Ex Parte Seizures Five Years After the Enactment of the Defend Trade Secrets Act
Almost five years has passed since the enactment of the Defend Trade Secrets Act (DTSA) on May 11, 2016, which provides for civil relief for the theft of trade secrets. The most controversial provision, 18 U.S.C. § 1836(b)(2), authorizes a federal court to issue an order, in extraordinary circumstances, and upon an ex parte application based on an affidavit or verified complaint, to provide for seizure of property necessary to preserve evidence or to prevent the propagation or dissemination of the trade secret. Thus, the issuance of a seizure order is limited to “extraordinary circumstances.” According to the House Report, the “ex parte seizure provision is expected to be used in instances in which a defendant is seeking to flee the country or planning to disclose the trade secret to a third party immediately or is otherwise not amenable to the enforcement of the court’s orders.” In other words, it is intended to stop the dissemination of a trade secret, especially overseas, before its value has been lost through public disclosure. Thus, it provides a trade secret owner with the ability to mitigate the risk that trade secrets are irrevocably lost, transferred, or moved beyond the jurisdiction of the court.