Employee Misappropriation

ECONOMIC ESPIONAGE AND PROTECTING TRADE SECRETS: Ninth Circuit Holds That Reasonable Measures to Guard Technology are Sufficient

How can you protect your trade secrets from a vast and well-concealed international effort to steal those secrets? What constitutes a “reasonable” effort to protect that information where at least one competitor may already have the information?  The Ninth Circuit recently opined on these matters in the ongoing saga of U.S. v. Liew.

In 2014, Walter Liew and his company, USA Performance Technology, Inc., were convicted of multiple offenses, including claims under the Economic Espionage Act and conveying misappropriated trade secrets to a third party. The trade secrets related to DuPont’s technology for producing titanium dioxide, which is used in a wide range of products such as paint and Oreo cookies. READ MORE

ROADBLOCK IN PLACE: Court Grants Limited Preliminary Injunction in Waymo v. Uber

Imagine preparing for that big meeting on your way to work, while you ride along in your car—without the need for a driver. What sounds like it might be out of a sci-fi movie, may actually be the not-so-distant future.  Such technology is at the center of the Waymo LLC v. Uber Technologies, Inc. litigation. The self-driving technology at issue hasn’t been the only intriguing part of this case–the litigation itself has been action packed, and we’ve been watching closely. As you’ll recall from previous posts, Waymo alleged that, while working at Waymo, its star engineer Anthony Levandowski downloaded over 14,000 confidential files before leaving the company to start his own competing business, Ottomoto, which was later acquired by Uber.  The twists and turns of this fast-paced litigation have included Uber’s denied petition for arbitration, Fifth Amendment invocations by Levandowski and his failed appeal, a criminal referral by Judge William Alsup of the Northern District of California, and now an order granting a “limited” preliminary injunction blocking any participation of Levandowski in Uber’s self-driving car project. READ MORE

The Saga Continues: New York’s Highest Court Will Weigh in on Aleynikov’s Fate

On April 20, 2017, the New York Court of Appeals issued a brief order continuing former Goldman Sachs programmer Sergey Aleynikov’s eight-year voyage through the state’s and country’s legal systems.  Here’s the issue:  does making a digital copy of misappropriated source code instead of physical copy constitute a “tangible reproduction or representation” of the source code?   READ MORE

Nice Try: Federal Circuit Denies Uber Engineer’s Writ, Affirming the District Court

In trade secret cases, it is often the case that a defendant company and employee accused of trade secret misappropriation enter into a joint defense agreement.  Often under such JDAs, facts, strategies and documents are shared with the understanding that they will remain confidential. READ MORE

Growing Small Satellite Market Spawning Litigation

Virgin Galactic expanded and continued its attack on its former VP of Propulsion, Thomas Markusic, and his new company, Firefly Space Systems, this month. Markusic co-founded Firefly around the time he left Virgin Galactic, and the two companies compete in the market for rockets capable of launching small and medium sized satellites into lower earth orbit. As the demand for services from such satellites increases steadily; the race to provide a more cost effective method for delivering those satellites into space is also growing and becoming more competitive. READ MORE

“Gist of Action” Doctrine: Don’t Contract Away Your Misappropriation Claim

The “gist of action” doctrine. Heard of it? Well, if you are dealing with Pennsylvania law, you need to know it. The “gist of action” doctrine asks whether the “gist” of a suit sounds in tort or contract. When applied to a claim of trade secret misappropriation, the doctrine questions whether the wrongful acts constitute a tort or a breach of contract. If the wrongful acts constitute a breach of contract, Pennsylvania law bars any trade secret claim. As evidenced by the case Wiggins v. Physiologic Assessment Services, LLC, whether a claim can be brought as a trade secret claim or a breach of contract claim can turn on the wording of the contract at issue. READ MORE

Get Off My Cloud: “BYOC” Workplaces Pose Trade Secrets Risks

There’s been a lot of talk in recent years about “BYOD” (“Bring Your Own Device”) policies, which are becoming increasingly common in the workplace. Employees want the flexibility and ease that comes with being able to use a personal device for work purposes, but employers have long been warned about risks to information security and other perils that come with the territory. Employers take on a separate and distinct set of risks when employees use personal cloud storage services at work—an increasing trend that’s been dubbed “Bring Your Own Cloud” or “BYOC.”  READ MORE

Trade Secrets in the Fast Lane – Formula One and the Importance of Trade Secret Protection

For a competition to be friendly, it should be scrupulously fair.” The Formula One world was recently jolted by allegations that a former Mercedes-Benz AMG engineer took highly-confidential information in anticipation of joining Mercedes’ chief competitor Ferrari. Mercedes recently filed suit in the High Court of Justice in the United Kingdom. To many in the Formula One world, the recent news is reminiscent of 2007’s “Spygate” controversy involving confidential technical data misappropriated from Ferrari. Nearly a decade later, the recent allegations underscore an important facet of Formula One: Formula One teams go to extraordinary lengths to protect their design secrets created at a cost of hundreds of millions of dollars. READ MORE

Trade Secrets Unwrapped: Packaging Materials Case Demonstrates The Importance Of Keeping Confidential Information Sealed Shut

There are many ways to gain trade secret protection, but also many ways to lose it. As the recent motion to dismiss ruling in Fleetwood Packaging v. Hein from the Northern District of Illinois illustrates, how a company vacuum packs its confidential information can make all the difference between preserving it and watching it get spoiled by a competitor. READ MORE

Think Before You Tack CFAA Claims on to Your Trade Secret Misappropriation Case

Before you include a Computer Fraud and Abuse Act (“CFAA”) claim in a trade secret case, consider carefully: was the data acquired through “unauthorized access” or was it just misused by the defendants? If it was properly accessed (but later misused), your CFAA claim, and the federal question jurisdiction that comes with it, is in jeopardy. In SunPower Corp. v. SunEdison, Inc., Judge Orrick of the Northern District of California recently dismissed the plaintiff’s CFAA claim because the plaintiff failed to allege that the data was accessed without authorization, only that it was later misused.  Because the CFAA claim provided the basis for federal jurisdiction, Judge Orrick indicated that he would dismiss the entire case and not exercise pendent jurisdiction over the remaining thirteen state claims if the CFAA claim could not be properly amended. READ MORE