Table of Contents

• Upon Hire:
• Upon Termination:

At Sutter Law PC, one of the first things we advise startups is to ensure they have a robust Trade Secret protection plan.

The best method for limiting the misappropriation of a Company’s Trade Secrets is to take a proactive approach upon hire.  However, there are also methods for ensuring Trade Secret protection after hire at termination.  We will discuss some of these methods below.

Upon Hire:

We recommend that the Company begin by requesting that the new hire return all their previous employer’s confidential information and property before starting the new job, including:

    ○ Copies of any work product

    ○ Customer lists

    ○ Business or marketing plans

    ○ Employee handbooks

    ○ Access badges or cards

    ○ Keys

    ○ Computers

    ○ USB drives, flash drives, or external hard drives

    ○ Phones

    ○ Company credit cards

The Company should also ensure that the new hire is not under any pre-existing confidentiality obligation or other restrictive covenants, and if so, to bring that to your attention to determine whether or not it is enforceable.

Next, we recommend that all new hires receive the Company’s Confidentiality policy (and if there is not one in place, you should have the Company’s attorney draft and disseminate the policy before the new hire begins).

  You should also require new hired to acknowledge receipt of the policy and ask questions if they are unclear.

 New hires should also sign a Confidentiality Agreement which prohibits the receipt, copying and disclosure of confidential or trade secrets learned while under the Company’s employment.

There should also be special technical measures to protect electronic information involving the Company’s computers, phones and other electronic devices. 

Third Party access should also be curtailed in the event that Company equipment is lost or stolen. 

Training for supervisors onboarding new employees should also be provided on at least an annual basis. 

Advise new hires to return their former employers’ confidential information and property.

New hires should return their previous employer’s confidential information and property on or before their last day of employment with the previous employer.

Such information and property may include, among other things.

Upon Termination:

If the above polices have not been implemented and the Employee is being terminated, then we recommend the following:

1. Have your corporate counsel prepare a Separation Agreement which requires at the minimum the following:
2. Severance pay as consideration to enforce a restrictive covenant for departing employee
3. Return of all proprietary materials
4. Cooperation in ongoing and future litigation
5. Conduct and Exit Interview if Possible
6. Review the Confidentiality Agreement and Policies

• Review departing employee’s servers and files to ensure that all confidential information is preserved properly.

• Revoke departing employee’s access to servers, files, and social media accounts.

If you would like assistance in preparing Confidentiality Polices upon hire or if you need assistance after terminating an employee, please reach out to Corporate attorney Kristina Pedroso at Kristina@sutterlegal.com.

The post How to limit employees from stealing your Company’s Trade Secrets upon hiring and termination. appeared first on Sutter Law Business Law Firm.

Table of Contents

• Should everyone have an estate plan?
• What about assets? Is a Trust absolutely necessary?
• The Trust
• Pourover Will
• Durable Power of Attorney for Financial Affairs
• Advance Health Care Directive
• HIPAA Authorization
• Other related documents

What is an estate plan? You ask? An estate plan can include a variety of elements, but generally, they are composed of the following:

1. A Revocable Living Trust
2. Your Last Will (“Pourover Will”)
3. A Durable Power of Attorney
4. Advance Health Care Directive
5. HIPAA consent form (Authorization to release protected health information)
6. (and a few other related documents)

What do all of these mean?  One way to think of an estate plan is like a “Babysitter.”

These are the documents that you put in place that will take care of everything you own–your home, your personal property, even including your own body and person and your children– in the event that you are unable to manage these things for yourself.

In the same way that a parent might give a Babysitter detailed directions on how to manage her kids for the evening, an estate plan is set up to manage everything of importance to you for the rest of your life and after you die.

Should everyone have an estate plan?

Certain elements– YES, absolutely, but they are all a good idea.  At the very minimum, everyone should have an Advance Health Care Directive. 

If you were, for example, to get in a car crash or have a stroke, this document would inform medical professionals as to how to give you medical care and appoint a person whom you trust to make decisions on your behalf.

Do you want every possible medical action taken to save you? Do you want pain medications? Do you want them to “pull the plug” and let you die peacefully? The Advance Health Care Directive speaks to your wishes and appoints people you trust to make decisions for you.

What about assets? Is a Trust absolutely necessary?

Not necessarily. In California, if you own assets worth less than $166,250 (in 2020), you don’t own real property, and the division of your estate would be very simple (i.e., to your spouse) your estate can usually be administered fairly easily after you die.  Your estate will avoid the protracted court process known as “probate”, and assets can be transferred by a written directive known as a “small estate affidavit.”

And if you own assets over $166,250?  A Living Trust with a pour-over Will is a really good idea.

The Trust

A Revocable Living Trust is the centerpiece of most modern estate planning.  In the most basic sense, a Living Trust is just a signed document that gives a bunch of directions. 

Those directions outline that the Trust represents an arrangement (similar to an entity like an LLC or Corporation, but different) where the Trust, through the Trustee, holds your assets manages them, and distributes them according to your wishes.

By holding your assets in a trust, you have complete control over gifts you’d like to make when you die, how assets are managed, and you receive the benefits of avoiding the costs and delays of probate and keeping your estate matters private. 

Pourover Will

We are all familiar with the basic concept of a will; it is a written statement that directs “who gets what” after someone dies.

A ‘pour over will’ simply says that the recipient of what you own after you die is the Trust itself.  This way, your property will be distributed according to the directions of the Trust, rather than via the will through the probate process.

Durable Power of Attorney for Financial Affairs

The Durable Power of Attorney (“DPA”) states a person or people who can manage your financial affairs for you in the event of your incapacity.

Advance Health Care Directive

Your Advance Health Care Directive allows you to appoint someone as your “Agent” to make medical decisions for you if you are incapacitated and provides a set of instructions for how medical providers should administer medical care to you at the end of your life or in extreme medical circumstances, and what you would like to do with your remains after you die. 

HIPAA Authorization

Your HIPAA Authorization simply gives the hospital permission to disclose your protected healthcare information to people of your choice.

Other related documents

Estate plans can become extremely complicated when a person or family may have numerous, international, or hard-to-value assets, elaborate gifting wishes, or complicated family situations. 

A plan may require setting up a variety of different kinds of trusts (e.g., for a special needs child, for life insurance or retirement accounts, for asset protection purposes, etc.) and sometimes require setting up certain kinds of business entities such as LLCs in various jurisdictions.

Without going too far into these kinds of tools, here are a few basic other elements that often arise:

• Certification of Trust: we typically include a Certification of Trust to show “proof of trust” to financial institutions in order to establish trust accounts, etc.
• Trust transfer deeds: if you own a home or any real property, it is important to properly title your property to your Trust and record it with the county.

Property Agreements: between spouses to clarify separate and community property or transmutation into one or the other.

To set up an appointment call or email.

The post Estate Planning 101, Should everyone have an estate plan? appeared first on Sutter Law Business Law Firm.