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Technology and Social Media Raise New Challenges with Confidential Information

Q: How has the treatment of confidential information changed since the Internet explosion?
A: While confidential information is as old as the first secret, the computer revolution of the last couple of decades has raised many questions about how the law addresses ownership and use of confidential information. Life-changing new technology has forced us to determine how the old legal rules apply to new situations. Today, people have easier access to more information than ever before, and most of that information exists in a highly mobile form. As a result, it is much more difficult to protect confidential information today than in the past, so it is more important than ever to take appropriate steps to protect information and avoid the legal problems that result from disclosures of confidential information.
 
Q: What kinds of confidential information are affected by the technological changes?
A: Anything that a person or company might not want somebody else to know has been affected, including such important categories of confidential information as business trade secrets, medical records and student records. Since virtually all information is created and/or stored electronically, anything that a company or an individual might like to keep confidential is subject to new challenges raised by Internet accessibility.
 
Q: What is a trade secret?
A: A trade secret is a form of confidential information recognized by statute in Ohio (and all states in one form or another). In short, trade secrets have value because of the very fact that they are kept confidential. For example, the owner of the formula for a soft drink will go to great lengths to make sure that formula is kept secret, since it is the crown jewel of the business. If the formula were to become known by those outside the business, the company would stand to lose a lot of money because the recipe for creating the drink’s distinctive taste would be available to its competitors. That is a trade secret.
 
Q: How has technology affected trade secrets law?
A: Because the formula referenced above almost certainly exists electronically, it could, in a split second, be emailed or posted on the Internet and become available to millions of people. Such a disclosure could cripple the business. For example, the formula could inadvertently be shared by an employee who leaves a mobile device such as a laptop, an iPhone or a flash drive in an insecure location.
 In light of these new challenges, the owner of information involving trade secrets must take appropriate steps to protect the information. In particular, the owner of the information must determine how to limit the physical locations of the information in all forms, electronic and otherwise.
 
Q: If, as an employee of a company, I’ve developed a list of LinkedIn contacts or Twitter followers, who owns that contact list?
A: If the list has been developed as part of your employment, then the employer will likely want to retain ownership and has strong grounds for doing so. The more complicated situations involve situations where some of the contacts relate to your employment and some do not, or where some of the contacts pre-date your employment. In order to avoid future misunderstandings, it is wise for both sides to specifically spell out as much as possible what each expects regarding ownership of contact information developed through the Internet.
 
Q: If I have business contact information on my personal smartphone, don’t I own it?
A: Not necessarily. This is the “BYOD” (bring your own device) issue that is currently receiving attention among employers. An employer may maintain trade secret protection for information located on an employee’s personal device. Both the employer and the employee should, therefore, plan for how to handle the situation where the device is lost. For example, there are programs that enable remotely “wiping” the device of data if it cannot be located.

 As an employee, you should not assume you have free rein to use job-related information on your smartphone. Such an assumption could lead to unwanted legal problems for you. 
 
11/2/2013
 
This “Law You Can Use” column was provided by the Ohio State Bar Association. It was prepared by attorney Bill Nolan of the Columbus office of Barnes & Thornburg LLP.
Articles appearing in this column are intended to provide broad, general information about the law. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney.

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