Florida Governor Ron DeSantis Signs Two Bills to Combat Intellectual Property Theft

On June 7, 2021, Florida Governor Ron DeSantis signed House Bills 7017 and 1523, which aim to safeguard intellectual property by protecting the state’s government, higher education institutions, and companies from foreign influence and corporate espionage.[1] A summary of each House Bill (“HB”) is included below, as provided by the Florida House of Representatives website:

• HOUSE BILL 7017 (Foreign Influence, effective July 1, 2021):  “Requiring any state agency or political subdivision to disclose certain gifts or grants received from any foreign source to the Department of Financial Services within a specified timeframe; requiring any entity that applies for a certain grant or proposes a certain contract to disclose to a state agency or political subdivision any current or prior interest of, contract with, or grant or gift received from a foreign country of concern under certain circumstances; requiring institutions of higher education to semiannually report to certain entities regarding certain gifts they received directly or indirectly from a foreign source; authorizing a whistle-blower to report an undisclosed foreign gift to the Attorney General or the Chief Financial Officer; authorizing the Chief Financial Officer to incur expenditures to provide such reward from the penalty recovery; requiring certain state universities and other entities to screen certain foreign applicants seeking employment in specified research positions; requiring certain state universities and other entities to establish an international travel approval and monitoring program, etc.”[2]

A “foreign country of concern,” defined by HB 7017-created Fla. Stat. § 286.101, includes China, Russia, Iran, North Korea, Cuba, Venezuela, Syria, and any other agency of or entity under the significant control of such countries.[3] According to a news release on Governor DeSantis’ website, HB 7017 will demand “the highest accountability measures and disclosure from individual scientists, technicians, and administrators on foreign support for public entities and postsecondary institutions.”[4] In the words of Senator Manny Diaz, Jr., the legislation comes in the wake of the reported “infiltration of U.S. intellectual property and research in our higher education institutions.”[5]

• HOUSE BILL 1523 (Corporate Espionage, effective October 1, 2021): “Prohibits theft of trade secret; prohibits trafficking in trade secrets; reclassifies penalty & increases offense severity ranking for an offense committed with specified intent; requires court to order specified restitution for violation; provides for civil actions for violations; provides exception to criminal & civil liability for certain disclosures.”[6]

Additionally, HB 1523 creates new criminal offenses for the theft and trafficking of trade secrets. At the signing event in Miami, Governor DeSantis stated that HB 1523 implements a third-degree felony punishable by up to five years in prison for any person who willfully, without authorization, steals or attempts to steal a trade secret and use it for their own benefit, as well as a second-degree felony punishable by up to fifteen years in prison for an attempt to sell a stolen trade secret. Further, where the law is violated on behalf of a foreign government, the penalties are significantly enhanced. “We don’t want bad actors involved in our colleges and universities, and we’ll hold you accountable if you run afoul of these new laws,” DeSantis warned.[7]

In an effort to “protect free markets, government operations, and educational institutions” from “unfettered access” by “foreign adversaries,” the bipartisan legislation is set to guard “innovation and ingenuity” in Florida.[8] Specifically, DeSantis expressed that the pair of bills are a reaction to China, which the Governor referred to as a “nefarious”[9] and “hostile foreign power” in view of its alleged commission of “espionage and commercial theft.”[10] According to House Speaker Sprowls, this legislation will “expose and stop foreign adversaries and their agents from walking through the front doors of our corporations and universities and sneaking out the back with our taxpayer-funded research.”[11]