[thaumasiotes]

So, the purpose of granting patents is that companies will take the temporary protection and put their techniques into the public record, preventing the technological loss that occurs when the only people who know a secret accidentally die.

What's the idea behind legal protection for trade secrets?

[ridgeguy]

Legal protection of trade secrets gives the trade secret owner the right to sue if someone steals the secret.

So if employees of Coca-Cola conspire to steal the (trade) secret formulation for Coke, the company can sue them for damages. There can be criminal offenses as well.

Trade secrets are used in situations where there's a secret (like some manufacturing process) that can't easily be reverse-engineered from the product. In that case, the owner can keep the secret as long as they wish. No patent to expire, no transfer of the IP to the public domain. For as long as the secret can be kept.

Of course, there's no legal protection from reverse-engineering a trade secret. Somebody who RE'd Coke's formula would not only be free to use it but could patent it as well. The patent holder might even be able to sue Coke for patent infringement.