united-states workplace trade-secret
Taking Leads from a Company I quit
<p>If Im a 1099 (independent contractor) at a cash advance firm and I left (quit). Can I take the leads I sorted through and became "my list" and take those leads and start my own merchant cash advance business? Or, am I legally not allowed to take them. Or if I am able to take them, how can I? </p>

<h2>Breach of confidence</h2>

<p>In the absence of a non-disclosure or confidentiality agreement you can still be liable for <a href="https://legalvision.com.au/intellectual-property-and-breach-of-confidence-what-it-means-for-you/" rel="nofollow noreferrer">breach of confidence</a>. To succeed, your ex-principal must prove:</p>

<ol>
<li>the information was confidential</li>
<li>it was given to you in such a manner that a reasonable person would know it was confidential</li>
<li>they suffered damage as a result of their use.</li>
</ol>

<p>Whether a client list is confidential or not depends on the circumstances of the case, but they <a href="https://www.dundaslawyers.com.au/restraining-a-former-employee-from-using-your-client-list/" rel="nofollow noreferrer">usually</a> are. Possible exceptions are where a business uses their client list as a marketing tool - "Look at who our clients are, aren't we great!". Your use of it would normally be considered a confidential transfer. Your using it in the way described would harm your ex-principals interest.</p>

<p>On balance, you <em>probably</em> can't do this legally.</p>

<p>In US law, a client list is often considered to be a <em>Trade Secret</em> under the various state versions of the <a href="https://en.wikipedia.org/wiki/Uniform_Trade_Secrets_Act" rel="nofollow noreferrer">Uniform Trade Secrets Act (UTSA)</a>. See also the  <a href="https://en.wikipedia.org/wiki/Defend_Trade_Secrets_Act" rel="nofollow noreferrer">US Federal "Defend Trade Secrets Act"</a> (DTSA)</p>

<p>A trade secret is information:
* from which a business derives commercial advantage,
* that is not public or generally known,
* that the business makes reasonable efforts to keep confidential, and
* that some or all of the commercial advantage to the business comes from the information not being known.</p>

<p>Client lists will often fit these conditions, and be treated as trade secrets.</p>

<p>Under the UTSA, a business may be able to obtain an injunction against improper use or disclosure of a trade secret, may be able to obtain damages for such improper use or disclosure, and may have other remedies. I believe that all or all but one US state has enacted a version of the UTSA.</p>

<p>Under the federal DTSA similar cases may be brought in federal court, and in some cases improper disclosure of a trade secret may be criminal.</p>

<p>In addition, if there is a contract requiring the employee in general terms to protect confidential information (as there often is) any client lists or information might well fall under such a provision. Any remedy under a contract is in addition remedies under the UTSA or DTSA.</p>
