Since 2009 BBA has hosted this symposium bringing together drafters,
sponsors, supporters and critics of state bills to reform the use of employee
non-compete agreements (ENCAs) and, separately, alternatively or
complementarily, to enact the Uniform Trade Secrets Act (UTSA) adopted by 48
other States.
Last session, the
Massachusetts Senate overwhelmingly approved a BBA-tweaked UTSA, as part of a
bill that also included what was intended as a compromise mechanism to
discourage overreaching ENCAs. That measure failed to get through the
House. However, on March 2, 2016, House Speaker Robert DeLeo announced
that he would support certain limitations of ENCA enforcement, which are
expected to be negotiated in these final months of the current session. On May
19, the Joint Committee on Labor and Workforce Development reported out a
redraft, H.
4323
.
Meanwhile, Congress
voted in April nearly unanimously (Senate 87-0, House 410-2, signed May 11) to
enact the Defend
Trade Secrets Act of 2016
(“DTSA”),
creating a federal private right of action for UTSA “misappropriation” of
Economic Espionage Act “trade secrets” that are “related to a product or service
used in, or intended for use, in interstate or foreign commerce.”
DTSA
embraces “employee mobility” (a la California) as a federal policy, and
injunctions under it expressly may not:
- prevent a person from entering into an employment
relationship, and that conditions placed on such employment shall be based on
evidence of threatened misappropriation and not merely on the information the
person knows; or
- otherwise conflict with an applicable State law prohibiting restraints on
the practice of a lawful profession, trade, or business.
We will explore the possible preemptive effects of DTSA on Massachusetts law
and possible responses, including whether suits against misappropriation of
trade secrets not currently used or merely threatened (e.g., “inevitable
disclosure”), rejected by some Massachusetts courts under the 1939 Restatement
of Torts formulation, should be enabled by enactment of the
UTSA.
Pricing:
BBA Members: FREE
Non-Members:
$50