If you believe another party has misappropriated a trade secret, how long do you have to file a lawsuit against that party? And from where does the legal authority come for that time period? We will discuss what is known as the statute of limitations for filing a trade secret claim in Texas.
A statute of limitations is the legal term for the time period in which you have to file your lawsuit. Typically, statutes of limitations begin from the date at which the plaintiff suffers a legal harm, or the date by which the plaintiff reasonably should have discovered the legal harm. When we talk about a statute of limitations for certain lawsuits, we typically say that the clock begins ticking at that point in time.
Now that you have a better understanding of what the legal term means, what is the appropriate statute of limitations for a trade secret claim in Texas?
Theft of Trade Secret Statute of Limitations Under Texas Law
The state of Texas now has its own version of the Uniform Trade Secrets Act (TUTSA). However, the TUTSA does not have a provision for the statute of limitations in trade secret cases. As such, the statute of limitations for such a claim falls under the Texas Civil Practice & Remedies Code, Section 16.010.
This particular section of the law applies only to the misappropriation of trade secrets. It specifies that “a person must bring suit for misappropriation of trade secrets not later than three years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered.” In other words, you have three years from the date that the trade secret was misappropriated, or three years from the date by which reasonable diligence should have allowed you to determine that the trade secret was misappropriated.
What happens if the misappropriation continues over time? The law takes this possibility into account and clarifies that the statute of limitations will begin running—and you will have three years from the initial misappropriation of the trade secret—whether the misappropriation “is a single or continuing act.”