Defense of

from claims due to

Protection of secrets.

Challenges with claims for
trade secret infringements

Unternehmen, die sich mit Abmahnungen wegen Verletzungen von Geschäftsgeheimnissen oder fremden Know-Hows konfrontiert sehen, stehen vor erheblichen Herausforderungen. Dabei sind nicht nur rechtliche Herausforderungen im Bereich des Know-How-Schutz zu meistern, sondern auch die wirtschaftlichen Auswirkungen, die mit diesen Ansprüchen einhergehen, zu beachten. Dabei sind geltend gemachte Ansprüche wegen Geschäftsgeheimnisverletzungen nicht immer so eindeutig, wie der Wortlaut entsprechender Abmahnung zunächst vermuten lässt.

In trade secret infringement cases, the question always arises as to whether the information concerned actually infringes the rights of the rights holder. Whether the information concerned or its use is actually so confidential and worthy of protection that an infringement has occurred is usually by no means clear-cut, but can often be argued one way or the other. There is therefore often a realistic chance of successfully defending against such claims.

Claims for infringement of
trade secrets

If you receive a cease and desist letter for infringement of a trade secret or are already in a legal dispute in court, the following claims are usually asserted:

• Injunctive relief:
  Injunctive relief serves to effectively prevent further acts of infringement. The infringer must refrain from unauthorized use of the trade secret in the future. This claim is fulfilled out of court by submitting a cease-and-desist declaration with a penalty clause.
• Removal claim:
  The removal claim serves to eliminate existing infringements of trade secrets or their consequences. The infringer must ensure that the infringement of the secret is eliminated, e.g. by returning or destroying information obtained without authorization or by removing corresponding confidential data from the affected systems.
• Claim for damages:
  The owner of the trade secret can use the claim for damages to assert the damage caused by the infringement. The damages can be calculated in various ways, e.g. the loss of profit, a reasonable license fee or the infringer’s profit. The amount of damages varies depending on the severity of the infringement.
• Claims for information and accounting:
  The claim for information and accounting serves to determine and quantify the damage incurred. This is particularly relevant in connection with products if, among other things, their design, features or functionality are based to a significant extent on the disclosed trade secret. With regard to infringing products, the infringer must provide detailed information on the names and addresses of manufacturers, suppliers and customers for whom the products were intended. The right to information also includes the exact quantities of the infringing products manufactured, ordered, delivered or received. Furthermore, information must be provided about the documents, objects, materials, substances or electronic files containing the trade secret and the person from whom the trade secret was obtained or to whom it was disclosed.
• Destruction and recall claims:
  The infringer must ensure that no further infringements of the trade secret occur. This includes in particular the return, destruction or removal of the unlawfully obtained information and the termination of its use, insofar as this is necessary to remedy the infringement. In addition, infringing products must be recalled, permanently removed from the distribution channels, destroyed and withdrawn from the market.
• Reimbursement of costs for cease and desist letters:
  The claim for reimbursement of costs serves to relieve the trade secret holder who takes action against an infringer of his or her laws. In the event of a justified cease and desist letter, the trade secret holder can demand reimbursement of the associated costs (e.g. legal fees, investigation or testing costs) from the infringer.

Effects of these claims for the defendant

Trade secret infringement claims have significant implications that not every company is immediately aware of when confronted with such claims in a cease and desist letter or lawsuit. The consequences can be considerable.

• Conversion costs:
  The claims can be associated with high costs. Affected products, documents, data, software or other materials that use the infringed trade secret must be removed or replaced with ones that do not infringe secrets, which is not always possible. This often also means that investments in the areas affected by the information are wasted and the company has to start its business processes all over again.
• Business interruptions:
  The removal and destruction of information protected as a trade secret can lead to an interruption of work processes, especially if central information that is essential for production or service is affected. The recovery or redevelopment of alternative solutions can also cost time and resources. This can severely restrict the ability to continue doing business.
• Reputational damage:
  Infringements of the company’s trade secrets that become known can cause lasting damage to its reputation. The same applies if the purchasers of infringing products are confronted with claims for trade secret infringements. Customers, investors and partners may lose confidence, which can lead to a decline in demand for products or services. The need to restore image and regain trust can require considerable resources.
• Information and accounting:
  The information that may have to be provided to the holder of trade secrets is very extensive and includes the disclosure of confidential business relationships as well as the submission of invoices and other internal documents. This can have a lasting negative impact on these business relationships, as the disclosure of sensitive information can affect the trust of partners and customers. In addition, commercial customers who become the focus of trade secret infringement claims may in turn assert recourse claims, which can result in additional legal and financial burdens for the company.
• Legal costs and claims for damages:
  The amount of damages is calculated on the basis of the trade secret owner’s loss of profit, a reasonable license fee or the profit made by the infringer. Depending on the constellation, considerable amounts can be incurred here, which, in the case of justified claims, are added to the cease and desist letter and procedural costs, which are also not insignificant.
• Recall and destruction costs:
  Companies may be obliged to recall and destroy infringing products that have already been produced and are in circulation. This not only leads to direct financial losses, but can also affect customer confidence.

How we defend our clients against claims for breach of confidentiality

We examine whether and to what extent claims asserted against you for trade secret infringement actually exist. We examine all possible defenses and identify the options that make the most legal and economic sense for you. We then develop targeted strategies to defend against claims in the best possible way or, if a defense does not appear possible, to limit the economic consequences in the best possible way. Our law firm offers you a range of services specially tailored to the defense against claims and cease and desist letters for trade secret infringement:

• Review and analysis:
  We analyze the validity of the claims made against you and check whether there has actually been an infringement of a trade secret. We also check whether the alleged trade secrets are actually protectable and whether it can be proven that this confidential information has been unlawfully accessed.
• Strategic advice:
  Based on our analysis, we develop a tailor-made defense strategy to defend against claims in the best possible way.
• Negotiation with the other party:
  We take over the communication with the cease and desist letter in order to reach an out-of-court settlement and represent your interests in the best possible way.
• Preparation of protective briefs:
  In the event of impending interim injunctions, we prepare protective briefs in appropriate cases in order to prevent the issue of an interim injunction without an oral hearing.
• Representation in court:
  Should a legal dispute arise, we will represent you competently in court.

Our expertise – your advantage

Our law firm has many years of experience in litigation and out-of-court disputes in the field of trade secrets. We know the possible defense strategies to achieve the best possible economic result for you. Our specialized lawyers combine sound legal expertise with practice-oriented strategies to optimally resolve even complex disputes in the area of trade secret infringement. You benefit from this:

• Legal expertise:
  Regular training and an intensive exchange within our professional network ensure that we are always up to date with the latest developments in the field of trade secrets and know-how protection.
• Experience before courts nationwide:
  We have successfully represented our clients before courts nationwide for many years. We therefore have a wealth of experience in court practice.
• International network:
  We have a strong international network and work with law firms worldwide to assist you with cross-border or purely foreign-related disputes.
• Individual support:
  We provide you with individual support and develop customized solutions that are precisely tailored to your needs and specific requirements.
• Success-oriented action:
  Our aim is to consistently defend ourselves against unjustified claims and to enforce the best economic solution for you in the event of justified claims.