Florida Statute § 542.335 lists five legitimate business interests which are protected through non-compete agreements. First on the list is trade secrets which includes information such as formulas, patterns, compilations, programs, methods or processes which derive their economic value from not being readily known to others. Further, the secrecy of a trade secret must be reasonably maintained under the circumstances. See Fla. Stat. § 688.002(4), defining trade secrets. Florida courts often define a trade secret as information that has value by not be readily available to others and which there has been reasonable efforts made to maintain the trade secret’s secrecy. See American Red Cross v. Palm Beach Blood Bank, Inc., 143 F.3d 1407, 1410 (11th Cir. 1998).
Customer lists may constitute trade secrets which are protected as a legitimate business interest under Fla. Stat. 542.335. One of the issues the court must decide is whether the information alleged to be a trade secret was the result of great expense and effort by the party that owns or compiled the information. See East v. Aqua Gaming, Inc., 805 So. 2d 932 (Fla. App. 2001) . Courts are less inclined to find materials constitute trade secrets if they were obtained from commercially available information which is easily available to the public. However, information that was “distilled” down from public information may rise to the level of trade secret. For example, a customer list consisting of names pulled from a public directory may not constitute a trade secret. Yet, a list of customers based on a public directory that contains the customer’s buying history may be protected under Fla. Stat. 542.335. See Sethscot Collection, Inc. v. Drbul, 669 So.2d 1076 (Fla. App. 1996).
Even if a party can show that the alleged trade secrets consisted of valuable information, it is not enough unless reasonable steps were taken to prevent the public distribution of the information. Proprietary information may not be protected as a trade secret where it was intentionally made available in public forums on the internet or through trade groups. Information that is commonly known in a particular industry usually does not rise to the level of trade secret. See Keel v. Quality Medical Systems, Inc., 515 So.2d 337 (Fla. 3d DCA 1987).
W Mason is a partner with Fox Rothschild LLP and serves in the Firm’s Litigation and Financial Services Industry departments in Fox Rothschild’s West Palm Beach office. An accomplished business trial attorney, W represents both plaintiffs and defendants in state and federal courts in employment disputes involving restrictive covenants, shareholder disputes, contract disputes, banking litigation, fraud claims, Uniform Commercial Code (UCC) claims, and other commercial disputes.
Below are some of W’s recent posts on Florida Noncompete Agreements:
Drafting Noncompete Agreements under Florida Law
Enforcement of Florida’s Noncompete Statute in Foreign Jurisdictions