G.L. c. 93, §§ 42–42G; G.L. c. 149, § 24L; 18 U.S.C. § 1836
Trade secret misappropriation in Massachusetts — MUTSA since 2018, and the non-compete rules that came with it
A claim in Massachusetts trial courts · Last verified August 26, 2026
Massachusetts replaced a one-sentence trade secret statute with a full Uniform Trade Secrets Act on October 1, 2018, and the same legislation imposed the first real limits on non-competition agreements the state has had.
The two changes travel together, and they should be read together. A company that once relied on a broad non-compete to protect its information now has a weaker non-compete and a stronger trade secret statute — which is what the Legislature intended.
What the claim is
Someone took confidential business information you worked to protect — a formula, a customer list, a process, pricing data — and used it or gave it to someone else.
Where the right comes from
G.L. c. 93, §§ 42 through 42G, the Massachusetts Uniform Trade Secrets Act, and the federal Defend Trade Secrets Act, 18 U.S.C. § 1836.
What a plaintiff has to prove
- The information is a trade secret — it derives independent economic value from not being generally known or readily ascertainable;
- The owner took reasonable measures to keep it secret; and
- The defendant acquired, disclosed or used it by improper means, or in breach of a duty of confidence.
Element two is where cases are won and lost, and it is about the plaintiff's own conduct rather than the defendant's. Confidentiality agreements, restricted access, password protection, marking documents, exit interviews and a written policy are the evidence. A company that shared the information freely and never called it confidential has a problem no defendant conduct will fix.
Limitations — three years from discovery
Section 42E: an action for misappropriation must be brought within three years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered.
A continuing course is one claim. The section treats a continuing disclosure or use as a single claim, which means the clock does not restart with each new use. A plaintiff who knew about the misappropriation four years ago cannot revive the claim by pointing to last month's use.
Fraudulent concealment under G.L. c. 260, § 12 can toll it. There is no statute of repose.
The federal DTSA carries its own three-year period from discovery.
MUTSA displaces the common law
The act displaces conflicting common-law claims for the same conduct. A complaint that pleads trade secret misappropriation alongside conversion, unjust enrichment and misappropriation of confidential information for the identical facts will lose the duplicative counts.
What survives: contract claims, including breach of a confidentiality or non-disclosure agreement; breach of fiduciary duty by an employee or officer; and claims about information that is not a trade secret, which the act does not reach.
That last category matters. Confidential business information falling short of a trade secret is not protected by MUTSA, and the claim for it has to rest on contract or on a duty of confidence.
What the claim pays
Section 42B(a) — actual loss caused by the misappropriation, plus unjust enrichment not already counted in the actual loss. In lieu of those, for unauthorised disclosure or use, a reasonable royalty.
Section 42B(b) — "If willful and malicious misappropriation exists, the court may award exemplary damages in an amount not exceeding twice any award made under subsection (a)."
Note the ceiling: twice the compensatory award, not three times, and it is discretionary.
Section 42C — fees, effectively both ways. Fees are available for willful and malicious misappropriation, and against a claimant who brought a claim in bad faith or a party who resisted or moved to terminate an injunction in bad faith. A trade secret plaintiff with a weak case faces real fee exposure, which is not true of most Massachusetts business torts.
Injunctive relief, which is usually the point. These cases are decided at the preliminary injunction stage, and the standard Massachusetts framework from Packaging Industries Group, Inc. v. Cheney, 380 Mass. 609 (1980), governs.
Twelve percent prejudgment interest.
The federal alternative
The DTSA gives a federal forum for a trade secret related to a product or service used in interstate commerce, and two things Massachusetts law does not:
Nationwide reach without diversity, which matters when the defendant and the information have left the state.
Ex parte civil seizure — an extraordinary remedy allowing seizure of property to prevent propagation of the secret, available in narrow circumstances and rarely granted.
Its damages and fee provisions parallel MUTSA's: exemplary damages up to twice the award and fees for willful and malicious misappropriation.
Most Massachusetts plaintiffs plead both.
Non-competes — G.L. c. 149 § 24L
The Massachusetts Noncompetition Agreement Act took effect the same day, October 1, 2018, and applies to agreements entered into on or after that date. It is not retroactive — agreements signed before then are governed by the older common law of reasonableness.
The consideration requirement. Section 24L requires a garden leave clause or other mutually-agreed upon consideration specified in the agreement. A garden leave clause must provide for payment, on a pro rata basis during the entirety of the restricted period, of at least 50 percent of the employee's highest annualised base salary in the two years preceding termination.
What counts as "other mutually-agreed upon consideration" is not defined by the statute, and it is the most litigated question under it. Federal decisions applying Massachusetts law have required something specified in the agreement beyond continued employment.
Duration. Restricted periods are capped at 12 months — extendable to two years only where the employee breached a fiduciary duty or unlawfully took property.
Notice. The agreement must be given by the earlier of a formal offer or 10 business days before the start date, be in writing signed by both parties, and expressly state that the employee has the right to consult counsel.
Who cannot be bound. Employees classified as non-exempt under the FLSA, undergraduate and graduate interns, employees age 18 or younger, and employees terminated without cause or laid off.
That last exclusion is the one employers most often forget: a non-compete does not survive a layoff.
Section 24L does not shift fees, and it does not reach non-solicitation agreements, non-disclosure agreements, or covenants made in connection with the sale of a business.
What has to happen before you file
Nothing statutory. In practice, forensic preservation comes first — the departing employee's devices, email, cloud storage and download logs are the case, and they change fast.
Which court
Superior Court, and in Suffolk County the Business Litigation Session, which is where most of these are heard. Federal court for the DTSA claim.
Common defenses
- Independent development — the defendant built it themselves.
- Reverse engineering, which is not improper means.
- No reasonable secrecy measures by the plaintiff.
- The information is not a trade secret — publicly available, readily ascertainable, or generally known in the trade.
- The information is an employee's general skill and knowledge, which they may take with them.
- The non-compete is void for failing § 24L.
- Limitations — three years from discovery, with continuing use as a single claim.
- Bad faith by the claimant, which under § 42C carries a fee award against them.
What people get wrong
You do not need a non-compete. The trade secret claim protects the information directly, and it survives where the non-compete fails.
Reasonable secrecy measures are the plaintiff's burden, and they are documented before the dispute, not after.
The multiplier is double, not treble — up to twice the award under § 42B(b), and discretionary.
Fees run both ways. A bad-faith claim is sanctionable under § 42C.
A layoff kills the non-compete. Section 24L excludes employees terminated without cause or laid off.
Garden leave means 50 percent of salary during the restricted period, or other consideration specified in the agreement — and continued employment alone has not been enough.
MUTSA displaces the duplicative common-law counts. Pleading conversion for the same facts adds nothing.
Where it came from
Massachusetts was one of the last states without a Uniform Trade Secrets Act, operating instead on a single statutory sentence and a body of common law. That left two problems: the remedies were uncertain, and the state's non-compete law was doing work trade secret law does elsewhere.
Because non-competes were freely enforceable if reasonable, Massachusetts employers protected information by restricting people. That worked for employers and badly for the labour market, particularly in a technology economy where the argument that mobility drives innovation had obvious local evidence.
The 2018 legislation addressed both halves at once, and the trade was explicit. Employers got a modern trade secret statute with exemplary damages and fee-shifting. Employees got a non-compete law with a garden leave requirement, a 12-month cap, a notice period, a right to consult counsel, and an exclusion for anyone laid off.
The intended result is that information is protected as information rather than by immobilising the people who know it. Whether that holds depends heavily on what courts make of "other mutually-agreed upon consideration," which the Legislature left undefined and which is still being worked out.
Common questions
Can I sue an ex-employee who took our customer list?
Yes, if the list is a trade secret — it has value from not being known, and you took reasonable steps to keep it secret.
Do I need a non-compete to protect trade secrets?
No. MUTSA protects the information directly, and it applies whether or not anyone signed anything.
How long do I have to sue?
Three years from when the misappropriation was discovered or should have been discovered. A continuing use counts as a single claim.
What damages can I get?
Actual loss plus unjust enrichment, or a reasonable royalty — and up to twice that amount as exemplary damages for willful and malicious misappropriation.
Is my non-compete enforceable?
If it was signed on or after October 1, 2018, it needs garden leave or other specified consideration, a restricted period of no more than 12 months, the statutory notice, and a statement of your right to consult counsel — and it does not apply if you were laid off or terminated without cause.
Can the other side make me pay their fees?
Yes. Section 42C allows a fee award against a claimant who brought the claim in bad faith.