The whole point of a trade secret agreement is to reveal technology securely -
it is hard to see how the secret itself would normally be impaired by the
shipment of a technology based thereon.  An injunction would certainly be the
only kind of remedy to prevent disclosure of a secret - as it allows for the
threat of court-imposed fines or prison terms for contempt - but why would you
think it the only appropriate remedy for a product v. product dispute (which
usually can be resolved by a monetary remedy if the money can be found...).  In
certain I.P. disputes one party may seek to attach a shipment of potentially
infringing goods to prevent export or sale (such an attachment is not an
injunction but is rather a seizure)  but this is based on a different
imperative and is in fact a "legal" remedy - in the UK you can seize infringing
goods without even getting a court order or on an uncontested
application for such an order.


There are of course other forms of "security" which could be given to your
Party B but in general one should not expect to compel a Court by your
agreement (I recall an amusing news post to the effect that enforcing contracts
is an obligation on the courts) - it is hard enough in an adversarial system to
persuade a Court to compel one's adversary, and 99% of contracts are
satisfactorily completed - not because of the threat of legal compulsion -
because they are indeed in the interests of both parties.

Yours,

Adam


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From: k@hprnd.rose.hp.com (Steve Kao)
Date: Tue, 15 Dec 1992 18:50:22 GMT
Subject: Re: Second Amendment Arguement
Organization: HP Roseville Networks Division