What is Theft of Trade Secrets?

What is Theft of Trade Secrets?

A trade secret can be generally understood as a secret technique or device used by a company in the manufacturing of its products.

Specifically, the Uniform Trade Secrets Act defines a “trade secret” as: “information, including a formula, pattern, compilation, program, device, method, technique, or process, that:

  1. derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and
  2. is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.”

Theft of a trade secret is a crime under federal and Arizona law.

Theft of Trade Secrets in Arizona

Under Arizona law a person commits theft of trade secrets if he or she “[T]akes, transmits, exhibits, conveys, alters, destroys, conceals or uses a trade secret” or makes a copy of trade secrets without the permission of the owner. A.R.S. § 13-1820(A)(1)-(2). A person can also be charged with theft of trade secrets by purchasing or possessing a trade secret that he or she knows has been illegally obtained. A.R.S. § 13-1820(A)(3).

It is not a defense to prosecution for theft of trade secrets that the person charged returned or intended to return the trade secret that was stolen, copied, or obtained from another. A.R.S. § 13-1820(B).

Theft of trade secrets in Arizona is charged as a class 5 felony, which can carry a sentence of up to two years and up to two-and-a-half years if there are aggravating factors.

Theft of Trade Secrets Under Federal Law

Under federal law, theft of a trade secrets involves “the intent to convert a trade secret, that is related to a product or service used in or intended for use in interstate or foreign commerce, to the economic benefit of anyone other than the owner,” while intending or knowing that the offense will injure the owner, and knowingly:

  • Steals, conceals, or by fraud, obtains the trade secret; or
  • Without authorization copies, downloads, replicates, or conveys the trade secret information; or
  • Receives, buys, or possesses the trade secret, knowing it was stolen or obtained without authorization; or
  • Attempts to commit any of the foregoing offenses or conspires with other people to commit any of these offenses.

18 U.S.C. § 1832(a).

A person convicted under this statute may be fined or imprisoned for not more than 10 years, or both. An organization convicted of theft of trade secrets under federal law “shall be fined” not more than the greater of $5 million or 3 times the value of the stolen trade secrets to the organization, “including expenses for research and design and other costs of reproducing the trade secret that the organization has thereby avoided.” 18 U.S.C. § 1832(b).

Defending Against Charges for Theft of Trade Secrets

When you hire us to defend you we will strive to get the charges against you dropped or reduced to lesser charges, and work to get mitigation of any sentencing. Our firm is dedicated to the criminal defense of individuals and organization accused of fraud, theft of trade secrets, and other white collar crimes.

The white collar criminal attorneys of Ashley D. Adams, PLC are prepared to defend your rights and combat aggressive prosecutors.

Contact us or call now (480) 219-1366 for a consultation.

The attorneys at Ashley D. Adams, PLC handle state criminal cases throughout Arizona and federal criminal cases throughout the United States, including Arizona, Oklahoma, Utah, and California.