Stop Sanctuary Policies and Protect Americans Act - Motion to Proceed

Floor Speech

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Mr. COONS. Mr. President, I thank Senator Hatch for his leadership on this important issue. As the Senator from Utah has mentioned, trade secrets are the only form of intellectual property not protected from theft under Federal civil law, which is particularly striking when one considers the value of trade secrets to the economy. According to some estimates, they are worth $5 trillion for the U.S. economy, on par with IP protected by patent. The scope of the loss due to theft or misappropriation is huge, somewhere between $160 and $480 billion annually.

I submit that there is not a State in the country that has not been affected by this problem, and Delaware is no exception. In the 1960s, DuPont--one of our signature manufacturing chemistry-based companies--invented Kevlar, a para-aramid fiber with extraordinary strength that is also very lightweight. These properties make Kevlar versatile, but its best known use is in lifesaving body armor worn by our police officers and the brave men and women in the American Armed Forces. It has saved thousands of lives, including more than 3,000 police officers here in the United States whose lives have been saved by Kevlar vests.

About 10 years ago, DuPont developed the next generation of Kevlar, which is even lighter and better able to withstand penetrating trauma from a broader range of rifle rounds and IED-generated shrapnel. It represented a real breakthrough in safety, but it cost millions of dollars to develop.

Chemically, para-aramid fibers are not that complicated, but the fabrication method, the manufacturing technique, which is what gives them their strength and flexibility, is actually incredibly difficult to develop and implement. So one day about 6 years ago, a rogue employee of DuPont took the know-how behind DuPont's creation of next-generation Kevlar and began to work with a rival manufacturing company in Korea, using DuPont trade secrets. The potential loss to DuPont alone from this one instance of trade secret theft or misappropriation approaches $1 billion.

So I ask Senator Hatch, if you were a CEO and your employees were ripping off your trade secrets, your intellectual property, and taking it to another country at the cost of $1 billion a pop, would that affect your willingness to invest the resources in future R&D here in the United States that are needed to make similar lifesaving technological breakthroughs?

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Mr. COONS. I thank Senator Hatch for the opportunity to go into more detail about this terrific bipartisan, bicameral Defend Trade Secrets Act. It is actually relatively simple. It creates a Federal private right of action for misappropriation of trade secrets. It uses an existing Federal criminal law, the Economic Espionage Act, to define trade secrets. It draws heavily from the Uniform Trade Secrets Act which has been enacted by many States to define what is misappropriation.

Simply put, our bill harmonizes U.S. law. Each State has a different trade secret law, and they vary in a range of different ways. Not all of these differences are major, but they affect in small but real ways the definition of a trade secret, what an owner must do to keep a trade secret a secret, what constitutes misappropriation, and what damages are available.

So our Defend Trade Secrets Act creates a single, national baseline or a minimum level of protection and gives trade secret owners access to both a uniform national law and our excellent Federal courts, which provide nationwide service of process and execution of judgments. It is important to note that this bill does not preempt State law because States are free to add further protections on top of what is in this bill. The proposed legislation does one more thing, and trade secret owners tell us this is a critical component of the law not available in States. It creates an ex parte seizure ability. Trade secrets are different from other forms of intellectual property because they are protected under the law only if they remain a secret. Once the public learns of a trade secret, even if it does so wrongfully, the trade secret loses its legal protection. So this bill provides a limited right of action for the owner of a trade secret to go to court ex parte and get it back before the misappropriator, the thief of the trade secret, has a chance to share it with a competitor or the world, thus exposing it.

This is a commonsense idea to help address a very serious problem, but when talking about Federal private rights of action and ex parte injunctive relief, we had to be very careful to avoid any unintended consequences. So, Senator Hatch, would you address how you took concerns about unintended consequences into account as we worked together to draft this bill?

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Mr. COONS. Yes, it is, I say to Senator Hatch. After all that work together, all that consultation, when we introduced this bill last Congress, we wanted to make sure the ex parte provision couldn't be used for abuse, so we required that the party seeking ex parte review must make a rigorous showing that they owned the trade secret, that the trade secret had been stolen, and that third parties would not be harmed if an ex parte order were granted. We also included damages for wrongful seizure, including attorneys' fees. And with that whole combination of important measures to ensure that the ex parte seizure capabilities under the statute are not misused, I think we achieved real consensus at that time. Isn't that right, Senator Hatch?

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Mr. COONS. Yes, I would, thanks in no small part to you, I say to Senator Hatch, and to Senator Flake, who insisted both last Congress and this Congress that we put everything on the table and invite all stakeholders to come forward and share their concerns. We worked together, we did that, and we found an incredible consensus.

In addition to talking with industry, we have gone to think tanks and academic institutions about this bill. Some people with whom we have spoken raised concerns that our bill, as previously drafted, could harm employee mobility.

So, Senator Hatch, I don't want to restrict employee mobility, and I don't think you want to either; is that right?

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Mr. COONS. Absolutely, Senator Hatch, I do. I think when you talk about an important issue such as trade secret theft, which poses such a great threat to American innovation, economic growth, and competitiveness, it really is past time that we act on this issue.

This bill is truly bipartisan. I was the lead sponsor in the last Congress, and you are the lead sponsor in this Congress. Along the way we have worked closely together and undertaken an inclusive and iterative process to make sure we have heard from all stakeholder perspectives so that we have legislation that creates winners only, not winners and losers.

Senator Hatch, it has been an honor to work with you on this. You have been a big part of the reason we were able to undertake such a successful and constructive process.

I would ask, Senator Hatch, in your view, has this process now produced a bill that is ready to move in the Senate Judiciary Committee, on which we both serve?

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