Here at the Law Office of Vincent Miletti, Esq. and the home of the #UnusuallyMotivated movement, we take pride as a resilient and dependable legal services firm, providing such services in both a traditional and online, web-based environment. With mastered specialization in areas such as Employment and Labor Law, Intellectual Property (IP) (trademark, copyright, patent), Entertainment Law, and e-Commerce (Supply Chain, Distribution, Fulfillment, Standard Legal & Regulatory), we provide a range of legal services including, but not limited to traditional legal representation (litigation, mediation, arbitration, opinion letters and advisory), non-litigated business legal representation and legal counsel, and unique, online legal services such as smart forms, mobile training, legal marketing and development.

Still, here at Miletti Law®, we feel obligated to enlighten, educate, and create awareness about how these issues and many others affect our unusually motivated® readers and/or their businesses. Accordingly, to achieve this goal, we have committed ourselves to creating authoritative, trustworthy, & distinctive content, which looks to educate and deliver in a manner that only Miletti Law® can. Usually, this content is featured as videos posted on our YouTube Channel https://www.youtube.com/channel/UCtvUryqkkMAJLwrLu2BBt6w and blogs that are published on our website WWW.MILETTILAW.COM. With the ball in your court, yours is an effortless obligation to subscribe to the channel and sign up for the Newsletter on the website, which encompasses the best way to ensure that you stay in the loop and benefit from the knowledge bombs we drop here!

As the authoritative force in Employment Law, we are committed to providing you with authoritative, up-to-date, and trustworthy content through which you can draw enlightening information to stay ahead of the game in your business. In this regard, this blog is Part IV of our new, multipart series on the “Enforcement of the Protection of Employers’ Confidential Information & Trade Secrets.” In Part II of this series, we moved the discussion forward by providing you with a hands-on guide regarding “How to Draft a DTSA (Federal Defend Trade Secrets Act) Complaint” and mentioned that a trade secret misappropriation complaint filed under the DTSA should precisely specify the reason why such information meets the qualification for trade secret protection. To keep the discussion ball rolling, we have hammered on “The Statute of Limitations under the DTSA” & “DTSA Civil Seizure” in this blog, which is Part IV of the series.

The Statute of Limitations under the DTSA

As we have mentioned in our past blogs and videos, the law sets a maximum period of time that legal proceedings should be initiated by parties involved in a dispute. This period usually commences from the date an alleged offense took place and is known as the statute of limitations. The DTSA has a three-year statute of limitations for claims. Pursuant to 18 U.S.C. § 1836(d), the period starts after the discovery of the misappropriation or following the discovery of the same after the exercise of reasonable diligence. Generally, only trade secret misappropriation that took place after or on May 2, 2016, which is the date that the Act was enacted, or started shortly before the Act was enacted and progressed after the Act took effect, applies to the DTSA provisions.

DTSA Civil Seizure

By definition, a civil seizure can be viewed as a preventative tool engaged before a misappropriation is found out, whereby an order requiring the property to be seized is given by a court as an essential measure for preventing the trade secret in question to be disseminated or propagated. Pursuant to 18 U.S.C. § 1836(b)(2), an ex parte civil seizure mechanism is provided for by the DTSA. This means that during the pendency of a formal DTSA case, an employer can employ this tool to promptly block and deter information from being further disseminated after such an employer becomes aware that a trade secret has been misappropriated. However, after a seizure order has been issued, the seizure obtainer is obligated to provide facts concerning the underlying order in a seizure hearing summoned by the court.

While the seizing party is obligated to provide and prove a range of facts, it is only in “extraordinary circumstances” that a court may order a civil seizure. Such facts include, but are not limited to:

  • The requested seizure has not been publicized by the applicant-
  • The party against whom the seizure order has been provided would, if on notice, hide, move, destroy, or otherwise hinder the accessibility of such a matter to court-
  • The location of the matter, the reasonableness of the matter to be seized, the extent of the reasonability behind the seizure-
  • The party against who the court has issued a seizure order possesses the trade secret of any other property in question and which requires to be seized-
  • There is a likelihood for the complainant to succeed in demonstrating that the party against who the court has issued a seizure order has been involved, through improper means, in either a conspiracy to trade secret misappropriation or personally engaged in the misappropriation-
  • If denied such an order, the complainant would undergo harm that (1) significantly outweighs the harm such a seizure would cause to third parties and (2) substantially outweighs the harm such a seizure would cause to the person against whom the court has issued the order-
  • The denial of a civil seizure would lead to irreparable and immediate injury to the applicant-and-
  • The inadequacy of some other form of equitable relief or an order, pursuant to Fed. R. Civ. P 65.

Generally speaking, when the applicant demonstrates the inadequacy of an injunctive or equitable relief other than ex parte seizure, then a court will issue an order for the latter. Usually, the failure to comply or the likelihood of the party against whom the court has issued the order to evade an injunction is a matter of significance to the court when such a determination is being made. For instance, if it becomes clear that an employee may fail to comply with a preliminary injunction or TRO (temporary restraining order) fully, a court may permit the employment of the civil seizure mechanism, particularly in a case where such an employee has stored the misappropriated trade secrets on cloud storage or external digital storage devices.

Nonetheless, to reinforce the effectiveness of a civil seizure, it is the burden of the applicant to efficiently and correctly explain to the court the type of information that was stolen, who stole it, and the location where it is being stored. This information is crucial to the court irrespective of the trade secret or confidential information misappropriated.

In Part V of this series, we will move this series forward by looking at “Other Remedies Provided under the DTSA” apart from the Civil Seizure Mechanism issued by courts.

As usual, while you should strive to be #UnusuallyMotivated, stay tuned for more education, training, and legal guidance. In the interim, reach out to us with questions and/or comments on our website at the Contact Us page!

Always rising above the bar,

Isaac T.,

Legal Writer & Author.