March 28, 2014

Protecting Trade Secrets Stored in the Cloud

Benjamin J. Bradford, Justin A. Maleson, and Michael T. Werner – March 28, 2014

As cloud computing has become a ubiquitous part of our personal and professional lives, businesses are rethinking how they store and protect their trade secrets. Over the past 30 years, trade secrets have moved from locked file cabinets and desk drawers, to floppy disks and PCs, to Dropbox and Google Docs. While the many benefits of cloud services are driving the current explosion in popularity, there are a host of related issues that businesses should consider when storing sensitive and valuable information in the cloud. This article provides a brief introduction to cloud computing and trade-secret law, before identifying challenges and practical tips for maintaining and protecting trade-secret information in the cloud. This article also discusses ways to preserve trade-secret status in the event of unauthorized use or disclosure, and during the course of litigation.

What Is Cloud Computing?
Gartner, Inc., a leading information technology research and advisory firm, defines cloud computing as "a style of computing in which scalable and elastic IT-enabled capabilities are delivered as a service using Internet technologies." Gartner IT Glossary (last visited Jan. 24, 2014). Simply put, data on the "cloud" are accessible anywhere there is an Internet connection.

Cloud computing is now a way of life for many of us.  It provides a way for friends and families to share photographs and videos, for employees to collaborate on documents while working from different parts of the world, and for businesses to store their sensitive information in a way that allows for on-demand access to the information. As companies increasingly turn to the cloud, it is important to understand what steps they can take to protect their trade-secret and confidential information.

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