Senate Bill No. 558–Committee on Government Affairs

 

March 26, 2001

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Referred to Committee on Commerce and Labor

 

SUMMARY—Strengthens protection of patents and trade secrets. (BDR 52‑1480)

 

FISCAL NOTE:    Effect on Local Government: No.

                                 Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to information; providing additional protection for trade secrets; defining a Nevada employer’s right to intellectual property created by his employee; providing remedies for unauthorized use of patented material owned by Nevada businesses and residents; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1. Chapter 600 of NRS is hereby amended by adding thereto

1-2  the provisions set forth as sections 2 to 5, inclusive, of this act.

1-3    Sec. 2.  1.  For the purposes of sections 2 to 5, inclusive, of this act,

1-4  a business is deemed to be a “Nevada business” if:

1-5    (a) It has its home office in Nevada;

1-6    (b) It is not controlled in whole or in part by one or more out-of-state

1-7  business entities; and

1-8    (c) At least 50 percent of its full-time and part-time employees are

1-9  Nevada residents, when the employees of business entities that are

1-10  controlled in whole or in part by the Nevada business are included in the

1-11  calculation as well as the employees of any business entity that controls

1-12  the Nevada business in whole or in part.

1-13    2.  For the purposes of subsection 1, a natural person shall be

1-14  deemed to be a Nevada resident when he has complied with the standard

1-15  set forth in NRS 10.155. A natural person is rebuttably presumed to be a

1-16  Nevada resident if he evidences any one of the following indications of

1-17  residency:

1-18    (a) A Nevada voter registration card issued pursuant to NRS 293.517

1-19  that identifies his residential address as a location within Nevada,

1-20  whereby residency is presumed to have begun on the date of registration;

1-21    (b) A Nevada driver’s license that identifies his residential address as

1-22  a location within Nevada, whereby residency is presumed to have begun

1-23  on the date the license was issued;

2-1    (c) A declaration of domicile in Nevada prepared pursuant to NRS

2-2  41.191, whereby residency is presumed to have begun on the date the

2-3  declaration was signed under oath pursuant to NRS 41.195; or

2-4    (d) Any other form of reliable evidence of one or more continuous

2-5  places of residence in Nevada for a period of at least 1 year

2-6  notwithstanding any temporary or transitory absences from this state,

2-7  whereby residency is presumed to have begun at the beginning of the

2-8  period of residence in Nevada.

2-9    3.  Any challenge to a presumption of residency established pursuant

2-10  to subsection 2 must be made by clear and convincing evidence.

2-11    4.  For the purposes of this section, any business whose status as a

2-12  Nevada business is challenged, or any natural person whose status as a

2-13  Nevada resident is challenged, may have the issue adjudicated by a court

2-14  of competent jurisdiction in Nevada.

2-15    Sec. 3.  A Nevada business has exclusive rights to any patentable

2-16  invention or technology developed by an employee of the Nevada

2-17  business during the course of the employment that relates directly to

2-18  work performed during the course of the employment.

2-19    Sec. 4.  1.  A person or business who uses technology claimed in a

2-20  patent issued by the United States Patent and Trademark Office to a

2-21  Nevada business or Nevada resident is presumed to benefit from the

2-22  patented technology. The benefit is presumed to begin at the time the

2-23  person or business first uses the technology during the term of the patent.

2-24    2.  A constructive contract arises between the Nevada business or

2-25  Nevada resident holding a patent issued by the United States Patent and

2-26  Trademark Office and a person who benefits from the patented

2-27  technology during the term of the patent and at the time the person first

2-28  uses the technology. The constructive contract remains in effect

2-29  throughout the period of use during the term of the patent.

2-30    3.  Unless the Nevada business or Nevada resident holding the patent

2-31  has licensed the user to use the patented technology, the user is liable for

2-32  damages in the amount of a reasonable royalty as if a license had existed

2-33  from the time the user first used the patented technology.

2-34    Sec. 5.  1.  A person or business is liable for intentional interference

2-35  with the economic expectations of a Nevada business or Nevada resident

2-36  holding a patent issued by the United States Patent and Trademark

2-37  Office if:

2-38    (a) The patent has not expired;

2-39    (b) The person or business that is liable was put on notice that the

2-40  technology the person or business was using was patented by the patent;

2-41  and

2-42    (c) The person or business that is liable continued to use the patented

2-43  technology after the notice of the patent was imparted.

2-44    2.  Notice that the technology is patented may be imparted by actual

2-45  notice, the recording of the patent in the office of a county recorder in

2-46  this state or other means that would inform a reasonable person.

2-47    3.  Harm is presumed to have occurred as a result of the conduct

2-48  described in paragraphs (b) and (c) of subsection 1, without further

2-49  proof.

3-1    Sec. 6.  Chapter 600A of NRS is hereby amended by adding thereto a

3-2  new section to read as follows:

3-3    The owner of a trade secret is presumed to make a reasonable effort to

3-4  maintain its secrecy if the word “Confidential” or another indication of

3-5  secrecy is marked on the face of the document containing the trade

3-6  secret.

 

3-7  H