Former Employees Taking Your Code in India: Trade Secret Remedies for US Companies

A US company with an Indian engineering team may discover that a departing developer has copied source code, customer lists or product plans. The company’s first question is usually whether India has a trade secret law. It does not have a single statute, but there are real remedies. The main trade secret theft India remedies come from contract, equity, copyright, the Information Technology Act and criminal law, and Indian courts have shown that they can grant fast interim orders.

This guide explains the legal framework, the remedies available, the steps to take in the first days, and how to prepare contracts and systems so that a claim is stronger. It is written by an Indian law firm for US companies. US trade secret law, including the Defend Trade Secrets Act, should be confirmed with US counsel, and cross-border strategy should be planned with both.

How India protects trade secrets

India has no standalone trade secret statute. Protection rests on contract, the equitable duty of confidence and related statutes. The Law Commission of India, in Report No. 289 of March 2024, recommended a dedicated law and suggested a draft Bill, but it has not been enacted. Until then, a claimant must fit the case within existing principles, which is workable but requires careful evidence. Understanding the base rules makes the trade secret theft India remedies easier to choose between.

Courts have recognised that confidential information, such as source code, customer data, pricing and know-how, can be protected even without a contract, where it was given or obtained in circumstances that imply a duty of confidence. Decisions of the Delhi and Bombay High Courts, including cases involving compiled databases and business ideas, support this. The claimant must identify the specific information, show that it is secret and has value, and show that the defendant took or used it.

Section 27 of the Indian Contract Act, 1872 voids agreements that restrain a person from carrying on a lawful profession after employment ends, subject to narrow exceptions. A post-employment non-compete is therefore generally unenforceable, but confidentiality obligations and restrictions on using trade secrets are valid. The line between protecting secrets and stopping a person from working is a recurring theme in trade secret theft India remedies, and your claim should focus on specific information, not general skill.

Civil remedies and interim relief

The main civil remedy is an injunction. Under Order 39 of the Code of Civil Procedure, 1908, a court can grant an interim injunction, even without notice to the defendant in urgent cases, to stop use or disclosure of the information. The claimant must show a prima facie case, balance of convenience and irreparable harm. A final decree can give a permanent injunction, damages or an account of profits, and orders for delivery up or destruction of copies.

In suits above the specified value, the Commercial Courts Act, 2015 applies, and the Delhi High Court’s IP Division handles many technology disputes. Pre-institution mediation is normally required under Section 12A, but the Supreme Court has recognised an exception where urgent interim relief is sought. The courts can also appoint a local commissioner to visit premises, copy devices and preserve evidence, in the manner of an Anton Piller order, with safeguards for confidentiality.

Where the claim concerns source code, the court may use confidentiality clubs or redactions so that the defendant’s lawyers see sensitive material without public disclosure. John Doe orders have been used against unknown defendants in some IP cases. A claim against the former employee and the new employer together is common, because the new employer may have received the information. Plead facts about when, how and by whom the information was used. These procedural tools are what make trade secret theft India remedies practical for foreign companies.

Criminal and statutory routes

Several statutes can apply. The Copyright Act, 1957 protects source code as a literary work, and unauthorised copying can give rise to civil and criminal remedies. The Information Technology Act, 2000 penalises unauthorised access to and copying of data from a computer system under Section 43 and Section 66, with compensation and criminal penalties. These provisions suit cases in which an employee copied data to a personal device or cloud account.

The Bharatiya Nyaya Sanhita, 2023 includes offences such as theft, criminal breach of trust and cheating that may be relevant where an employee dishonestly misused property or information entrusted to them. Whether a particular offence fits depends on the facts, and police action in commercial disputes can be uneven. Criminal complaints should be used carefully, since courts dislike attempts to use them as pressure in civil matters.

Combine routes with care. A civil suit for an injunction is usually the primary step, supported by a notice to the former employee and, where justified, a complaint under the IT Act or copyright law. Keep US proceedings in mind. A US company may also have claims in the United States against the former employee or a competitor, and coordination can avoid inconsistent positions. Plan timing, because delay weakens a request for urgent relief. Good coordination keeps trade secret theft India remedies consistent with US claims.

What to do in the first days

Move quickly. Preserve evidence by taking forensic images of the former employee’s laptop, email and cloud accounts, and by exporting repository logs, access records and download histories. Do not delete or alter data. Suspend access to systems, remind the employee in writing of their confidentiality duties and ask for the return of all material. Record the date and time you learned of the problem, since urgency affects interim relief.

Identify the information precisely. List the files, repositories, documents or customer data that you believe were taken and explain why each is secret and valuable. Gather the employment contract, confidentiality agreement, IP assignment, handbook and policies, the access control records and proof that you took steps to protect the information. Electronic records should be certified under Section 63 of the Bharatiya Sakshya Adhiniyam, 2023.

Decide on the target. Consider whether to send a notice first or to go to court without notice, in cases where a warning would lead to destruction of evidence. Assess where the former employee and the new employer are, and where the damage occurs. Instruct Indian counsel early, and brief US counsel. A coordinated plan that covers evidence, interim relief and communications gives you the best chance. Planning is what turns the available trade secret theft India remedies into a result.

Next steps and quick answers

To make future claims easier, update your systems and contracts now. Use role-based access, logging and data loss controls, restrict removable media, and run exit checklists that include device return and account closure. Keep employment agreements with clear confidentiality terms, a valid IP assignment and a limit on use of information after employment, avoiding a post-employment non-compete that Section 27 would void. Train managers to act at the first sign of a leak.

Related reading: trade secret protection in India for source code and algorithms, NDA enforceability in India, who owns code written by Indian developers, hiring contractors in India from the US, offshore AI teams and data privacy in India, open-source licence audits for US startups with Indian developers, software copyright protection in India and setting up an Indian subsidiary of a US company; also employee source code theft in India and trade secrets in the UK and India.

Quick answers

Does India have a trade secret law?

There is no standalone statute. Trade secrets are protected through contract, the equitable duty of confidence, copyright, the Information Technology Act and criminal law. The Law Commission recommended a dedicated law in 2024, but it has not been enacted.

Can a US company get an urgent order against a former employee in India?

Yes. Indian High Courts can grant interim injunctions and appoint local commissioners to preserve evidence, if you show a prima facie case, balance of convenience and irreparable harm. Act quickly and prepare evidence.

Can an Indian employment contract stop an ex-employee joining a competitor?

Generally no, because Section 27 of the Contract Act makes post-employment non-competes void. You can enforce confidentiality duties and restrictions on using specific trade secrets.

Should I sue in India or the US?

It depends on where the former employee and the new employer are and where the harm occurs. Often both are used together, with Indian counsel handling urgent evidence and interim relief in India.

What evidence should I preserve first?

Forensic images of devices and accounts, repository logs, access records, download histories and the contracts and policies the employee signed.

Final word

Halverton & Co. is an Indian law firm advising US companies, founders, investors and law firms on Indian law, including trade secret and confidentiality disputes, employment and IP assignment agreements, technology and source code litigation, and cross-border enforcement in India. We practise in Jharkhand, Maharashtra and before the Supreme Court of India, and work alongside US counsel, who advise on US law. Halverton & Co.: Where tech needs law! If you have a question about Indian law, write to us at office@halvertonandco.com, or get in touch.

This article reflects developments reported up to late October 2026. It is for general information only, is not legal advice, and does not create an attorney-client relationship. Halverton & Co. is an Indian law firm and does not advise on US law; US-law points should be confirmed with US counsel.