Who knew pizza could lead to serious legal battles? That is the case in a recent trade secret lawsuit, where frozen food delivery service Schwan’s has accused a competitor, Conagra, of hiring a research scientist to steal their frozen pizza dough recipe.
Take a step back — what is a trade secret and how do I protect it?
A trade secret can include a formula, pattern, technique, method, process or even a recipe that provides the owner with economic value. Classic examples include the recipe for Coca-Cola, KFC’s secret blend of herbs and spices and Google’s search algorithm. Businesses often have a team of professionals working to develop, update and tweak their own trade secrets.
But what happens when one of these professionals shares those trade secrets? Does the business have recourse?
First, it is important to review whether or not the information is protected. Business owners are wise to proactively protect their trade secrets and other forms of intellectual property to better ensure they can act in these types of situations. Without the proper protection in place it is very difficult to fight back.
When it comes to trade secrets, this means being able to show that you took reasonable efforts to maintain secrecy. This could include restricting access to the trade secret and having those who do have access sign non-disclosure or confidentiality agreements.
How serious is it if someone steals a business’ trade secrets?
These types of violations are serious as they can result in a loss of competitive advantage and profitability. In the case noted above, Schwan’s has voiced concern that the loss of this recipe could give the competitor “unjust enrichment” since Conagra now has Schwan’s research. If successful, they could get an injunction or court order forcing Conagra to cease operations that make use of this information as well as monetary awards.