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If passed, a new bill would strengthen the International Trade Commission’s ability to fight back against trade secret misappropriation.
There's been no shortage of cases involving the theft of trade secrets over the last several years. Along with it, there’s been an increase in legislation introduced to help businesses recover from the damage IP theft can leave in its wake.
One of the latest, a bill introduced over the summer, would empower the International Trade Commission - an agency of the United States federal government that advises the legislative and executive branches on trade matters – to better protect intellectual property owners who have had their trade secrets misappropriated.
The Stopping and Excluding Chinese Rip-offs and Exports with United States Trade Secrets Act of 2021, or the SECRETS Act of 2021, would expand the ITC's power to investigate and “direct the exclusion of” the importation of products that “contain, were produced using, benefit from, or use” trade secrets acquired by “improper means or misappropriation by a foreign agent or foreign instrumentality.”
The ITC already has the power to exclude the importation into the U.S. of products that infringe on American intellectual property; this bill would strengthen those powers.
While China is referenced in the name of the bill, it would apply to trade secrets stolen and used by any country. It appears the inclusion is more of a reaction to the rash of allegations of trade secret theft involving Chinese nationals and Americans working on behalf of China, like those stemming from China's Thousand Talents program.
If passed, the bill, introduced by U.S. Senators John Cornyn (R-Tex.), Christopher Coons (D-Del.), and Todd Young (R-Ind.) would technically insert a new section into the Tariff Act of 1930. Originally known as the Smoot–Hawley Tariff, the law codified protectionist trade policies in the United States and raised U.S. import duties.
The bill would create a new interagency committee on trade secrets that could request an emergency import ban on products believed to be made using stolen trade secrets. That committee would be comprised of least six voting members from a list of government agencies - the Secretary of the Treasury, the Secretary of Homeland Security, the Secretary of Commerce, the Attorney General, the Intellectual Property Enforcement Coordinator, the United States Trade Representative - it would be chaired by the Attorney General, according to the bill’s text.
Trade secret owners would be able to file a complaint alleging that a product is using a trade secret misappropriated with the help of a foreign government. The committee would have 30 days to look into the claim. If the committee discovers that "it is more likely than not" that the item being imported involves a stolen trade secret, it could then issue a an exclusion order, which would prevent the import from entry into the United States.
While there hasn't been any movement on the bill since it was introduced - it was submitted to the Senate Finance Committee in June – if passed, it would create additional and much welcome protections for trade secret owners.