February 26, 2026
By: Alan L. Goodman
A company’s trade secrets are among its most valuable assets. They are often the lifeblood of the business, so protecting them against theft or other misappropriation by bad actors is of paramount importance.
Florida’s Uniform Trade Secrets Act (FUTSA) is designed to provide that protection and imposes remedies against those who violate the Act – so long as the elements of FUTSA are met. In short, FUTSA protects valuable business information that gains value from being secret and is kept reasonably confidential.
What must a business prove to win a trade secrets claim?
To win a trade secrets claim, a company must show it had a trade secret, took reasonable steps to keep it secret, and someone misused it knowing or having reason to know it was improperly obtained.
Reasonable steps include limiting access, using confidentiality agreements, monitoring use, and implementing contractual protections.
What qualifies as a trade secret under FUTSA?
A trade secret can be any information, such as a formula, method, or process, that derives economic value from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use. It must also be subject to reasonable efforts to maintain secrecy under the circumstances.
Whether information is a trade secret is a factually intensive question for a court or jury to decide. Even a unique combination of public information can be a trade secret if the compilation gives a competitive edge.
When do customer lists qualify as trade secrets?
Many disputes involve the question of whether a company’s customer lists qualify as trade secrets. Florida courts consistently apply a three-factor test to determine when a customer list merits trade secret protection:
- Was the list created through the product of great expense and effort,
- Did it include information that was confidential and not available from public sources, and
- Was it distilled from larger lists of potential customers into a list of viable customers for the company’s unique business.
If these elements are satisfied, the list will usually qualify as a trade secret. However, customer lists derived from readily available sources without substantial development effort will generally fail to qualify for trade secret status.
What are reasonable secrecy measures?
To qualify as a trade secret, a business must also demonstrate it took reasonable steps to keep it secret. Courts look for practical safeguards that fit the situation.
For example, courts will likely not impose the same “reasonable” secrecy measures on a small business with limited resources as on a much larger company. Nonetheless, some reasonable measure of secrecy is required, no matter the size of the enterprise.
Access controls, usernames, and passwords are basic security measures, including limiting user permissions and tracking system usage through logs. Requiring confidentiality agreements from prospects, employees, and clients is strong evidence of reasonable protection. Contract clauses requiring customers to keep systems and information confidential and use of commercially reasonable security measures also help. Moreover, given today’s ever-evolving technological landscape, if confidential business information is posted on an unencrypted website and is accessible through search engines, a court may conclude the company failed to maintain its secrecy, thereby eliminating trade secret protection. Similarly, sharing trade secrets with an artificial intelligence (AI) chatbot may be deemed a failure to take reasonable steps to preserve their secrecy.
Courts do not require perfect secrecy, only reasonable efforts for the context.
How do businesses prove trade secret misappropriation?
Misappropriation under FUTSA includes acquiring a trade secret by improper means or disclosing or using it without consent when the person knew or should have known it was obtained improperly or under a duty of secrecy.
Direct proof of misappropriation can be hard to obtain, so circumstantial evidence is allowed.
For example, if a person had access to a company’s trade secret information and left the company to open a competing company, selling almost identical products, a court could infer trade secret misappropriation. Although the trade secret owner bears the burden of proving unauthorized use of the trade secret, proof of the wrongdoer’s knowledge of the trade secret coupled with substantial similarities between the parties’ products or processes may justify an inference of misappropriation. Moreover, the development of a product on an implausibly fast timeline can be strong evidence that it was borne of misappropriation.
Other examples of circumstantial evidence of misappropriation include sharing links, passwords, and reports with a third party against confidentiality obligations.
When will a court issue an injunction?
Courts can stop actual or threatened misappropriation through injunctions. To obtain a temporary injunction under FUTSA, a trade secret owner must show:
- A substantial likelihood of success on the merits of the claim,
- The unavailability of an adequate remedy at law,
- Irreparable harm absent entry of an injunction, and
- That the injunction would serve the public interest.
With respect to proving irreparable harm, a plaintiff must generally act quickly to seek an injunction. A temporary injunction requires showing “imminent” irreparable harm. As one court stated in the case of Car Body Lab Inc. v. Lithia Motors, Inc., 2021 WL 2652774, * 9 (S.D. Fla. June 21, 2021), “A delay in seeking a (temporary) injunction of even only a few months – though not necessarily fatal – militates against a finding of irreparable harm. Indeed, the very idea of a (temporary) injunction is premised on the need for speedy and urgent action to protect a plaintiff's rights before a case can be resolved on its merits.”
What damages and financial remedies are available under FUTSA?
FUTSA allows for recovery of actual losses and unjust enrichment resulting from the misappropriation, or in lieu of damages, a reasonable royalty may be imposed on the wrongdoer. Additionally, if there’s a finding of willful and malicious misappropriation, this can result in double the amount of damages awarded. Courts may also award attorneys’ fees for bad faith or willful and malicious conduct, though fee awards are discretionary.
What can businesses do now to protect their trade secrets?
FUTSA offers robust protections for confidential business information when owners take reasonable secrecy measures and can show misappropriation, and it provides strong remedies, including injunctions and damages. Businesses should tailor practical safeguards to their circumstances, act quickly to enjoin actual or threatened misuse, and leverage FUTSA’s monetary and fee-shifting remedies when warranted. Finally, although this article provides only a general discussion of FUTSA, claims under the Act can sometimes be brought alongside related claims in the same action—such as violations of the federal Defend Trade Secrets Act, or trademark, copyright, and patent infringement claims—depending on the specific facts of the case.
Note: This Insight provides a general introduction to trade secret issues. Proceeding with trade secret claims is a complex decision that requires analysis of the specific facts. Please speak with counsel before choosing to take any action.
Questions?
Contact GrayRobinson Shareholder Alan L. Goodman or a member of the Litigation Section.