Texas 2017 - 85th Regular

Texas House Bill HB1995 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	By: Elkins (Senate Sponsor - Hughes) H.B. No. 1995
2		-	(In the Senate - Received from the House May 1, 2017;
3		-	May 2, 2017, read first time and referred to Committee on
4		-	Administration; May 2, 2017, reported favorably by the following
5		-	vote: Yeas 6, Nays 0; May 2, 2017, sent to printer.)
6		-	Click here to see the committee vote
	1	+	H.B. No. 1995
7	2
8	3
9		-	A BILL TO BE ENTITLED
10	4		AN ACT
11	5		relating to the Texas Uniform Trade Secrets Act.
12	6		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	7		SECTION 1. Section 134A.002, Civil Practice and Remedies
14	8		Code, is amended by adding Subdivisions (1-a), (3-a), and (7) and
15	9		amending Subdivisions (3), (4), and (6) to read as follows:
16	10		(1-a) "Clear and convincing" means the measure or
17	11		degree of proof that will produce in the mind of the trier of fact a
18	12		firm belief or conviction as to the truth of the allegations sought
19	13		to be established.
20	14		(3) "Misappropriation" means:
21	15		(A) acquisition of a trade secret of another by a
22	16		person who knows or has reason to know that the trade secret was
23	17		acquired by improper means; or
24	18		(B) disclosure or use of a trade secret of
25	19		another without express or implied consent by a person who:
26	20		(i) used improper means to acquire
27	21		knowledge of the trade secret;
28	22		(ii) at the time of disclosure or use, knew
29	23		or had reason to know that the person's knowledge of the trade
30	24		secret was:
31	25		(a) derived from or through a person
32	26		who used [had utilized] improper means to acquire the trade secret
33	27		[it];
34	28		(b) acquired under circumstances
35	29		giving rise to a duty to maintain the [its] secrecy of or limit the
36	30		[its] use of the trade secret; or
37	31		(c) derived from or through a person
38	32		who owed a duty to the person seeking relief to maintain the [its]
39	33		secrecy of or limit the [its] use of the trade secret; or
40	34		(iii) before a material change of the
41	35		position of the person [person's position], knew or had reason to
42	36		know that the trade secret [it] was a trade secret and that
43	37		knowledge of the trade secret [it] had been acquired by accident or
44	38		mistake.
45	39		(3-a) "Owner" means, with respect to a trade secret,
46	40		the person or entity in whom or in which rightful, legal, or
47	41		equitable title to, or the right to enforce rights in, the trade
48	42		secret is reposed.
49	43		(4) "Proper means" means discovery by independent
50	44		development, reverse engineering unless prohibited, or any other
51	45		means that is not improper means.
52	46		(6) "Trade secret" means all forms and types of
53	47		information, including business, scientific, technical, economic,
54	48		or engineering information, and any [a] formula, design, prototype,
55	49		pattern, plan, compilation, program device, program, code, device,
56	50		method, technique, process, procedure, financial data, or list of
57	51		actual or potential customers or suppliers, whether tangible or
58	52		intangible and whether or how stored, compiled, or memorialized
59	53		physically, electronically, graphically, photographically, or in
60	54		writing if [that]:
61	55		(A) the owner of the trade secret has taken
62	56		reasonable measures under the circumstances to keep the information
63	57		secret; and
64	58		(B) the information derives independent economic
65	59		value, actual or potential, from not being generally known to, and
66	60		not being readily ascertainable through [by] proper means by,
67	61		another person [other persons] who can obtain economic value from
68	62		the [its] disclosure or use of the information [; and
69	63		[(B) is the subject of efforts that are
70	64		reasonable under the circumstances to maintain its secrecy].
71	65		(7) "Willful and malicious misappropriation" means
72	66		intentional misappropriation resulting from the conscious
73	67		disregard of the rights of the owner of the trade secret.
74	68		SECTION 2. Section 134A.003, Civil Practice and Remedies
75	69		Code, is amended by amending Subsection (a) and adding Subsection
76	70		(a-1) to read as follows:
77	71		(a) Actual or threatened misappropriation may be enjoined
78	72		if the order does not prohibit a person from using general
79	73		knowledge, skill, and experience that person acquired during
80	74		employment.
81	75		(a-1) On application to the court, an injunction shall be
82	76		terminated when the trade secret has ceased to exist, but the
83	77		injunction may be continued for an additional reasonable period of
84	78		time in order to eliminate commercial advantage that otherwise
85	79		would be derived from the misappropriation.
86	80		SECTION 3. Section 134A.004(b), Civil Practice and Remedies
87	81		Code, is amended to read as follows:
88	82		(b) If willful [wilful] and malicious misappropriation is
89	83		proven by clear and convincing evidence, the fact finder may award
90	84		exemplary damages in an amount not exceeding twice any award made
91	85		under Subsection (a).
92	86		SECTION 4. Section 134A.005, Civil Practice and Remedies
93	87		Code, is amended to read as follows:
94	88		Sec. 134A.005. ATTORNEY'S FEES. The court may award
95	89		reasonable attorney's fees to the prevailing party if:
96	90		(1) a claim of misappropriation is made in bad faith;
97	91		(2) a motion to terminate an injunction is made or
98	92		resisted in bad faith; or
99	93		(3) willful [wilful] and malicious misappropriation
100	94		exists.
101	95		SECTION 5. Section 134A.006, Civil Practice and Remedies
102	96		Code, is amended to read as follows:
103	97		Sec. 134A.006. PRESERVATION OF SECRECY. (a) In an action
104	98		under this chapter, a court shall preserve the secrecy of an alleged
105	99		trade secret by reasonable means. There is a presumption in favor
106	100		of granting protective orders to preserve the secrecy of trade
107	101		secrets. Protective orders may include provisions limiting access
108	102		to confidential information to only the attorneys and their
109	103		experts, holding in camera hearings, sealing the records of the
110	104		action, and ordering any person involved in the litigation not to
111	105		disclose an alleged trade secret without prior court approval.
112	106		(b) In an action under this chapter, a presumption exists
113	107		that a party is allowed to participate and assist counsel in the
114	108		presentation of the party's case. At any stage of the action, the
115	109		court may exclude a party and the party's representative or limit a
116	110		party's access to the alleged trade secret of another party if other
117	111		countervailing interests overcome the presumption. In making this
118	112		determination, the court must conduct a balancing test that
119	113		considers:
120	114		(1) the value of an owner's alleged trade secret;
121	115		(2) the degree of competitive harm an owner would
122	116		suffer from the dissemination of the owner's alleged trade secret
123	117		to the other party;
124	118		(3) whether the owner is alleging that the other party
125	119		is already in possession of the alleged trade secret;
126	120		(4) whether a party's representative acts as a
127	121		competitive decision maker;
128	122		(5) the degree to which a party's defense would be
129	123		impaired by limiting that party's access to the alleged trade
130	124		secret;
131	125		(6) whether a party or a party's representative
132	126		possesses specialized expertise that would not be available to a
133	127		party's outside expert; and
134	128		(7) the stage of the action.
135	129		SECTION 6. Chapter 134A, Civil Practice and Remedies Code,
136	130		as amended by this Act, applies only to an action that commences on
137	131		or after the effective date of this Act. An action that commences
138	132		before the effective date of this Act is governed by the law
139	133		applicable to the action immediately before the effective date of
140	134		this Act, and that law is continued in effect for that purpose.
141	135		SECTION 7. This Act takes effect September 1, 2017.
142		-	* * * * *
	136	+	______________________________ ______________________________
	137	+	President of the Senate Speaker of the House
	138	+	I certify that H.B. No. 1995 was passed by the House on April
	139	+	27, 2017, by the following vote: Yeas 144, Nays 0, 3 present, not
	140	+	voting.
	141	+	______________________________
	142	+	Chief Clerk of the House
	143	+	I certify that H.B. No. 1995 was passed by the Senate on May
	144	+	8, 2017, by the following vote: Yeas 31, Nays 0.
	145	+	______________________________
	146	+	Secretary of the Senate
	147	+	APPROVED: _____________________
	148	+	Date
	149	+	_____________________
	150	+	Governor