In a recent discovery dispute before the Northern District of California, Plaintiff Monolithic Power Systems, Inc. (“Monolithic”) unsuccessfully attempted to bypass California Code of Civil Procedure section 2019.210 which requires the party making a claim of trade secret misappropriation under the California Uniform Trade Secrets Act (“CUTSA”) to identify the trade secret “with reasonable particularity” before “commencing discovery relating to the trade secret.”
The latest appellate decision in the nearly 20-year legal battle between Ajaxo and E*Trade highlights the importance of expert discovery and a well-developed trial court record for a plaintiff attempting to claim reasonable royalties for trade secret misappropriation.
The saga between Ajaxo and E*Trade began back in the late 1990s, with Ajaxo, a six-person company, approaching E*Trade, seeking to support its wireless access and trading business. In response, E*Trade asked Ajaxo for a technical paper and live demonstrations, during which E*Trade’s engineers peppered Ajaxo with questions. One E*Trade senior engineer, Dan Baca, made a copy of Ajaxo’s technical binder. After E*Trade sent Ajaxo a draft letter of intent—with everything but the dollar amount filled in—E*Trade had a change of heart and told Ajaxo it was simply too small to be an E*Trade partner. Instead, E*Trade acquired these services a short time later from Everypath, a company that it had been meeting with simultaneously, and where Dan Baca started to work shortly after attending the Ajaxo meetings. READ MORE