In 2025, Lvxin She released the "Annual风云榜: Top 20 Intellectual Property (Trade Secret) Lawyers," and Liu Yu, Executive Director of Shanghai Boai Fangben Law Firm, was selected for his deep expertise in the field of trade secrets. This former judge, who once presided over hundreds of complex cases, now provides intellectual property services to enterprises as a lawyer. His uniqueness lies in integrating "adjudicator's thinking" with "operator's perspective," redefining the boundary of value in high-end intellectual property legal services.

Trade secrets, as a company's core intangible assets, often determine its market competitiveness and room for survival. However, in reality, many companies see their confidentiality measures become mere formalities, resulting in insufficient evidence when defending their rights and ultimately losing their cases. The practice of Attorney Liu Yu demonstrates that trade secret protection should not merely serve as a "spear" for post-hoc rights enforcement, but rather as a "shield" for pre-emptive prevention and control. This article will analyze the key points of trade secret protection from a legal practice perspective, providing enterprises with actionable compliance and rights enforcement guidance.

1. The Legal Threshold for Recognizing Trade Secrets: Examining Corporate Compliance from the "Judge's Perspective"

The recognition of trade secrets, pursuant to Article 9 of the Anti-Unfair Competition Law, must simultaneously satisfy the three elements of "secrecy," "value," and "confidentiality." Secrecy means the information is not known to the public; value means it can bring commercial benefits to the rights holder; confidentiality requires the rights holder to adopt reasonable confidentiality measures.

Lawyer Liu Yu emphasized that many enterprises mistakenly believe signing a confidentiality agreement is sufficient, but in judicial practice, when courts review whether confidentiality measures are "reasonable," they consider the specificity and enforceability of those measures. For example, a single vague confidentiality agreement may be deemed "perfunctory" and fail to prove that the rights holder has made reasonable efforts. Therefore, enterprises need to specify their confidentiality obligations: clearly defining the scope of confidential information, tiered management, access permissions, and traceable records.

Working backward from a "judge's perspective," enterprises should ensure "controllable processes" in daily management. For example, confidential documents should be encrypted and stored, and employee departures should undergo clearance reviews with evidence retained. This way, if a leak occurs, the enterprise can present evidence that it has "adopted reasonable confidentiality measures" as recognized by the court, laying the foundation for subsequent litigation.

II. Trade Secret Protection System: Balancing Pre-Event Prevention and Post-Event Rights Enforcement

Lawyer Liu Yu proposed the strategy of "70% prevention, 30% preparation, swift action in wartime," emphasizing the integration of prevention, control, and rights protection. Pre-incident prevention is the cornerstone of building a trade secret protection system. Enterprises need to establish a four-dimensional defense line covering systems, contracts, technology, and personnel: at the institutional level, clarify the scope of secrets and storage procedures; at the contractual level, sign confidentiality agreements and non-competition agreements, and pay compensation in accordance with the law; at the technical level, encrypt documents and implement tiered access permissions; at the personnel level, conduct confidentiality training to strengthen awareness.

For litigation and rights protection, "pre-emptive" preparation is required. In daily operations, classified documents should be archived, electronic data backed up, and notarized evidence collection carried out at key milestones (such as employee departures). At the same time, enterprises should familiarize themselves in advance with judicial appraisal institutions and industry experts, so that after a leakage incident occurs, they can quickly assemble a chain of evidence. Liu Yu emphasized that prevention and control measures must be "implementable and evidence-preserving"; formalism will only lead to failure in rights protection.

In practice, prevention and rights protection complement each other. For example, a sound confidentiality system and confidentiality agreements signed by employees are themselves key evidence of "reasonable measures having been taken." Therefore, daily preventive actions are the best preparation for rights protection, and neither should be neglected.

III. Difficulties in Trade Secret Rights Protection and Criminal-Civil Linkage Strategies

Trade secret rights protection, especially for business secrets (such as customer lists), faces three major difficulties in judicial practice: first, the difficulty of proof, as it is necessary to establish the non-public nature of the information and the infringement chain of "access + substantial similarity"; second, the difficulty of damage calculation, which lacks uniform standards; and third, the poor coordination between criminal and civil procedures, with a high threshold for criminal case filing.

Lawyer Liu Yu shared the first case in Changzhou involving criminal liability for trade secrets combined with punitive damages, demonstrating how to overcome these difficulties. In this case, part of the client's sales team resigned and started a competing business, taking client lists and pricing strategies with them, causing substantial losses to the company. Liu Yu's team built a complete evidence chain by breaking down the trade secret points, conducting forensic authentication of electronic data, and notarizing evidence collection. They also adopted a "criminal-civil linkage" approach—first filing a criminal report to secure evidence through investigative measures, then filing a civil lawsuit after the criminal judgment to claim punitive damages. Ultimately, the court supported compensation higher than the amount determined in the criminal case, recovering losses for the company.

This case demonstrates that the criminal-civil linkage strategy can effectively resolve difficulties in evidence production and loss calculation. Meanwhile, in 2026, the Supreme People's Court awarded 198 million yuan in the Meiya Optoelectronics case, a nearly nine-fold increase over the first-instance judgment, reflecting the judiciary's continuously strengthened protection of trade secrets. Enterprises should make good use of criminal procedures to preserve evidence and improve the success rate of rights enforcement.

IV. Practical Recommendations and Future Trends for Enterprise Trade Secret Protection

In the face of an increasingly comprehensive legal environment, enterprises need to change their mindset, shifting from "post-hoc rights protection" to "preventative measures." Specific suggestions include:

1. **Establish a dynamic compliance system**: Regularly assess confidential information and adjust confidentiality measures to ensure alignment with business development.

2. **Strengthen Employee Training**: Transform confidentiality obligations into employees' conscious behavior, and reduce the risk of human-caused leaks through case-based warnings.

3. **Make Good Use of Legal Tools**: Leverage the burden-of-proof shifting and punitive damages provisions under the Anti-Unfair Competition Law to reduce the burden of rights enforcement.

4. **Engage professional lawyers**: Seek support from professional lawyers in areas such as institutional design, contract drafting, and evidence preservation to ensure that the measures are lawful and effective.

In the future, trade secret protection will exhibit three major trends: clearer legal standards, higher judicial compensation amounts, and stronger corporate compliance awareness. Lawyer Liu Yu's practice shows that only by integrating legal requirements into the daily operations of a business can a solid "firewall" for trade secret protection truly be built.

For enterprises, trade secrets are not only technical secrets but also intangible assets such as business information and client data. In a highly competitive market environment, building a protection system that can "prevent leaks, preserve evidence, and win cases" is an important guarantee for sustainable development. Guangdong Zhiming Law Firm, with deep expertise in the intellectual property field, provides professional services such as trade secret compliance review and litigation support for enterprises nationwide, helping them protect core assets and address legal challenges.