From the practicing bar... Tyler G. Newby, CRIMINAL ENFORCEMENT OF FEDERAL INTELLECTUAL PROPERTY LAWS-AN OVERVIEW, 50-SEP Advocate (Idaho) 37 (2007) Tyler G. Newby is a trial attorney with the Computer Crime and Intellectual Property Section of the United States Department of Justice's Criminal Division. Prior to joining the Justice Department, he practiced civil intellectual property litigation in Silicon Valley and San Francisco.
Many intellectual property attorneys may spend their entire careers without coming into contact with the criminal provisions of federal intellectual property laws... Trade Secret Theft Nearly every state has a civil trade secret statute based on the Uniform Trade Secrets Act. Some states have also codified criminal penalties for willful trade secret theft. To fill the gaps in state criminal laws and to address situations where an individual may steal a trade secret from a company in one state for use in another state or country, Congress enacted the Economic Espionage Act (EEA) in 1996, which created the federal crime of trade secret theft. While the EEA borrows from the UTSA in many respects, such as in its definition of what constitutes a trade secret, it also has several material differences.
First, the EEA creates two separate offenses, depending on the mis-appropriator: (1) trade secret theft for the benefit of a foreign government, instrumentality or agent, 18 U.S.C. § 1831; and (2) theft of a trade secret related to a product in interstate or foreign commerce with the intent to provide an economic benefit to a third party, 18 U.S.C. § 1832. Violation of § 1831 carries a maximum penalty of a $500,000 fine or 15 years imprisonment, or both, and violation of § 1832 carries a maximum penalty of 10 years imprisonment. Because commercial trade secret cases involving commercial entities rather than foreign instrumentalities are seen the most frequently by civil IP lawyers, this article will focus on § 1832. Second, to be covered by the EEA, the trade secret must “be related to or included in a product that is produced for or placed in interstate or foreign commerce.” [FN6] The UTSA contains no such limitation that the trade secret be “related to or included in a product,” nor does it require the product to be produced for or placed in interstate or foreign commerce. Third, to be guilty of economic espionage, the defendant must have intended to confer an economic benefit on someone other than the trade secret's owner and to injure the trade secret's owner. The legislative history is clear that the intent to injure element does not require malice - only awareness by the defendant that his conduct would cause some disadvantage to the trade secret's owner. Unlike the UTSA, the EEA penalizes conspiracies and attempts to commit criminal trade secret theft. Like other attempt statutes, to prove attempted trade secret theft under either § 1831 or § 1832, the government must prove beyond a reasonable doubt that the defendant (a) had the requisite intent, and (b) took a “substantial step” toward commission of the trade secret theft. For conspiracy, the government must prove that the defendant agreed with one or more people to commit trade secret theft and at least one of the co-conspirators committed an overt act in furtherance of the object of the conspiracy. The crimes of attempt and conspiracy are powerful tools for law enforcement to prosecute crimes before the full damage of the crime has been incurred. Indeed, at least three circuit courts of appeal have held that the government is not required to prove that the information sought by the co-conspirator was, in fact a trade secret, so long as the co-conspirators believed they were obtaining trade secrets.To read this full survey contact the Idaho State Bar Advicate. The Advocate is also on Lexis and Westlaw.

