Reasonable measures standard

The legal requirement that a trade secret plaintiff demonstrate it took objectively reasonable steps to maintain the secrecy of the information claimed as a trade secret — a prerequisite to protection under both the DTSA and state-law equivalents. Reasonable measures are evaluated contextually and may include NDAs, access controls, employee training, data encryption, and physical security protocols, but courts do not require perfection. In litigation finance diligence, the reasonable measures inquiry is often determinative: plaintiffs who maintained lax security practices or widely shared the alleged secret face substantial risk of summary judgment before recovery is possible. Funders analyze contemporaneous security documentation, onboarding practices, and any public disclosures that might undermine the secrecy element before committing capital to trade secret cases.

This is typically the single largest go/no-go diligence item in a trade secret investment, because a plaintiff with lax security practices can lose on summary judgment before any misappropriation evidence is even weighed — a very different failure mode from a merits loss at trial. Funders request contemporaneous security documentation, including access logs, NDAs, and encryption practices, before committing capital specifically because after-the-fact assertions of secrecy carry little evidentiary weight, and a weak reasonable-measures record cannot be cured once litigation has begun.