On August 13, 2020, a Delaware District Court judge granted Defendant Azstrazeneca Pharmaceuticals LP’s motion to dismiss, finding that Plaintiff Lithero, LLC failed to plead a plausible trade secret misappropriation claim under the federal Defend Trade Secrets Act (“DTSA”).

Lithero’s complaint alleged that Azstrazeneca misappropriated Lithero’s confidential and proprietary information regarding Lithero’s Automated Regulatory Assistant (“LARA”), including information regarding how it is trained and the process by which it learns, as well as “years of past research and development, the current capabilities of LARA coming as a result of that research and development, and detailed plans for future areas of growth.” But none of these allegations were sufficient to survive dismissal at the pleadings stage.

As explained in the judge’s Order, while courts generally do not require a plaintiff to disclose the trade secrets at issue in detail in the complaint, in order to adequately plead trade secret misappropriation under the DTSA, a plaintiff must nonetheless identify a trade secret with “sufficient particularity” so as to provide notice to a defendant of what he is accused of misappropriating and for a court to determine whether misappropriation has or is threatened to occur.

In this case, despite the fact that the Court permitted Lithero to file its complaint under seal to avoid unnecessary public disclosure, the Court found that its “complaint describes the alleged trade secrets in broad terms.” Specifically, the Court explained that the complaint “points to large, general areas of information that Plaintiff alleges to have shared with Defendant, but does not identify what the trade secrets are within those general areas. Without knowing, for example, what about LARA’s training process is a trade secret, Defendant is not put on sufficient notice of what it is accused of misappropriating.” Therefore, the Court dismissed Plaintiff’s trade secret misappropriation claim.

With the expected increase in trade secrets litigations resulting from the COVID-19 pandemic, it is important for companies to refresh their understanding of the requirements for pleading a plausible trade secret misappropriation claim under the DTSA, paying close attention to what is required to plead with particularity the information alleged to constitute a trade secret.

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Photo of Molly A. Jones Molly A. Jones

Molly A. Jones is an Intellectual Property and Litigation counsel in Crowell & Moring’s San Francisco office. Her practice emphasizes patent, trademark, technology licensing, and other commercial disputes in a range of industries including software, biotechnology, commercial real estate, education, health care, and…

Molly A. Jones is an Intellectual Property and Litigation counsel in Crowell & Moring’s San Francisco office. Her practice emphasizes patent, trademark, technology licensing, and other commercial disputes in a range of industries including software, biotechnology, commercial real estate, education, health care, and food and beverage. She has represented clients in matters in the Northern, Eastern, and Southern Districts of California, Eastern District of Texas, and California state courts. Molly has also second-chaired a trademark infringement trial in the Western District of Texas.

Molly earned her J.D., cum laude, from the University of California, Hastings College of the Law, where she was the executive symposium editor of the Hastings Law Journal and co-authored amicus curiae briefs in two landmark patent cases at the U.S. Supreme Court. While attending law school, Molly also externed at the Northern District of California and studied abroad at Sungkyunkwan University in Seoul, South Korea.

Photo of Michelle Chipetine Michelle Chipetine

Michelle Chipetine is a counsel in Crowell & Moring’s New York office and a member of the firm’s Intellectual Property and Health Care groups. Michelle’s practice focuses on patent litigation and representing health care entities and not-for-profit corporations on a wide range of…

Michelle Chipetine is a counsel in Crowell & Moring’s New York office and a member of the firm’s Intellectual Property and Health Care groups. Michelle’s practice focuses on patent litigation and representing health care entities and not-for-profit corporations on a wide range of transactional, corporate, and regulatory matters. Michelle also maintains an active pro bono practice.

Michelle graduated cum laude from Fordham University School of Law, where she was a legal writing and torts teaching assistant and actively involved with Fordham’s Neuroscience and Law Center. During law school, Michelle worked for Mount Sinai Innovation Partners, where she facilitated the transfer and commercialization of technologies developed by Mount Sinai researchers. Michelle also studied neuroscience at Vassar College, where she graduated cum laude.