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Security Classification of Information: Table of Contents

Appendix A.


This appendix describes similarities between the field of knowledge designated as security classification of information and the field of knowledge designated as trade secret law. Those similarities can be used to provide support to some existing classification principles and to develop new classification principles. That trade secret/classification analogy is particularly appropriate with respect to principles for classifying scientific and technical information, which is of major interest in this document.

Our legal system's roots go back millennia, thereby giving that system a solid foundation. Trade secret law is a part of that legal system. Trade secret law has developed over hundreds of years and has been a distinct area of the legal system for over a century—principles of trade secret law are widely accepted. Because trade secret law evolved as part of the "common law,"* it has a firm basis in our culture. Our extensive body of trade secret law has been developed by a very open process; the workings of our legal system are essentially completely open to the public, and the judicial decisions on trade secrets have been extensively published and discussed. Thus, trade secret law rests on a solid foundation, is consistent with our culture, and is known, understood, and accepted by our citizens.

Although the right of a government to classify information has been accepted for thousands of years,1 extensive classification of information by the U.S. Government began only relatively recently at the start of World War II. During the ~50 years that the government has been extensively classifying information, there has been little development of classification principles. Also, details of the rationale for specific classification decisions usually have not been discussed openly--only by personnel with the requisite security clearance and a need to know the information. Therefore, the few classification principles that have been developed have not been subject to nearly as much thought and discussion as have trade secret law principles.

We (the security classification of information community) should take advantage of trade secret law and related knowledge to help establish an extensive system of classification principles.+ To the extent that existing classification principles are consistent with accepted principles from another, well established field of knowledge (trade secret law), increased confidence can be placed in those classification principles. To the extent that new classification principles can be derived from accepted principles from that other field of knowledge, those new classification principles should be relatively reliable. Additionally, the time and effort required to independently develop new classification principles can be significantly reduced if those new principles can be derived from analogous principles from that other field of knowledge.

The next section of this appendix describes the many similarities between trade secret law and classification of information. A following section discusses the important elements of a trade secret with particular emphasis on those that are related to matters of classification of information, especially to the classification of scientific or technical information. The final section of this appendix briefly mentions a part of trade secret law that may be helpful when determining the extent to which expertise that an individual acquires by working on a classified program can (or cannot) legitimately be applied by that individual to unclassified programs.

Although the similarities between classification of information and trade secret law are useful in helping to develop a system of classification principles, it should perhaps be emphasized that those analogies do not provide all the bases for such a system. Additional insights are needed, and much additional thought needs to be brought to bear on classification matters. Some of that material is provided in the main body of this document.


Businesses protect information that gives them an advantage over competitors just as governments protect information that gives them an advantage over adversaries. One of today's best-kept secrets is a trade secret, the recipe for Coca-Cola Classic®.* "State secrets" probably accompanied the formation of the first "state." "Trade secrets" (proprietary information) may have been important assets of the first business. State secrets and trade secrets occasionally were identical. For about 3000 years the Chinese royal family closely guarded, as a state secret, the source of and production methods for silk, an important export item in China's trade with other countries.2 It was not until the 6th century A.D. that a silk industry was established in western countries when two Persian monks clandestinely removed silkworm eggs and mulberry tree seeds from China.3 The Chinese were even said to have used a "cover story" to confuse those who tried to learn the secrets of silk manufacture. The cover story was that the process of making silk involved putting wool in the sun, sprinkling it with water, and then combing it to produce silk.4

There are many similarities between the classification and protection of national defense and foreign relations information by governments and the identification and protection of trade secrets by businesses.5, 6, 7 In both circumstances the information being protected is so important that its loss to an adversary (enemy/competitor) could have very bad effects on key interests (national security/profits) of the protector. Both trade secrets and classified information require continuing vigilance to protect against their unauthorized disclosure. Both may lose their status as secrets with the passage of time (e.g., because of technological advances, state-of-the-art technology may become commonplace). A rule in trade secret law—"that which has become public property cannot be recalled to privacy"8 -- has its classification counterpart in the rule that information declassified or officially disclosed cannot be reclassified.*

Some trade secrets such as chemical formulas or knowledge of certain manufacturing processes are comparable to classified scientific and technical information. Other trade secrets such as lists of customers are analogous to classified intelligence information (e.g., confidential sources). A proprietary code for determining discounts from a catalog price list is not unlike classified cryptographic codes.

Information about a new commercial product is kept secret by a business to give that business a head start+ and, therefore, a market advantage (greater profits) over its competitors. Information about the design and manufacture of a new weapons system is kept secret by a nation to give that nation a lead time and, therefore, a military advantage (greater security) over its adversaries.

Classified information is more likely to be protected if it is precisely defined. Trade secrets are more likely to be protected if they are "delineated with some particularity."9 The need to know has relevance in trade secret law; if a business does not limit knowledge of a trade secret only to those who need this knowledge to benefit the business, then a court may decide that this knowledge was not a trade secret.10 The need to know is also a well known principle in the protection of classified information.

Espionage, long practiced by governments, has its counterpart in business as industrial espionage,++, 11 which significantly affected technology transfer during the industrial revolution.12 A Society of Competitor Intelligence has even been established.13, 14 With the apparent end of the "cold war," the U.S. Central Intelligence Agency appears to be interested in putting its espionage expertise to use in industrial espionage for the benefit of the nation.15

The legal protection afforded both to trade secrets and state secrets have their roots in the common law. Some of our states now provide statutory protection for trade secrets in addition to or in place of the common-law protection afforded trade secrets. The government now uses statutes and Executive Orders as authority to classify and protect our national secrets.

The government specifies three levels of classification—Confidential, Secret, and Top Secret. It has been suggested that businesses with trade secrets should perhaps establish two or three grades (levels) of importance for those secrets.*, 16

Neither trade secrets nor classified information need to be the sole knowledge of one entity (e.g., business entities for trade secrets; national entities for state secrets) to warrant protection. Just as several countries independently have and protect the secrets for enriching uranium by gas centrifuge technology, so may a specific trade secret be known to more than one company in a field and still be protected by each company as a trade secret.17

Trade secret law protects the holder of a trade secret "against the disclosure or unauthorized use of the trade secret by those to whom the secret has been confided . . . or when the knowledge [of the trade secret] is gained, not by the owner's volition, but by some `improper means'."18 Trade secret law does not protect a trade secret holder against discovery of that trade secret by "fair and honest means, such as by independent invention, accidental disclosure, or by so-called reverse engineering."+, 19 In that respect, trade secret law is identical to classification policy, because the objective of classification is not to prevent an adversary from obtaining the information by independent efforts or by reverse engineering but rather to avoid assisting the adversary in acquiring that information.++

Because of the above-mentioned similarities between trade secrets and classified information, the rationale for some of the principles used in deciding whether certain information is a trade secret can also be used as a rationale for some of the principles for classifying information, thereby providing added support to those classification principles. The next section of this chapter very briefly summarizes the principles of trade secret law that appear to be applicable to security classification of information.


Definitions of a Trade Secret

A trade secret consists of secret knowledge used in a business, not previously available, and not known to a business's competitors. It is difficult to precisely define a trade secret (just as it is difficult to precisely define classified information). One widely accepted definition, from the Restatement of the Law of Torts, is as follows:

A trade secret may consist of any formula, pattern, device or compilation of information which is used in one's business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it. It may be a formula for a chemical compound, a process of manufacturing, treating or preserving materials, a pattern for a machine or other device, or a list of customers. It differs from other secret information in a business (see §759) in that it is not simply information as to single or ephemeral events in the conduct of the business, as, for example, the amount or other terms of a secret bid for a contract or the salary of certain employees, or the security investments made or contemplated, or the date fixed for the announcement of a new policy or for bringing out a new model or the like. A trade secret is a process or device for continuous use in the operation of the business. Generally it relates to the production of goods, as, for example, a machine or formula for the production of an article. It may, however, relate to the sale of goods or to other operations in the business, such as a code for determining discounts, rebates or other concessions in a price list or catalogue, or a list of specialized customers, or a method of bookkeeping or other office management.20

Another definition of trade secrets is contained in the Uniform Trade Secrets Act:

In the definition of trade secret contained in the Uniform Trade Secrets Act, the words "method, technique" are intended to include know-how.*, 22 It is evident that many types of information can be trade secrets, just as many types of information can be classified.

The Uniform Trade Secrets Act allows information to be protected as a trade secret even though that information has not yet been put to use22 (i.e., it protects research and development information that may lead to commercial products in addition to protecting information on existing commercial products). However, the Restatement of the Law of Torts definition requires that a trade secret be used in a business before the business can receive protection under trade secret law. The broader definition in the Uniform Trade Secrets Act recognizes the value of research and development information or other information that gives a business a head start over its competitors23 and is, therefore, closer to the definition of classified information than is the Restatement of the Law of Torts definition.

A trade secret represents objective knowledge, such as a manufacturing process and not subjective knowledge, such as the date for the announcement of a new product.* In that regard, trade secrets differ from classified information because subjective national defense or foreign relations information is frequently classified (e.g., a time or location for a military invasion of another nation).+ Trade secret information particularly resembles classified scientific or technical information, which is always objective information.

Not all commercial secrets are trade secrets. Many business matters are confidential (e.g., for a business's internal use only) but "only secrets affording a demonstrable competitive advantage may be properly considered as trade secrets."24 Perhaps most of the confidential business matters that are not trade secrets represent subjective information that, as mentioned above, is not generally given trade secret protection.

Determining whether information meets the requirements of a trade secret is to some extent a subjective process.++ The elements of a trade secret described below are widely accepted as factors to be used when making such a determination. However, the weight assigned to each factor will vary depending on the facts of a particular situation (e.g., the nature of the information and the conduct of the parties involved).25

Specific Elements of a Trade Secret

The characteristics of information that is protectable as a trade secret are similar to the characteristics of information that is protectable as classified information. Because of those similarities, it is especially pertinent to examine that part of trade secret law which characterizes trade secrets.

Six elements or factors have been proposed for use in determining whether information is a trade secret:** "(1) the extent to which the information is known outside of his business; (2) the extent to which it is known by employees and others involved in his business; (3) the extent of measures taken by him to guard the secrecy of the information; (4) the value of the information to him and to his competitors; (5) the amount of effort or money expended by him in developing the information; (6) the ease or difficulty with which the information could be properly acquired or duplicated by others."*, 26 These specific elements of a trade secret are discussed in the following subsections.

It should be noted, with respect to similarities between trade secret law and classification principles, that the second and third elements of a trade secret (given above) are mostly security-of-information matters, not classification-of-information concerns. Those two elements indicate whether the possessor of an alleged trade secret truly acted as if that information was valuable to the business. They are not elements to be considered when objectively evaluating whether the information is a trade secret.

General Availability of Information. For information to be a trade secret, that information must in fact be secret.+

The Restatement of the Law of Torts is unequivocal on this point:

Absolute secrecy, in the sense that only the trade secret owner's employees or business associates know the trade secret, is not required. Some trade secrets may be known, via independent discovery, by several businesses in a trade. Each discoverer may have a trade secret in his information.28 However, as more entities obtain the information through legitimate means, "the protectable interest erodes—at some point there will be a sufficient number of independent users to render the matter no longer secret."29

Easily obtainable information, or information generally known, is not a trade secret.30 "Information is readily ascertainable if it is available in trade journals, reference books, or published materials"22 or is otherwise in the public domain. This includes information that is a matter of general knowledge within a trade or business.++

Outside views of a facility are not trade secrets.31 "That which is readily visible and ascertainable cannot constitute a trade secret."32

Some customer lists are considered trade secrets; others are not. Generally, if the customer list could be developed from public sources without extraordinary efforts, it is not a trade secret.33 For example, a customer list that is obtainable from the yellow pages of a telephone directory is not a trade secret.34 Customer routes that can be obtained by observation are not trade secrets.35 Customer lists that have been developed over a number of years and that cannot easily be obtained from public sources will be afforded trade secret protection.

Common "shop practices" are widely known, are not novel, and thus do not qualify as trade secrets. A combination of common shop practices generally will not be considered to be a trade secret unless the combination is unique.* A machine was considered to be a trade secret, even though all its components were known in the industry, because the combination was unique.36 High-technology products are said to "often consist largely of novel applications of `know-how' common to the industry" and "the trade secret status of such products depends not on the component parts but on the arrangements of such parts into new designs."37 By requiring at least some uniqueness, originality, or novelty, courts ensure that information in the public domain is not withdrawn from that common knowledge and designated a trade secret.38

The Extent to Which the Information is Known by Employees and Business Associates. To be of value, information must be used. Trade secret information usually has to be disclosed to some employees or agents of a business so that they may use this information to further the purposes of the business. This principle was stated in one of the first trade secret cases in this country:

Under the doctrine of "relative secrecy," trade secret owners do not abandon their claim of secrecy by limited disclosure of the secret for a restricted purpose (i.e., to further their business).40 However, a "substantial element of secrecy must exist."41

Trade secrets should be disclosed to employees or business associates only on a need-to-know basis. Trade secrets should be given only to those employees who need the information to do their jobs. Trade secrets should be given to nonemployees only if they need that information to further the trade secret owner's interests.40 Trade secret information can be given, in confidence and for valid business reasons, to joint venturers, materials suppliers, and others without losing its status as a trade secret.42 However, if trade secret information is not closely controlled—is given to employees or business associates even though the recipients do not need that information to further the trade secret owner's interests—then courts may determine that the information no longer deserves protection as a trade secret because the information was not rigorously protected by its owner. As mentioned earlier, this need-to-know element is mainly a protection-of-information consideration (a security matter) and not important to classification-of-information principles.

The Extent of Measures to Protect the Information. When determining whether information deserves protection as a trade secret, courts consider the extent to which the information's owner took measures to protect the information. To prove the existence of a trade secret, one must show that the possessor of the alleged trade secret considered it to be a secret and protected it accordingly. "Security costs money, and presumably an employer would not incur such costs if it believed that the competitors already knew the information."43 Conversely, if the owner did not take special measures to protect the information, then one could infer that the owner did not consider the information to be valuable and, therefore, the law should not consider it a secret.44 The "secrecy must be real and not merely formalistic."45

Although this element of a trade secret is not exactly relevant to classification principles (protection of classified information is the responsibility of the security organization, not the classification organization), the similarities between classification and trade secrets make it of interest to describe security measures considered reasonable in protecting trade secrets. Heroic protective measures are not required—only reasonable security precautions.46 Security measures used by industry to protect trade secrets include the following:

In Eastman Co. v. Reichenbach, the court noted with approval that a secret formula "was kept under lock and key, and, lest it should be discovered by other manufacturers, the different ingredients composing it were purchased in the name of a third party."*, 47 In another case involving secret machinery, the court noted that when new machinery was built, different components were obtained from different suppliers so that no "outside" person would see a completed machine in operation.+, 48

The "extent of measures to protect the information" element of trade secret law has an analogy in prosecutions under the U.S. espionage statutes. In United States v. Heine,49 the defendant Heine was convicted in a U.S. District Court of violating an espionage statute++ that forbade the communication of information relating to the national defense to a foreign nation. Heine had gathered information on the U.S. aviation industry and sent it to a foreign country (the United States was not at war with this country). The information that he gathered was "lawfully accessible to anyone who was willing to take the pains to find, sift, and collate it."50 A Circuit Court overturned the conviction, stating that Heine could not be guilty of violating the espionage statute for such activities because the government had not objected to the dissemination of the information (that Heine had gathered) within the United States.** Thus, the court held that if the government did not protect the information within the United States, then it cannot be espionage to send that information outside the United States. The Executive Branch must try to protect information that it considers to be secret before the Judicial Branch will apply the sanctions of espionage statutes to such information.+++

The Value of the Information to the Business and to its Competitors. Trade secret information must have economic value (competitive advantage), actual or potential, in not being known to others.***, 51 The requirement that a trade secret provide a competitive advantage has been characterized as "minimal," and "deemed to exist almost by virtue of a corporation taking steps to meet the secrecy element requirement for information to be a trade secret."52 "In essence . . . it [the trade secret] must reasonably be believed to provide the trade secret owner with some not too speculative value and benefit."53

Negative information, such as results that show a process will not work, has economic value and frequently may be a trade secret.22, 54 However, some courts have held that knowledge about a mistake to be avoided is not a trade secret.55

Information is not protected as a trade secret if it is only a "trivial advance" or its value is "not significant"; an "unusual competitive advantage" is usually required.56, 57 However, slight advantages in technical know-how have sometimes been considered trade secrets because they help control production costs and thereby provide a competitive edge.58

The value of information to a competitor is also an important consideration in determining whether that information is a trade secret. If the information saves a competitor time and money, then that competitor has materially benefitted from the information.60 With respect to business matters such as secret bid information, a suggested threshold test is whether a competitor could use the information to change the competitive balance in favor of the competitor.61

Amount of Effort or Money Expended to Develop the Information. One of the purposes of trade secret law is to protect "the substantial investment of employers in their proprietary information [trade secrets]"62 so as to encourage invention and promote research and development.63 Trade secret determinations are based in part on "the investment of time, money, or effort expended to research and develop or otherwise acquire the information."*, 64 In cases where the existence of a trade secret was upheld because of the time, money, or effort required to develop that trade secret, the amounts of time, money, or effort have varied widely.+, 65 Thus, there are no established minimum values for these parameters that can be used as guidance in determining whether information qualifies as a trade secret—the outcome of each case depends upon the facts and equities in that case.

The amount of effort expended to develop information is never the sole factor in determining whether that information is a trade secret.66 Other trade secret elements, especially the secrecy element, must be present. Because trade secrets can arise from inexpensive development efforts or fortuitous discoveries,67, 68 it would be inconsistent if the effort required to develop information was the determinative element of a trade secret.69

The Ease or Difficulty with Which the Information Could be Properly Acquired by Others. The first element of a trade secret given above was that the information is not generally known or available. Thus, information easily obtainable is not a trade secret. However, information that is publicly available but not easily ascertainable can be a trade secret. Therefore, the ease with which others may obtain the same information is a factor in determining whether that information is a trade secret.

A trade secret may be embodied in a product available to the public. Sometimes this trade secret may be discovered by reverse engineering a product purchased on the open market. If so, the information discovered is no longer a trade secret. However, it is not a defense to a charge of trade secret theft that the information could have been obtained by legitimate means (e.g., reverse engineering) but in fact was not obtained in that manner.70 "A valuable ingredient [in a hair care formula] that was not discovered by others for twenty years could not be `readily ascertainable.'"71 "Any finding of easy discoverability must be reconciled with the fact of non-discovery."71 The time required for reverse engineering is a factor in determining whether the information was readily obtainable.72 "If reverse engineering is lengthy and expensive, a person who discovers a trade secret through reverse engineering can have a trade secret in the information obtained from reverse engineering."*, 2

The policy of the law of trade secrets is that a competitor should not be given an advantage by obtaining a trade secret without incurring the usual costs of invention or duplication+ or without payment to the owner of the trade secret. In DuPont de Nemours v. Rolfe Christopher (1973), the court said: "To obtain knowledge of a process without spending the time and money to discover it independently is improper unless the holder voluntarily discloses it or fails to take reasonable precautions to ensure its secrecy."73 Another court said that a person should not be able to get a trade secret by unfair means and use it to advantage "Without himself paying the price in labor, money or machines expended by the discoverer."74


Trade secret litigation frequently occurs when a skilled employee quits a job to work for a competitor or to start a new business. The former employer is very suspicious that the employee was hired by his new employer because of the employee's knowledge of the former employer's trade secrets or that the employee will use those trade secrets in the employee's new business. Courts are then asked to determine whether a scientific or technical employee who knows his employer's trade secrets and who is a very competent scientist or engineer may (or may not) use certain specific information after leaving that employer. The employee's know-how (scientific and technical skills) includes publicly known information as well as the former employer's trade secrets.

Similar problems sometimes arise in classified research, development, or production activities.* The questions with respect to classified activities include: (1) What aspects of the technology may be applied to other unclassified programs? and (2) What restrictions may be placed on a scientific or technical person who leaves a classified program to work on an unclassified program (either within the same company or for a new employer)?+, ++ In the latter case, the employee's knowledge includes unclassified information as well as classified information. The answers to those questions may be found in the guidance supplied by court decisions concerning former employees and trade secrets.

When working for a new employer or in his or her own business, an employee can make use of his or her general skills, knowledge, memory,** and experience, some of which may have been acquired while working for the former employer, so long as those skills do not include trade secret knowledge—that "special confidential knowledge obtained from the employer which belongs to the employer."75 An employee "is entitled to take with him to his new employment his native skills as enhanced by his employment experiences."76 However, specialized knowledge (know-how) obtained on the job is more than experience and may be protectable trade secrets of the former employer.77 An employee's ability and experience do not belong to an employer; only "The compiled products of that ability and experience that had been recorded for repetitive use" are entitled to trade secret protection (emphasis added).78 The decision as to what knowledge an employee may use in a new job involves a balancing process between the employee's individual freedoms and the employer's right to protection of his business assets (trade secrets).79, 80

Reasoning similar to that contained in the previous paragraph can be used to evaluate classification aspects of situations that arise when a scientific or technical employee working on a classified program applies professional expertise to an unclassified program.


1. A. S. Quist, "Introduction to Classification," Chap. 1 in Security Classification of Information, Volume 1. Introduction, History, and Adverse Impacts, K/CG-1077/V1, Martin Marietta Energy Systems, Inc., Oak Ridge, Tennessee, 1989.

2. The New Encyclopedia Britannica, Macropaedia, Encyclopedia Britannica, Inc., Chicago, 15th ed., 1982, 7, p. 287; 9, p. 183. The Encyclopedia Americana, International ed., Grolier, Inc., Danbury, Conn., 24, 1985, pp. 816–819. The World Book Encyclopedia, World Book–Childcraft International, Inc., Chicago, 17, 1979, pp. 379–382. Compton's Encyclopedia and Fact-Index, The University of Chicago, 21, 1987, pp. 197–202.

3. The New Encyclopedia Britannica, Macropaedia, Encyclopedia Britannica, Inc., Chicago, 15th ed., 7, 1982, p. 287.

4. R. J. Healy, "Panel: Protection of Company Proprietary Information," J. Natl. Class. Mgmt. Soc., 10, 84–88 (1974), p. 85.

5. T. S. Church, "Panel—Science and Technology, and Classification Management," J. Natl. Class. Mgmt. Soc., 2, 39–43 (1966), p. 40.

6. R. L. Taylor, "A Study of the Effects of Security Classification Restrictions on Technical Communication," J. Natl. Class. Mgmt. Soc., 9, 47–53 (1973), p. 48.

7. W. P. Ranney, "The Sea Lanes & Their Challenges," J. Natl. Class. Mgmt. Soc., 13, 17–22 (1977), p. 21.

8. Smith v. Dravo Corp., 203 F.2d 369, 373 (7th Cir., 1953).

9. Jostens, Inc. v. National Computer Systems, 318 N.W.2d 691, 699 (Minn. 1982).

10. R. M. Milgrim, Milgrim on Trade Secrets, Matthew Bender & Co., Inc., New York, 1987, §2.04, pp. 2-62 through 2-64. Hereafter cited as "Milgrim."

11. See also S. Ghoshal and S. K. Kim, "Building Effective Intelligence Systems for Competitive Advantage," Sloan Management Review, 28(1), 49–58 (Fall 1986); E. Mount and W. B. Newman, Top Secret/Trade Secret, Neal-Schumam Publishers, Inc., New York, 1985.

12. J. Harris, "Spies Who Sparked the Industrial Revolution," New Scientist, 110(1509), 42–47 (May 22, 1986).

13. E. M. Fowler, "Careers: Intelligence Experts for Corporations," New York Times, 138(47,641), p. D23 (Sept. 27, 1988).

14. D. A. Maxwell, "Keeping the Secret in Trade Secrets," Security Management, 33(1), 38–42 (January 1989), p. 39.

15. A. Borrus et al., "Should the CIA Start Spying for Corporate America?" Business Week, 3235, 96–100 (Oct. 14, 1991); M. Crawford, "CIA Stakes Out Larger Role in Technology and Trade Policy," Defense Week, 13(17), 17 (Apr. 27, 1992).

16. S. H. Lieberstein, Who Owns What is in Your Head, Hawthorn Books, Inc., New York, 1979, pp. 91–92.

17. Electro-Craft Corporation v. Controlled Motion, Inc., 332 N.W.2d, 890,900 (Minn. 1983).

18. Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 475–476 (1974).

19. Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 476 (1974).

20. Restatement of the Law of Torts, 4, American Law Institute, St. Paul, Minn., §757, Comment (b) (1939). Hereafter cited as "4 Restatement of the Law of Torts."

21. "Uniform Trade Secrets Act," in Uniform Laws Annotated, 14, 541–551 (1980), §1(4), p. 542, West Publishing Co., St. Paul, Minn. Hereafter cited as "Uniform Trade Secrets Act."

22. Uniform Trade Secrets Act, comment to §1, p. 543.

23. Milgrim, §2.02[1], p. 2-28.

24. Milgrim, §2.03, p. 2-40.

25. A. V. Gross, What is "Trade Secret" So As to Render Actionable Under State Law Its Use or Disclosure by Former Employee, 59 ALR 4th, 641, 652 (1988). Hereafter cited as "Gross."

26. 4 Restatement of the Law of Torts, p. 6.

27. 4 Restatement of the Law of Torts, pp. 5-6.

28. J. S. Rakoff and M. A. Glassberg, "Trade Secrets and the Criminal Law," Chap. 5 in Protecting Trade Secrets 1986, M. F. Jager, Chmn., Practising Law Institute, New York, 1986, pp. 167–168, citing E. I. duPont Nemours & Co. v. United States, 288 F.2d 904, 911 (Ct. Cl. 1961). Hereafter cited as "Rakoff and Glassberg."

29. Rakoff and Glassberg, p. 168, citing Milgrim, §2.07[2], p. 2-179.

30. Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 475, 481 (1974).

31. M. F. Jager, Trade Secrets Law, Clark Boardman Co., Ltd., New York, 1988, p. 5-37. Hereafter cited as "Jager." See also Interox America v. PPG Industries, Inc., 736 F.2d 194 (5th Cir. 1984).

32. Interox America v. PPG Industries, Inc., 736 F.2d 194, 201 (5th. Cir. 1984).

33. G. Sobel, "Preserving Trade Secret Protection," Chap. 12 in Protecting Trade Secrets 1986, M. F. Jager, Chmn., Practising Law Institute, New York, 1986, p. 573.

34. M. A. Epstein, Modern Intellectual Property, Law & Business, Inc./Harcourt Brace Jovanovich, Publishers, Clifton, N.J., 1984, p. 13 and citations therein. Hereafter cited as "Epstein."

35. Jager, p. 5-22.5.

36. Jager, pp. 5-52.1 through 5-54, citing By-Buk Co. v. Printed Cellophane Tape Co., 329 P.2d 147, 152 (1958) and other cases.

37. M. K. Readio, "Balancing Employers' Trade Secret Interests in High-Technology Products Against Employees' Rights and Public Interest in Minnesota," Minn. L. Rev., 68, 984–1006 (1985), p. 995.

38. Jager, p. 5-57.

39. Peabody v. Norfolk, 98 Mass. 452, 461 (1868).

40. Jager, p. 5-32 and citations therein.

41. 4 Restatement of the Law of Torts, p. 6.

42. Jager, pp. 5-32, 5-33, 6-3.

43. Jager, p. 5-48.

44. M. J. Hutter, "Legal Theories and Recent Developments," Chap. 1 in Protecting Trade Secrets 1986, M. F. Jager, Chmn., Practising Law Institute, New York, 1986, p. 18. Hereafter cited as "Hutter."

45. Hutter, p. 19.

46. Jager, p. 5-41.

47. Eastman Co. v. Reichenbach, 20 NYS 110, 113 (1892).

48. O. & W. Thum Co. v. Tloczynski, 114 Mich. 149, 152 (1897).

49. United States v. Heine, 151 F.2d 813 (2nd Cir., 1945).

50. United States v. Heine, 151 F.2d 813, 815 (2nd Cir., 1945).

51. Uniform Trade Secrets Act, §1(4)(i).

52. Epstein, p. 3.

53. Epstein, p. 3, citing Syntex Ophthamics, Inc. v. Tsuetaki, 701 F.2d 677, 683 (7th Cir., 1983).

54. Milgrim, §2.02[1], pp. 2-28 through 2-33.

55. Jager, p. 5-60.

56. Jager, p. 5-61.

57. S. J. Davidson and R. L. DeMay, "Application of Trade Secret Law to New Technology—Unwinding the Tangled Web," Wm. Mitchell L. Rev., 12, 579–621 (1986), p. 607. Hereafter cited as "Davidson and DeMay."

58. Jager, p. 5-63, citing Sheridan v. Mallinckrodt, Inc., 568 F. Supp. 1347, 1352, n. 7 (N.D.N.Y. 1983).

59. Milgrim, §2.07[3], p. 2-181.

60. Milgrim, §2.02[1], p. 2-27.

61. Davidson and DeMay, p. 608.

62. Valco v. N & D Machining, 24 Ohio St. 3d, 41 (1986); 492 NE2d 814; 59 ALR 4th 629, 638 (1988).

63. Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 481–482 (1974).

64. Gross, p. 652.

65. Gross, pp. 872–887.

66. Milgrim, §2.02[2], p. 2-33.

67. Milgrim, §2.02[2], pp. 2-33 through 2-36.

68. Hutter, p. 20 and citations therein.

69. Milgrim, §2.02[2], p. 2-36.

70. Milgrim, §2.02[2], p. 2-36.

71. Jager, p. 5-22.7, citing Zotos International, Inc. v. Young, 830 F.2d 350, 353 (D.C. Cir. 1987).

72. Electro-Craft Corp. v. Controlled Motion, Inc., 332 N.W.2d, 890, 899 (Minn., 1983).

73. DuPont de Nemours v. Rolfe Christopher, 431 F.2d 1012, 1015–1016 (5th Cir. 1970).

74. Jager, pp. 5-62 and 5-63, citing A. O. Smith Corporation v. Petroleum Iron Works Co., 73 F.2d 531, 538 (6th Cir., 1934).

75. Jager, p. 8-10. See also P. Guthrie, "Employee's Duty, In Absence of Express Contract, Not to Disclose or Use in New Employment Special Skills or Techniques Acquired in Earlier Employment," 30 ALR 3d, 631–669 (1970).

76. W. D. Hawkland, "Some Recent American Developments in the Protection of Know-How," Buffalo L. Rev., 20, 119–145 (1970), p. 137.

77. Jager, p. 5-55.

78. Hutter, p. 15, citing S. I. Handling Systems, Inc., v. Heisley, 753 F.2d 1244 (3rd Cir., 1985).

79. Engineered Mechanical Services, Inc. v. Langlois, La. App. 1 Cir. 1984, 464 So.2d 329, writ denied 467 So.2d 531.

80. T. Robison, "The Confidence Game: An Approach to the Law About Trade Secrets," Ariz. L. Rev., 25, 347–393 (1983).

On to Appendix B.

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