Senate Approves “New Jersey Trade Secrets Act”; Returns to Assembly for Consideration

On September 26, 2011, the New Jersey Senate approved a bill known as the “New Jersey Trade Secrets Act” (A 921) to provide remedies for the misappropriation of trade secrets. The bill is based on the Uniform Trade Secrets Act prepared by the National Conference of Commissioners on Uniform State Laws, which has been adopted by 46 states. This new bill supersedes current common law remedies for misappropriation of trade secrets and provides for damages for both actual loss suffered by a plaintiff and for any unjust enrichment of the defendant caused by the misappropriation of trade secrets. Damages also may include a reasonable royalty for unauthorized disclosure or use of the trade secrets. In cases of willful misappropriation, punitive damages and attorneys’ fees may be awarded. In addition, if a claim for misappropriation is brought in bad faith, attorneys’ fees may be awarded.

The bill passed by the Senate was an amended version of the bill previously passed by the Assembly by a unanimous vote. The Assembly will need to vote again on the Senate’s amended version before it heads to the Governor’s desk. If the bill is signed by Governor Christie, the amendment will go into effect immediately.