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What is (and what isn’t) corporate espionage

On Behalf of | May 28, 2021 | Federal Offenses, White-Collar Crimes

When we talk about corporate espionage, we typically refer to the theft of trade. That theft, and the financial damages it inflicts, can be extremely far-reaching.

Theft of trade secrets defined

Virtually any confidential information that a company uses to develop or market its products is a trade secret. As defined by the Economic Espionage Act, a trade secret may take the form of:

  • Plans
  • Formulas
  • Designs
  • Prototypes
  • Processes

To violate the law, an individual or company must steal and send the trade secret to another party. Additionally, the theft must be done knowingly to benefit anyone aside from the secret’s owner.

A person accused of stealing a trade secret can face up to ten years in prison and a fine of up to $5,000,000. However, if the theft is on behalf of a foreign government or agent, then the maximum penalties are increased to 15 years and $10,000,000.

Competitive innovation is not corporate espionage

Business competition is not for the faint-hearted, and businesses have every right to pursue every legal avenue to get an edge. Through no fault, a company with savvy technical staff and strong staff can come to similar conclusions and use similar processes to another company.

Being good at your work does not mean you’ve committed the crime of economic espionage, but unfortunately, it can look like it. By enticing employees away from competitors or aggressively investigating market success, your competitors may try to use the law against you. And if you have relationships with foreign companies or governments, that can create a significant concern.

Corporate espionage charges can damage a company

Simply an accusation of impropriety in competition is enough to bring unnecessary scrutiny, both from authorities and customers. Aggressively defending against charges might not just protect you but your entire company’s future.