Trade-Secret Best Practices Should Include Plan of Action for Suspected Theft

Even a company that follows best practices to protect trade secrets is vulnerable to trade-secret thefts. Zoho, a Software-as-a-Service company, followed all the best practices to reduce the accessibility of sensitive information. In 2010, some employees left the company to start their own business, Freshworks. A decade later Zoho filed suit for trade-secret misappropriation. Freshworks claims Zoho knew about the alleged theft long enough that the three-year statute of limitations has run out on their claim. While Zoho might have had a legitimate theft claim, their lack of timely action may work against them. It’s a reminder to all companies that trade-secret protection isn’t the end-all-be-all. A company must be willing to file suit when theft is discovered.