You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

December 16, 2011

How to Prove Damages in Trade Secret Infringement Disputes

Subscribe to Updates
Bangkok Post, Corporate Counsellor Column

Calculating damages is difficult in any type of litigation, but attempting to assess the damages in cases involving trade secrets can be far more complex than in cases relating to other forms of intellectual property rights.

For plaintiffs, recovery of damages is a key factor in trade secrets litigation. Like other forms of intellectual property litigation, the plaintiff’s lost profits form a central component of any damages award. But unlike trademark or patent litigation, Thailand’s Trade Secrets Act empowers the court to move beyond lost profits and award other types of damages as well.

Causes of Action

Protection for trade secrets is usually provided in the form of non-disclosure of trade information, which must be kept confidential by the owner through the use of appropriate means. Trade secrets are only valuable as long as they remain a secret.

Any act of disclosure, deprivation, or usage of a trade secret without the consent of the owner in a manner contrary to fair commercial practice constitutes an infringement of trade secret rights, provided that the infringer knows or should have known that his or her action is contrary to fair commercial practice.

The causes of action which are available in trade secret cases include: (1) breach of an employment agreement by an employee; (2) misappropriation of trade secrets and confidential information; and (3) tortious interference with business relations with the ex-employee and/or between the former employer and its customers or suppliers.

Calculating Lost Profits

Where a cause of action exists, the plaintiff will likely seek damages that are sufficient to compensate for the economic and financial loss caused by the defendant’s infringement.

In trade secrets litigation cases where both the plaintiff and the defendant have already developed and sold the products, a historical baseline for profitability can be been established. If such actual damages can be proved, then the lost profits may be recoverable.

Lost profits are typically calculated as net profits (i.e. gross revenue minus overheads and expenses). Most courts prefer to use the plaintiff’s lost profits, or the defendant’s profit gains, as the preferred measure for assessing damages.

However, if neither the plaintiff nor the defendant has any sales history on which to base such a calculation, most courts would find the measure of lost profits to be too speculative for the purpose of recovering damages.

The court calculates the lost profits which are attributable to the plaintiff through a range of methods, which vary from relatively straightforward to extremely complex. The court will consider the following factors:

  • The nature of the misappropriated trade secret
  • Research and development costs
  • Competition between the businesses of the plaintiff and the defendant
  • The size of the markets and other factors which are difficult to quantify

Therefore, during the trial, the plaintiff should show the court that the plaintiff has invested significantly, over the course of many years, in technology, time, money, intellectual property, security measures, and so forth, in relation to the trade secrets. The plaintiff may present evidence to prove these factors to the court, so that the court can use the information to determine the amount of damages to award.

The Thai Trade Secrets Act does not specify the amount of expenses that can be claimed in relation to the enforcement of rights, in the same manner as the Thai Patent Act. A plaintiff can claim its lawyers’ fees and travel expenses in the lost-profit calculations, but it is important to bear in mind that there is no precedent judgment in relation to such claims.

Additional Damages

Beyond just recovery of lost profits, the Thai Trade Secrets Act empowers the court to apply several additional measures for calculating damages:

  1. In addition to the damages for the actual damage suffered, the court may include in the damages for the plaintiff profits accrued from, or connected with, the infringement by the infringer.
  2. If the court is unable to measure the damages under (1), it may order that an amount of damages be paid to the controller of the trade secrets.
  3. Where there is clear evidence that the infringement of trade secrets has been conducted wilfully or maliciously, the court is empowered to order the infringer to pay punitive damages, in addition to the amount of damages granted under (1) or (2). However, the punitive damages are limited to no more than double the damages payable under (1) or (2).

These additional forms of damages provide new avenues for trade secret owners to seek redress when their valuable information has been misappropriated. Thai legal practitioners will be closely monitoring the practical application of these damages awards as more trade secrets disputes are heard by Thailand’s Intellectual Property and International Trade Court.

Download Full Article
Related Professionals

Practices

Dispute Resolution and Litigation

Intellectual Property

Location

RELATED INSIGHTS​ 

June 10, 2026
In March 2026, the Intellectual Property Office of Vietnam (IP Office) issued a decision refusing a trademark application after considering an opposition based primarily on copyright grounds. The outcome is noteworthy because the foreign brand owner had neither trademark registrations nor applications in Vietnam at the time the opposition was filed, and the IP Office has historically applied a stringent approach to oppositions relying on copyright. The Opposition Maurten is a well-known Swedish sports nutrition brand recognized globally for its innovative hydrogel technology, which is designed to help endurance athletes fuel more effectively without gastrointestinal discomfort. The brand’s distinctive logo is characterized by clean lines and a bold black-and-white color scheme, and has long been associated with the company’s performance products. The brand’s logo is displayed above. An identical mark was filed for registration by a Vietnamese trademark squatter. In 2023, a Vietnamese individual filed an application for registration of an identical mark (Application No. 4-2023-38668), a practice commonly observed in Vietnam as trademark squatting. The brand owner engaged Tilleke & Gibbins to assist with strategy and filing an opposition to the mark. At the time, Maurten had no trademark rights or meaningful use in Vietnam, and global marketing data showed only modest figures without any local presence. Thus, to convince the IP Office to refuse the squatter’s application, instead of relying on trademark rights or use evidence, the opposition strategy centered on the copyright protection of the logo itself, as copyright arises automatically in Vietnam upon creation of the work and does not require registration. (It is worth noting, however, that the IP Office has traditionally been cautious in accepting copyright as a basis for refusing trademark applications.) On September 24, 2024, an opposition was filed on three main grounds: confusing similarity, copyright infringement of the artistic work,
Read More
June 10, 2026
For multinational franchisors operating in Thailand, a key risk after franchise termination is that former outlets may continue operating in ways that could easily mislead consumers into believing they remain within the authorized network. To justify such operations, former franchisees often argue that the termination was invalid or ineffective. As a result, these cases are often treated as contractual disputes, making it difficult for franchisors to obtain injunctive relief before a final judgment confirms that the termination was lawful. Franchisors face significant commercial and reputational harm during lengthy proceedings, including consumer confusion, disruption to franchise restructuring, and damage to brand reputation and customer trust. In an encouraging development, the Thai court in a 2025 case responded to the problem of unauthorized post-termination franchise operations by granting interim relief, recognizing broader brand and consumer harm, and awarding substantial damages, highlighting a successful litigation strategy of framing the dispute not merely as a contractual termination issue but as trademark infringement causing ongoing commercial injury. The Subway Case From December 2024 to mid-2025, an unauthorized “Subway®” franchise operation in Thailand attracted substantial public and media attention. Reports and online discussions about unauthorized Subway® stores circulated widely after complaints arose about food quality and customer experience at certain outlets that were allegedly operating after their franchise rights had expired. Because these stores continued to use Subway® trademarks, trade dress, and overall commercial appearance, many consumers were unable to distinguish them from authorized operations, resulting in reputational risks and customer confusion that affected the franchisor’s brand and franchise system in Thailand. Subway treated this matter with the utmost seriousness and moved promptly to protect its brand, franchise system, and customers. It filed a civil action with the IP&IT Court seeking a permanent injunction and damages. During the proceedings, the court granted a preliminary injunction
Read More
May 25, 2026
Thailand published new rules on May 1, 2026, establishing clear procedures for how the Anti-Money Laundering Office (AMLO) handles digital assets seized during criminal and money laundering investigations. Taking effect the following day, the Regulation of the Anti-Money Laundering Board on the Custody and Management of Seized or Frozen Assets (No. 3) B.E. 2569 applies to digital asset businesses, cryptocurrency holders, and anyone subject to asset seizure under Thailand’s anti-money laundering laws. For the first time, authorities now have a detailed roadmap for transferring seized digital property from private or foreign control into secure state custody. Digital asset businesses holding customer assets under investigation must be prepared to comply with these rules compelling repatriation of such assets in enforcement actions. Expanded Definition of Digital Assets The regulation defines digital assets to include not only those covered by Thailand’s existing digital asset business law but also any other property that can be stored using the same methods as digital assets. This broad formulation means the custody rules will apply to emerging blockchain-based assets and tokenized property that may not yet fall within the statutory definition of a digital asset business, giving authorities flexibility as the technology evolves. Mandatory Transfer to Domestic Custody When digital assets are held with service providers outside Thailand, AMLO will first attempt to transfer them to an account the office maintains with a licensed domestic digital asset business operator. If the domestic operator does not support that particular asset, the office will instead move the assets to its own cold wallet (offline, internet-isolated storage system). If neither option is feasible, the seizing official will report the situation to the Anti-Money Laundering Committee for alternative instructions. A similar hierarchy governs assets held in an accused party’s private wallet or by any third party that is not a
Read More
May 22, 2026
Intellectual property specialists from Tilleke & Gibbins in Vietnam have contributed an updated Intellectual Property Transactions in Vietnam overview for Thomson Reuters Practical Law, an online publication that provides comprehensive legal guides for jurisdictions worldwide. The Vietnam overview was authored by Linh Thi Mai Nguyen, Thanh Phuong Vu, Chi Lan Dang, Son Thai Hoang, and Duc Anh Tran. The chapter provides a high-level examination of key aspects of IP transactions law in Vietnam, including IP assignment and licensing, research and development collaborations, IP in mergers and acquisitions (M&A), lending and taking security over intellectual property rights, settlement agreements, employee- and consultant-created IP, competition law, taxation, and non-tariff trade barriers. Key topics covered in the chapter include: IP assignment: Basis and formalities for assignments of patents, utility models, trade marks, copyright, design rights, trade secrets, confidential information, and domain names in Vietnam. IP licensing: Scope, formalities, and recordal requirements for licensing patents, trade marks, copyright, design rights, and trade secrets. Research and development collaborations: Treatment of improvements, derivatives, and joint ownership of IP, including exploitation and enforcement issues. IP aspects of M&A and security: Due diligence, warranties, transfer formalities, and taking security over intellectual property rights. Practical Law, a legal reference resource from Thomson Reuters, publishes a range of guides for hundreds of jurisdictions and practice areas. The Intellectual Property Transactions Global Guide is a valuable resource for legal practitioners seeking comparative insight into transactional IP issues across multiple jurisdictions. To view the latest version of the Intellectual Property Transactions in Vietnam overview, please visit the Practical Law website and enroll in the free Practical Law trial to gain full access.
Read More