Proposed SECRETS Act of 2021: What To Know

There has been a recent increase in the volume of complaints filed with the International Trade Commission – to be specific, in complaints alleging misappropriation of trade secrets and their unauthorized use in imports to the United States. Such allegations fall under the ITC’s Section 337 (Unfair Import Investigations), and they are not new. Senators John Cornyn (R-TX), Christopher Coons (D-DE), and Todd Young (R-IN), have introduced a bill to bulk up the ITC’s power to protect U.S. Intellectual Property owners. The bill creates a new committee within the ITC to conduct ex parte investigations into products alleged to have stolen trade secrets, speeding up the investigation process, and ultimately expediting the banning of any products found to have committed IP theft.

The ITC investigations into such claims have long been quick, but comprehensive. For imports found to have stolen trade secrets, the reprisal is thorough as well. Not only is it possible to block those imports, but the Commission may even issue cease and desist orders against importers who steal trade secrets. Nevertheless, there has been grumbling that the process takes too long, at an average duration of a year and a half.

Under Cornyn’s bill, either the owner of a trade secret or the committee itself on its own initiative could file a complaint against a product alleging said product contains trade secrets misappropriated with a foreign government’s assistance. Upon receipt of the complaint, the committee would have 30 days to review and determine if an ex parte investigation should commence. During the initial 30-day review, the committee must decide if imports should be halted for the duration of the in-depth (150 days maximum) investigation.

The bill is no doubt born of the increased number of ITC complaints, and particularly targets China – note the bill’s full title, Stopping and Excluding Chinese Rip-Offs and Exports with United States Trade Secrets Act of 2021. Cornyn accused the Chinese government of making billions each year off of stolen U.S. trade secrets, going on to state that the goal of the bill is to halt those profits. Coons emphasized that speed is critical in protecting U.S. I.P. owners, while reiterating that China has perpetrated massive theft. The bipartisan bill was introduced in June, and the current level of support is unclear. If it passes, it would be one more protection available to trade secret owners.

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