A recent decision from the Fifth Circuit showcased the usefulness of the “discovery rule” for trade secret plaintiffs facing statute of limitations issues. The court reversed the dismissal of a claim for misappropriation of trade secrets because the plaintiff could not have discovered the misappropriation using reasonable diligence within the applicable statute of limitations period.
While California law is clear regarding the elements required to establish a misappropriation of trade secrets claim, the law has remained unsettled on the elements required to maintain an action for threatened misappropriation of trade secrets. However, in the case of Beauty Barrage LLC, et al. v. Dermaceutical Laboratories LLC, et al., San Francisco Superior Court Judge Anne-Christine Massullo shed some light on the question.
Located in the heart of Europe, Belgium is a true hub of logistics and innovation. It is for example home to one of Europe’s largest sea ports (with all the warehousing infrastructure that one would expect). Belgium also hosts several, globally leading biotech and life sciences clusters. It is no coincidence for example that pharma giant Pfizer has one of its largest production and packaging sites in Puurs, a small Belgian town, where it produces its Covid-19 vaccine. A few miles north, Jansen Pharmaceuticals has its HQ.
Such hubs are not just rich in talented human resources, but also in cutting edge and highly valuable know-how. A high concentration of know-how, combined with the increased mobility of employees, means a high(er) risk of misappropriation of this valuable information by unauthorized (third) parties. When a (foreign) company suspects its know-how has been misappropriated in Belgium, it will need evidence to substantiate this allegation in court. If the know-how is (also) covered by an intellectual property (IP) right, the holder of the know-how has access to a very efficient means of collecting evidence: the descriptive counterfeit seizure whereby discovery-like evidentiary measures will be granted ex parte. When the misappropriated know-how is only protected as a trade secret, no similar measures are provided for under EU law. The Belgian judges have therefore in the past not been very eager to grant trade secret holders access to ex parte evidence-gathering. With a recent judgment, however, the Brussels Court of Appeal has left the door behind which discovery-like measures are stored for holders of trade secrets open.
Bolsinger is still pitching! After a recent dismissal for lack of jurisdiction in California, former Major League Baseball pitcher Michael Bolsinger refiled claims against the Houston Astros in state court in Houston, Texas on May 13, 2021. While asserting similar factual allegations as his original California complaint, the former Toronto Blue Jays pitcher has abandoned his previous unfair business practice causes of action in favor of claims for trade secret misappropriation under the Texas Uniform Trade Secrets Act and for conversion. Bolsinger claims that the pitching signs he used during his August 4, 2017 game against the Astros were trade secrets.
We begin the first in a series of case studies of the Trade Secrets Laws of the Middle East and North Africa (“MENA”) with a review of the trade secrets law of the United Arab Emirates (“UAE”).
The UAE affords broad protection of trade secrets through multiple avenues, including its civil, labor and patent laws. However, the lack of a specific and comprehensive trade secrets law means that scope and enforceability of these rights is somewhat uncertain. Thus, while the UAE does afford trade secret protection and remedies, the best form of trade secret protection for companies doing business in the UAE is through contracts with employees and third parties, which are generally enforceable. Continue Reading MENA Trade Secrets Law Review: United Arab Emirates
As predicted, the trade secrets battle between Olaplex, Inc. and L’Oreal continues – and L’Oreal has scored a fresh victory. On May 6, 2021, the Federal Circuit Court of Appeals overturned a $66 million judgment against L’Oreal and ordered a new trial – but only on one of Olaplex’s patent claims. The panel stated that Olaplex had entirely failed to show that its information was eligible for trade-secret protection, and that no reasonable jury could find otherwise. Continue Reading Partial Victory for L’Oreal In Hair Coloring Fight
The Massachusetts Supreme Judicial Court (“SJC”) recently found that trade secret misappropriation by employees who then use the trade secrets to compete is actionable under Massachusetts’ Unfair and Deceptive Trade Practices Law. The SJC’s ruling in Governo Law Firm v. Bergeron means that Unfair and Deceptive Trade Practices Statute, Massachusetts General Laws Chapter 93A Section 11 (“Chapter 93A”), now applies to trade secret disputes in the employer-employer context. Previously, such cases were considered an “internal matter” and therefore not actionable. Continue Reading Massachusetts Supreme Judicial Court Rules that Employees May be Held Liable to Their Employer Under Massachusetts’ Unfair and Deceptive Trade Practices Law
Changing Patent Protections
U.S. and foreign patent systems have suffered legislative and judicial reverses as
to subject matter eligibility for patenting, a rising bar of obviousness due to increasing skill of the art, insights aided by artificial intelligence (AI) tools, procedural artifacts for no-risk post grant invalidation by granting agencies, and awakening of once dormant antitrust and public policy limits. Although patents must be pursued when copying is inevitable, trade secrets can provide an important strategic complement when trying to protect intellectual property rights.
Growth of Trade Secrets
Trade secret law has continued to evolve over the decades. All states – except, notably, New York – have adopted laws modeled on the Uniform Trade Secrets Act (UTSA) which codify basic trade secret law principles, preserve differences from patent law, and standardize certain key definitions. In 2016, Congress passed the federal Defend Trade Secrets Act (DTSA) which created a federal private right of action for trade secret misappropriation under the Economic Espionage Act.
This article was published by the AIPLA’s Biotech Buzz Trade Secret Subcommittee. To read the full article, click here.
First off, don’t worry, Coca-Cola’s super-secret trade secret recipe is still safe. But on April 22, 2021, a jury in the Eastern District of Tennessee convicted a former Coca-Cola employee, Dr. Xiaorong (a/k/a Shannon) You, of stealing trade secrets related to BPA-free coatings for the inside of beverage cans for the Chinese Government. The Indictment alleged that the trade secret information cost almost $120 million to develop. The twelve-day in-person trial focused not just on the former employee’s wrong doing, but also on some the best practices Coca-Cola and Eastman Chemical Company used to protect the trade secrets at issue.
On April 20th, U.S. Senator Lindsey Graham, R-S.C. introduced Senate bill S. 1245, “The Combating Chinese Purloining (CCP) of Trade Secrets Act.” The full text of the bill is not yet available, but a press release announcing the legislation highlighted key features of the CCP, including:
- increasing the maximum penalty from 5 to 20 years of imprisonment for individuals who use “communication interception devices” to aid a foreign government;
- expanding trade secret misappropriation penalties for foreign persons, including by: the U.S. Customs and Border Protection imposing import restrictions, the U.S. Department of Commerce denying export licenses, the U.S. Patent and Trademark Office rejecting applications for patent protection, and the U.S. Department of State denying visas;
- creating grounds for inadmissibility and deportability for individuals that seek to enter, or remain in, the U.S. to engage in espionage and intellectual property theft; and
- prohibiting the issuance of visas to Chinese nationals who present a national security risk and to prevent their pursuit of graduate-level coursework in sensitive fields.