For companies that rely heavily on R&D, such as those in the biotechnology, pharmaceutical, and associated manufacturing industries, IP forms some of their core assets. Protecting these assets is critical, and choosing between patents and trade secrets is not always straightforward.
This decision involves flexibility, understanding, and factoring in the ever-changing case law interpretations, which
The Supreme Court recently denied a petition for certiorari by Monib Zirvi and others, in which petitioners sought Supreme Court intervention regarding the notice required to trigger the statute of limitations clock for trade secret misappropriation claims. The case is Zirvi et al. v. Flatley et al. (Case No. 20-1612). You can review the petition here. The case arises out of a 2018 lawsuit, in which four self-described inventors of DNA Arrays brought suit against Illumina, a “multibillion-dollar, global player in genetic analysis,” alleging that Illumina and its associates conspired to steal Petitioner’s trade secrets and covertly conceal the information in patent applications. According to Petitioners, the DNA Arrays at issue are now used in the detection of cancer, inherited genetic defects, and viral infections such as COVID-19.
Continue Reading Supreme Court Declines to Weigh in on Notice Required to Trigger Statute of Limitations for Trade Secret Misappropriation Claims
The Seventh Circuit Court of Appeals recently upheld a preliminary injunction prohibiting a former distributor and its parent company from selling a spine implant device that incorporated trade secret information. Plaintiff Life Spine, Inc. had created a device to correct spinal spacing issues during surgery. Life Spine contracted with Defendant Aegis Spine to distribute the device only to medical facilities nationwide and to keep Life Spine’s confidential information secret and use the confidential information only in furtherance of the business relationship. However, Life Spine alleged that Aegis Spine passed confidential details, such as component dimensions to fractions of a millimeter of the device, to Aegis Spine’s parent company, who quickly developed a similar device that competed against Life Spine’s device. Life Spine sued Aegis Spine and its parent, alleging that Aegis Spine misappropriated its trade secrets, as well as other contractual and tort claims, and sought a preliminary injunction. Based on findings of trade secret misappropriation and breach of contract, the Northern District of Illinois entered a preliminary injunction against Aegis Spine and its business partners from making, marketing, distributing, selling, or obtaining intellectual property rights in the competing device to Life Spine’s device.
Continue Reading Seventh Circuit Affirms Trade Secret Protection of Patented Spinal Implant Device
The legal saga between L’Oreal USA Inc. and Olaplex LLC (“Olaplex”) over a hair-coloring product continues. In August 2019, a Delaware federal jury found that L’Oreal misappropriated Olaplex’s trade secrets, willfully infringed two Olaplex patents, and breached a nondisclosure agreement. The jury awarded Olaplex $22.3 million for willful infringement of trade secrets, $22.3 million for breach of contract, and $47 million for patent infringement. On March 24, 2020, the court entered a $66.2 million final judgment including attorneys’ fees and prejudgment interest.
Earlier this month, L’Oreal appealed and asked the Federal Circuit to reverse this judgment based on purported errors by the district court in (1) improperly excluding two witnesses and (2) improperly granting summary judgment on patent infringement.
Continue Reading L’Oreal Appeals $66 Million Trade Secret Judgment
The Federal Circuit recently rejected an attempt to avoid a trade secret trial in state court by invoking federal jurisdiction under patent law. Intellisoft discovered, in the early 2010’s, that Acer had applied for a patent which incorporated its alleged trade secrets. Intellisoft sued Acer in March 2014 in California state court asserting various state law claims, including trade secret misappropriation. The Acer patent was thus a key component of Intellisoft’s trade secret misappropriation evidence and was the subject of fact and expert discovery by both parties.
The case proceeded in state court for three years. As discovery wrapped up, one of Intellisoft’s experts opined that an Intellisoft employee – who created some aspects of the trade secrets at issue – should be named as an inventor on Acer’s patent. Additionally, a second Intellisoft expert opined that portions of the Acer patent’s claims corresponded to various Intellisoft trade secrets.
Continue Reading Patents as Evidence of Trade Secret Theft Does Not Create Federal Subject Matter Jurisdiction