“Trade secret" means information, including a formula, pattern, compilation, program, device, method, technique or process to which all of the following apply:
The information derives independent economic value, actual or potential, 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.
The information is the subject of efforts to maintain its secrecy that are reasonable under the circumstances.
No person, including the state, may misappropriate or threaten to misappropriate a trade secret by doing any of the following:
Acquiring the trade secret of another by means which the person knows or has reason to know constitute improper means.
Disclosing or using without express or implied consent a trade secret of another if the person did any of the following:
Used improper means to acquire knowledge of the trade secret.
At the time of disclosure or use, knew or had reason to know that he or she obtained knowledge of the trade secret through any of the following means:
Deriving it from or through a person who utilized improper means to acquire it.
Acquiring it under circumstances giving rise to a duty to maintain its secrecy or limit its use.
Deriving it from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use.
A court may grant an injunction against a person who violates sub. (2)
. Chapter 813
governs any temporary or interlocutory injunction or ex parte restraining order in an action under this section, except that no court may issue such an injunction or restraining order unless the complainant makes an application which includes a description of each alleged trade secret in sufficient detail to inform the party to be enjoined or restrained of the nature of the complaint against that party or, if the court so orders, includes written disclosure of the trade secret. The complainant shall serve this application upon the party to be enjoined or restrained at the time the motion for the injunction is made or the restraining order is served, whichever is earlier.
Except as provided in subd. 3.
, upon application to the court, the court shall terminate an injunction when a trade secret ceases to exist.
The court may continue an injunction for a reasonable period of time to eliminate commercial advantage which the person who violated sub. (2)
otherwise would derive from the violation.
In exceptional circumstances, an injunction granted under par. (a)
may condition future use of a trade secret by the person who violated sub. (2)
upon payment of a reasonable royalty by that person to the owner of the trade secret for no longer than the period of time for which the court may enjoin or restrain the use of the trade secret under par. (a)
. Exceptional circumstances include a material and prejudicial change of position, prior to acquiring knowledge or reason to know of a violation of sub. (2)
, that renders an injunction inequitable.
In appropriate circumstances, the court may order affirmative acts to protect a trade secret.
Except to the extent that a material and prejudicial change of position prior to acquiring knowledge or reason to know of a violation of sub. (2)
renders a monetary recovery inequitable, a court may award damages to the complainant for a violation of sub. (2)
. A court may award damages in addition to, or in lieu of, injunctive relief under sub. (3)
. Damages may include both the actual loss caused by the violation and unjust enrichment caused by the violation that is not taken into account in computing actual loss. Damages may be measured exclusively by the imposition of liability for a reasonable royalty for a violation of sub. (2)
if the complainant cannot by any other method of measurement prove an amount of damages which exceeds the reasonable royalty.
If a violation of sub. (2)
is willful and malicious, the court may award punitive damages in an amount not exceeding twice any award under par. (a)
If a claim that sub. (2)
has been violated is made in bad faith, a motion to terminate an injunction is made or resisted in bad faith, or a violation of sub. (2)
is willful and deliberate, the court may award reasonable attorney fees to the prevailing party.
(5) Preservation of secrecy.
In an action under this section, a court shall preserve the secrecy of an alleged trade secret by reasonable means, which may include granting a protective order in a discovery proceeding, holding an in-camera hearing, sealing the record of the action and ordering any person involved in the action not to disclose an alleged trade secret without prior court approval.
Except as provided in par. (b)
, this section displaces conflicting tort law, restitutionary law and any other law of this state providing a civil remedy for misappropriation of a trade secret.
This section does not affect any of the following:
Any contractual remedy, whether or not based upon misappropriation of a trade secret.
Any civil remedy not based upon misappropriation of a trade secret.
Any criminal remedy, whether or not based upon misappropriation of a trade secret.
(7) Uniformity of application and construction.
This section shall be applied and construed to make uniform the law relating to misappropriation of trade secrets among states enacting substantially identical laws.
History: 1985 a. 236
NOTE: 1985 Wis. Act 236
, which created this section, contains extensive notes describing this section and other sections affected by Act 236.
Some factors to be considered in determining whether given information is one's trade secret are: 1) the extent to which the information is known outside of the person's business; 2) the extent to which it is known by employees and others involved in the person's business; 3) the extent of measures taken by the person to guard the secrecy of the information; 4) the value of the information to the person and to the person's competitors; 5) the amount of effort or money expended by the person in developing the information; and 6) the ease or difficulty with which the information could be properly acquired or duplicated by others. Minuteman, Inc. v. Alexander, 147 Wis. 2d 842
, 434 N.W.2d 773
A party asserting a trade secret need not spell out details that would destroy what the party seeks to protect, but the party must include with some specificity the nature of the trade secret that is more than a generalized allegation that there is a trade secret. ECT International, Inc. v. Zwerlein, 228 Wis. 2d 343
, 597 N.W.2d 479
(Ct. App. 1999), 98-2041
By limiting the period in which an employee agrees not to divulge trade secrets, an employer manifests its intent that there is no need to maintain the secrecy after the specified period. ECT International, Inc. v. Zwerlein, 228 Wis. 2d 343
, 597 N.W.2d 479
(Ct. App. 1999), 98-2041
Under sub. (4), “actual loss caused by the violation" may include losses that result when a misappropriator uses a trade secret unsuccessfully and produces and sells a defective product that causes the plaintiff's business to suffer. World Wide Prosthetic Supply, Inc. v. Mikulsky, 2002 WI 26
, 251 Wis. 2d 45
, 640 N.W.2d 764
Sub. (6) (a) and (b) 2. together do the following: 1) replace all pre-existing definitions of trade secret and remedies for tort claims dependent solely on the existence of a specific class of information statutorily defined as trade secrets; and 2) leave available all other types of civil actions that do not depend on information that meets the statutory definition of a trade secret. Therefore, any civil tort claim not grounded in a trade secret, as defined in the statute, remains available. Burbank Grease Services, LLC v. Sokolowski, 2006 WI 103
, 294 Wis. 2d 274
, 717 N.W.2d 781
Although a court may grant injunctive relief against a person who misappropriated a trade secret, the injunction should only be for a period reasonable to eliminate commercial advantage that the person who misappropriated the secret would otherwise derive from the violation. Once the defendant would have discovered the trade secret without the misappropriation, any lost profits from that time forward are not caused by the defendant's wrongful act. Minnesota Mining & Manufacturing Co. v. Pribyl, 259 F.3d 587
Nondisclosure agreements under sub. (6) between suppliers and users of intellectual property are not subject to rules that govern noncompete agreements between employers and employees. A much greater scope of restraint is allowed in contracts between vendors and vendees than between employers and employees. IDX Systems Corp. v. Epic Systems Corp., 285 F.3d 581
An independent contractor presumptively owns his or her work product. In the absence of an agreement, non-exclusivity is the norm. The law of trade secrets follows the same approach to ownership. Wisconsin does not require an express, written contract of confidentiality. An independent contractor does not acquire any rights in his or client's trade-secret data just because he or she used those data in the performance of his or her duties. Breach of an implicit promise to hold information for the client's sole benefit in turn violates sub. (2) (a). Hicklin Engineering, L.C. v. Bartell, 439 F.3d 346
Because the recovery of unjust enrichment damages is grounded in equitable principles, Wisconsin law limits the measure of unjust enrichment damages to the value of the benefit conferred upon the defendant. Calculating the benefit conferred on a defendant to determine unjust enrichment damages is a context-specific analysis. Under Wisconsin law, a jury can award avoided research and development costs based on the defendant gaining a significant head start in its operation. Epic Systems Corp. v. Tata Consultancy Services Ltd., 980 F.3d 1117
This section does not require absolute secrecy, but one who claims a trade secret must exercise eternal vigilance in protecting its confidentiality. In determining whether companies have fulfilled this requirement, Wisconsin courts consider whether the company negotiated confidentiality agreements, kept documents locked up, limited access to information, restricted building access, denoted documents as confidential, informed individuals that information was confidential, and allowed individuals to keep information after the business relationship had ended. Starsurgical Inc. v. Aperta, LLC, 40 F. Supp. 3d 1069
It is perfectly lawful to “steal" a firm's trade secret by reverse engineering. In this case, the plaintiff failed to rebut the defendants' contention that the plaintiff's designs may be reverse engineered, so the plaintiff did not meet its burden of showing its product designs were trade secrets. Kuryakyn Holdings, LLC v. Ciro, LLC, 242 F. Supp. 3d 789
Bare bones listings of customer information, such as names, addresses, phone numbers, and contact persons, have been routinely rejected by the Wisconsin courts as constituting a trade secret. Indeed, when the names, addresses, and contact persons of a company's customers are readily ascertainable by proper means, a customer list is not a trade secret. Additionally, an agent is permitted to use general information concerning the names of customers retained in the agent's memory, if not acquired in violation of his duty as an agent. Charles Schwab & Co. v. Lagrant, 483 F. Supp. 3d 625
Revisions to the law of trade secrets. Whitesel & Sklansky. WBB Aug. 1986.
Sale of dextromethorphan to a minor without prescription prohibited. 134.91(2)(a)
No person may sell at retail a drug containing dextromethorphan to a person who is under 18 years of age, unless the sale is pursuant to a prescription order.
No person may sell at retail a drug containing dextromethorphan unless the person making the sale receives from the purchaser, at the time of purchase, a form of identification from which the age of the purchaser can be determined, or unless based upon the outward appearance of the purchaser the person making the sale reasonably presumes that the purchaser is 25 years of age or older.
A person who is under 18 years of age may not purchase a drug containing dextromethorphan unless pursuant to a prescription order.
A person who violates sub. (2) (a)
is subject to a civil forfeiture of not more than $250 for each violation.
A person who violates sub. (2) (c)
is subject to a civil forfeiture of $50 for each violation.
History: 2017 a. 160
; 2021 a. 238
Payment of commissions to independent sales representatives. 134.93(1)(a)
“Commission" means compensation accruing to an independent sales representative for payment by a principal, the rate of which is expressed as a percentage of the dollar amount of orders or sales made by the independent sales representative or as a percentage of the dollar amount of profits generated by the independent sales representative.
“Independent sales representative" means a person, other than an insurance agent or broker, who contracts with a principal to solicit wholesale orders and who is compensated, in whole or in part, by commission. “Independent sales representative" does not include any of the following:
A person who places orders or purchases products for the person's own account for resale.
A person who is an employee of the principal and whose wages must be paid as required under s. 109.03
“Principal" means a sole proprietorship, partnership, joint venture, corporation or other business entity, whether or not having a permanent or fixed place of business in this state, that does all of the following:
Manufactures, produces, imports or distributes a product for wholesale.
Contracts with an independent sales representative to solicit orders for the product.
Compensates the independent sales representative, in whole or in part, by commission.
Subject to pars. (b)
, a commission becomes due as provided in the contract between the principal and the independent sales representative.
If there is no written contract between the principal and the independent sales representative, or if the written contract does not provide for when a commission becomes due, or if the written contract is ambiguous or unclear as to when a commission becomes due, a commission becomes due according to the past practice used by the principal and the independent sales representative.
If it cannot be determined under par. (a)
when a commission becomes due, a commission becomes due according to the custom and usage prevalent in this state for the particular industry of the principal and independent sales representative.
(3) Notice of termination or change in contract.
Unless otherwise provided in a written contract between a principal and an independent sales representative, a principal shall provide an independent sales representative with at least 90 days' prior written notice of any termination, cancellation, nonrenewal or substantial change in the competitive circumstances of the contract between the principal and the independent sales representative.
(4) Commissions due; payment on termination of contract.
A principal shall pay an independent sales representative all commissions that are due to the independent sales representative at the time of termination, cancellation or nonrenewal of the contract between the principal and the independent sales representative as required under sub. (2)
(5) Civil liability.
Any principal that violates sub. (2)
by failing to pay a commission due to an independent sales representative as required under sub. (2)
is liable to the independent sales representative for the amount of the commission due and for exemplary damages of not more than 200 percent of the amount of the commissions due. In addition, the principal shall pay to the independent sales representative, notwithstanding the limitations specified in s. 799.25
, all actual costs, including reasonable actual attorney fees, incurred by the independent sales representative in bringing an action, obtaining a judgment and collecting on a judgment under this subsection.
History: 1997 a. 71
“Person" in this section is subject to the definition in s. 990.01 (26), which includes not only natural persons, but also partnerships, associations, and bodies corporate and politic. Industry to Industry, Inc. v. Hillsman Modular Molding, Inc., 2002 WI 51
, 252 Wis. 2d 544
, 644 N.W.2d 236
Violations against elderly or disabled persons. 134.95(1)(a)
“Disabled person" means a person who has an impairment of a physical, mental or emotional nature that substantially limits at least one major life activity.
“Elderly person" means a person who is at least 62 years of age.
“Major life activity" means self-care, walking, seeing, hearing, speaking, breathing, learning, performing manual tasks or being able to be gainfully employed.
(2) Supplemental forfeiture.
If a fine or a forfeiture is imposed on a person for a violation under s. 100.171
, or 134.87
or ch. 136
or a rule promulgated under these sections or that chapter, the person shall be subject to a supplemental forfeiture not to exceed $10,000 for that violation if the conduct by the defendant, for which the fine or forfeiture was imposed, was perpetrated against an elderly person or disabled person and if any of the factors under s. 100.264 (2) (a)
, or (c)
Use of lodging establishments.