The FTC has answered the NAM’s trade-secrets objection by pointing out that laws against the theft of trade secrets remain on the books, and that contractual non-disclosure agreements would remain legal under its rule. These protections, it’s said, should be sufficient to deter theft. The NAM replied that these “are poor substitutes for non-compete agreements.” For one thing, businesses don’t always know when their secrets are stolen. That argument amounts to: Better that we constrict the freedom of all our employees than risk that one of them will do us some hypothetical harm.
The NAM further complained that trade secrets don’t enjoy the same level of legal protection as patents. That suggests to me that stealing them may not be as serious a matter as the NAM would have me believe. Finally, the NAM said that “trade secret litigation is costly and slow.” Well, yes, suing another business is costlier and slower than threatening to bury some sad sack of a former employee in an avalanche of legal bills. In a similar vein, I might argue that purchasing a candy bar at the corner store would be costlier and slower than seizing one from the hand of a five-year-old child.
The amicus brief was submitted by Erica T. Klenicki and Michael Tilghman II of the NAM and Richard D. Salgado, Paul W. Hughes, and Andrew A. Lyons-Berg of the law firm McDermott Will and Emergy LLP. I mention this because even as these five attorneys argued to the court that non-compete clauses were a vital tool of American commerce, they were none of them at risk of being sued by the NAM should they take employment at some rival organization—say, the Association for Manufacturing Technology, or (God forbid) the AFL-CIO. That’s because the American Bar Association does not permit “non-competition clauses in partnership, member, shareholder, or employer agreements.” What’s sauce for the goose should not be mistaken for sauce for the gander.
