A landmark ruling in China has found that the purchase of data containing trade secrets can lead to legal consequences. In one specific case, Guangzhou Sanmou Motorcycle, a motorcycle manufacturer, acquired company data from the top ten motorcycle exporters through a contract with a data provider. This data included sensitive information of a competitor, Chongqing Guangmou Motorcycle Manufacturing, including export destinations, product details and quantities.
Chongqing Guangmou considered this information to be trade secrets and sued Sanmou for unlawful appropriation. The People’s Court in the Chongqing Liangjiang New Area ruled in favor of the plaintiff. It declared that the export data is a trade secret because it is not publicly known, commercially valuable and adequately protected. The court also recognized that Sanmou, as a competitor, should have known that such information was proprietary. Sanmou was ordered to cease the infringement and to pay compensation for economic losses and costs.
This ruling underscores the importance of protecting data rights in China and signals that buyers of data must be careful in transactions to avoid being held liable for trade secret infringement.
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China Intellectual Property Blog 