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Protecting a Valuable Trade Secret: Client Lists - Reyes Law Group

Protecting a Valuable Trade Secret: Client Lists

At Reyes Law Group, we guide our clients in their business transactions and provide counsel to corporations. We see firsthand the amount of work and dedication that it takes to build a successful business. That’s why one of our biggest passions within the world of business law is helping our clients protect what they have built. This means prosecuting or defending against lawsuits, aiding in acquisitions, and helping you ensure that your licensing and permits are in order, but it also means safeguarding trade secrets.

One of the most valuable trade secrets that we’ve seen businesses fail to take action to protect time and time again is one that might not immediately come to mind. It’s not a secret recipe or a groundbreaking way to speed up production. It’s your client/customer list. 

Why does my client list need to be protected?

Without legal protections, your client list could be poached by any of your employees who are interested in going to work for competing businesses or starting a competing business of their own. With access to the names and contact information of people who have bought your product or service in the past, they can advertise directly to those people, potentially taking their business by offering a lower price than what you charge.

The information you have gathered about your clients has economic value as well. You have likely devoted time, money, and other resources to finding the right market for your product or services, the most profitable price point, and other such information. Gaining access to this information without investing in finding it would put your direct competitors at a major advantage. 

What can I do to protect my client list and related information?

The first step in protecting your client list is limiting access to it within your company. This means it should not be accessible to every employee who gets a job with you. It should only be available to those who need the information in order to perform their duties.

To prevent employees who need access to this information in order to perform their duties from misappropriating it, you need to take legal measures. You will need to inform your employees in writing that your list of customers is property of the company and considered a trade secret. You should obtain your employees’ acknowledgement of this, preferably with a signature. This can be worked into your employment contract and/or onboarding process. This agreement can be made even more secure by supplemental confidentiality and computer use agreements. 

At the Reyes Law Group, we have over 32 years experience helping companies protect their valuable trade secrets, such as client lists. We would welcome the opportunity to guide you through the process of making sure your business is legally secure. Please contact us at (954) 369-1993 or info@reyeslegal.com to discuss how we can help you with your legal needs.

Written by Reyes Law Group