What to do after an employee leaked our algorithm?

Question

One of my company's internally developed algorithms was published online. It's a complex algorithm that took years to develop, I have a pretty good idea of which employee leaked it based on the team who worked on it and personal information on the blog, but I want confirmation. The algorithm is covered in detail but without any code from our codebase, so my employee might have thought it was okay to share this information publicly when it is absolutely not.

It looks like the algorithm has been online for at least a month. What can we do to mitigate damage from competition? Should we go ahead and license it? Should we even talk about this on our company blog?

(Related management question asked here.)

Answer 1

Whether this is considered a trade secret (at least in the US) depends partly on whether you've taken reasonable action to keep it secret. If an employee thought it was OK to publish the algorithm, that's evidence that you didn't try very hard to keep it from getting out.

Even if nobody's noticed it yet, getting the blog post taken down in't going to get it off the internet. You may as well try to do it anyway. If nobody has noticed the algorithm by now, you want to make it harder for them to find.

You need an IP lawyer pronto. Depending on where you are, you might be able to get a patent on the algorithm still, but patents are hard to enforce, and it appears to be getting harder in the US to patent algorithms. (There's a Stack Exchange site so people can look at patent applications and see if they can invalidate the application with prior art.) You can't license out the algorithm without having some legal way of stopping other places from just using it.

If you have more proprietary algorithms or things that aren't generally known that give you a competitive advantage, it would be a good idea to inform employees that they aren't supposed to reveal them. Check with your IP lawyer to see what you should do.

Answer 2

Let's go over the options:

• Copyright is out of the question as you cannot copyright an algorithm. No code is shared in this case anyway.
• Patent might be possible but the cons outweighs the pros in this case. Depending on the nature of your algorithm and your jurisdiction you may not succeed. And a patent by definition is going to disclose the algorithm to everyone, which is against your objective.
• Trade secret is your way to go.

my employee might have thought it was okay to share this information publicly when it is absolutely not

Surely there was a non-disclosure clause on the employment contract? Now is the time to use it! You'd wish to establish that:

1. The algorithm is "confidential".
2. The employee leaked this confidential information and violated the NDA.
3. There are damages to your company due to this action.

It's not as simple as it sounds though. Is everyone well aware of what they can and cannot share? Can you conclusively proof a certain employee is responsible? In some jurisdictions, if the company dismiss the employee without proofing their wrong-doings, the company may be liable under employment laws.

Should we go ahead and license it? Should we even talk about this on our company blog?

Well, if you don't want somebody to notice it, don't talk about it.

In addition, if you wish to take down the content, you first need to establish you have the right to do so. It's more complicated when the website is hosted overseas.

TLDR: Your company would need to hire legal services. If the algorithm is valuable, the cost would be justified.