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Angel Investor (Individual)

Investments

1

Portfolio Exits

1

About Gerard Kelly

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Latest Gerard Kelly News

Practical tips to protect trade secrets

Nov 8, 2023

Gerard Kelly of Mason Hayes & Curran LLP discusses the practical and legal aspects of safeguarding trade secrets in Ireland and highlights potential challenges. Protecting confidential information and trade secrets is an important part of any business. Confidential information is a proprietary element of the business that gives it a competitive edge over the rest of the market. However, a competitive edge can only last as long as the information remains secret and outside the public domain. Protection is often ensured through clear contract terms with employees and contractors, or non-disclosure agreements (NDAs) with various partners. Some of the best-known examples of trade secrets are the Coca Cola recipe or KFC’s chicken coating. There is also a recent example where the footwear manufacturer, Crocs, issued a case in the US against a former employee where Crocs could demonstrate the taking of confidential information and the misuse of that information in launching a competing footwear company. Legal protections for trade secrets Irish law recognises the protection of confidential information and trade secrets in two ways - under the common law, through established case law, and through legislation. Business Bulletin Historically, common law protected confidential information based on the relationship between parties, regardless of if a formal agreement was in place or the information's format. The EU Trade Secrets Directive was implemented in Ireland by the European Union (Protection of Trade Secrets) Regulations 2018. A trade secret is defined by the Directive as information that: + Is secret, i.e. not generally known + Has commercial value because it is secret, and + Has been kept secret through reasonable steps taken by the holder. Information meeting all three criteria benefits from protection under the Directive if acquired without the consent of the trade secret holder unlawfully or in breach of a relevant agreement. Unlike the common law regime, the Directive made it unlawful to acquire confidential information as opposed to imparting it. However, the protection is not absolute. The Directive clarifies that trade secret infringement does not arise where the acquisition of a trade secret may be considered lawful, such as independent creation or reverse engineering from what is publicly available. The protections available for unlawful use include remedies such as damages, injunctive relief and other corrective measures. Limitations It is difficult to prove misappropriation of trade secrets since the perpetrators are unlikely to make their unlawful conduct obvious. They will often ensure there is no record or paper trail. That said, Crocs contended in their recent claim in the US that the former employee had downloaded documents and e-mails to a personal USB from a folder on his laptop named ‘Take’, which would make the case stronger, but that would be a rare example. Very often it will be the weight of circumstantial evidence and the evidence of one or more experts in the relevant field which will determine the question of liability. often after a significant discovery exercise looking for the ‘smoking gun’. Practical protections for trade secrets In order for a company to best protect itself from the misappropriation of its trade secrets there are a few practical steps that can be taken: + Companies should identify and define what constitutes their confidential information. This should be documented and form part of the company’s NDAs. + There should be adequate safeguards in place to prevent unauthorised access to trade secrets, including physical and technological restrictions on access. + For employees and contractors, especially those permitted to have access to the trade secrets, their contracts should have appropriately worded confidentiality, non-compete and non-solicitation clauses. The same goes for third parties who may have access to trade secrets as part of their engagement with a business, for example, a potential purchaser of the business. + Care should be taken that any contractual limitations imposed are clear, reasonable and proportionate in the context so as to remain enforceable. Gerry Kelly, Mason Hayes & Curran Ideally, while NDAs should be signed at the start of the engagement, companies should consider that contractors sign confirmatory agreements at the end of an engagement. These agreements are useful as they re-iterate the position on confidential information and provide for the ability to notify companies that may subsequently engage with the contractor about those obligations. For practical advice on effectively protecting your organisation’s intellectual property rights, visit MHC.ie/IP

Gerard Kelly Investments

1 Investments

Gerard Kelly has made 1 investments. Their latest investment was in Troy Studios as part of their Angel on September 16, 2019.

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Gerard Kelly Investments Activity

investments chart

Date

Round

Company

Amount

New?

Co-Investors

Sources

9/16/2019

Angel

Troy Studios

Yes

1

Date

9/16/2019

Round

Angel

Company

Troy Studios

Amount

New?

Yes

Co-Investors

Sources

1

Gerard Kelly Portfolio Exits

1 Portfolio Exit

Gerard Kelly has 1 portfolio exit. Their latest portfolio exit was Troy Studios on August 13, 2021.

Date

Exit

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Acquirer

Sources

8/13/2021

Acq - Fin

$99M

2

Date

8/13/2021

Exit

Acq - Fin

Companies

Valuation

$99M

Acquirer

Sources

2

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