Texas 2013 - 83rd Regular

Texas Senate Bill SB953 Compare Versions

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1	1	By: Carona S.B. No. 953
2	2	(Elkins, Button, Reynolds)
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the adoption of the Uniform Trade Secrets Act.
8	8	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	9	SECTION 1. Title 6, Civil Practice and Remedies Code, is
10	10	amended by adding Chapter 134A to read as follows:
11	11	CHAPTER 134A. TRADE SECRETS
12	12	Sec. 134A.001. SHORT TITLE. This chapter may be cited as
13	13	the Texas Uniform Trade Secrets Act.
14	14	Sec. 134A.002. DEFINITIONS. In this chapter:
15	15	(1) "Claimant" means a party seeking to recover
16	16	damages under this chapter, including a plaintiff,
17	17	counterclaimant, cross-claimant, or third-party plaintiff. In an
18	18	action in which a party seeks recovery of damages under this chapter
19	19	on behalf of another person, "claimant" includes both that other
20	20	person and the party seeking recovery of damages.
21	21	(2) "Improper means" includes theft, bribery,
22	22	misrepresentation, breach or inducement of a breach of a duty to
23	23	maintain secrecy, to limit use, or to prohibit discovery of a trade
24	24	secret, or espionage through electronic or other means.
25	25	(3) "Misappropriation" means:
26	26	(A) acquisition of a trade secret of another by a
27	27	person who knows or has reason to know that the trade secret was
28	28	acquired by improper means; or
29	29	(B) disclosure or use of a trade secret of
30	30	another without express or implied consent by a person who:
31	31	(i) used improper means to acquire
32	32	knowledge of the trade secret;
33	33	(ii) at the time of disclosure or use, knew
34	34	or had reason to know that the person's knowledge of the trade
35	35	secret was:
36	36	(a) derived from or through a person
37	37	who had utilized improper means to acquire it;
38	38	(b) acquired under circumstances
39	39	giving rise to a duty to maintain its secrecy or limit its use; or
40	40	(c) derived from or through a person
41	41	who owed a duty to the person seeking relief to maintain its secrecy
42	42	or limit its use; or
43	43	(iii) before a material change of the
44	44	person's position, knew or had reason to know that it was a trade
45	45	secret and that knowledge of it had been acquired by accident or
46	46	mistake.
47	47	(4) "Proper means" means discovery by independent
48	48	development, reverse engineering unless prohibited, or any other
49	49	means that is not improper.
50	50	(5) "Reverse engineering" means the process of
51	51	studying, analyzing, or disassembling a product or device to
52	52	discover its design, structure, construction, or source code
53	53	provided that the product or device was acquired lawfully or from a
54	54	person having the legal right to convey it.
55	55	(6) "Trade secret" means information, including a
56	56	formula, pattern, compilation, program, device, method, technique,
57	57	process, financial data, or list of actual or potential customers
58	58	or suppliers, that:
59	59	(A) derives independent economic value, actual
60	60	or potential, from not being generally known to, and not being
61	61	readily ascertainable by proper means by, other persons who can
62	62	obtain economic value from its disclosure or use; and
63	63	(B) is the subject of efforts that are reasonable
64	64	under the circumstances to maintain its secrecy.
65	65	Sec. 134A.003. INJUNCTIVE RELIEF. (a) Actual or
66	66	threatened misappropriation may be enjoined. On application to the
67	67	court, an injunction shall be terminated when the trade secret has
68	68	ceased to exist, but the injunction may be continued for an
69	69	additional reasonable period of time in order to eliminate
70	70	commercial advantage that otherwise would be derived from the
71	71	misappropriation.
72	72	(b) In exceptional circumstances, an injunction may
73	73	condition future use upon payment of a reasonable royalty for no
74	74	longer than the period of time for which use could have been
75	75	prohibited. Exceptional circumstances include a material and
76	76	prejudicial change of position before acquiring knowledge or reason
77	77	to know of misappropriation that renders a prohibitive injunction
78	78	inequitable.
79	79	(c) In appropriate circumstances, affirmative acts to
80	80	protect a trade secret may be compelled by court order.
81	81	Sec. 134A.004. DAMAGES. (a) In addition to or in lieu of
82	82	injunctive relief, a claimant is entitled to recover damages for
83	83	misappropriation. Damages can include both the actual loss caused
84	84	by misappropriation and the unjust enrichment caused by
85	85	misappropriation that is not taken into account in computing actual
86	86	loss. In lieu of damages measured by any other methods, the damages
87	87	caused by misappropriation may be measured by imposition of
88	88	liability for a reasonable royalty for a misappropriator's
89	89	unauthorized disclosure or use of a trade secret.
90	90	(b) If wilful and malicious misappropriation is proven by
91	91	clear and convincing evidence, the fact finder may award exemplary
92	92	damages in an amount not exceeding twice any award made under
93	93	Subsection (a).
94	94	Sec. 134A.005. ATTORNEY'S FEES. The court may award
95	95	reasonable attorney's fees to the prevailing party if:
96	96	(1) a claim of misappropriation is made in bad faith;
97	97	(2) a motion to terminate an injunction is made or
98	98	resisted in bad faith; or
99	99	(3) wilful and malicious misappropriation exists.
100	100	Sec. 134A.006. PRESERVATION OF SECRECY. In an action under
101	101	this chapter, a court shall preserve the secrecy of an alleged trade
102	102	secret by reasonable means. There is a presumption in favor of
103	103	granting protective orders to preserve the secrecy of trade
104	104	secrets. Protective orders may include provisions limiting access
105	105	to confidential information to only the attorneys and their
106	106	experts, holding in camera hearings, sealing the records of the
107	107	action, and ordering any person involved in the litigation not to
108	108	disclose an alleged trade secret without prior court approval.
109	109	Sec. 134A.007. EFFECT ON OTHER LAW. (a) Except as
110	110	provided by Subsection (b), this chapter displaces conflicting
111	111	tort, restitutionary, and other law of this state providing civil
112	112	remedies for misappropriation of a trade secret.
113	113	(b) This chapter does not affect:
114	114	(1) contractual remedies, whether or not based upon
115	115	misappropriation of a trade secret;
116	116	(2) other civil remedies that are not based upon
117	117	misappropriation of a trade secret; or
118	118	(3) criminal remedies, whether or not based upon
119	119	misappropriation of a trade secret.
120	120	(c) To the extent that this chapter conflicts with the Texas
121	121	Rules of Civil Procedure, this chapter controls. Notwithstanding
122	122	Section 22.004, Government Code, the supreme court may not amend or
123	123	adopt rules in conflict with this chapter.
124	124	(d) This chapter does not affect the disclosure of public
125	125	information by a governmental body under Chapter 552, Government
126	126	Code.
127	127	Sec. 134A.008. UNIFORMITY OF APPLICATION AND CONSTRUCTION.
128	128	This chapter shall be applied and construed to effectuate its
129	129	general purpose to make uniform the law with respect to the subject
130	130	of this chapter among states enacting it.
131	131	SECTION 2. Subdivision (2), Section 134.002, Civil Practice
132	132	and Remedies Code, is amended to read as follows:
133	133	(2) "Theft" means unlawfully appropriating property
134	134	or unlawfully obtaining services as described by Section 31.03,
135	135	31.04, [31.05,] 31.06, 31.07, 31.11, 31.12, 31.13, or 31.14, Penal
136	136	Code.
137	137	SECTION 3. The change in law made by this Act applies to the
138	138	misappropriation of a trade secret made on or after the effective
139	139	date of this Act. A misappropriation of a trade secret made before
140	140	and a continuing misappropriation beginning before the effective
141	141	date of this Act are governed by the law in effect immediately
142	142	before the effective date of this Act, and that law is continued in
143	143	effect for that purpose.
144	144	SECTION 4. This Act takes effect September 1, 2013.