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Colorado Trade Secrets Part 4

Who can claim trade secret protections in Colorado?

Colorado law defines trade secrets as certain information "relating to any business or profession which is secret and of value."  Part 2 discussed the requirement that the business information actually be used. This post will discuss the interpretation of the requirement that the information be something "relating to any business or profession..."

Often asked is whether only businesses can make a claim for trade secret protection? Colorado courts have yet to fully consider whether the trade secret must related to a “business.” However, courts outside of Colorado have taken two approaches to analyzing who can claim trade secret protections. The first approach is to examine the nature of the person or entity claiming trade secret protection. These courts will determine whether person claiming trade secret protection fits within the statutory definition of business for that state. The terms "business" or "profession" are not defined in Colorado's trade secret statue; therefore, the activities of volunteer organizations, trade groups, universities, and other non-profits may not be disqualified based solely on a lack of "for profit" existence. It is likely that Colorado courts will instead focus on the other elements of the protection, such as secrecy and value. The nature of the protection and the value of the information it protects will likely dictate one’s standing rather than the for/non-profit status of the party.

Focusing more on the "value" of the information to the party claiming protection, the second approach that courts outside of Colorado have used is to look at the relationship between the information and the claiming party. Courts look at the party seeking protection’s mission, purpose, or other activities. For example, an advocacy or lobbying group may have "secret" information related to the position of a politician on a piece of legislation. The lobbying group may also have "secret" information on an individ


Mallon & Lonnquist, LLC, is a business and real estate law firm. Reed F. Morris is a Colorado a litigation attorney with Mallon & Lonnquist, based in Denver, Colorado. Reed regularly represents businesses and individuals in transactions in and commercial disputes and can be reached at rmorris@mallon-lonnquist.com.

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