Andrew Boutros and Alex Meier authored "An Endangered Claim Reemerges: The Defend Trade Secrets Act Breathes New Life Into Trade-Secrets-Based RICO Claims," an article on March 17 for Bloomberg's White Collar Crime Report. This article examines how the DTSA, in certain circumstances, may create liability under RICO for the misappropriation of trade secrets.
Pre-DTSA, courts were hesitant to impose RICO liability based on trade-secrets misappropriation, because even fraudulent acts with the end goal of misappropriating trade secrets did not present a threat of ongoing criminal activity ("continuity," in RICO parlance). With the DTSA's passage, however, the misappropriation, copying, disclosure, and use of trade secrets constitute "predicate acts" that may satisfy RICO's continuity requirement. The article analyzes two scenarios that may create civil RICO liability: First, a coordinated departure involving multiple employees defecting to join the same competitor; and, second, when a company repeatedly hires key employees in an attempt to acquire its competitors trade secrets.
You can read the full article here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
