Accused of Taking Company Data or Trade Secrets After Leaving a Job: How to Respond

Last updated: October 2026

A letter from a former employer's lawyer accusing you of taking company data, trade secrets, or equipment is serious even when the accusation is wrong. The next step can be a lawsuit with a request for an immediate court order. The right response is fast and careful: preserve everything, stop using anything that might be the company's, do not delete, and answer through counsel. California's trade secret statute also protects the accused: a court may award reasonable attorney fees and costs to the prevailing party when a misappropriation claim is made in bad faith. (Civ. Code, § 3426.4.) Kolmogorov Law, P.C. defends executives, salespeople, engineers, and bookkeepers against these claims in Orange County, Los Angeles, and across California.

Call (909) 235-6116 or contact us online if a former employer has accused you of taking its data.

Why these letters are sent

Some are justified; a departing employee really did download the customer list. Many are not. The letter arrives because the employer is angry about the departure, or wants to keep you from competing, or wants an edge in a dispute over unpaid commissions. Sometimes it found your name in a log of files synced to a personal cloud account that you set up years ago at the company's request. California does not enforce non-compete agreements for employees. A trade secret accusation is often the only tool an employer has to slow a competitor down. Our non-compete guide explains that background.

I represent the accused in these cases as often as the accuser, and the same facts decide both sides.

The first 48 hours

Do not delete anything. Deleting files after receiving the letter, even files you believe are yours, is the fact that turns a weak case into a strong one for the employer. Stop using any document, list, or login that came from the former employer. Do not forward the letter to your new employer with commentary; a short notice that you have received a demand and are handling it through counsel is enough. Make a list of every device and account that touched company information: laptops, phones, personal email, cloud storage, USB drives. Write down what you actually took, if anything, and why. Then call a lawyer.

What the employer has to prove

Under California's Uniform Trade Secrets Act, the employer must show two things. The information is a trade secret, meaning it derives independent economic value from not being generally known and was the subject of reasonable efforts to keep it secret. And you acquired, used, or disclosed it improperly. A customer list that could be reconstructed from public sources, pricing that customers freely share, or know-how you brought with you is not a trade secret. Our article on what courts treat as trade secrets covers the line.

Before the employer can take discovery about the trade secret in a lawsuit, it must identify the trade secret with reasonable particularity. (Code Civ. Proc., § 2019.210.) Employers who send letters about "confidential information" in general often struggle with that step, and the identification requirement is one of the first defenses we raise.

Separate from trade secrets, employers plead computer data theft under Penal Code section 502, conversion of devices and files, breach of the confidentiality agreement, and sometimes Penal Code section 496. Each has its own elements and its own answers.

The defenses that work

The information is not secret. The employer never treated it as confidential; it was emailed to customers, posted in a shared drive with no restrictions, or available from a trade directory.

You did not take it, or you took it for a permitted purpose. Syncing a personal device at the company's request, keeping copies of your own pay records and employment agreement, or retaining a file you were told to work on from home are not misappropriation.

You have not used it. Possession of a file is not use. A prompt, documented return or destruction, supervised by counsel, defeats most claims for injunctive relief.

The employer's own conduct. Unpaid commissions, a withheld final paycheck, or a threatened criminal referral used as a bargaining chip are facts that cut against the employer, and they often reveal the real dispute.

Bad-faith claims and fee shifting

If a claim of misappropriation is made in bad faith, the court may award reasonable attorney fees and costs to the prevailing party. (Civ. Code, § 3426.4.) Courts have applied that provision to employers who sued without evidence that any secret existed or was taken. The exposure is a real deterrent, and we raise it early in the response when the facts support it.

Returning property the right way

Where you do have company files or devices, the return should be handled so that it ends the dispute rather than feeding it. That usually means an inventory, a forensic copy preserved by a neutral so the employer cannot later claim something is missing, a supervised deletion from personal accounts, and a written certification. Doing this informally, by emailing the files back from a personal account, creates new evidence of possession and use.

If a lawsuit or a TRO application follows

An employer that sues will often seek a temporary restraining order on short notice. The hearing happens within days, and the accused employee's declaration, explaining what was and was not taken and what has been returned, is the center of the defense. Our page on TROs and preliminary injunctions describes the process. Many of these cases end with a narrow stipulated order and no further litigation once the employer sees the return and the declaration.

Where these cases are heard

Trade secret claims are filed in the Superior Court: the Central Justice Center in Santa Ana for Orange County, the Stanley Mosk Courthouse for Los Angeles. Under the Defend Trade Secrets Act they can also be filed in federal court, typically the Central District of California. Employment agreements with arbitration clauses move the dispute to arbitration.

What to bring to the first meeting

Bring the demand letter, your employment agreement and any confidentiality or invention agreement, your separation communications, a list of the devices and accounts that held company information, and an honest account of what you have. Bring your new employer's offer letter as well; the employer's goal is often your new job.

Frequently asked questions

My former employer says I stole trade secrets. What should I do first?

Preserve everything, stop using anything that came from the employer, do not delete files, and respond through counsel. Deletion after a demand is the most damaging step an accused employee can take.

Can my former employer sue me for taking my own contacts?

Contacts you developed and remember are generally yours. A copied customer database with pricing and purchase history is a different matter. The line depends on what the information is and how the employer protected it.

What happens if the employer's trade secret claim is baseless?

If the claim was made in bad faith, the court may award you reasonable attorney fees and costs as the prevailing party. (Civ. Code, § 3426.4.) The employer also must identify the trade secret with reasonable particularity before taking discovery about it. (Code Civ. Proc., § 2019.210.)

Should I just delete the files to make the problem go away?

No. Deleting files after receiving a demand destroys evidence, can support sanctions, and turns a dispute about possession into one about spoliation. Return or destruction should be documented and supervised.

Can my new employer be sued too?

Yes, employers sometimes name the new employer on the theory that it is using the information. A prompt, documented confirmation that the new employer has received nothing from you is the usual way to keep it out of the dispute.

Talk to a California trade secret defense attorney

If you have been accused of taking company data, call (909) 235-6116 or contact us online before you respond. Kolmogorov Law, P.C. is at 327 Magnet, Irvine, CA 92618, and represents individuals and companies in Orange County, Los Angeles, and throughout California. See also our trade secret page and, for employers, our page on a former employee threatening to sue.

This page provides general information about California law and is not legal advice. Outcomes depend on what was taken, how it was protected, and the court.