Trade Secret Lawsuits Soar, Patent Strategies Face New Scrutiny
Federal trade secret lawsuits rose 20% in 2025, spotlighting patent vs trade secret tensions.
Why it matters: Corporate legal counsel must refine IP protection strategies as trade secret litigation surges, especially in tech sectors like AI. Recent USPTO policies also shift the patent landscape, emphasizing U.S. manufacturing considerations.
- 1,552 federal trade secret cases filed in 2025, the highest ever.
- AI-related trade secret cases jumped 92% in the last half of 2025.
- Central District of California led with 100 new trade secret lawsuits in 2025.
- USPTO’s March 2026 memo directs PTAB to factor in U.S. manufacturing in AIA trial decisions.
Trade secret litigation in the United States reached unprecedented levels in 2025, setting a new record of 1,552 federal filings, per a Lex Machina 2026 report.
This 20% rise compared with 2024 reflects intensified disputes over proprietary information, driven primarily by rapid advancement in technology fields.
In particular, artificial intelligence-related trade secret cases escalated sharply, with a 92% increase in filings during the second half of 2025, according to industry analysis from CRAI. This surge underscores how AI innovation has become a focal point for intellectual property contention.
Regional trends reveal that the Central District of California was the nation's busiest for trade secret suits, with 100 new cases filed throughout 2025.
More than 80% of these federal cases involve claims under the Defend Trade Secrets Act (DTSA), underscoring the statute’s central role in protecting business secrets.
Meanwhile, the US Patent and Trademark Office issued a significant policy update on March 11, 2026. This memo instructs the Patent Trial and Appeal Board to consider domestic manufacturing activity when deciding on instituting America Invents Act (AIA) trials. This marks a strategic shift prioritizing U.S.-based innovation amid national security and economic concerns, especially in electronics and ICT sectors, per analysis by Brownstein Hyatt Farber Schreck.
These developments collectively highlight a renewed strategic dialogue for corporate legal teams on choosing between patent protection and trade secrecy. As trade secret litigation intensifies, particularly in cutting-edge areas like AI, counselors must assess risks and benefits tied to patents versus confidential internal safeguards.
By the numbers:
- 1,552 cases — federal trade secret filings in 2025, highest on record
- 20% increase — trade secret filings rise from 2024 to 2025
- 92% increase — AI-related trade secret cases in second half of 2025
What's next: Market watchers will closely track how the USPTO’s new PTAB discretion policy affects AIA trial rates in the coming year, and whether trade secret litigation trends continue to accelerate.