Strategy to Protect Trade Secrets Unveiled

WH: New Strategy Complements Recent Cyber Initiatives
Strategy to Protect Trade Secrets Unveiled

Coming just days after IT security provider Mandiant detailed Chinese spying on American companies [see 6 Types of Data Chinese Hackers Pilfer], the Obama administration unveiled a governmentwide strategy to mitigate the theft of intellectual property of American companies, much of it being pilfered over the Internet.

See Also: OnDemand | The Cost of Underpreparedness to Your Business

Although separate from recent administration cybersecurity initiatives, White House Press Secretary Jay Carney says those and the new Administration's Strategy on Mitigating the Theft of U.S. Trade Secrets "are understandably related issues."

The trade secrets protection strategy was unveiled in a White House webcast on Feb. 20 by Attorney General Eric Holder, Commerce Acting Secretary Rebecca Blank and Victoria Espinel, White House intellectual property enforcement coordinator.

"Trade secrets play a crucial role in America's global competitiveness," Espinel says. "We will use this strategy to put in place an effective and coordinated approach to protect American trade secrets."

Employing Diplomacy

The strategy contains five major components:

  1. Increase diplomatic engagement by conveying the U.S. government's concerns to countries where there are high incidents of trade secret theft with coordinated and sustained messages from the most senior levels of the administration. The United States will build coalitions with countries that share its concerns and will urge foreign law enforcement to do more. "We will use our trade policy tools to press other governments for better protection and enforcement," Espinel says.
  2. The federal government will support industry-led efforts to develop best practices to protect trade secrets and encourage companies to share with each other best practices that can mitigate the risk of trade secret theft.
  3. The Justice Department will designate as a top priority intensive investigation and prosecution of trade secret theft by foreign competitors and foreign governments. In addition, the FBI and the intelligence community will provide warnings and threat assessments to the private sector on information and technology that are being targeted for theft by foreign competitors and foreign governments.
  4. The administration will conduct a review of U.S. laws to determine if further legislation is needed to enhance enforcement. If changes are necessary, the administration pledges to work with Congress to make those changes lasting and comprehensive.
  5. The government will develop programs to increase public awareness of the threats and risks to the U.S. economy posed by trade secret theft.

Holder's former deputy chief of staff, Jim Garland, characterizes the strategy as appropriately recognizing the vital role the business plays in defending itself against trade secret theft. "It also recognizes that government can help industry defend itself by increasing the sharing of threat information with the private sector," says Garland, a partner at the law firm Covington and Burling.

Amplified Threat from Cyberspace

In an appendix to the strategy, referencing a year-old report to Congress on industrial espionage, the Office of National Counterintelligence Executive states what has become conventional wisdom: Cyberspace amplifies the threats of intellectual property theft by making it possible for malicious actors, whether they are corrupted insiders or foreign intelligence services, to quickly steal and transfer massive quantities of data while remaining anonymous and hard to detect.

The strategy points out that the Chinese are the world's most active and persistent perpetrators of economic espionage. But the Chinese aren't the only nation seeking to pilfer U.S. intellectual property. According to the strategy, Russia's intelligence services conduct a range of activities to collect economic information and technology from American targets.

Even some U.S. allies and partners use their broad access to American institutions to acquire sensitive economic and technology information, primarily through aggressive elicitation and other human intelligence tactics. Some of these states have advanced cyber capabilities, the strategy says.

"Because the United States is a leader in the development of new technologies and a central player in global financial and trade networks, foreign attempts to collect U.S. technological and economic information will continue at a high level and will represent a growing and persistent threat to U.S. economic security," the strategy says. "The nature of the cyber-threat will evolve with continuing technological advances in the global information environment."

About the Author

Eric Chabrow

Eric Chabrow

Retired Executive Editor, GovInfoSecurity

Chabrow, who retired at the end of 2017, hosted and produced the semi-weekly podcast ISMG Security Report and oversaw ISMG's GovInfoSecurity and InfoRiskToday. He's a veteran multimedia journalist who has covered information technology, government and business.

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