Identifying Trade Secrets Under the DTSA: The Critical Requirement of 'Reasonable Particularity'

"Whether the plaintiff has adequately identified the trade secrets that have allegedly been misappropriated is a commonly litigated and critical issue under the Defend Trade Secrets Act (DTSA). Unlike other types of intellectual property-such as patents, copyrights, and trademarks-where the property has already been identified and registered, trade secrets by definition are secret and cannot be identified publicly without destroying the subject matter of the plaintiff's legal claim."

"The burden is on the party alleging misappropriation to identify the trade secrets it claims have been misappropriated. However, at the federal level, neither the Economic Espionage Act nor the DTSA expressly addresses identification requirements. At the state level, only California and Massachusetts have statutes that define certain, but not all, aspects of identification. Notably, the Ninth Circuit recently held in Quintara Biosciences, Inc. v. Ruifeng Biztech, Inc. that the California Uniform Trade Secrets Act does not bind federal courts adjudicating DTSA"

"Yet defendants still need to know what secrets they have allegedly misappropriated, and the court needs to know what the case is about. Even more fundamentally, the plaintiff must establish that the information claimed to be a trade secret is in fact a trade secret. This has become an important issue with courts increasingly focusing on whether the plaintiff has met its burden concerning this issue."

Whether the plaintiff has adequately identified the trade secrets alleged to have been misappropriated is a central issue in DTSA litigation. Trade secrets cannot be publicly identified without destroying their secrecy, yet defendants and courts require sufficient detail to understand the allegations. The plaintiff bears the burden of identifying the claimed secrets and proving that the information is in fact a trade secret. Federal statutes do not specify identification requirements, and only a few states have partial statutory guidance. Courts are increasingly enforcing a 'reasonable particularity' standard, and recent appellate decisions, including NEXT Payment Solutions, have dismissed DTSA claims for failure to meet that standard.

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