Obama Administration Launches Effort To Combat Theft of U.S. Trade Secrets

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The White House Feb. 20 released a report from several federal departments and agencies containing strategies and recommendations for protecting U.S. trade secrets.

According to the report, the Obama administration is focused on protecting the innovation that drives the U.S. economy and supports jobs in the United States. Emerging trends, however, indicate that the pace of economic espionage and trade secret theft against U.S. corporations is accelerating, the report stated.

The report contains action items, including:

• focusing diplomatic efforts to protect trade secrets overseas;

• promoting voluntary best practices by private industry to protect trade secrets;

• enhancing domestic law enforcement operations;

• improving domestic legislation; and

• promoting public awareness and stakeholder outreach.


The report is the product of a collaborative effort and reflects the recommendations and input of agencies within the departments of Commerce, Defense, Homeland Security, Justice, State, and Treasury, and the Office of the U.S. Trade Representative.

U.S. Government Promises Action

The theft of trade secrets affects national security, undermines global competitiveness, diminishes U.S. export prospects, and puts American jobs at risk, U.S. Intellectual Property Enforcement Coordinator Victoria Espinel, said at an event with administration officials and company executives to release the report. The administration will act vigorously to combat the theft of trade secrets that could be used by foreign companies or governments to gain an unfair economic advantage, she said.

Attorney General Eric Holder said that as government agencies and private sector partners come together to put the action items into action, they will protect the rights, safety, and best interests of U.S. consumers and entrepreneurs. By corrupting insiders, hiring hackers, and engaging in other illegal activities, cybercriminals can inflict devastating harm on individual creators, startups, and major corporations, he said.

As one private security expert has said, there are only two categories of companies affected by trade secret theft: those that know they have been compromised and those that have been compromised but do not know it yet, Holder said.

By 2015, experts say the volume of new technology in use will double from 2010, which will open up new vulnerabilities to allow criminals to steal information, Holder said. In some industries, a single trade secret theft can be worth millions or even billions of dollars. It could lead to layoffs, closed factories, lost sales, or even put the company out of business, he said.

“In response, the Justice Department has made the investigation and prosecution of trade secret theft a top priority,” Holder said.

Demetrios Marantis, deputy U.S. trade representative, said it is important for U.S. trading partners to see how much emphasis the administration is placing on fighting the misappropriation of trade secrets and securing intellectual property.

The USTR is moving on a variety of fronts, through international negotiations and bilaterally, on trade-secret related issues with key partners, Marantis said. It is also trying to incorporate the protection of trade secrets in the work it does in nonintellectual property areas, such as investments, he said.

By Cheryl Bolen  

Full text of the 141-page report, “Administration's Strategy to Mitigate the Theft of U.S. Trade Secrets,” is available at http://op.bna.com/der.nsf/r?Open=palo-954np4.

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