Mobile Electronics July Issue, 7-1-2016 -- Once upon a time there was a 12-volt technician. After years of learning his craft by working at different jobs, he decided to open his own car audio business. He struggled for years, learning tough lessons along the way. Eventually, after educating himself thoroughly on industry best practices using every resource available, he created a list of procedures that helped grow his business.
With seemingly strong procedures in place, he began to hire and build a team. Despite using common sense to hire, eventually, one of his employees decided he wasn’t happy and left to work for a local competitor. With him were digital files he took on a cloud-based database. The files included build photos taken while working for the shop and operating procedures with sensitive financial data. Without thinking, he brought them to his new shop on his Smartphone and synced his phone with the shop's cloud database. The files were now in the hands of a competitor. Despite his best efforts to protect his shop, the store owner had not taken all steps necessary to protect his data.
In most industries, this practice can bankrupt a company. But in the mobile electronics industry, the common feeling is that as long as you take care of your staff, they'll take care of you. While it might be true in many cases, most lawyers would disagree. Despite the educational resources available to retailers, the concept of protecting proprietary or sensitive information is generally not fully understood to the 12-volt community. To properly ready one’s business for a potential lawsuit, it's important to know what risks are possible and how to prepare for them. That's where consulting with a lawyer could be the smartest thing a retailer ever does.
Mine, Not Yours
Stefan Mentzer is a partner at White & Case, a renowned law firm with offices all over the world. Mentzer specializes in intellectual property law and litigates for clients in several industries including technology, retail, automobile and financial services, among others.
"Store managers, to the extent they have customer information, the products they sell, prices they use and services are essentially trade secret information," Mentzer explained. If two stores offer the same service and one learns of the other's prices, they can drop prices to counter, which isn't a trade secret. But for things like processes and future promotional plans, shop's can protect themselves by requiring employees to sign confidentiality agreements. "They serve two functions: one, to educate employees that information is potentially property of the store and two, to let them know to treat it as property and not take it when they leave. It also functions to ensure that the store owner takes reasonable measures to maintain secrecy of that information," he added.
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