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Why legal experts are up in arms over the trade-secrets bill Microsoft loves

Katherine Noyes | Dec. 3, 2015
It could strike a blow against free speech and algorithmic transparency, they warn

"Federal litigation tends to have more psychological power behind it," she said. "That's a benefit that will be used by the people who own the algorithms."

There's also no federal jurisprudence on the matter, she added, so "technically the federal courts can decide what everything means within trade-secret law."

In other words, the federal courts could take an expansive view of what constitutes a trade secret and what it means to steal one, resulting in stronger protections for companies seeking to protect algorithms and other secrets.

That could come as a blow to those like Ashkan Soltani, the FTC's chief technologist, who seek greater algorithmic transparency for social and ethical reasons.

Hamline University's Sandeen suspects a hidden agenda behind the bill. Protections on trade secrets were traditionally kept relatively weak to encourage companies to pursue patents instead, she noted.

Patents are generally limited to 20 years, while "in theory, trade secrets can last forever," she said. Particularly in industries such as manufacturing and pharmaceuticals, "they realize that trade secrets would be a better option."

In addition, patents are filed publicly. A greater reliance on trade secrets would strike another blow to transparency.

"Patents offer a form of disclosure and rudimentary algorithmic transparency that can be used to inform the public of how those systems operate," said Nick Diakopoulos, a professor in the University of Maryland's College of Journalism. "Fewer patents means there will be less information about corporate algorithms available to the public."

Hacking a company to steal a trade secret is already illegal under the federal Computer Fraud and Abuse Act, noted Christian Sandvig, a professor in the School of Information at the University of Michigan.

With its new seizure provisions, the Defend Trade Secrets Act could threaten free speech as well, he suggested.

"We know that in the past, corporations have used the courts to try to shut down Web servers that publicize technological research that makes them look bad," Sandvig said. "This bill would give corporate censors a powerful new tool."

 

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