Legal Question in Business Law in California

Re: Trade Secrets

The law is clear that you must return the information and not make use of it. And I presume by "top secret" you are not talking about classified information, that would require you to call the FBI.

Re: Trade Secrets

This is perhaps as much an ethical issue as it is legal. The legal aspect is covered by the Uniform Trade Secrets Act, which in California is part of the Civil Code (see sections 3426 to 3426.11).

The key provisions for you to look at and consider are:

3426.1(b)(1): "Misappropriation" means ..... acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means......

3426.1(a): "Improper means" includes theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means. Reverse engineering or independent derivation alone shall not be considered improper means.

The following sections of the Act go on to describe remedies for misappropriation, which include injunction, money damages and possible punitive damages.

It seems clear that the disgruntled employee was under a duty not to disclose, that you knew or had reason to know of his duty, and therefore any use of the information by you or your firm would be misappropriation by statutory definition and thus you'd be subject to the damages and penalty provisions of the Act.

Further, this attempt to slip you the secrets could give you the additional headache of proving you didn't use the info, should your firm later independently discover the information that was in the attempted disclosure. I'd suggest asking a local intellectual-property attorney about how to return the information and how best to disclaim having looked at it or retained copies of it.