Under California Law, Civil Code Section 3426.1(d) defines a trade secret as: “…information, including a formula, pattern, compilation, program, device, method technique, or process that (1) Derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value form its disclosure or use; and (2) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.”

Bottom line: Very generally, any information that can be used in the operation of a business that is a secret and has economic worth is a trade secret.

Compare this to copyright.  Software source code may be protected by copyright, but the way or the ideas on its expression are not protected by copyright.  How the software works may be a trade secret (or patented).  Some other common trade secrets are associated with recipes of famous foods and beverages or a client, vendor or customer list.

What is the importance of a trade secret? Trade secrets provide protections that copyright and patents do not.  They provide for protections that require minimal affirmative actions in order to protect from breach.  The owners of trade secrets merely have to insure they make reasonable efforts to maintain its secrecy in order for it to be considered a trade secret if a former employee or competitor acquires it.