How do you control data without actually owning it? Data, even though not qualified as property, can be protected in principle by two legal instruments: as trade secrets or with robust contractual obligations. Trade secrets is a flexible legal protection method that fits those BHD actors who solely act within a small confined network of data gatherers, processors and refiners. A prerequisite to gain trade secret protection for any kind of information, data included, is that it is kept somewhat secret from the general public. This requirement of confidentiality poses a challenge in the BHD industry where the network of actors is very vast.
The industry is characterized by the large number of different types of actors within its value chain. The actors range from internet service providers and infrastructure providers, data providers and data brokers, the data subjects themselves, analysts to even the general public. All these actors are essential within the data value cycle. The sheer number of essential actors creates a situation where trade secrets, although valid, are a sub-optimal solution to your data control problem. Therefore, even though it might seem like a good idea to protect your data or data sets through trade secrets, it has not been widely adopted by the modern Big Data industry as the principle legal mechanism to protect data.
Another way to control your data is through contractual obligations by binding all your collaborative partners contractually. Protecting your data with contracts is a less fragile way compared to using trade secrets, which by definition rely on confidentiality to protect the data asset. Contracts as a protection mechanism are unlikely to hinder innovation and sharing, unlike with trade secrets. Trade secrets derive their value from the secrecy whereas the value of data to the actors in the field lies in the ability to share analyzed and standardized data sets. Actors are therefore compensated for managing, maintaining but more importantly, making Big Data available.
The fragility of trade secrets and the lack of traditionally tailored legal mechanisms underlines how important it is to properly plan and structure your company’s contracts. Your carefully drafted contracts may be the only control mechanism you have to control your most and sometimes only valuable corporate asset – data. Let us help your company analyze, structure and create the control mechanisms needed within your data driven business.