Photo of John E. McCarthy Jr.

Earlier this month, a federal judge ruled that a copycat trade secrets theft claim could not be re-litigated in federal court, having already been dismissed in a state court action. That decision came out of a complex dispute between a stem cell company and its prior President and CEO.

After former CEO Alan Smith left Cognate Bioservices Inc. in 2010, he sued Cognate for wage violations in Maryland state court. Cognate then counterclaimed for misappropriation of trade secrets alleging that Smith failed to return his company computer and passwords and misappropriated Cognate’s trade secrets. Meanwhile, Cognate filed a separate lawsuit in Maryland federal court alleging that Smith violated the Computer Fraud and Abuse Act and misappropriated Cognate’s trade secrets, among other things. Both the state court and federal court actions ran in parallel until May 2014 when the state court action went to a jury trial. The jury found against Cognate on its misappropriation counterclaim. Smith accordingly moved to dismiss the federal suit.

Continue Reading State Trade Secrets Claim Cannot Be Re-Litigated in Federal Court

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[via Flickr user Glyn Lowe Photoworks]

On Monday November 30, the House demonstrated its resolve to fight high-tech crime such as trade secret theft by passing the Strengthening State and Local Cyber Crime Fighting Act (H.R. 3490). The Act formally establishes the National Computer Forensics Institute, which is located in Hoover, Alabama and has been operating since 2008. Under the Act, the Institute will:

  • Educate law enforcement officers, prosecutors, and judges on (i) cyber and electronic crimes; (ii) methods for investigating such crimes, including forensically examining computers and mobile devices; and (iii) prosecutorial and judicial challenges related to such crimes and forensic examinations; and
  • Train law enforcement officers to (i) investigate cyber and electronic crimes; (ii) forensically examine computers and mobile devices; and (iii) respond to network intrusions.


Continue Reading Keeping Up with Cybercriminals: House Passes Bill to Formally Establish National Computer Forensics Institute

Last week, ProLogic, Inc. (ProLogic) voluntarily dismissed — without a settlement — the last of the claims remaining in its lawsuit against Aquarian Systems, Inc. (Aquarian) and two former employees who became employees of Aquarian. A team of Crowell & Moring lawyers successfully represented Aquarian and, after the claims against Aquarian were dismissed by ProLogic in May, the individual defendants. What began as a complaint seeking $25 million in damages for alleged trade secret misappropriation, tortious interference, and breach of contract, ended with a dismissal of all claims against Aquarian and the individual defendants, without any settlement or payment.
Continue Reading ProLogic Drops $25M Trade Secrets Lawsuit Against Clients of Crowell & Moring

In a move designed to attract commercial technology companies into DoD contracting, the Pentagon has announced plans to open a Silicon Valley office and provide venture capital to identify and fund innovative technologies that can improve the national defense. Although traditionally Silicon Valley companies have been wary of contracting with DoD because of its bureaucracy