A company's trade secrets are its lifeblood. In the wrong hands, they can severely cripple a company's sales, and, consequently, its future viability.

Trade secrets can include anything that is not public information that gives a company an advantage over its competitors, such as drawings, customer lists, formulas, product lines, marketing decisions and advertising campaigns.

Protecting confidential material, or intellectual property, is in the best interest of all companies, but, unfortunately, the issue of employee intellectual property theft isn't easy to navigate, and isn't always detected. In fact, Geof Oberhaus, a partner at Dinsmore & Shohl, estimates that in 90 percent of cases, companies don't even know the intellectual property was stolen.

Take sales, a field where employee IP theft often happens by accident. "Sales is a relationship business," Oberhaus says. "Good salesmen get to know people. So, if you leave your job for another sales job and you take the address book, that's the big issue. It depends on your intent and how close your new job is to your last one. And, he adds, "Did you take the whole address book?" Here in the Midwest, most courts would view the address book as company property.

Another industry where employee IP theft is sometimes hard to pinpoint is manufacturing. It's where Oberhaus and Josh Lorentz, a fellow partner at Dinsmore & Shohl, agree employee IP theft has the biggest impact. Because manufacturing companies are producing goods, it's easy in today's global economy to obtain the information on how a product is made and open a factory five miles down the road.

"That's happening every day, unfortunately," Oberhaus says.

Many companies are becoming increasingly savvy about protecting against employee IP theft.

Consider the 2006 case in which Coca-Cola employees tried to sell Coke trade secrets to PepsiCo. Instead of cashing in on the stolen information, Pepsi contacted Coke, and federal authorities arrested the suspects. A Pepsi spokesman said competition can be fierce, but it should also be fair and legal.

It used to be the norm for companies to accept whatever a new employee brought to the table without question. Today, however, thanks to a heightened awareness of intellectual property theft and an increase in safeguards, more companies are following Pepsi's example and, in an effort to make sure they're not held liable themselves, taking action.

"Employee intellectual property theft is not happening at the level it was 10 years ago," Oberhaus confirms. "The last thing a company wants to do is be sued by its new employee's former company."

In most instances, Lorentz adds, companies treat the issue very seriously.

"They tell new employees, particularly ones who come from a competitor, not to bring information from a previous employer into the company. If they find out differently, that a new employee has in fact brought in information from its past employer, they will, No. 1, terminate the employee, and, No. 2, go to the previous employer and say, "¢Your former employee brought this information, we've deleted all records and files on it, and here is what we have.'"

The main safeguard a company can take is education, Lorentz says. Educating new employees on what is confidential information, and on what employees' obligations are with respect to that information, is the most important thing a company can do. The second most important thing, he continues, is making sure a new employee signs confidentiality and non-disclosure agreements and that those agreements are updated every few years as people change positions and the company itself changes.

It's also crucial not to wait.

"A lot of times," Oberhaus says, "companies make the mistake of waiting until an employee's last day to go over what is company property. That's too late."

As for employees looking to stay out of trouble, the best advice Lorentz can give is to take the high road.

"If your new company doesn't have any safeguards in place, simply don't use any information you've taken that you know, understand and believe to be confidential," Lorentz says.