Defend Trade Secrets Act of 2016

Bill: 114-s-1890
Sponsor: Sen. Hatch, Orrin G. [R-UT]
Introduced: 2015-07-29 in the Senate
Policy area: Crime and Law Enforcement
Subjects: Business ethics
Business records
Civil actions and liability
Competitiveness, trade promotion, trade deficits
Congressional oversight
Crimes against property
Criminal investigation, prosecution, interrogation
Evidence and witnesses
Fraud offenses and financial crimes
Jurisdiction and venue
Product development and innovation
Trade agreements and negotiations
Trade secrets and economic espionage

Summary:
action_date: 2015-07-29
text: 

Defend Trade Secrets Act of 2015

 
This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
Specifically, the bill authorizes a trade secret owner to file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. It establishes remedies, such as an injunction and damages. The statute of limitation is set at five years from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant a seizure order to prevent dissemination of the trade secret if the court makes specific findings, including that an immediate and irreparable injury will occur if seizure is not ordered. A court must take custody of the seized materials and hold a seizure hearing within seven days.
 
Any party harmed by the order may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order for wrongful or excessive seizure. 
 
The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, and (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft. 

action_date: 2016-01-28
text: 

Defend Trade Secrets Act of 2016

 
(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
A trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediate and irreparable injury will occur if seizure is not ordered, and (3) the person against whom seizure would be ordered has actual possession of the trade secret and any property to be seized. 
 
A court must take custody of and secure seized materials and hold a seizure hearing within seven days. An interested party may file a motion to encrypt seized material. 
 
 A party harmed by a wrongful or excessive seizure may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order. 
 
(Sec. 3) The bill increases the maximum penalty for trade secret theft (currently $5 million) to the greater of $5 million or three times the value of the stolen trade secret. 
 
A court may not authorize or require the disclosure of information that an owner asserts to be a trade secret unless the court allows the owner to submit under seal a description of the interest in keeping the information confidential. Additionally, disclosure of information related to a trade secret in connection with a prosecution does not constitute a waiver of trade secret protection unless an owner expressly consents to such waiver. 
 
It adds economic espionage and trade secret theft to the list of predicate offenses that constitute racketeering activity. 
 
(Sec. 4) The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 (Sec. 5) The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft; and (4) it is important, when seizing information, to balance the need to address misappropriation with the needs of third parties and the accused party.
 
(Sec. 6) The Federal Judicial Center must develop, update, and submit to Congress best practices for seizing information and securing seized information. 
 
(Sec. 7) The bill provides immunity from civil and criminal liability for an individual who discloses a trade secret: (1) to a government official or attorney in confidence to report or investigate a violation of law, or (2) in a legal complaint or filing under seal. 

action_date: 2016-04-04
text: 
(This measure has not been amended since it was reported to the Senate on January 28, 2016. The summary of that version is repeated here.)
 

Defend Trade Secrets Act of 2016

 
(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
A trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediate and irreparable injury will occur if seizure is not ordered, and (3) the person against whom seizure would be ordered has actual possession of the trade secret and any property to be seized. 
 
A court must take custody of and secure seized materials and hold a seizure hearing within seven days. An interested party may file a motion to encrypt seized material. 
 
 A party harmed by a wrongful or excessive seizure may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order. 
 
(Sec. 3) The bill increases the maximum penalty for trade secret theft (currently $5 million) to the greater of $5 million or three times the value of the stolen trade secret. 
 
A court may not authorize or require the disclosure of information that an owner asserts to be a trade secret unless the court allows the owner to submit under seal a description of the interest in keeping the information confidential. Additionally, disclosure of information related to a trade secret in connection with a prosecution does not constitute a waiver of trade secret protection unless an owner expressly consents to such waiver. 
 
It adds economic espionage and trade secret theft to the list of predicate offenses that constitute racketeering activity. 
 
(Sec. 4) The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 (Sec. 5) The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft; and (4) it is important, when seizing information, to balance the need to address misappropriation with the needs of third parties and the accused party.
 
(Sec. 6) The Federal Judicial Center must develop, update, and submit to Congress best practices for seizing information and securing seized information. 
 
(Sec. 7) The bill provides immunity from civil and criminal liability for an individual who discloses a trade secret: (1) to a government official or attorney in confidence to report or investigate a violation of law, or (2) in a legal complaint or filing under seal. 

action_date: 2016-04-26
text: 
(This measure has not been amended since it was reported to the Senate on January 28, 2016. The summary of that version is repeated here.)
 

Defend Trade Secrets Act of 2016

 
(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
A trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediate and irreparable injury will occur if seizure is not ordered, and (3) the person against whom seizure would be ordered has actual possession of the trade secret and any property to be seized. 
 
A court must take custody of and secure seized materials and hold a seizure hearing within seven days. An interested party may file a motion to encrypt seized material. 
 
 A party harmed by a wrongful or excessive seizure may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order. 
 
(Sec. 3) The bill increases the maximum penalty for trade secret theft (currently $5 million) to the greater of $5 million or three times the value of the stolen trade secret. 
 
A court may not authorize or require the disclosure of information that an owner asserts to be a trade secret unless the court allows the owner to submit under seal a description of the interest in keeping the information confidential. Additionally, disclosure of information related to a trade secret in connection with a prosecution does not constitute a waiver of trade secret protection unless an owner expressly consents to such waiver. 
 
It adds economic espionage and trade secret theft to the list of predicate offenses that constitute racketeering activity. 
 
(Sec. 4) The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 (Sec. 5) The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft; and (4) it is important, when seizing information, to balance the need to address misappropriation with the needs of third parties and the accused party.
 
(Sec. 6) The Federal Judicial Center must develop, update, and submit to Congress best practices for seizing information and securing seized information. 
 
(Sec. 7) The bill provides immunity from civil and criminal liability for an individual who discloses a trade secret: (1) to a government official or attorney in confidence to report or investigate a violation of law, or (2) in a legal complaint or filing under seal. 

action_date: 2016-04-27
text: 
(This measure has not been amended since it was reported to the Senate on January 28, 2016. The summary of that version is repeated here.)
 

Defend Trade Secrets Act of 2016

 
(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
A trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediate and irreparable injury will occur if seizure is not ordered, and (3) the person against whom seizure would be ordered has actual possession of the trade secret and any property to be seized. 
 
A court must take custody of and secure seized materials and hold a seizure hearing within seven days. An interested party may file a motion to encrypt seized material. 
 
 A party harmed by a wrongful or excessive seizure may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order. 
 
(Sec. 3) The bill increases the maximum penalty for trade secret theft (currently $5 million) to the greater of $5 million or three times the value of the stolen trade secret. 
 
A court may not authorize or require the disclosure of information that an owner asserts to be a trade secret unless the court allows the owner to submit under seal a description of the interest in keeping the information confidential. Additionally, disclosure of information related to a trade secret in connection with a prosecution does not constitute a waiver of trade secret protection unless an owner expressly consents to such waiver. 
 
It adds economic espionage and trade secret theft to the list of predicate offenses that constitute racketeering activity. 
 
(Sec. 4) The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 (Sec. 5) The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft; and (4) it is important, when seizing information, to balance the need to address misappropriation with the needs of third parties and the accused party.
 
(Sec. 6) The Federal Judicial Center must develop, update, and submit to Congress best practices for seizing information and securing seized information. 
 
(Sec. 7) The bill provides immunity from civil and criminal liability for an individual who discloses a trade secret: (1) to a government official or attorney in confidence to report or investigate a violation of law, or (2) in a legal complaint or filing under seal. 

action_date: 2016-05-11
text: 
(This measure has not been amended since it was reported to the Senate on January 28, 2016. The summary of that version is repeated here.)
 

Defend Trade Secrets Act of 2016

 
(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
 
A trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation. 
 
A trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediate and irreparable injury will occur if seizure is not ordered, and (3) the person against whom seizure would be ordered has actual possession of the trade secret and any property to be seized. 
 
A court must take custody of and secure seized materials and hold a seizure hearing within seven days. An interested party may file a motion to encrypt seized material. 
 
 A party harmed by a wrongful or excessive seizure may move to dissolve or modify the order and may also seek relief against the applicant of the seizure order. 
 
(Sec. 3) The bill increases the maximum penalty for trade secret theft (currently $5 million) to the greater of $5 million or three times the value of the stolen trade secret. 
 
A court may not authorize or require the disclosure of information that an owner asserts to be a trade secret unless the court allows the owner to submit under seal a description of the interest in keeping the information confidential. Additionally, disclosure of information related to a trade secret in connection with a prosecution does not constitute a waiver of trade secret protection unless an owner expressly consents to such waiver. 
 
It adds economic espionage and trade secret theft to the list of predicate offenses that constitute racketeering activity. 
 
(Sec. 4) The Department of Justice must submit to Congress and publish a biannual report on trade secret theft outside the United States. 
 
 (Sec. 5) The bill expresses the sense of Congress that: (1) trade secret theft occurs in the United States and around the world, (2) trade secret theft harms owner companies and their employees, (3) the Economic Espionage Act of 1996 applies broadly to protect trade secrets from theft; and (4) it is important, when seizing information, to balance the need to address misappropriation with the needs of third parties and the accused party.
 
(Sec. 6) The Federal Judicial Center must develop, update, and submit to Congress best practices for seizing information and securing seized information. 
 
(Sec. 7) The bill provides immunity from civil and criminal liability for an individual who discloses a trade secret: (1) to a government official or attorney in confidence to report or investigate a violation of law, or (2) in a legal complaint or filing under seal. 


Legislative actions:
action_date: 2016-05-11
text: Became Public Law No: 114-153.
action_date: 2016-05-11
text: Became Public Law No: 114-153.
action_date: 2016-05-11
text: Signed by President.
action_date: 2016-05-11
text: Signed by President.
action_date: 2016-04-29
text: Presented to President.
action_date: 2016-04-29
text: Presented to President.
action_date: 2016-04-27
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2016-04-27
text: On motion to suspend the rules and pass the bill Agreed to by the Yeas and Nays: (2/3 required): 410 - 2 (Roll no. 172). (text: CR H2028)
action_date: 2016-04-27
text: Passed/agreed to in House: On motion to suspend the rules and pass the bill Agreed to by the Yeas and Nays: (2/3 required): 410 - 2 (Roll no. 172).(text: CR H2028)
action_date: 2016-04-27
text: Considered as unfinished business. (consideration: CR H2046-2047)
action_date: 2016-04-27
text: At the conclusion of debate, the Yeas and Nays were demanded and ordered. Pursuant to the provisions of clause 8, rule XX, the Chair announced that further proceedings on the motion would be postponed.
action_date: 2016-04-27
text: DEBATE - The House proceeded with forty minutes of debate on S. 1890.
action_date: 2016-04-27
text: Considered under suspension of the rules. (consideration: CR H2028-2034)
action_date: 2016-04-27
text: Mr. Goodlatte moved to suspend the rules and pass the bill.
action_date: 2016-04-26
text: Placed on the Union Calendar, Calendar No. 409.
action_date: 2016-04-26
text: Reported by the Committee on Judiciary. H. Rept. 114-529.
action_date: 2016-04-26
text: Reported by the Committee on Judiciary. H. Rept. 114-529.
action_date: 2016-04-20
text: Ordered to be Reported by Voice Vote.
action_date: 2016-04-20
text: Committee Consideration and Mark-up Session Held.
action_date: 2016-04-18
text: Subcommittee on Courts, Intellectual Property, and the Internet Discharged.
action_date: 2016-04-11
text: Referred to the House Committee on the Judiciary.
action_date: 2016-04-11
text: Referred to the Subcommittee on Courts, Intellectual Property, and the Internet.
action_date: 2016-04-11
text: Received in the House.
action_date: 2016-04-05
text: Message on Senate action sent to the House.
action_date: 2016-04-04
text: Passed Senate with an amendment by Yea-Nay Vote. 87 - 0. Record Vote Number: 39.
action_date: 2016-04-04
text: Passed/agreed to in Senate: Passed Senate with an amendment by Yea-Nay Vote. 87 - 0. Record Vote Number: 39.
action_date: 2016-04-04
text: The committee substitute agreed to by Unanimous Consent. (text of committee substitute as amended: CR S1631-1634)
action_date: 2016-04-04
text: Measure laid before Senate by unanimous consent. (consideration: CR S1631-1636)
action_date: 2016-03-07
text: By Senator Grassley from Committee on the Judiciary filed written report. Report No. 114-220.
action_date: 2016-03-07
text: By Senator Grassley from Committee on the Judiciary filed written report. Report No. 114-220.
action_date: 2016-01-28
text: Placed on Senate Legislative Calendar under General Orders. Calendar No. 355.
action_date: 2016-01-28
text: Committee on the Judiciary. Reported by Senator Grassley with an amendment in the nature of a substitute. Without written report.
action_date: 2016-01-28
text: Committee on the Judiciary. Reported by Senator Grassley with an amendment in the nature of a substitute. Without written report.
action_date: 2016-01-28
text: Committee on the Judiciary. Ordered to be reported with an amendment in the nature of a substitute favorably.
action_date: 2015-12-02
text: Committee on the Judiciary. Hearings held.
action_date: 2015-07-29
text: Read twice and referred to the Committee on the Judiciary.
action_date: 2015-07-29
text: Introduced in Senate

Enacted as: number: 114-153