Trade secrets, an essential form of intellectual property, are among the most valued business assets for manufacturers. They can include everything from the special recipe for a food or beverage to the formula for a chemical or pharmaceutical. This proprietary information powers the innovation on a shop floor, which drives job creation at facilities in communities across our country. 

Trade secrets can comprise as much as 80 percent of the value of a company’s knowledge portfolio, and according to one estimate, theft costs businesses in this country some $250 billion a year.The current system desperately needs to be updated to provide the owners of trade secrets the ability to pursue intellectual property thieves aggressively and efficiently, in full cooperation with the federal government. 


While patent, copyright and trademark owners can protect their rights in federal court, trade secret owners must instead rely on an array of state law remedies that were designed with small-scale, intrastate theft in mind. Although those laws may be sufficient and appropriate when, for example, an employee takes a former employer’s customer list to a competitor down the street, they are ill-suited for the fast-moving, multijurisdictional cases in today’s global economy.   

Fortunately, there is important, bipartisan legislation that would fill this gap and assist manufacturers in pursuing trade secret thieves and protecting intellectual property. The Defend Trade Secrets Act of 2016 (DTSA)—a bipartisan, bicameral bill led by Sens. Orrin HatchOrrin Grant HatchPress: Forget bipartisanship — it's dead! Privatization of foster care has been a disaster for children Remembering Ted Kennedy highlights decline of the Senate MORE (R-Utah) and Chris CoonsChris Andrew CoonsHow to save the Amazon rainforest Biden dispatches Cabinet members to sell infrastructure plan Advocacy groups pushing Biden to cancel student debt for disabled MORE (D-Del.) and Reps. Doug Collins (R-Ga.) and Jerrold Nadler (D-N.Y.)—creates a federal civil cause of action for trade secret misappropriation to unify trade secrets law nationwide. The bill would also offer trade secrets owners the same legal options as owners of other forms of intellectual property.  

The National Association of Manufacturers has long supported a federal civil remedy for trade secret theft and urges passage of DTSA. The consensus-oriented approach of the legislation has drawn strong support from all industry groups and manufacturing subsectors, including biotech, pharmaceutical, medical device, automotive, agriculture and beyond.   

Trade secrets are vital to the competitiveness of companies throughout our economy, and the threat to these innovations is becoming more serious and more complex. By creating a strong, uniform body of trade secrets law nationwide, the DTSA ensures that our laws keep pace.  

Congress should move quickly to pass this important legislation because strong trade secrets protection is critical to the American economy and to manufacturers’ competitive advantage in the global economy. The DTSA encourages investment in cutting-edge research and development and will have an immediate, positive impact on our innovative sector, ultimately creating jobs and opportunity in manufacturing in the United States. 

Newhouse is senior vice president of Government Relations and Policy for the National Association of Manufacturers.