Trade Secrets – Top 10 Questions
Print this article
Font Size
Questions 4 - 6
View ArticleView Article Comments

Question 4 – How Do You Create a Trade Secret?

You create a trade secret the moment you meet its definition. In other words, you create a trade secret the moment you take (i) information (ii) that remains secret to others (iii) and you take reasonable means to protect its secrecy and (iv) the trade secret has some type of actual or potential economic value (e.g. it has monetary value). That’s it. You don’t have to technically do anything else.

Question 5 – What Cannot Be a Trade Secret?

In short, anything that does not meet its definition. For example, just having information that you keep secret from others does not necessarily mean you’ve created a trade secret. The trade secret would have to hold some type of value – which generally means economic or monetary value – for your business and/or endeavor. Further, inherent to the definition of a trade secret, the information would have to remain secret even when you’re selling or using your product or service. In other words, information would not be considered a trade secret if you had to reveal it to the public.

Question 6 – Can You Give Some Real-Life Examples of Trade Secrets?

Sure. As mentioned previously, Coca-Cola’s recipe for its Coca-Cola carbonated beverage is one of the most famous trade secrets in the world. It’s a trade secret because only a select few within the Coca-Cola Corporation know the exact recipe for the soft drink. While nearly everyone has tried Cola-Cola, and many have attempted to reproduce it, no one knows for sure the exact ingredients of the beverage.

Google’s algorithm for its search engine is also a very valuable trade secret. Everyone knows that Google uses an algorithm that ranks websites based on many factors including inbound links, page rank, relevant text, anchor tags, etc. However, no one except perhaps Larry Page and Sergey Brin, the founders of Google, know the exact algorithm for the Google search engine – which has made Page and Brin billionaires.

Other real-life examples of trade secrets could include such things as the processes that Intel uses to make its integrated circuits for computers. Intel likely has patents on many of these processes, but certain aspects of the processes may very likely not be patented and are simply left "secret" to others. These secret processes would be trade secrets – and very valuable.

Of course, there are many other types of trade secrets. However, the problem is that we have no way to learn about many of them because of their inherent nature – they are secrets.

Next, we’ll go over trade secret questions 7 – 9.

Related Legal Words