10-3 DIFFERENCES FROM TUTSA

• Jurisdiction: United States

10-3 Differences from TUTSA

Although both TUTSA and the DTSA were modeled after the UTSA, it is important to understand key differences between the two in deciding whether to bring a claim in state or federal court. With a few minor exceptions, the DTSA does not preempt state trade secret law, such as TUTSA.⁷ One major difference, however, is that, unlike TUTSA, the DTSA requires that the trade secret at issue be "related to a product or service used in or intended for use in interstate or foreign commerce."⁸

As discussed in previous chapters, the definition sections in both TUTSA and UTSA significantly impact the outcome of a misappropriation claim, including whether a court will find that a plaintiff's information qualifies as a "trade secret" in the first place. The same is true for definitions of "misappropriation" and "improper means." Both the DTSA and TUTSA give guidance to courts through their definition sections, but definitional variations make TUTSA appear to be the more expansive of the two; however, recent amendments to TUTSA have brought some of the definitions into closer alignment.⁹

10-3:1 "Trade Secret"

In 2017, the Texas Legislature amended TUTSA to mirror the DTSA's definition in order to avoid any conflict or confusion between the two "trade secret" definitions.

10-3:2 "Proper Means" and "Improper Means"

The DTSA simply states what the term "improper means" does not include, instead of creating its own separate definition for proper means; TUTSA includes definitions for both terms.¹⁰ This means that TUTSA's definition is somewhat more expansive. Unlike the DTSA, the Texas statute states that "improper means" includes a breach of a duty to limit the use or prohibit the discovery of a trade secret.¹¹ Under both statutes, the "improper means" definition carries over to the respective definitions of "misappropriation."¹²

10-3:3 Other Definitions

The DTSA appropriately includes a few definitions that do not appear in TUTSA, such as definitions for "foreign instrumentality" and "foreign agent," which are intended to cover situations involving corporate international espionage.¹³ TUTSA also includes a helpful definition for "reverse engineering," which qualifies as a proper means of discovery of a trade secret under both the federal and Texas statutes.¹⁴ The DTSA contains no such definition.

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Notes:

^[7] 18 U.S.C. § 1838.

^[8] 18 U.S.C. § 1832(a).

^[9] See 18 U.S.C. § 1839; Tex. Civ. Prac. & Rem. Code Ann. § 134A.002; RealPage, Inc. v....