The Departing Employee

The Core Exposure

A departing employee's central legal risk is a claim for misappropriation of a trade secret under RCW 19.108.010(2). Misappropriation takes two forms relevant to a departure:

• Acquisition of a trade secret by improper means — for example, downloading proprietary files in the final weeks of employment for use elsewhere; and
• Disclosure or use without consent, where the employee knew or had reason to know the information was a trade secret acquired under circumstances giving rise to a duty to maintain its secrecy.

The remedies a former employer can pursue are significant and, in part, personal to the employee: an injunction against use or disclosure (RCW 19.108.020); recovery of the employer's actual loss plus the employee's unjust enrichment (RCW 19.108.030(1)); exemplary damages up to twice the compensatory award if the misappropriation was wilful and malicious (RCW 19.108.030(2)); and the former employer's attorney's fees where wilful and malicious misappropriation exists (RCW 19.108.040).

The exemplary-damages and fee exposure is the feature employees most often underestimate. A jury finding that a misappropriation was deliberate can double the award and shift the employer's legal fees onto the departing employee.

The Risk That Surprises Employees Most: Memorized Information

Many departing employees assume that if they do not take documents — if they simply remember client names, pricing, or contacts — they are safe. Washington law rejects that assumption.

In Ed Nowogroski Insurance, Inc. v. Rucker, 137 Wn.2d 427, 971 P.2d 936 (1999), the Washington Supreme Court held that the Act focuses on the nature of the information, not the form in which it is held, so the distinction between written and memorized information lacks legal significance. 137 Wn.2d at 440–41. An employee who solicited his largest accounts using only memorized client information was still liable.

The practical lesson for an employee: memorizing protected customer information rather than copying it is not a defense. If the underlying information qualifies as a trade secret, using it is misappropriation whether it came from a file or from memory.

The Line Between General Skill and a Protectable Secret

On the other hand Washington law does not prevent a person from using the general skill, knowledge, and experience acquired on the job. An employee who has not signed an enforceable restraint may go to work for a competitor and may use what he or she has learned as a professional. The line falls between general skill and knowledge (which the employee keeps) and the former employer's protectable trade secrets (which the employee may not use or disclose).

That line is not always crystal clear. But the law articulates several general principles:

• Information that is readily ascertainable by proper means is not a trade secret, and the former employer bears the burden of proving it is not. Precision Moulding & Frame, Inc. v. Simpson Door Co., 77 Wn. App. 20, 25, 888 P.2d 1239 (1995).
• Information in the public domain, or derivable from the product itself, is not protectable. Woo v. Fireman's Fund Insurance Co., 137 Wn. App. 480, 488–89, 154 P.3d 236 (2007).
• Reverse engineering and independent development are proper means of acquisition. Boeing Co. v. Sierracin Corp., 108 Wn.2d 38, 53–54, 738 P.2d 665 (1987).

An employee whose new work rests on publicly available information, general industry know-how, or independently developed methods stands on defensible ground. An employee who replicates the former employer's specific, secret, hard-earned proprietary information is at risk.

Conduct That Creates or Aggravates Liability

Certain acts turn a defensible departure into a losing case, and several of them bear directly on the wilful-and-malicious findings that unlock double damages and fee-shifting:

• Mass downloads or transfers before departure. Copying files to personal devices, cloud accounts, or personal email in the final weeks is rarely advisable. It supplies both the acquisition element and depending on the circumstances can be used to show strong evidence of intent. Forensic artifacts — USB insertion logs, cloud-sync records, forwarding to personal email — are routinely relied upon when such data is available.
• Taking documents "just in case" or as a personal archive. Even without immediate use, retention of the employer's proprietary materials during departure without consent can lead to exposure.
• Soliciting the former employer's customers using protected information, including memorized information. This is a factor that frequently leads to litigation.
• Deleting or wiping devices after litigation is anticipated, which invites a spoliation argument and an adverse inference.
• Ignoring a whistleblower-notice safe harbor where it would otherwise apply can expose the former employer to liability.

Contractual and Statutory Restraints After HB 1155

An employee's obligations do not arise from the trade secret statute alone. Multiple restrictions under Washington law will survive HB 1155's 2027 noncompete ban in Washington and bind departing employees:

• Confidentiality agreements are expressly preserved by RCW 49.62 and HB 1155. Confidentiality agreements protect information beyond what qualifies as a statutory trade secret and can lay the legal foundation for a breach of contract claim when violated.
• Covenants prohibiting the use or disclosure of trade secrets or inventions are likewise preserved by RCW 49.62 and HB 1155.
• Nonsolicitation agreements, permitted within limits: they may restrict soliciting the employer's employees, and soliciting current or prospective customers with whom the employee established or substantially developed a direct relationship, for no longer than 18 months after departure.

What will no longer bind the employee, as of June 30, 2027, is any noncompetition covenant — including customer nonservicing provisions and forfeiture-for-competition ("stay or pay") arrangements that penalize competitive work. An employee presented with or currently subject to such a covenant should understand that it is becoming void and that the employer must, by October 1, 2027, provide written notice that it is unenforceable.

The Federal Whistleblower Immunity

An employee who discloses a trade secret in confidence to a government official or an attorney solely to report or investigate a suspected violation of law, or in a sealed court filing, is immune from liability under any federal or state trade secret law. 18 U.S.C. § 1833(b)(1). An employee may also use trade secret information in an anti-retaliation lawsuit, subject to sealing requirements. § 1833(b)(2).

This is a genuine protection for a good-faith whistleblower, but it is narrow: the disclosure must be confidential and tied to reporting suspected illegality. It is not a license to take or publish an employer's information for competitive use.

Practical Risk-Reduction for the Departing Employee

1. Take nothing. Leave all documents, files, and devices; do not forward work materials to personal accounts; return company property affirmatively and, if possible, on the record.
2. Do not "clean up" or wipe personal devices once a dispute is foreseeable; preservation cuts both ways and destruction is its own liability.
3. Distinguish, in your own conduct, general skill from the former employer's secrets. Build the new role on public information, industry knowledge, and independently developed work.
4. Read the paperwork you signed — confidentiality, invention-assignment, and nonsolicitation provisions survive; know their terms and their durations.
5. Be cautious with customers, remembering that memorized information about a protected client list is still protected.
6. Get advice before, not after, the move if the role is competitively sensitive or you are subject to restrictive covenants.