What Counts as a Trade Secret in Court

Common situations.

• A company claims its customer list is a trade secret, but much of it is on LinkedIn.
• An owner sues over "all of our confidential information" without identifying anything specific.
• A former employee argues that what he used is just experience in the industry.

The statutory definitions.

Texas and federal law use nearly the same definition. Since the 2017 amendments to the Texas Uniform Trade Secrets Act, both cover all forms and types of business, scientific, technical, economic, or engineering information, including formulas, designs, prototypes, plans, programs, code, methods, processes, procedures, financial data, and lists of actual or potential customers or suppliers, however stored (Tex. Civ. Prac. & Rem. Code § 134A.002(6); 18 U.S.C. § 1839(3)). Information qualifies only if:

1. Reasonable measures. The owner has taken reasonable measures under the circumstances to keep it secret; and
2. Value from secrecy. It derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, others who could profit from it.

Reasonable measures.

The law does not require perfect security, only measures that are reasonable for the information and the business. Courts look at the whole picture, such as:

• confidentiality and invention-assignment agreements with employees and contractors;
• nondisclosure agreements with customers, vendors, and partners;
• limiting access to those who need it, with passwords, permissions, and logging;
• marking documents confidential and training employees on what is confidential;
• exit procedures, including return of devices and reminders of continuing obligations.

Weak points that defendants raise include sharing the information without an NDA, posting it publicly, failing to restrict access, or treating it inconsistently. Before TUTSA, the Texas Supreme Court listed factors from the Restatement for deciding whether information is a trade secret, including the extent of measures taken to guard its secrecy and how easily others could acquire or duplicate it (In re Bass, 113 S.W.3d 735 (Tex. 2003)). Texas courts still consult those factors.

Value from secrecy.

The information must be worth something because competitors do not have it. Evidence includes the time and money spent developing it, the advantage it gives, and what competitors would pay for it. Information that is generally known in the industry, or that a competitor could readily find through proper means such as public sources or reverse engineering a lawfully acquired product, does not qualify.

What is outside the definition.

• General knowledge, skill, and experience. A Texas court may not enjoin a person from using general knowledge, skill, and experience acquired during employment (Tex. Civ. Prac. & Rem. Code § 134A.003(a)), and a DTSA injunction may not prevent a person from taking a job (18 U.S.C. § 1836(b)(3)(A)(i)).
• Readily ascertainable information. Contact details or prices that anyone can find are not secret, though a compilation that took real effort to assemble may be.
• Information the owner disclosed. Disclosure without confidentiality protections, including in a published patent or patent application, ends secrecy for what was disclosed.

Identifying the secrets.

Neither statute says when an owner must identify its secrets, but courts expect owners to do so early, in writing, with reasonable particularity, so the defendant can prepare a defense and the court can set the scope of discovery and any injunction. The Sedona Conference recommends identifying each asserted secret early, allowing amendment as discovery proceeds, and treating the identification as a case-management step rather than a ruling on the merits (Sedona Conference, Commentary on the Proper Identification of Asserted Trade Secrets in Misappropriation Cases (2020)).

Precise identification also matters at the end of the case. In Trinseo Europe GmbH v. Kellogg Brown & Root, L.L.C., No. 24-20460 (5th Cir. Jan. 21, 2026), the plaintiff's damages model assumed ten secrets but the jury found only four, and the Fifth Circuit affirmed vacating the $75 million award. A Texas appellate court reached a similar result in 2025, requiring damages tied to each trade secret found misappropriated (Coe v. DNOW LP, 718 S.W.3d 338 (Tex. App.–Houston [14th Dist.] 2025, pet. denied)). Owners should be ready to value each secret, or each group of secrets, separately.

Texas notes.

• Most Texas trade secret cases are decided under TUTSA, which displaced the common-law misappropriation claim for conduct after its effective date. See Misappropriation and Related Claims.
• The Texas Business Court hears trade secret cases over $5 million. Its judges have begun issuing written opinions on TUTSA questions. See Where Trade Secret Cases Are Heard.

Sources.

• Tex. Civ. Prac. & Rem. Code §§ 134A.002, 134A.003(a).
• 18 U.S.C. §§ 1836(b)(3)(A)(i), 1839(3).
• H.B. 1995, 85th Leg., R.S. (2017) (amending ch. 134A, effective Sept. 1, 2017).
• In re Bass, 113 S.W.3d 735 (Tex. 2003).
• Trinseo Eur. GmbH v. Kellogg Brown & Root, L.L.C., No. 24-20460 (5th Cir. Jan. 21, 2026).
• Coe v. DNOW LP, 718 S.W.3d 338 (Tex. App.–Houston [14th Dist.] 2025, pet. denied).
• The Sedona Conference, Commentary on the Proper Identification of Asserted Trade Secrets in Misappropriation Cases (2020).

This guide is general information, not legal advice. Law checked through October 20, 2026. See the Disclaimer.