DTSA (Defend Trade Secrets Act)

A federal statute enacted in 2016 that created a private civil cause of action for trade secret misappropriation in federal court, harmonizing trade secret enforcement with existing federal IP litigation infrastructure. Before the DTSA, trade secret plaintiffs were limited to state court under the Uniform Trade Secrets Act or its state-law equivalents. The DTSA matters to litigation funders because it provides access to federal courts, federal discovery tools, and extraordinary remedies — including ex parte seizure orders — and enables cases with nationwide or international misappropriation to be litigated in a single forum. The DTSA's whistleblower immunity provision and the requirement that employers notify employees of these protections have also become relevant in employer-employee trade secret disputes, which represent a significant segment of funded trade secret dockets.

Access to federal court and the DTSA's ex parte seizure remedy expands the funder's playbook for protecting the asset mid-case — a seizure order preventing further use or dissemination of the secret can be pursued as an early value-preservation step independent of the ultimate damages case. Funders also value DTSA's nationwide service and consolidated federal discovery for cases spanning multiple states, since fragmented state-court trade secret litigation against the same defendant is harder to underwrite as a single, coherent capital commitment.