PILLOW TALK: A Threat to Trade Secrets?

It turns out that, even in romantic relationships, some things are best kept secret.  On July 7, 2017, Teva Pharmaceuticals USA, Inc. filed a complaint in the Eastern District of Pennsylvania alleging that a former executive disclosed confidential information to a romantic partner who happens to be an executive of one of Teva’s direct competitors.

Teva alleges that during multiple years of her employment, Defendant Barinder Sandhu, its former senior director of regulatory affairs, shared trade secrets and other confidential information with Defendant Jeremy Desai, Apotex’s president and CEO.  Teva asserts that Sandhu violated her confidentiality agreement and several company policies by:

• emailing confidential documents directly to Desai at Apotex;
• emailing confidential documents to her personal Gmail account in order to share with Desai without Teva’s detection;
• using USB flash drives to copy confidential files from her work laptop;
• verbally communicating and providing printed copies of confidential information; and
• backing up confidential files to a cloud-based drive for nearly two years.

Teva contends that Desai and/or co-defendant Apotex used the misappropriated information to gain a competitive advantage: Desai allegedly received product development information relating to “Product X,” a generic drug being developed by Teva, which Apotex employees discussed and used to speed regulatory approval and advance the market position of Apotex’s competing product.  Among other claims, Teva sued for violations of the Defend Trade Secrets Act, Computer Fraud and Abuse Act, and state Uniform Trade Secrets Act.

Since an employer can’t control the romantic relationships of its employees, what can an employer do to minimize the harm from betrayal by a trusted employee blinded by love?

Teva’s own actions provide good examples.  According to the complaint, Teva had a confidentiality agreement in place with Sandhu (giving it the right to an injunction and fees) along with policies governing confidential information, data privacy, documents and records, and computer systems and security, as well as a code of business conduct.  Teva also contends that it used multiple means to protect its trade secret information, including limiting dissemination to need-to-know employees, limiting electronic access to documents, using password protection, and maintaining building security.  While these measures may not have ultimately prevented the wrongful disclosure of Teva’s information in the first place, they are likely to give Teva an advantage in litigation.