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Cloud Computing and Trade Secrets: Storm on the Horizon?
Cloud computing — that is, on-demand access to computer data and applications on the Internet — is a very hot topic these days. Many people and businesses are already using it without even realizing that they are. Twitter, LinkedIn, Facebook and Gmail are just a few examples of popular cloud-based services in wide use.
Cloud computing is among the top strategic technologies for 2011, and for good reason. Those who work "in the cloud" need nothing more than an Internet connection to gain access to their information from any device and any location. Purchasing only the services and resources one needs yields cost savings on equipment, staff and maintenance.
But as more and more businesses take advantage of cloud computing by moving data from in-house servers to third-party servers in the cloud, legal and compliance issues can arise. Data stored in the cloud may include proprietary and confidential information such as trade secrets, which can lose its protected status — and its value to its owner — if it is disclosed or misappropriated.
In some instances, information stored in the cloud may be more vulnerable to disclosure than information that is stored in-house. For example, cloud services such as social media may involve an increased risk of intentional or accidental disclosure of information by employees. And if a cloud provider accidentally disclosed a trade secret belonging to a client, the information could permanently lose its trade-secret status.
As businesses embrace cloud computing — whether in the context of social-media use, data storage or otherwise, it's more important than ever that they train their employees on how to protect valuable trade secrets and how to use social media wisely and appropriately.
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Posted by Claudia Westin on July 6, 2011 Claudia Westin is Director of Content at WeComply, where she writes and edits a variety of interactive compliance training materials and courses. Before joining WeComply, Claudia practiced law for 15 years in the public and private sectors. She has experience as a litigator, as in-house counsel covering court administration matters for the State of California, and as an instructor and author of undergraduate business law and environmental law/policy courses. Claudia holds a J.D. from the University of Virginia School of Law. |
Tags: Social-Media, Trade Secrets
