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Workers Cannot Leave A Job With Their Employer’s Secrets

On Behalf of | Jan 23, 2015 | Employment Law

Under New Hampshire law a worker is prohibited from disclosing or using her employer’s trade secrets even if she did not sign a confidentiality agreement. New Hampshire law prohibits the misuse of an employer’s confidential and proprietary information by statute. RSA 350-B, Uniform Trade Secret Act, makes it illegal to disclose or use a trade secret of another without consent.

Under that Act, a trade secret is defined as information including a formula, pattern, compilation, program, device, method, technique or process that is of particular value because of its confidential, proprietary nature and is subject to efforts that are reasonable under the circumstance to maintain its secrecy. A customer list, particularly to the extent it has detailed customer information that is not known to the employer’s competitors, may constitute a trade secret and therefore a worker who discloses or uses the contents of customer list may be in violation of the law.

If a former worker were to disclose or use such information in competition with her former employer, even absent a confidentiality agreement or non-compete agreement, the employer may still be able to get a court injunction prohibiting the former worker from such use. Furthermore, to the extent the employer was damaged, the law entitles the employer to receive a monetary award which could include both the actual loss to the employer and the unjust enrichment to the former employee caused by the misappropriation not taken in account in computing actual loss. Therefore to the extent the use of these trade secrets by the former worker benefited her more than the actual loss caused to her former employer, those monies may also be recouped by the former employer from her and those who were conspiring with her in using those trade secrets.

In cases where the employer is able to show willful or malicious misappropriation, the Court may award exemplary damages not to exceed twice the amount of the total damages and unjust enrichment. The Court may also award reasonable attorney’s fees to the winning party if it finds that: the claim of misappropriation was made in bad faith or a motion to terminate an injunction is made or resisted in bad faith; or willful and malicious misappropriation exists. Depending on the facts of the matter, it is also possible that federal laws and state criminal laws of theft apply.

In conclusion, a worker who is considering leaving her former employer should realize that even, if she did not sign a confidentiality agreement or non-compete agreement, she still has certain legal obligations to her former employer under the law. It would be prudent for her to discuss with legal counsel what those legal obligations are when she takes a new job with a competitor or sets up her own company to compete with her former employer.

J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at [email protected].