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  • Writer's pictureBrian Foley

Woodlands Criminal Defense Attorney - Rules of Evidence Series RULE 507

Rule 507 is the rule which protects trade secrets. Some of the most famous example of trade secrets are the google algorithm, the 11 spices in KFC's original recipe, and the formula for Coca-Cola.

If rule 507 wasn't in place any old competitor could sue one of these businesses claiming that they had stolen their intellectual property or recipe and then demand disclosure of the recipe in discovery. Understanding the difficulty this would prove with business incentives towards litigation the rules disallow the disclosure of Trade Secrets.

The courts will in fact order the disclosure of a Trade Secret if it appears that nondisclosure would tend to conceal fraud or otherwise work injustice. "Our trade secret privilege . . . recognizes the importance we place on fair adjudication of lawsuits." In re Continental Gen. Tire, Inc., 979 S.W.2d 609, (Tex. 1998).

In re Bass 113, S.W.3d 735, 739 (Tex. 2003) established a relevant factor analysis for when disclosure should be ordered by the court.

  1. The extent information is known outside the business;

  2. The extent information is known within the business by employees;

  3. The extent of the measures taken to keep the information secret;

  4. the value of the information to competitors;

  5. the amount of energy or money spent in developing the information; and

  6. the ease of which the information could be acquired by others.

In other words you can't expect the court to protect your method of keeping drinks cool by placing ice in the cup. But you can probably keep secret the procedural aspects of creating a neck-thru Paul Reed Smith Custom 24 single piece Brazilian rosewood neck joint.

Rule 507. Trade Secrets Privilege

(a) General Rule. A person has a privilege to refuse to disclose and to prevent other persons from disclosing a trade secret owned by the person, unless the court finds that nondisclosure will tend to conceal fraud or otherwise work injustice.

(b) Who May Claim. The privilege may be claimed by the person who owns the trade secret or the person’s agent or employee.

(c) Protective Measure. If a court orders a person to disclose a trade secret, it must take any protective measure required by the interests of the privilege holder and the parties and to further justice.

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