How In-House Counsel Handle Rogue Employees
From the Association of Corporate Counsel's Annual Meeting, a look at how GCs keep employees from walking off with sensitive data.
October 18, 2017 at 06:47 PM
3 minute read
When an employee leaves a company, he or she may inadvertently or maliciously walk out the door with valuable intellectual property. Files may accidentally end up on a personal device or a disgruntled employee may transfer trade secrets to a thumb drive to later use at a competitor.
No matter the intention, the reality is that the biggest threats to a company often come from inside. And while it's all but impossible to completely eliminate this risk, there are a number of ways in-house counsel can limit the damage.
It starts with, to the extent possible, locking down the data when the situation warrants it, Jody Riger, senior corporate counsel for employment, labor and ethics at Sun Chemical Corp., said on a panel Tuesday at the Association of Corporate Counsel's annual meeting.
If an employee who's had access to a lot of information gives notice and won't say where they are going, but there's suspicion it might be to a competitor, there are essentially two options, she said: “We'll either accept the notice … and cut off all access to our network,” within a day, depending on the employee. Or, “There are some employees that, you know what, good employee, good relationship, maybe going to a supplier or customer, [and] you want to maintain a good relationship, so we'll let the employee work out their notice period.”
With respect to trade secrets, specifically, Riger said these are kept “under lock and key” by not only requiring that certain employees sign a general confidentiality agreement when hired, but for one current project, they also sign an internal confidentiality agreement. Those involved can only speak to one another about this project as a means to provide “extra protection,” she said.
Quickly taking away all access provided by employee identification cards is a “first line of defense,” said panelist Courtney Manzel, managing privacy counsel at Sprint Corp. Also helpful is to remind employees of their obligations, both when they join and leave the company, she noted. “When somebody is hired, they are apprised of their confidentiality obligations with respect to data … and then when they leave, if necessary, there would be a letter reminding them of those obligations that copies their new employer.”
If there's a major concern that a particular person has a lot of sensitive information, Manzel said there's always an opportunity to rely on forensic tests on computers and other devices.
And then, of course, “education is key,” said Ari Sherwin, corporate intellectual property counsel at The Sherwin-Williams Co., not just to prevent losses, but also because it can be helpful to point to in litigation. Sherwin noted a 2016 case that came down in favor of an employer that took reasonable measures to secure trade secrets “because they provided training to their employee—not just inboarding, but once a year—and they also had password-protected computers that could only be accessed by people working on specific projects that relate to the work. And finally, they had their employees sign confidentiality agreements.”
Sherwin added: “If you take those measures and you mimic the case law, it can help you.”
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllMeta Hit With Class Action for Allegedly Using Pirated Books to Train AI Models
Chastised by Judge, Authors' Lawyers Bring Boies Schiller Into Meta AI Copyright Suit
3 minute readJudge Blasts Authors' Lawyers in Key AI Suit, Says Case Doomed Without Upgraded Team
Judge Whittles Down Artists' Landmark AI Copyright Suit but Keeps Core Infringement Claims Alive
Trending Stories
- 1Will England Accept that Digital Assets Are ‘Property’?
- 2Congress and Courts Are Considering Litigation Financing: Is Disclosure Imminent?
- 3Bar Report — Nov. 25, 2024
- 4People in the News—Nov. 25, 2024—Eckert Seamans, Klehr Harrison
- 5How We Made Practice Group Chair: 'One of the Most Important Skills Is Being a Good Listener,' Say Timothy Kincaid and Brad Vaiana of Winston & Strawn
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250