II 

114TH CONGRESS 

1ST SESSION S. 1890 

To amend chapter 90 of title 18, United States Code, to provide Federal 

jurisdiction for the theft of trade secrets, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 29, 2015 

Mr. HATCH (for himself, Mr. COONS, Mr. FLAKE, Mr. DURBIN, Mr. TILLIS, 

and Ms. BALDWIN) introduced the following bill; which was read twice 

and referred to the Committee on the Judiciary 

A BILL 

To amend chapter 90 of title 18, United States Code, to 

provide Federal jurisdiction for the theft of trade secrets, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Defend Trade Secrets 

5 Act of 2015’’. 


smartinez on DSK4TPTVN1PROD with BILLS
2 

•S 1890 IS

1 SEC. 2. FEDERAL JURISDICTION FOR THEFT OF TRADE SE2 CRETS. 

3 (a) IN GENERAL.—Section 1836 of title 18, United 

4 States Code, is amended by striking subsection (b) and 

5 inserting the following: 

6 ‘‘(b) PRIVATE CIVIL ACTIONS.— 

7 ‘‘(1) IN GENERAL.—An owner of a trade secret 

8 may bring a civil action under this subsection if the 

9 person is aggrieved by a misappropriation of a trade 

10 secret that is related to a product or service used in, 

11 or intended for use in, interstate or foreign com12 merce. 

13 ‘‘(2) CIVIL SEIZURE.— 

14 ‘‘(A) IN GENERAL.— 

15 ‘‘(i) APPLICATION.—Based on an affi16 davit or verified complaint satisfying the 

17 requirements of this paragraph, the court 

18 may, upon ex parte application, issue an 

19 order providing for the seizure of property 

20 necessary to prevent the propagation or 

21 dissemination of the trade secret that is 

22 the subject of the action. 

23 ‘‘(ii) REQUIREMENTS FOR ISSUING

24 ORDER.—The court may not grant an ap25 plication under clause (i) unless the court 


smartinez on DSK4TPTVN1PROD with BILLS
3 

•S 1890 IS

1 finds that it clearly appears from specific 

2 facts that— 

3 ‘‘(I) an order issued pursuant to 

4 Rule 65(b) of the Federal Rules of 

5 Civil Procedure would be inadequate 

6 to achieve the purpose of this para7 graph because the party to which the 

8 order would be issued would evade, 

9 avoid, or otherwise not comply with 

10 such an order; 

11 ‘‘(II) an immediate and irrep12 arable injury will occur if such seizure 

13 is not ordered; 

14 ‘‘(III) the harm to the applicant 

15 of denying the application outweighs 

16 the harm to the legitimate interests of 

17 the person against whom seizure 

18 would be ordered of granting the ap19 plication and substantially outweighs 

20 the harm to any third parties who 

21 may be harmed by such seizure; 

22 ‘‘(IV) the applicant is likely to 

23 succeed in showing that— 

24 ‘‘(aa) the information is a 

25 trade secret; 


smartinez on DSK4TPTVN1PROD with BILLS
4 

•S 1890 IS

1 ‘‘(bb) the person against 

2 whom seizure would be ordered— 

3 ‘‘(AA) misappropriated 

4 the trade secret of the appli5 cant by improper means; or 

6 ‘‘(BB) conspired to use 

7 improper means to mis8 appropriate the trade secret 

9 of the applicant; and 

10 ‘‘(cc) the person against 

11 whom seizure would be ordered 

12 has possession of the trade se13 cret; 

14 ‘‘(V) the application describes 

15 with reasonable particularity the mat16 ter to be seized and, to the extent rea17 sonable under the circumstances, 

18 identifies the location where the mat19 ter is to be seized; 

20 ‘‘(VI) the person against whom 

21 seizure would be ordered, or persons 

22 acting in concert with such person, 

23 would destroy, move, hide, or other24 wise make such matter inaccessible to 


smartinez on DSK4TPTVN1PROD with BILLS
5 

•S 1890 IS

1 the court, if the applicant were to pro2 ceed on notice to such person; and 

3 ‘‘(VII) the applicant has not pub4 licized the requested seizure. 

5 ‘‘(B) ELEMENTS OF ORDER.—If an order 

6 is issued under subparagraph (A), it shall— 

7 ‘‘(i) set forth findings of fact and con8 clusions of law required for the order; 

9 ‘‘(ii) provide for the narrowest seizure 

10 of property necessary to achieve the pur11 pose of this paragraph and direct that the 

12 seizure be conducted in a manner that 

13 minimizes any interruption of the business 

14 operations of third parties and, to the ex15 tent possible, does not interrupt the legiti16 mate business operations of the person ac17 cused of misappropriating the trade secret 

18 that are unrelated to the trade secret that 

19 has allegedly been misappropriated; 

20 ‘‘(iii)(I) be accompanied by an order 

21 protecting the seized property from disclo22 sure by restricting the access of the appli23 cant, including during the seizure, and pro24 hibiting any copies, in whole or in part, of 

25 the seized property, to prevent undue damVerDate Sep 11 2014 01:57 Aug 01, 2015 Jkt 049200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1890.IS S1890

smartinez on DSK4TPTVN1PROD with BILLS
6 

•S 1890 IS

1 age to the party against whom the order 

2 has issued or others, until such parties 

3 have an opportunity to be heard in court; 

4 and 

5 ‘‘(II) if access is granted to the appli6 cant, the access shall be consistent with 

7 subparagraph (D); 

8 ‘‘(iv) set a date for a hearing de9 scribed in subparagraph (F) at the earliest 

10 possible time, and not later than 7 days 

11 after the order has issued, unless the party 

12 against whom the order is directed and 

13 others harmed by the order consent to an14 other date for the hearing, except that a 

15 party against whom the order has issued 

16 or any person harmed by the order may 

17 move the court at any time to dissolve or 

18 modify the order after giving notice to the 

19 applicant who obtained the order; and 

20 ‘‘(v) require the person obtaining the 

21 order to provide the security determined 

22 adequate by the court for the payment of 

23 the damages that any person may be enti24 tled to recover as a result of a wrongful or 


smartinez on DSK4TPTVN1PROD with BILLS
7 

•S 1890 IS

1 excessive seizure or wrongful or excessive 

2 attempted seizure under this paragraph. 

3 ‘‘(C) PROTECTION FROM PUBLICITY.—The 

4 court shall take appropriate action to protect 

5 the person against whom an order under this 

6 paragraph is directed from publicity, by or at 

7 the behest of the person obtaining the order, 

8 about such order and any seizure under such 

9 order. 

10 ‘‘(D) MATERIALS IN CUSTODY OF

11 COURT.—Any materials seized under this para12 graph shall be taken into the custody of the 

13 court. The court shall secure the seized material 

14 from physical and electronic access during the 

15 seizure and while in the custody of the court. 

16 If the seized material includes an electronic 

17 storage medium, or if the seized material is 

18 stored on an electronic storage medium, the 

19 court shall prohibit the medium from being con20 nected to an electronic network or the Internet 

21 without the consent of both parties, until the 

22 hearing required under subparagraph (B)(iv) 

23 and described in subparagraph (F). 

24 ‘‘(E) SERVICE OF ORDER.—The court shall 

25 order that service of a copy of the order under 


smartinez on DSK4TPTVN1PROD with BILLS
8 

•S 1890 IS

1 this paragraph, and the submissions of the ap2 plicant to obtain the order, shall be made by a 

3 Federal law enforcement officer, or may be 

4 made by a State or local law enforcement offi5 cer, who, upon making service, shall carry out 

6 the seizure under the order. 

7 ‘‘(F) SEIZURE HEARING.— 

8 ‘‘(i) DATE.—A court that issues a sei9 zure order shall hold a hearing on the date 

10 set by the court under subparagraph 

11 (B)(iv). 

12 ‘‘(ii) BURDEN OF PROOF.—At a hear13 ing held under this subparagraph, the 

14 party obtaining the order shall have the 

15 burden to prove that the facts supporting 

16 the findings of fact and conclusions of law 

17 necessary to support the order are still in 

18 effect. If the party fails to meet that bur19 den, the seizure order shall be dissolved or 

20 modified appropriately. 

21 ‘‘(iii) DISSOLUTION OR MODIFICATION

22 OF ORDER.—A party against whom the 

23 order has been issued or any person 

24 harmed by the order may move the court 

25 at any time to dissolve or modify the order 


smartinez on DSK4TPTVN1PROD with BILLS
9 

•S 1890 IS

1 after giving notice to the party who ob2 tained the order. 

3 ‘‘(iv) DISCOVERY TIME LIMITS.—The 

4 court may make such orders modifying the 

5 time limits for discovery under the Federal 

6 Rules of Civil Procedure as may be nec7 essary to prevent the frustration of the 

8 purposes of a hearing under this subpara9 graph. 

10 ‘‘(G) ACTION FOR DAMAGE CAUSED BY

11 WRONGFUL SEIZURE.—A person who suffers 

12 damage by reason of a wrongful or excessive 

13 seizure under this paragraph has a cause of ac14 tion against the applicant for the order under 

15 which such seizure was made, and shall be enti16 tled to the same relief as is provided under sec17 tion 34(d)(11) of the Trademark Act of 1946 

18 (15 U.S.C. 1116(d)(11)). The security posted 

19 with the court under subparagraph (B)(v) shall 

20 not limit the recovery of third parties for dam21 ages. 

22 ‘‘(H) MOTION FOR ENCRYPTION.—A party 

23 may make a motion at any time, which may be 

24 heard ex parte, to encrypt any material seized 

25 or to be seized under this paragraph that is 


smartinez on DSK4TPTVN1PROD with BILLS
10 

•S 1890 IS

1 stored on an electronic storage medium. The 

2 motion shall include, when possible, the desired 

3 encryption method. 

4 ‘‘(3) REMEDIES.—In a civil action brought 

5 under this subsection with respect to the misappro6 priation of a trade secret, a court may— 

7 ‘‘(A) grant an injunction— 

8 ‘‘(i) to prevent any actual or threat9 ened misappropriation described in para10 graph (1) on such terms as the court 

11 deems reasonable, provided the order does 

12 not prevent a person from accepting an 

13 offer of employment under conditions that 

14 avoid actual or threatened misappropria15 tion described in paragraph (1); 

16 ‘‘(ii) if determined appropriate by the 

17 court, requiring affirmative actions to be 

18 taken to protect the trade secret; and 

19 ‘‘(iii) in exceptional circumstances 

20 that render an injunction inequitable, that 

21 conditions future use of the trade secret 

22 upon payment of a reasonable royalty for 

23 no longer than the period of time for which 

24 such use could have been prohibited; 

25 ‘‘(B) award— 


smartinez on DSK4TPTVN1PROD with BILLS
11 

•S 1890 IS

1 ‘‘(i)(I) damages for actual loss caused 

2 by the misappropriation of the trade se3 cret; and 

4 ‘‘(II) damages for any unjust enrich5 ment caused by the misappropriation of 

6 the trade secret that is not addressed in 

7 computing damages for actual loss; or 

8 ‘‘(ii) in lieu of damages measured by 

9 any other methods, the damages caused by 

10 the misappropriation measured by imposi11 tion of liability for a reasonable royalty for 

12 the misappropriator’s unauthorized disclo13 sure or use of the trade secret; 

14 ‘‘(C) if the trade secret is willfully and ma15 liciously misappropriated, award exemplary 

16 damages in an amount not more than 3 times 

17 the amount of the damages awarded under sub18 paragraph (B); and 

19 ‘‘(D) if a claim of the misappropriation is 

20 made in bad faith, a motion to terminate an in21 junction is made or opposed in bad faith, or the 

22 trade secret was willfully and maliciously mis23 appropriated, award reasonable attorney’s fees 

24 to the prevailing party. 


smartinez on DSK4TPTVN1PROD with BILLS
12 

•S 1890 IS

1 ‘‘(c) JURISDICTION.—The district courts of the 

2 United States shall have original jurisdiction of civil ac3 tions brought under this section. 

4 ‘‘(d) PERIOD OF LIMITATIONS.—A civil action under 

5 subsection (b) may not be commenced later than 5 years 

6 after the date on which the misappropriation with respect 

7 to which the action would relate is discovered or by the 

8 exercise of reasonable diligence should have been discov9 ered. For purposes of this subsection, a continuing mis10 appropriation constitutes a single claim of misappropria11 tion.’’. 

12 (b) DEFINITIONS.—Section 1839 of title 18, United 

13 States Code, is amended— 

14 (1) in paragraph (3), by striking ‘‘and’’ at the 

15 end; 

16 (2) in paragraph (4), by striking the period at 

17 the end and inserting a semicolon; and 

18 (3) by adding at the end the following: 

19 ‘‘(5) the term ‘misappropriation’ means— 

20 ‘‘(A) acquisition of a trade secret of an21 other by a person who knows or has reason to 

22 know that the trade secret was acquired by im23 proper means; or 


smartinez on DSK4TPTVN1PROD with BILLS
13 

•S 1890 IS

1 ‘‘(B) disclosure or use of a trade secret of 

2 another without express or implied consent by 

3 a person who— 

4 ‘‘(i) used improper means to acquire 

5 knowledge of the trade secret; 

6 ‘‘(ii) at the time of disclosure or use, 

7 knew or had reason to know that the 

8 knowledge of the trade secret was— 

9 ‘‘(I) derived from or through a 

10 person who had used improper means 

11 to acquire the trade secret; 

12 ‘‘(II) acquired under cir13 cumstances giving rise to a duty to 

14 maintain the secrecy of the trade se15 cret or limit the use of the trade se16 cret; or 

17 ‘‘(III) derived from or through a 

18 person who owed a duty to the person 

19 seeking relief to maintain the secrecy 

20 of the trade secret or limit the use of 

21 the trade secret; or 

22 ‘‘(iii) before a material change of the 

23 position of the person, knew or had reason 

24 to know that— 


smartinez on DSK4TPTVN1PROD with BILLS
14 

•S 1890 IS

1 ‘‘(I) the trade secret was a trade 

2 secret; and 

3 ‘‘(II) knowledge of the trade se4 cret had been acquired by accident or 

5 mistake; 

6 ‘‘(6) the term ‘improper means’— 

7 ‘‘(A) includes theft, bribery, misrepresenta8 tion, breach or inducement of a breach of a 

9 duty to maintain secrecy, or espionage through 

10 electronic or other means; and 

11 ‘‘(B) does not include reverse engineering 

12 or independent derivation; and 

13 ‘‘(7) the term ‘Trademark Act of 1946’ means 

14 the Act entitled ‘An Act to provide for the registra15 tion and protection of trademarks used in commerce, 

16 to carry out the provisions of certain international 

17 conventions, and for other purposes, approved July 

18 5, 1946 (15 U.S.C. 1051 et seq.) (commonly re19 ferred to as the ‘‘Trademark Act of 1946’’ or the 

20 ‘‘Lanham Act’’)’.’’. 

21 (c) EXCEPTIONS TO PROHIBITION.—Section 1833 of 

22 title 18, United States Code, is amended, in the matter 

23 preceding paragraph (1), by inserting ‘‘or create a private 

24 right of action for’’ after ‘‘prohibit’’. 

25 (d) CONFORMING AMENDMENTS.— 


smartinez on DSK4TPTVN1PROD with BILLS
15 

•S 1890 IS

1 (1) The section heading for section 1836 of title 

2 18, United States Code, is amended to read as fol3 lows: 

4 ‘‘§ 1836. Civil proceedings’’. 

5 (2) The table of sections for chapter 90 of title 

6 18, United States Code, is amended by striking the 

7 item relating to section 1836 and inserting the fol8 lowing: 

‘‘1836. Civil proceedings.’’. 

9 (e) EFFECTIVE DATE.—The amendments made by 

10 this section shall apply with respect to any misappropria11 tion of a trade secret (as defined in section 1839 of title 

12 18, United States Code, as amended by this section) for 

13 which any act occurs on or after the date of the enactment 

14 of this Act. 

15 (f) RULE OF CONSTRUCTION.—Nothing in the 

16 amendments made by this section shall be construed to 

17 modify the rule of construction under section 1838 of title 

18 18, United States Code, or to preempt any other provision 

19 of law. 

20 (g) APPLICABILITY TO OTHER LAWS.—This section 

21 and the amendments made by this section shall not be con22 strued to be a law pertaining to intellectual property for 

23 purposes of any other Act of Congress. 


smartinez on DSK4TPTVN1PROD with BILLS
16 

•S 1890 IS

1 SEC. 3. REPORT ON THEFT OF TRADE SECRETS OCCUR2 RING ABROAD. 

3 (a) DEFINITIONS.—In this section: 

4 (1) DIRECTOR.—The term ‘‘Director’’ means 

5 the Under Secretary of Commerce for Intellectual 

6 Property and Director of the United States Patent 

7 and Trademark Office. 

8 (2) FOREIGN INSTRUMENTALITY, ETC.—The 

9 terms ‘‘foreign instrumentality’’, ‘‘foreign agent’’, 

10 and ‘‘trade secret’’ have the meanings given those 

11 terms in section 1839 of title 18, United States 

12 Code. 

13 (3) STATE.—The term ‘‘State’’ includes the 

14 District of Columbia and any commonwealth, terri15 tory, or possession of the United States. 

16 (4) UNITED STATES COMPANY.—The term 

17 ‘‘United States company’’ means an organization or18 ganized under the laws of the United States or a 

19 State or political subdivision thereof. 

20 (b) REPORTS.—Not later than 1 year after the date 

21 of enactment of this Act, and biannually thereafter, the 

22 Attorney General, in consultation with the Intellectual 

23 Property Enforcement Coordinator, the Director, and the 

24 heads of other appropriate agencies, shall submit to the 

25 Committees on the Judiciary of the House of Representa26 tives and the Senate, and make publicly available on the 


smartinez on DSK4TPTVN1PROD with BILLS
17 

•S 1890 IS

1 Web site of the Department of Justice and disseminate 

2 to the public through such other means as the Attorney 

3 General may identify, a report on the following: 

4 (1) The scope and breadth of the theft of the 

5 trade secrets of United States companies occurring 

6 outside of the United States. 

7 (2) The extent to which theft of trade secrets 

8 occurring outside of the United States is sponsored 

9 by foreign governments, foreign instrumentalities, or 

10 foreign agents. 

11 (3) The threat posed by theft of trade secrets 

12 occurring outside of the United States. 

13 (4) The ability and limitations of trade secret 

14 owners to prevent the misappropriation of trade se15 crets outside of the United States, to enforce any 

16 judgment against foreign entities for theft of trade 

17 secrets, and to prevent imports based on theft of 

18 trade secrets overseas. 

19 (5) A breakdown of the trade secret protections 

20 afforded United States companies by each country 

21 that is a trading partner of the United States and 

22 enforcement efforts available and undertaken in each 

23 such country, including a list identifying specific 

24 countries where trade secret theft, laws, or enforceVerDate Sep 11 2014 01:57 Aug 01, 2015 Jkt 049200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\S1890.IS S1890

smartinez on DSK4TPTVN1PROD with BILLS
18 

•S 1890 IS

1 ment is a significant problem for United States com2 panies. 

3 (6) Instances of the Federal Government work4 ing with foreign countries to investigate, arrest, and 

5 prosecute entities and individuals involved in the 

6 theft of trade secrets outside of the United States. 

7 (7) Specific progress made under trade agree8 ments and treaties, including any new remedies en9 acted by foreign countries, to protect against theft 

10 of trade secrets of United States companies outside 

11 of the United States. 

12 (8) Recommendations of legislative and execu13 tive branch actions that may be undertaken to— 

14 (A) reduce the threat of and economic im15 pact caused by the theft of the trade secrets of 

16 United States companies occurring outside of 

17 the United States; 

18 (B) educate United States companies re19 garding the threats to their trade secrets when 

20 taken outside of the United States; 

21 (C) provide assistance to United States 

22 companies to reduce the risk of loss of their 

23 trade secrets when taken outside of the United 

24 States; and 


smartinez on DSK4TPTVN1PROD with BILLS
19 

•S 1890 IS

1 (D) provide a mechanism for United States 

2 companies to confidentially or anonymously re3 port the theft of trade secrets occurring outside 

4 of the United States. 

5 SEC. 4. SENSE OF CONGRESS. 

6 It is the sense of Congress that— 

7 (1) trade secret theft occurs in the United 

8 States and around the world; 

9 (2) trade secret theft, wherever it occurs, harms 

10 the companies that own the trade secrets and the 

11 employees of the companies; and 

12 (3) chapter 90 of title 18, United States Code 

13 (commonly known as the Economic Espionage Act of 

14 1996), applies broadly to protect trade secrets from 

15 theft. 

Æ 


smartinez on DSK4TPTVN1PROD with BILLS