Prepared Senate Floor Statement by Senator Chuck Grassley of Iowa
Chairman, Senate Judiciary Committee
Passage of the Defend Trade Secrets Act of 2016
April 4, 2016
Mr. President, today the Senate is poised to pass the Defend Trade Secrets Act of 2016, a bill that offers practical and necessary solutions to a growing problem.
I’ve recently had the opportunity to speak about a number of bipartisan bills that have passed out of the Judiciary Committee and that have been taken up here on the Senate floor. That is a testament to the fact that the Judiciary Committee is working hard, through an open process, to find thoughtful solutions to the problems facing our country.
In fact, we’ve processed 24 bills out of the Judiciary Committee, all in a bipartisan fashion. Of these, 16 have passed the Senate and 6 have been signed into law by the president.
While any member of this body can tell you that it isn’t always easy to find legislative agreement, the American people deserve hardworking representatives in Washington who strive to get things accomplished. And the record of the Judiciary Committee shows that we have chosen to overcome gridlock and dysfunction to pass legislation that addresses problems that American people face.
Here are a few examples of the Judiciary Committee’s legislative accomplishments so far:
Last month the Senate overwhelmingly passed the bipartisan Comprehensive Addiction and Recovery Act, or CARA, by a vote of 94-1. In the face of a growing and deadly epidemic of heroin and opioid painkillers, this bill addresses this crisis comprehensively, supporting prevention, education, treatment, recovery, and law enforcement.
In the past few weeks, the Senate also passed the FOIA Improvement Act, a bill authored by Senators Cornyn and Leahy that I worked to move through the committee process. It codifies a presumption of openness for government agencies to follow when they respond to requests for government records via the Freedom of Information Act. In passing the FOIA Improvement Act – the Senate is helping change the culture in government toward openness and transparency.
In February, the Judiciary Committee reported out the bipartisan Justice Against Sponsors of Terrorism Act by a vote of 19-0. The bill would hold sponsors of terrorism accountable by preventing them from invoking “sovereign immunity” in cases involving attacks within the United States. It would also allow civil suits to be filed against foreign entities that have aided or abetted terrorists.
The Committee has worked to protect families and children by passing bills such as the Amy and Vicky Child Pornography Victim Restitution Improvement Act and the Adoptive Family Relief Act. The Amy and Vicky Child Pornography Victim Restitution Improvement Act reverses a Supreme Court decision that limited the restitution that victims of child pornography can seek from any single perpetrator, ensuring that victims can be fully compensated for these heinous crimes, and can focus their attention on healing. The Adoptive Family Relief Act was signed into law in October of 2015, after passing the Judiciary Committee, and aims to help families facing challenges with international adoptions.
And once again today, Mr. President, we are set to approve another Judiciary Committee bill that is supported by folks across the whole of the political spectrum.
The support behind the Defend Trade Secrets Act makes clear that the Senate and Judiciary Committee is working to find thoughtful solutions to problems facing our country. This bipartisan legislation is authored by Senators Hatch and Coons. It brings needed uniformity to trade secret litigation so creators and owners of trade secrets can more effectively address the growing problem of trade secret theft.
It’s estimated that the American economy loses 2.1 million jobs every year because of trade secret theft. Further, according to a recent report of the Commission on the Theft of American Intellectual Property, annual losses owing to trade secret theft are likely comparable to the current annual level of U.S. exports to Asia – over $300 billion.
Back in Iowa we’ve seen this first-hand as innovative companies like Monsanto and DuPont-Pioneer have become targets for trade secret theft. In a well-publicized case, a naturalized citizen was indicted and convicted for engaging in a scheme with foreign nationals to steal proprietary test seeds from Iowa fields to benefit foreign companies.
Contrasted with other areas of intellectual property, trade secrets are mainly protected as a matter of state law. Forty-seven states have enacted some variation of the Uniform Trade Secrets Act. Yet as we’ve learned through hearings in the Judiciary Committee and from companies who have experienced trade secret theft, the increasing use of technology by criminals and their ability to quickly travel across state lines, means at times these laws are inadequate.
The existing patchwork of state laws has become a difficult procedural hurdle for victims who must seek immediate relief before their valuable intellectual property is lost forever. As the pace of trade secret theft has soared, the Federal Bureau of Investigation reports that their caseload for economic espionage and trade secret theft cases has also increased more than 60% from 2009 to 2013. The Defend Trade Secrets Act will create a uniform federal civil cause of action, without preempting state law, to provide clear rules and predictability for trade secret cases. Victims of trade secret theft will now have another weapon in their arsenal to combat trade secret theft, aside from criminal enforcement.
This bill will provide certainty of the rules, standards, and practices to stop trade secrets from being disseminated and losing their value, and will allow victims to move quickly to federal court to stop their trade secrets from being disseminated.
By improving trade secret protection, this bill will also help to incentivize future innovation.
Importantly, the Defend Trade Secrets Act codifies protections for whistleblowers. An amendment that I authored with Ranking Member Leahy, which was included in Committee, would create express protections for whistleblowers who disclose trade secrets confidentially to the government to report a violation of the law. There is a longstanding and compelling public interest in safeguarding the ability of whistleblowers to lawfully and appropriately disclose waste, fraud, and abuse that would otherwise never be brought to light.
As Chairman, and one of the founding members of the Senate Whistleblower Protection Caucus, I’ve seen how whistleblowers help hold wrongdoers accountable and allow the government to recoup taxpayer money that might otherwise be lost to fraud and other unlawful activities. The inclusion of this whistleblower protection in the Defend Trade Secrets Act allows us to help make sure that those who are best in a position to report illegal conduct can come forward.
Passing legislation to help Americans deal with a growing problem like trade secret theft, in a bipartisan fashion, is an important accomplishment. I’m proud of the way the Judiciary Committee continues to get things done.