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Trade Secret Law |
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Any establishment can protect its
confidential information through non-compete non-disclosure contracts with its employees.
In the absence of formal protection, a third party is not prevented from
independently duplicating and using the secret information once it is discovered.
The law of protection of confidential information allows a perpetual
monopoly in secret information.
Generally the following factors are to be considered in determining whether a plaintiff
possessed a trade secret:
- the extent to which the information is known outside to [plaintiffs] business;
- the extent to which it is known by employees and others involved in [plaintiffs]
business;
- the extent of measures taken by [plaintiff] to guard the secrecy of the information;
- the value of the information to the [plaintiff] and to his competitors;
- the amount of effort or money expended by [plaintiff] in developing the information;
[and]
- the ease or difficulty with which the information could be properly acquired or
duplicated by others.
In order to succeed in a trade secret infringement suit, a trade secret owner
(Plaintiff) must show:
- that the information alleged to be confidential provides a competitive advantage,
- that the information really is maintained in secrecy,
- that the information was improperly acquired by the defendant (if the defendant is
accused of making commercial use of the secret), or
- that the information was improperly disclosed by the defendant (if the defendant is
accused of leaking the information).
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 Intellectual
Property Rights
Books On Trade Secrets Law
Case Law
The
"Inevitable Disclosure" Doctrine
Trade secret law has gained importance and recognition only recently
with the intensification of competition in business activity.
Trade secret is not registered with the government as is done in the case of intellectual
properties such as patents, copyrights and trademarks.
The only way to protect trade secret is to keep the information confidential. Trade secret
protection lasts for as long as the trade secret is kept confidential. Trade secret
protection ends the moment a trade secret is made available to the public.
What is a trade secret?
Trade secrets may consist of any formula, physical device, idea, pattern, process
or compilation of information.
Trade secret provides the owner of the information with a competitive advantage in a
competitive market.
Trade secret is protected in such a way that competitors gain knowledge of it only through
acquisition or theft.
Potential trade secrets are a secret recipe or a formula for a drink, survey methods used
by professional pollsters, a new invention for which a patent application has not yet been
filed, marketing strategies, manufacturing techniques and computer algorithms.
How to keep and protect trade secrets?
Trade secrets are valuable intellectual property that cannot be protected by intellectual
property laws such as patents, copyrights and trademarks laws. So, the best way to keep
and protect trade secrets is:
- By keeping a new idea or business concept secret in order to enjoy a competitive
advantage as a early mover.
- By keeping competitors from learning that a product or service is under development and
from discovering its functional or technical attributes.
- By protecting valuable business information such as marketing plans, cost and price
information and customer lists.
- By protecting both negative and positive information learned during the course of
research and development.
- By protecting any other information that has some value and is not generally known by
your competitors.
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What are trade secret ownership rights?
A company owning tradesecrets can prevent any employee who routinely comes into
contact with the employer's trade secrets as part of the employee's job, who is
automatically bound by a duty of confidentiality, not to disclose or use trade secret
information, from copying, using and benefiting from its trade secrets or disclosing them
to others without permission.
A company owning tradesecrets can prevent those who acquire a trade secret through
improper means such as theft, industrial espionage or bribery, from copying, using and
benefiting from its trade secrets or disclosing them to others without permission.
A company owning tradesecrets can prevent those who knowingly obtain trade secrets from
people who have no right to disclose them, from copying, using and benefiting from its
trade secrets or disclosing them to others without permission.
A company owning tradesecrets can prevent those who learn about a trade secret by accident
or mistake, but had reason to know that the information was a protected trade secret, from
copying, using and benefiting from its trade secrets or disclosing them to others without
permission.
A company owning tradesecrets can prevent those who sign nondisclosure agreements
("confidentiality agreements") from copying, using and benefiting from its trade
secrets or disclosing them to others without permission.
Employees are normally bound by an implied duty not to disclose sensitive information.
Even then, nondisclosure agreements should preferably be signed by all employees who come
into contact with a company's trade secrets, including high-level employees and company
presidents. Nondisclosure agreements make it clear to the employee that the company's
trade secrets must be kept confidential. A company's lenders, investors and potential
investors may also insist that employees sign nondisclosure agreements.
People who discover the tradesecret independently, without using illegal means or
violating agreements or state laws cannot be stopped from using information protected
under trade secret law.. It is not a violation of trade secret law to "reverse
engineer" any lawfully obtained product and determine its trade secret.
Product X is comprised of a trade secret protected formula. Y reverse engineers the
Product X and recreates the formula. Y can legally use this information to make and sell
his own Product X.
How can trade secrets be protected?
There must be a clear demonstrated intention to keep any valuable business
information a trade secret by marking documents containing trade secrets
"Confidential," maintaining computer security and limiting access to secrets.
Trade secrets are best protected through the use of nondisclosure agreements. Courts have
repeatedly reiterated that the use of nondisclosure agreements is the best demonstrated
way to maintain the secrecy of confidential information.
Lack of nondisclosure agreements gives rise to doubts about genuine intention to keep
trade secrets protected.
Enforcing trade secret rights if someone steals or improperly discloses confidential
information.
Every state has enacted a law prohibiting theft or disclosure of trade secrets. Most of
these laws are derived from the Uniform Trade Secrets Act (UTSA).
A trade secret owner can enforce rights against someone who steals confidential
information by asking a court to issue an injunction preventing further disclosure. If
Company X learns that an employee has emailed trade secrets to Company Y, Company X can
obtain a court order preventing use of the secrets by Company Y. A trade secret owner can
also collect damages for any economic injury suffered as a result of the trade secret's
improper acquisition and use.
Examples of trade secret infringement that can lead to trade secret lawsuits:
- X, a former employee of Y, discloses Y's trade secrets to a new employer.
- X hacks into the network for a company and downloads information. X sells the
information to a third party which a rival company.
- X works as an independent contractor for Y. X signed a nondisclosure agreement with Y,
but later discloses Y's secrets to a rival.
The "Inevitable
Disclosure" Doctrine
A company may prevent a former employee from working for a competitor if the
company can demonstrate that employment with the competitor will inevitably lead to
disclosure of trade secrets.
In PepsiCo, Inc. v. Redmond, 54 F.3d 1262 (7th Cir. 1995), there is discussion of when
disclosure of trade secrets is inevitable.
The court identified several factors to be weighed in determining whether disclosure of
trade secrets in inevitable including;
(1) Is the new employer a competitor? (2) What is the scope of the defendants new
job? (3) Has the employee been less than candid about his new position? (4) Has the
plaintiff clearly identified the trade secrets that are at risk? (5) Has actual trade
secret misappropriation already occurred? (6) Did the employee sign a nondisclosure and/or
non-competition agreement? (7) Does the new employer have a policy against use of
others trade secrets? (8) Is it possible to sanitize the employees
new position?
PepsiCo (1995 case) successfully argued that a former executive could not work as Chief
Executive Officer of a competitor Gatorade and Snapple because the executive will
inevitably rely on PepsiCo's trade secrets and in the process give the competitor an
unfair advantage over PepsiCo.
The inevitable disclosure doctrine has been rejected by many States because it challenges
an employee's basic freedom to switch employers. A court may refuse to apply the
inevitable disclosure doctrine unless
- additional bad faith is shown
- underhanded dealing is proved, or
- a competitor who does not have comparable technology has employed the worker.
Does the stealing of trade secrets constitute a crime?
Intentional theft of trade secrets can constitute a crime under both federal and state
laws. The most significant federal law dealing with trade secret theft is the Economic
Espionage Act of 1996 (EEA) (18 U.S.C., Sections 1831 to 1839). The EEA gives the U.S.
Attorney General sweeping powers to prosecute any person or company involved in trade
secret misappropriation and punishes intentional stealing, copying or receiving of trade
secrets. Individuals may be fined up to $500,000 and corporations up to $5 million. A
violator may also be sent to prison for up to ten years. All property used and proceeds
derived from the theft can be seized and sold by the government.
The EEA applies not only to thefts that occur within the United States, but also to thefts
outside the U.S. if the thief is a U.S. citizen or corporation, or if any act in
furtherance of the offense occurred in the U.S. If the theft is performed on behalf of a
foreign government or agent, the corporate fines can double and jail time may increase to
15 years.
Trade secret infringement a crime in California. It is a crime to acquire, disclose or use
trade secrets without authorization. Violators may be fined up to $5,000, sentenced to up
to one year in jail, or both. (Cal. Penal Code Section 499c.)
Unless otherwise stated, the statute in the United States of America reads as follows:
Trade secret" means information, including a formula, pattern, compilation,
program, device, method, technique, process, drawing, cost data or customer list that:
(1) Derives independent economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use, and
(2) is the subject of efforts that are reasonable under the circumstances to maintain its
secrecy.
"Misappropriation" of trade secrets is defined as the:
(1) Acquisition of a trade secret of another by a person who knows or has reason to know
that the trade secret was acquired by improper means; or
(2) disclosure or use of a trade secret of another without express or implied consent by a
person who
(A) used improper means to acquire knowledge of the trade secret; or
(B) at the time of disclosure or use, knew or had reason to know that his knowledge of the
trade secret was (i) derived from or through a person who had utilized improper means to
acquire it; (ii) acquired under circumstances giving rise to a duty to maintain its
secrecy or limit its use, or (iii) derived from or through a person who owed a duty to the
person seeking relief to maintain its secrecy or limit its use; or
(C) before a material change of his position, knew or had reason to know that it was a
trade secret and that knowledge of it had been acquired by accident or mistake.
Books On Trade Secrets Law:
The
Uniform Trade Secrets Act : An article from: JOM [HTML] (Digital)
January 31, 2006
by David V Radack
Once a trade secret misappropriation is found, the UTSA provides remedies for the
aggrieved party. Traditional remedies, such as money damages and injunctions, are provided
under the UTSA. Money damages can take the form of the defendant's unjust enrichment or
the injured party's loss, in terms of lost profits. The UTSA also provides for a
reasonable royalty as an alternate measure of damages.
This digital document is an article from JOM, most recently published by ProQuest
Information and Learning on January 31, 2006. The length of the article is 902 words. The
page length shown above is based on a typical 300-word page. The article is delivered in
HTML format and is available in your Amazon.com Digital Locker immediately after purchase.
You can view it with any web browser.
Nondisclosure
Agreements: Protect Your Trade Secrets and More (Paperback)
by Richard Stim, Stephen Fishman - Bk&CD-Rom edition (September 1, 2001)
Attorneys Stim (License Your Invention) and Fishman (Working for Yourself) target
small-business managers with this comprehensive explanation of nondisclosure agreements
(NDAs). The book covers the use of the agreements to prevent theft of business secrets by
employees and competitors, beginning with a discussion of what trade secrets are and which
kind can be protected by NDAs and followed by a review of the essential elements of a
basic nondisclosure form. There is a chapter on agreements for specific situations in
which secrets might be divulged, such as software beta tests, employment interviews,
business visits, and sharing customer lists. Readers will learn what the options are if an
agreement is violated and how to find and work with an attorney to enforce an NDA. The
book includes a glossary, a list of state signatories to the Uniform Trade Secrets Act,
and plenty of sample forms for NDAs printed in the text and on an accompanying CD-ROM.
Highly recommended for business collections. Joan Pedzich, Harris Beach, Rochester, NY
Copyright 2002 Reed Business Information, Inc.
Inventors, business people, programmers and other professionals often possess confidential
information that gives them an advantage in their field. The sad reality, however, is that
a secret can be leaked, obliterating any benefit it provided.
Protect yourself and your business. Armed with Nondisclosure Agreements, you have the
step-by-step instructions and legal forms you need to safeguard your trade secrets, even
if they reach the wrong hands.
Written by attorneys who specialize in intellectual property, this book guides you through
the development of a nondisclosure agreement, explaining the "fine print" so
that you can keep your information confidential. Nondisclosure agreements can be tailored
for every type of situation, including:
* employers maintaining employee secrecy
* inventors keeping their gadgets under wraps
* businesses licensing their secret technology
* programmers beta-testing their software
* marketers protecting customer lists
* and many more
The book provides a thorough, easy-to-follow analysis of trade secret law and
nondisclosure agreements, including an explanation of how trade secrets are created and
who owns them. Includes over 15 forms as tear-outs and on CD-ROM.

Protecting
Trade Secrets Under the Uniform Trade Secrets Act (Hardcover)
by Michael Craig Budden
...is concice, useful, and well-written primer for the subject of commercial
confidential information....Budden's careful and realistic approach has produced a useful,
compact guidebook for the on-the-go business executive who must confront the subject of
trade secrets, simultaneously Budden's work can well serve the needs of academicians,
especially in business schools and law schools....[P]rovides thoughtful and practical
advice in the field of information security without excessive legal jargon....[H]eartily
recommended for any business leader or academician who must deal with the subject of
information security.IJCM
Trade secrets are valuable. Executives know that, but do they also know how easily they
can be stolen? Marketing expert Michael Budden thinks not. The departure of unhappy
employees, sabotage by current employees, or simply the carelessness of managers unmindful
of the risks or unaware of the protection available to them can be hazardous to the
security of essential corporate information. Now, however, there is the Uniform Trade
Secrets Act. Prevalent in most states with enactment in others almost certain, the Act
offers the protection executives need providing they have taken reasonable steps on their
own before seeking redress under its provisions. In this readable text, Budden explains
the law, how it works, and what executives must do to avail themselves of it. He includes
revealing case studies for futher guidance and to aid executives in their corporate
strategic planning. An essential resource for people with management responsibilities in
almost all organizations, and a useful quick refresher for their legal advisers.

Trade
Secrets: Protecting Your Confidential Business Information (Self-Counsel
Business (Paperback)) (Paperback)
by Nishan Swais
- Safeguard your confidential business information - Understand the threat posed by
technology - What to do if your secret gets out.
This book was written for the Canadian market; hence, the laws and regulations contained
pertain to Canada. It is, however, an excellent beginner's guide for anyone. |
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Navigant Consulting Inc. v. Wilkinson
U.S. 5th Circuit Court of Appeals
Action brought against two of plaintiff-consulting company's former employees alleging
breach of fiduciary duty, breach of contract, and misappropriation of trade secrets.
Judgment against defendants is affirmed.
San Jose Constr., Inc. v. S.B.C.C., Inc.
California Appellate Districts
Action by plaintiff-construction company against its former employee and his new employer,
summary judgment for the new employer is reversed. There were triable issues of fact with
regard to causes of action for misappropriation of trade secrets, intentional interference
with prospective economic advantage, and unfair competition.
Yield Dynamics, Inc. v. TEA Sys. Corp.
California Appellate Districts
Dispute with former employee over computer code and alleged trade secrets, judgment for
defendants is affirmed as plaintiff failed to establish that the code constituted a trade
secret.
Incase Inc. v. Timex Corp.
U.S. 1st Circuit Court of Appeals
Claims of misappropriation of trade secret, unfair trade practices, breach of contract,
and implied contract: Judgment as a matter of law (JMOL) on the trade secret claim is
affirmed where there was no evidence to support plaintiff's argument that it took
reasonable steps to preserve the secrecy of the design in question.
Am. Family Mut. Ins. Co. v. Roth
U.S. 7th Circuit Court of Appeals
Breach of contract and misappropriation of trade secrets in the form of client lists.
Preliminary injunction in favor of plaintiffs is affirmed in part where the information in
plaintiff's client database was a trade secret entitling plaintiff to an injunction.
Huong Que, Inc. v. Luu
California Appellate Districts
Order temporarily enjoining defendants from engaging in certain activities found by the
trial court to constitute, among other things, tortious disloyalty to, and interference
with the business of plaintiffs is affirmed.
Synergetics, Inc. v. Hurst
U.S. 8th Circuit Court of Appeals
Action by a company against former employees for breach of contract, misappropriation of
trade secrets.
People v. Laiwala
California Appellate Districts
Defendant established, and the prosecutor failed to refute, that there is no reasonable
cause to support a finding that the information at issue was a trade secret.
People v. Laiwala
California Appellate Districts
The record contains insufficient evidence that the "master key" associated with
a DVD copy protection scheme had "independent economic value." Thus it was not
shown to qualify as a trade secret under Penal Code section 499c.
BondPro Corp. v. Siemens Power Generation, Inc.
U.S. 7th Circuit Court of Appeals
Judgment as a matter of law for defendant in a trade secrets suit involving a
manufacturing technique is affirmed where the disputed invention did not meet the criteria
for a trade secret.
Hicklin Eng LC v. Bartell, R.J.
U.S. 7th Circuit Court of Appeals
Summary judgment for the plaintiff in a trade secret case is reversed after a finding that
a reasonable jury could have determined that the defendant, an independent contractor,
knew that the plaintiff company treated at least some of the data it provided him as trade
secrets.
US v. Ye
U.S. 9th Circuit Court of Appeals
Petition for a writ of mandamus challenging a discovery order involving pretrial
depositions of government witnesses in a prosecution for possession of stolen trade
secrets is granted where the Bauman factors weighed strongly in favor of granting such
relief. Bauman v. U.S. Dist. Court, 557 F.2d 650 (9th Cir. 1977).
Hacny Transp. v. Chu
U.S. 7th Circuit Court of Appeals
Claims for misappropriation of trade secrets are foreclosed by Section 8(a) of the
Illinois Trade Secrets Act only when they rest on the conduct that is said to have
misappropriated the secrets.
Advanced Modular Sputtering, Inc. v. Super. Ct. of Santa Barbara
California Appellate Districts
Code of Civil Procedure section 2019.210, which provides that discovery relating to a
trade secret may not commence until the trade secret is identified with reasonable
particularity, extends to any cause of action which relates to the trade secret.
BP Chem. v. Jiangsu SOPO Corp.
U.S. 8th Circuit Court of Appeals
Suit alleging misappropriation of trade secrets, plaintiff has marshalled sufficient facts
in support of its pleadings to survive defendant's factual jurisdictional challenge under
the Foreign Sovereign Immunities Act.
READYLINK HEALTHCARE v. COTTON
California Appellate Districts
Trial court's enforcement of plaintiff-employer's noncompetition agreement is affirmed
where there is sufficient evidence establishing that defendant-employee intended to use
protectable trade secret information stolen from plaintiff.
MILLENNIUM CORP. SOLUTIONS v. PECKINPAUGH
California Appellate Districts
Suit concerning the misappropriation of trade secrets, the grant of a preliminary
injunction against plaintiff-brokerage firm is affirmed over its challenge that it was
deprived of its right to a fair hearing.
WYETH v. NATURAL BIOLOGICS, INC.
U.S. 8th Circuit Court of Appeals
District court did not err in finding defendant misappropriated plaintiff's trade secret
for producing bulk natural conjugated estrogens used in the development of Premarin.
PEAT v. VANGUARD RESEARCH
U.S. 11th Circuit Court of Appeals
Trade secrets case. Jury verdict and judgment in favor of plaintiff is reversed because
the erroneous and prejudicial admission of a summary exhibit constituted reversible error.
CHILDREN'S BROADCASTING CORP. v. THE WALT DISNEY CO.
U.S. 8th Circuit Court of Appeals
On retrial for damages, evidence supported the jury verdict on damages due to
misappropriation of a trade secret.
RHONE-POULENC AGRO, S.A. v. DEKALB GENETICS CORP.
U.S. Fed. Circuit Court of Appeals
On remand from the U.S. Supreme Court, the fraudulent inducement, trade secret
misappropriation, and patent infringement jury verdicts in favor of plaintiff, as well as
the award of punitive damages and several related post-trial rulings made by the district
court, are affirmed.
DVD COPY CONTROL ASS'N, INC. v. BUNNER
Supreme Court of California
A preliminary injunction prohibiting a web site operator from disclosing trade secrets
violates neither the First Amendment nor the California Constitution, assuming the trial
court properly issued the injunction under California's trade secret law.
LEARNING CURVE TOYS, INC. v. PLAYWOOD TOYS, INC.
U.S. 7th Circuit Court of Appeals
Plaintiff had a protectable trade secret in a concept for a noise-producing toy railroad
track under the Illinois Trade Secrets Act; a rational jury could conclude that exemplary
damages were justified.
HARVEY BARNETT, INC. v. SHIDLER
U.S. 10th Circuit Court of Appeals
Summary judgment was not appropriate on whether an "Infant Swimming Program,"
viewed comprehensively, was a trade secret under Colorado law; district court erred in
determining that a confidentiality provision in a license agreement was a disguised
restrictive covenant.
SARGENT FLETCHER, INC. v. ABLE CORP.
California Appellate Districts
Action by a manufacturer against a subcontractor for misappropriation of trade secrets
under the California Uniform Trade Secrets Act, the trial court correctly refused the
manufacturer's proposed instruction to place the burden of proof on defendant.
IN RE BASS
Supreme Court of Texas
Geological seismic data are trade secrets, and non-participating mineral royalty interest
owners failed to establish the existence of a claim against the mineral estate owner,
justifying discovery of the trade secret data.
GUY CARPENTER & CO., INC. v. PROVENZALE
U.S. 5th Circuit Court of Appeals
A customer list was not a trade secret where it was readily ascertainable.
BOURNS, INC. v. RAYCHEM CORP.
U.S. 9th Circuit Court of Appeals
Jury instructions as a whole did not allow the jury to find actual misappropriation based
on inevitable disclosure alone, thus findings of misappropriation and associated damages
are affirmed.
IN RE: BRIDGESTONE/FIRESTONE, INC.
Supreme Court of Texas
Plaintiffs in defective tire litigation are not entitled to discovery of defendant's
"skim stock" formulas, which are trade secrets, as mere possibility of
unfairness is not enough to warrant disclosure of the information.
CHEMETALL GMBH v. ZR ENERGY, INC.
U.S. 7th Circuit Court of Appeals
Illinois law. The question whether plaintiff acquired the right to enforce an employee's
duty of confidentiality could not be decided on the contracts alone, and the parties were
entitled to present evidence on the issue at trial.
MOORE v. KULICKE & SOFFA INDUS., INC.
U.S. 3rd Circuit Court of Appeals
Pennsylvania trade secret law, only the burden of production is shifted when defendant
raises independent development, and the ultimate burden remains on plaintiff to prove that
defendant did not arrive at a technique similar to the trade secret through its own
independent development.
LUIGINO'S, INC. v. PETERSON
U.S. 8th Circuit Court of Appeals
Summary judgment was proper in breach of fiduciary duty, negligent misrepresentation,
corporate usurpation, trade secret misappropriation, and breach of confidentiality
agreement claims.
PENALTY KICK MGMT. LTD. v. COCA-COLA CO.
U.S. 11th Circuit Court of Appeals
Plaintiff failed to provide evidence of defendant's actual disclosure or unauthorized use
of plaintiff's trade secrets under the Georgia Trade Secrets Act (GTSA).
SAVOR, INC. v. FMR CORP.
Supreme Court of Delaware
complaint seeking relief from misappropriation of trade secrets met the minimal standards
governing notice pleading, and thus adequately stated a claim.
PHILIP MORRIS, INC. v. REILLY
U.S. 1st Circuit Court of Appeals
A Massachusetts law, requiring tobacco companies to submit to the state the ingredient
lists for certain tobacco products sold in the state, is an unconstitutional taking of
property (trade secrets) in violation of due process.
CADENCE DESIGN SYS., INC. v. AVANT! CORP.
Supreme Court of California
Trade secret infringement action under the California Uniform Trade Secrets Act (UTSA).
Continued improper use or disclosure of a trade secret after defendant's initial
misappropriation is viewed as part of a single claim of "continuing
misappropriation" accruing at the time of the initial misappropriation.
WESTERN FORMS, INC. v. PICKELL
U.S. 8th Circuit Court of Appeals
District court did not err in finding defendant did not breach confidentiality or use
trade secrets, as the materials plaintiff seeks to protect are not protectable.
FOUR PILLARS ENTER. CO. v. AVERY DENNISON CORP.
U.S. 9th Circuit Court of Appeals
Magistrate judge did not abuse his discretion in concluding that a discovery order for
trade secret material, under 28 U.S.C. section 1782, would improperly frustrate a
protective order issued by an Ohio court in a separate action between the same parties.
SCHLAGE LOCK CO. V. WHYTE
California Appellate Districts
Inevitable disclosure doctrine, permitting a trade secret owner to prevent a former
employee from working for a competitor, is contrary to California law and policy because
it creates an after-the-fact covenant not to compete restricting employee mobility.
BBA NONWOVENS SIMPSONVILLE, INC. v. SUPERIOR NONWOVENS, LLC
U.S. Fed. Circuit Court of Appeals
Claimed trade secret technology satisfied each of the statutory requirements for existence
of a trade secret under South Carolina law, and the record supported a finding of willful
misappropriation.
HERRICK v. GARVEY
U.S. 10th Circuit Court of Appeals
The "trade secret" exemption, to the Freedom of Information Act's general
requirement that the federal government release information to the public, will bar a
request to the FAA for plans and specifications regarding an antique aircraft.
BAXTER INT'L, INC. v. ABBOTT LAB.
U.S. 7th Circuit Court of Appeals
A renewed motion to place documents under seal, based on a claim of commercially sensitive
information, is denied where it does not analyze in detail, document by document, the
propriety of secrecy, providing legal citations and reasons in support.
STRATEGIC DIRECTIONS GROUP, INC. v. BRISTOL-MYERS SQUIBB CO.
U.S. 8th Circuit Court of Appeals
Questions that a pharmaceutical company used in research surveys were not trade secrets,
because they were readily ascertainable in public sources, and its use of three of the
questions in a follow-up survey did not breach an agreement with a market research
company.
LUCINI ITALIA CO. v. GRAPPOLINI
U.S. 7th Circuit Court of Appeals
Misappropriation of gourmet food company's trade secrets.
LEGGETT & PLATT, INC. v. HICKORY SPRINGS MFG. CO.
U.S. Fed. Circuit Court of Appeals
Genuine issues of material fact preclude summary judgment on infringement under the
doctrine of equivalents and trade secret misappropriation.
IDX SYS. CORP. v. EPIC SYS. CORP.
U.S. 7th Circuit Court of Appeals
Where a software manufacturer failed to precisely define its trade secret, summary
judgment on its claim against former employees, alleging trade secret theft, was proper;
however, the dismissal of its claims of tortious inducement of former customers to switch
software providers was reversed.
US v. YANG
U.S. 6th Circuit Court of Appeals
Where the defendants believed the information they conspired and attempted to steal was a
trade secret, the fact that the information was not an actual trade secret was irrelevant,
as the defense of impossibility is unavailable to defendants charged under the Economic
Espionage Act of 1996, 18 U.S.C. sections 1832(a)(4) and (5).
IN RE: PROVIDIAN CREDIT CARD CASES
California Appellate Districts
Rules 243.1 and 243.2 of the California Rules of Court vest a trial court with a
considerable amount of discretion in deciding whether to seal or unseal a judicial record
and, in light of the strong presumption in favor of public access, unsealing records
containing alleged trade secrets was not an abuse of discretion.
DVD COPY CONTROL ASS'N v. BUNNER
California Appellate Districts
A computer source code which describes an alternative method of decrypting copy protection
on DVD's is pure "speech" protected by the First Amendment.
MINNESOTA MINING & MFG. CO. v. PRIBYL
U.S. 7th Circuit Court of Appeals
Evidence that plaintiff took six years to develop its process, but that the company
founded by plaintiff's employees developed a similar process almost immediately, is
sufficient for a jury inference that defendants misappropriated plaintiff's trade secrets.
CADENCE DESIGN SYS., INC. v. AVANT! CORP.
U.S. 9th Circuit Court of Appeals
California Supreme Court certified to determine whether, under the Uniform Trade Secrets
Act, an infringment arises only upon the initial misappropriation of the trade secret or
with each subsequent misuse of the trade secret.
DTM RESEARCH, L.L.C. v. AT&T CORP.
U.S. 4th Circuit Court of Appeals
A defendant in a trade secrets case is not entitled to summary judgment on the ground that
a protective order, based on the governments' assertion of a "state secrets"
privilege, precluded it from defending the case effectively.
UROPLASTY, INC v. ADVANCED UROSCIENCE, INC.,
U.S. Fed. Circuit Court of Appeals
Because plaintiff's trade secrets misappropriation action does not implicate federal
patent law, removal from state court was improper, and the district court lacked
jurisdiction to enter summary judgment for defendant.
Edwards v. Arthur Andersen LLP - 08/30/06 - California Appellate Districts.
Noncompetition agreement prohibiting employee from performing services for former clients
is invalid under Business and Professions Code section 16000 unless it falls within
statutory or "trade secret" exceptions to statute.
Imaging Bus. Machs., LLC v. BancTec, Inc. - 08/10/06 - Cyberspace Law, Intellectual
Property, Trade Secrets. - U.S. 11th Circuit Court of Appeals.
Finding on the preliminary injunction motion that plaintiff lacked a trade secret was not
the result of resolving all disputes and drawing all inferences in the light most
favorable to plaintiff.
O'Grady v. Santa Clara Superior Ct. (Apple Computer, Inc.) - 05/26/06 - California
Appellate Districts.
Cyberspace Law, Trade Secrets.
Federal Stored Communications Act, California reporter's shield, conditional
constitutional privilege against compulsory disclosure of confidential sources.
Doeblers' Pennsylvania Hybrids, Inc. v. Doebler - 03/23/06 - Intellectual Property, Trade
Secrets, Trademark - U.S. 3rd Circuit Court of Appeals. Trademark and trade secret dispute
between corn-seed businesses owned by relatives of the same founder is reversed where
plaintiff did not meet its burden of showing that it was entitled to judgment as a matter
of law.
APG, Inc. v. MCI Telecomms. Corp. - 02/08/06 - Retail, Trade Secrets - U.S. 1st Circuit
Court of Appeals.
Summary judgment and judgment as a matter of law in favor of defendant vacated in part
where the facts left open the possibility of liability on a theory of unjust enrichment.
Will v. Hallock - 01/18/06 - Intellectual Property, Trade Secrets - U.S. Supreme Court.
Positive Software Solutions, Inc. v. New Century Mortgage Corp. - 01/11/06 - Trade
Secrets, Copyright, Cyberspace Law, Ethics & Professional Responsibility. - U.S. 5th
Circuit Court of Appeals.
ConFold Pac., Inc. v. Polaris Indus., Inc. - 01/10/06 - Intellectual Property,
Manufacturing, Trade Secrets. - U.S. 7th Circuit Court of Appeals.
suit for breach of contract and unjust enrichment involving a proposal containing a
shipping container design. Contract at issue did not bind defendant from revealing to a
third party plaintiff's proposed container design.
Ajaxo, Inc. v. E*Trade Group, Inc. - 12/21/05 - Intellectual Property, Remedies, Trade
Secrets, Cyberspace Law, Evidence - California Appellate Districts.
Misappropriation of plaintiff's trade secrets regarding certain technology designed by
plaintiff. There was sufficient evidence of damages for misappropriation as to each
defendant to survive a motion for nonsuit.
Microstrategy Inc. v. Bus. Objects - 11/17/05 - Intellectual Property, Patent, Remedies,
Trade Secrets. - U.S. Fed. Circuit Court of Appeals.
District court erred in determining that Virginia law would not acknowledge plaintiff's
contractual non-solicitation clause.
Manuel v. Convergys Corp. - 11/15/05 - Employment Law, Trade Secrets - U.S. 11th Circuit
Court of Appeals.
Summary: Summary judgment for plaintiff in a contract action is affirmed. Noncompetition
agreement was void and unenforceable under Georgia law
P.C. Yonkers, Inc. v. Celebrations - 11/07/05 - Retail, Trade Secrets, White Collar Crime
- U.S. 3rd Circuit Court of Appeals.
Plaintiffs failed to adduce sufficient proof that defendants-former employees violated the
Computer Fraud and Abuse Act (CFAA).
Mid-Michigan Computer Sys. v. Marc Glassman, Inc. - 07/20/05 - Trade Secrets - U.S. 6th
Circuit Court of Appeals.
State Farm MUT. Auto. Ins. Co. v. Garamendi - 04/26/04 - Insurance Law, Intellectual
Property, Trade Secrets - Supreme Court of California
Exemption from disclosure of information protected by the trade secret privilege.
California Code of Regulations permitting public inspection of statements that insurers
are required to file, is valid; the public disclosure provision of Insurance Code section
1861.07 does not incorporate the exemption from disclosure found in Government Code
section 6254(k), and thus does not exempt from disclosure information protected by the
trade secret privilege.
Phillips v. AWH Corp. - 04/08/04 - Patent, Intellectual Property, Trade Secrets - U.S.
Fed. Circuit Court of Appeals
Trade secret misappropriation claim was correctly dismissed as time-barred.
Jasmine Networks, Inc. v. Marvell Semiconductor, Inc. - 04/08/04 - Patent, Intellectual
Property, Trade Secrets - California Appellate Districts
Disclosure of a transcript of a conversation among defendant's officers and lawyers that
was inadvertently left on plaintiff's voicemail system. Defendant waived its
attorney-client privilege by disclosing the information within the meaning of section
912(a).
Vliw Tech., LLC v. Hewlett-Packard Co. - 12/19/03 - Intellectual Property, Trade Secrets -
Supreme Court of Delaware.
Contract provisions regarding confidentiality and restricting the use of the licensed
technology were sufficiently ambiguous to survive dismissal.
Elecs. For Imaging, Inc. v. Coyle - - 08/18/03 - Patent, Intellectual Property, Trade
Secrets - U.S. Fed. Circuit Court of Appeals.
Plaintiff established a prima facie case that personal jurisdiction over defendants would
be proper and comports with due process.
PAVLOVICH v. THE SUPERIOR COURT OF SANTA CLARA COUNTY ( DVD COPY CONTROL ASS'N, INC.)
- 11/25/02 - Cyberspace Law, Intellectual Property, Trade Secrets - Supreme Court of
California.
Court exercising personal jurisdiction over a defendant, based on a posting on an Internet
Web site, was improper because defendant's knowledge that his conduct may harm industries
centered in California did not, by itself, establish express aiming.
STATE FARM MUT. AUTO. INS. CO. v. LOW - 10/17/01 - Insurance Law, Intellectual Property,
Trade Secrets - California Appellate Districts.
California Code of Regulations, title 10, section 2646.6(c) and Insurance Code section
1861.07 permit public disclosure of Community Service Statements that insurance companies
file under Proposition 103 even if they contain trade secrets.
Nondisclosure
Agreements: Protect Your Trade Secrets and More Protecting
Trade Secrets Under the Uniform Trade Secrets Act Trade
Secrets: Protecting Your Confidential Business Information The
Uniform Trade Secrets Act
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