Are You Committing Data Theft at Work Without Even Realizing It?

Violating the Virginia Uniform Trade Secrets Act (VUTSA) is easier than you might think. A federal court recently held that an employee downloading company information to an external storage device or emailing it to a personal email address may be liable for trade secret theft regardless of whether that information is actually used in an improper way. Something as casual or seemingly innocuous as using a flash drive to bring work home could implicate Virginia’s uniquely broad trade secret theft statute.

In Marsteller v. ESC Federal, Inc., a government contractor notified an employee that she was being terminated. Prior to her termination, the employee, who had signed an agreement requiring her to hold proprietary company information “in strictest confidence,” downloaded information to an external storage device and emailed it her personal email account as well. She was sued by her former employer for VUTSA violations. Although there were no allegations that Marsteller actually used the proprietary information that she downloaded and emailed to herself, the U.S. District Court for the Eastern District of Virginia held that allegations of improper acquisition alone are sufficient for a VUTSA claim to survive a motion to dismiss.

In Virginia, “improper acquisition” is described as “theft, bribery, misrepresentation, use of a computer or computer network without authority, breach of a duty or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other means.” While that list is comprised of obviously unacceptable means of acquiring information on its face, the Marsteller decision gives broad applicability to the “use of a computer or computer network without authority” aspect. Something as simple as downloading proprietary company information onto a thumb drive (which may be proscribed by your employment agreement), at least in Virginia, may leave you open to liability for trade secret theft, whether you make improper use of that information or not.

Frank Gulino is an associate attorney with Washington, DC business law firm Berenzweig Leonard. He can be reached at fgulino@BerenzweigLaw.com.