The Bologna IP Court on the protection of trade secrets

On 27 July the IP Court of Bologna issued a judgment (no. 2340/15) which summarises the current Italian law and case-law on the protection of trade secrets.

The Judges essentially recalled that trade secrets are protected both under Articles 98 and 99 of the Italian IP Code (“IPC”), and pursuant to Article 2598(1)(3) Civil Code (“CC”) on unfair competition. In this case, it was found that the information for which the plaintiff demanded protection was secret and had economic value precisely because it was secret, thus meeting two of the three requirements set forth by Art. 98 ICP for its protection. However, the third requirement set out by the provision was not met, i.e. that the information be also subject to (technical and regulatory) measures adequate to keep it secret. Therefore, the information could not be protected under Art. 98 IPC, and there was no room to apply, to their misappropriation by the summoned competitor, Art. 99 IPC prohibiting the abusive appropriation, disclosure and/or use of trade secrets protected by Art. 98.

Nevertheless, according to the Court, Art. 99 IPC “applies without prejudice to the legislation on unfair competition”, based on which “the use of confidential information or, in general, the use of a business’ know-how, is to be considered as unfair competition, on the condition that it is used in a manner that is incorrect and potentially results in competitive harm, potential or actual”. This applies even if the confidential information does not possess all of the requirements set forth by Art. 98 IPC, hence, also in the present case, where the information was subjected to measures deemed inadequate to keep it secret.

The Judges additionally specified that the finding of unfair competition requires “that the information disclosed to third parties or acquired or used by the latter was intended not to be disclosed outside the company, i.e. that it was confidential, in the sense that access to their contents was not easy. Therefore, the potentially harmful conduct aimed at stealing confidential information related to production processes and substances used by a competitor to manufacture a given product, amounts to unfair competition for violation of principles of professional conduct (Civil Supreme Court, Sec. I, decision of 20.01.2014, no. 1100). Consequently, also the one who, with the theft of confidential information, saves the time and costs of an independent reconstruction of industrially useful information, must be considered to be in breach of the rules on fair competition, in accordance with Art. 2598(1)(3) CC. He puts in place unfair competition acts in relation to any acquisition of information made through misappropriation rather than independent investigation”.