Posts by: Editorial Board

Diamonds Are Forever, but Joint Ventures Are Not: Court Finds Claims Preempted by CUTSA in Business Deal Gone Bad

Editorial BoardPosted on December 14, 2016

The holiday season is officially upon us: peppermint mochas have popped up on coffee shop menus, carols ring from department store speakers, and you can’t turn on the television without seeing at least three diamond commercials. But it’s not all yuletide and merriment for those in the diamond business. As one diamond importer and wholesaler recently learned, sometimes instead of a gem you get a lump of coal—in this case, from the Northern District of California, which tossed out certain claims against a former business partner on the grounds those claims were preempted by the California Uniform Trade Secrets Act. READ MORE →

Supreme Court May Consider ITC’s Authority Over Trade Secret Matters

Editorial BoardPosted on November 28, 2016

Here at TSW, we continue to watch closely developments in the Sino Legend v. ITC case. In September, Sino Legend petitioned the Supreme Court for a writ of certiorari to review whether Section 337 of the Tariff Act of 1930 allows the ITC to adjudicate cases involving allegations of trade secret misappropriation occurring entirely in a foreign country. This week, we summarize the relevant law, background, and the legal basis of Sino Legend’s petition. READ MORE →

THANKSGIVING EDITION [FROM THE ARCHIVES]: Court Protects Quizno’s Franchise Turkey Trade Secrets

Editorial BoardPosted on November 23, 2016

This Thanksgiving, Trade Secrets Watch is serving a delicious tale about protecting trade secrets in a franchising relationship.

In 1994, Quizno’s entered into a franchise agreement with Robert Kampendahl, an enterprising fellow who wanted to open up a Quizno’s sandwich shop in St. Charles, Illinois. Unfortunately, Kampendahl didn’t keep his food equipment clean, used unapproved foods, and had safety and sanitation problems, so Quizno’s terminated the franchise agreement. Upon termination, Kampendahl was subject to a covenant not to compete that prohibited him from opening a competing sandwich shop within five miles. READ MORE →

No Way Around It: SB 1241 Further Restricts Non-Compete Agreements For California Workers

Editorial BoardPosted on October 18, 2016

Companies often seek to protect their trade secrets by requiring employees to sign non-compete agreements. California law invalidates such provisions except in very limited circumstances. See Bus. & Prof. Code §§ 16600 et seq. With the recent passage of a new statute, the ability of employers to enforce such agreements against California employees is more restricted than ever. READ MORE →

RIGHT IN THE BREADBASKET: Lessons From Early Cases at the Intersection of Noncompetes and the DTSA

Editorial BoardPosted on August 29, 2016

As many TSW readers are aware, 2016 has been a big year for trade secret law, with both the United States and the European Union expanding trade secrets protections and increasing the uniformity of their laws. But as good as this year has been for trade secrets protection, it’s been every bit as bad for noncompete agreements.
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These are Not the Trade Secrets You’re Looking For: Star Wars Model Maker Sues Ex-Employees for Misappropriation

Editorial BoardPosted on July 20, 2016

In a tale of alleged betrayal and misappropriation of trade secrets in a courtroom (not) far, far away, a pioneering company in the area of special effects has sued its former employees and a vendor, claiming that they conspired to recreate the company’s primary business under a new name, erasing the evidence on the way out. The alleged tale is an illustration of how vulnerable a company and its trade secrets can be in times of ownership and business transition, especially when the company relies mostly on a single customer. READ MORE →

Early Returns (Part 2 of 3): The DTSA Lifts Off

Editorial BoardPosted on June 23, 2016

(Editorial Note: This is the second in our two-part series exploring recent litigation under the newly-enacted Defend Trade Secrets Act.)

We’ve been tracking the development of the Defend Trade Secrets Act (“DTSA”) for a while on TSW. It was only last month that President Obama signed the dotted line, and the DTSA became law. Now, Space Data has filed suit against Google for patent infringement, misappropriation of trade secrets under the DTSA, misappropriation of trade secrets under the California Uniform Trade Secrets Act, and breach of contract. We’ll be watching closely to see how the Northern District Court of California handles one of the first cases under the DTSA. READ MORE →

The Gloves Are Off: Competing Biopics Battle For Hollywood Purse

Editorial BoardPosted on March 11, 2016

Hollywood’s heavy-hitters often enter the ring over unauthorized biographies. Elizabeth Taylor famously invoked her rights of publicity and privacy in an attempt to shut down an unofficial docudrama about her life; Clint Eastwood sued the author and publisher of his unsanctioned biography for libel; and a film production company brought claims for copyright and trademark infringement against the producers of the biopic Lovelace starring Amanda Seyfried. Hollywood’s newest matchup involves misappropriation of trade secrets, a growing concern in the entertainment industry, especially after the recent Sony hack. READ MORE →

Aviation Contractor Glides Away From Liability After Receiving Unsolicited Email Containing Trade Secrets

Editorial BoardPosted on January 29, 2016

If a third party sends you someone’s trade secrets, and you delete them as soon as you know they’re trade secrets, you’re off the hook for misappropriation.

That, in a nutshell, is what a Florida federal judge held on January 14, when he dismissed Dyncorp International LLC’s allegations that rival contractor AAR Airlift Group, Inc. stole trade secrets to gain an unfair advantage in securing a multibillion-dollar government contract. The contract, which Dyncorp had performed for more than 20 years, was to provide aviation support to the U.S. State Department for its counter-narcotics operations. READ MORE →

LOOKING BACK TO MOVE FORWARD: Need to Balance Trade Secret Protection and Judicial Transparency Remains Ten Years After Federal Court Reprimanded for Issuing Secret Opinion

Editorial BoardPosted on January 8, 2016

Ringing in the New Year provides a unique opportunity to reflect on the past and look ahead to the future. This mirrors the day-to-day reality for legal practitioners: the future is shaped by precedent from the past. And in these early days of 2016, with the possibility of a federal trade secrets law looming in the proposed Defend Trade Secrets Act, it’s important to understand the tensions and limits surrounding trade secret law. READ MORE →