Trade Secrets Trends

Trade Secrets Trends

Analysis and commentary on the latest developments in trade secrets protection, disputes, and enforcement

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Waymo v. Otto: Self-Driving and Self-Dealing

Posted in U.S. Litigation
Last week, Waymo LLC (a subsidiary of Google’s parent company Alphabet, Inc.) filed suit in the Northern District of California against Uber Technologies, Inc. and Otto Trucking LLC for misappropriation of trade secrets, patent infringement, and unfair business practices. The case is sure to become one of the first high-profile cases alleging claims under the… Continue Reading

Oculus: Looks Like Trade Secret Theft

Posted in U.S. Litigation
On February 1, 2017, a Texas jury awarded Zenimax $500 million following trial in Zenimax’s longstanding dispute with Oculus, the creators of the Oculus Rift virtual reality system. Zenimax and Oculus had initially worked together on the Oculus Rift, with Zenimax programmer John Carmack (a well-known figure in the video game industry) working with Oculus… Continue Reading

United States v. Nosal: Keep Your Friends Close, but Your Passwords Even Closer

Posted in Criminal Prosecution, Data Protection, U.S. Litigation
On July 5, 2016, the Ninth Circuit affirmed the conviction of David Nosal, an ex-employee of Korn/Ferry, an executive search firm, who left to start a competing firm. With Nosal’s knowledge and encouragement, two other former employees of Korn/Ferry used a current employee’s credentials to gain access to the Korn/Ferry database and take confidential information.… Continue Reading

4 Key Takeaways: What the New Federal Trade Secrets Law Means for Your Clients (June 15 Webinar)

Posted in Legislation & Policy, Non-Competes
On June 15, Crowell & Moring hosted a trade secrets webinar, “What the New Federal Trade Secrets Law Means for Your Clients.” The panelists, Mark Klapow, Mark Romeo, Mike Songer, and Vince Galluzzo provided an overview Defend Trade Secrets Act (DTSA), signed by President Obama in May. The panelists also discussed how the courts are… Continue Reading

House Finally Passes Federal Trade Secrets Law; Next Step is Obama’s Promised Signature

Posted in Legislation & Policy
As we have noted over the past several months, trade secrets will finally obtain additional protection under federal law. Yesterday, April 27, 2016, the House of Representatives passed the Defend Trade Secrets Act of 2016, S. 1890, without amendment. The bipartisan bill passed with a vote of 410-2, sending the bill to the White House… Continue Reading

Federal Trade Secrets Bill Headed to House Vote Wednesday

Posted in Data Protection, Legislation & Policy, U.S. Litigation
A federal civil cause of action for trade secrets misappropriation appears to be quickly becoming reality. Following the lead of the Senate, on Wednesday, April 20, the U.S. House Judiciary Committee approved the Defend Trade Secrets Act of 2015, S. 1890, without amendment. The bipartisan bill will now head to the full House of Representatives… Continue Reading

Designation of Trade Secrets a One-Way Ratchet in Discovery

Posted in U.S. Litigation
One of the most complicated parts of litigating a trade secret case is the discovery process.  Plaintiffs often seek discovery immediately to determine the full extent of information that was taken and how it was used, and often seek expedited discovery to prevent the defendants from destroying or hiding evidence of wrongdoing.  Defendants, on the… Continue Reading

Recent Decision Reinforces the Significance of Motions to Seal in Trade Secret Cases

Posted in U.S. Litigation
Plaintiffs in trade secret cases are often torn between two conflicting interests: the need to state their trade secrets with enough specificity to survive a motion to dismiss, and the necessity of keeping their trade secrets confidential. In order to resolve this dilemma, plaintiffs often seek to file their complaints under seal, so that the… Continue Reading

Be Careful What You Wish For: The Importance of Forum Selection Clauses

Posted in U.S. Litigation
Last week, the California Court of Appeal issued a decision highlighting the need for employers, especially large employers with operations and employees in several states or countries, to take great care in drafting mandatory forum selection clauses and to always be aware of the relevant law in the chosen jurisdiction. In Richtek USA, Inc. v.… Continue Reading

Hammering a Hard Drive Instead of a Royalty Check

Posted in U.S. Litigation
Earlier this month, in Ajaxo Inc. v. E*Trade Financial Corp., Case No. 1-00-CV-793529, the long-running dispute between Ajaxo Inc. and E-Trade over Ajaxo’s proprietary stock trading software took yet another turn following a two-part trial in Santa Clara County Superior Court.   In the latest round of this fight over trade secrets related to proprietary stock… Continue Reading

Access v. Use: An Important Distinction in the Computer Fraud and Abuse Act

Posted in Data Protection, Non-Competes, U.S. Litigation
Earlier this month, the District Court for the Northern District of California addressed the scope of the Computer Fraud and Abuse Act (“CFAA”), drawing a firm line between causes of action based on improper access of an employer’s computer, and causes of action based on improper use of the employer’s data.  Because of the narrow… Continue Reading

Access Denied — Christensen Sets the Standard for Violations of Penal Code § 502(c)

Posted in U.S. Litigation
Last week, the Ninth Circuit  issued an important decision for employers in United States v. Christensen, No. 08-50531, 2015 WL 5010591, at *14 (9th Cir. Aug. 25, 2015). In that case, the Court of Appeals held that employees who misuse their access to their employers’ computer systems can be held criminally liable under California Penal… Continue Reading

The Growing Momentum for Federal Trade Secrets Legislation

Posted in Legislation & Policy
The momentum for federal trade secrets legislation appears to be growing with last week’s introduction of the “Defend Trade Secrets Act of 2015” in both chambers of Congress. The bill, H.R. 3326 in the House and S. 1890 in the Senate, would create a uniform federal civil action for trade secret misappropriation, which is currently litigated exclusively… Continue Reading

Threatened Misappropriation Under CUTSA in Absence of “Inevitable Disclosure”?

Posted in U.S. Litigation
Under the inevitable disclosure doctrine, an employer may prevent a former employee from working for a competitor by simply demonstrating that the employee possesses the employer’s trade secrets and the former employee’s new job duties will “inevitably” cause her to rely upon those trade secrets.  The doctrine is not available in California.  However, California employers… Continue Reading

Arizona Supreme Court Bucks Majority in Critical Decision Interpreting Arizona Uniform Trade Secrets Act

Posted in Legislation & Policy, U.S. Litigation
Against the majority of courts to have considered the issue, the Arizona Supreme Court held last week that the Arizona Uniform Trade Secrets Act (AUTSA) does not preempt (or displace) common-law claims when the claim is based on the misappropriation of confidential information as opposed to a trade secret. In other words, where the information… Continue Reading

California Court Recognizes Narrowly Drawn CFAA Claim Against Traffickers of Access Credentials

Posted in Cyberhacking, Legislation & Policy
In a blow to victims of data theft, the Ninth Circuit in United States v. Nosal held that the Computer Fraud and Abuse Act (CFAA) was not an available remedy where the alleged thief had authorized access to the computer system from which data was stolen. The Northern District Court of California’s recent decision in… Continue Reading

District Court Carves Out “Trade Secret Exception” to California Ban on Enforcement of Non-Compete Agreements

Posted in Non-Competes
It is common knowledge that California is somewhat of an outlier when it comes to trying to enforce contracts which prohibit employees from competing with their former employer. The recent federal decision in Richmond Technologies, Inc. v. Aumtech Business Solutions, et al., No. 11-CV-02460-LHK, 2011 WL 2607158 (N.D. Cal. July 1, 2011), now provides an argument… Continue Reading

Trade Secret Misappropriation and Non-Competes Across (California) State Lines: What Law Governs?

Posted in Non-Competes
Choice of law issues permeate trade secret and non-compete cases because employers are nationwide and, employees themselves are extraordinarily mobile. Many decisions begin with a discussion of relevant choice of law issues, but often avoid deciding them by finding that the result would be the same under any of the applicable state laws, which are… Continue Reading