On Wednesday, October 21 at 12 to 1 p.m. Pacific, Robert Milligan is presenting “Trade Secrets in Cannabis” for the California Lawyer’s Association. The program aims to help cannabusinesses and their counsel identify the potential trade secrets in this industry and learn how to protect them, including in these COVID-19 times. The speakers will also discuss some of the more recent and significant trade secrets cases involving the cannabis industry to illustrate key takeaways.

Find more information and register for the webinar here.

In a decision of first impression issued last week, the United States District Court for the Western District of Tennessee held, in Gus’s Franchisor, LLC v. Terrapin Restaurant Partners, LLC, that the COVID-19 pandemic did not excuse a terminated franchisee of Gus’s World Famous Fried Chicken (“Gus’s”) from complying with a temporary restraining order (TRO) and permanent injunction prohibiting it from using Gus’s trademarks, trade secrets and proprietary business information. Continue Reading Don’t Play Chicken With Court Orders: COVID-19 Is No Excuse for a Terminated Franchisee to Continue Using the Franchisor’s Intellectual Property and Trade Secrets

Real estate startup HouseCanary made headlines when it secured a $700 million judgment against Title Source, Inc., now known as Amrock, in a trade secrets misappropriation case. In short, HouseCanary claimed that Amrock misappropriated its trade secrets to develop an app to compete with the very product Amrock hired HouseCanary to create—a product HouseCanary never delivered. Continue Reading HouseCanary Weighs a Bird in Hand… Collect on a $201,000,000 Judgment or Retry the Entire Case

Decision overview

On August 7, 2020, the Fifth Circuit addressed an issue presently undecided by the Texas Supreme Court; namely, whether reformation of an overbroad non-compete restriction is appropriate, and perhaps even required, at the preliminary injunction stage or must occur as a remedy after trial upon the merits.

In reversing and remanding the contrary lower court decision that declined to reform an overboard non-compete due to an inadequate record, the Fifth Circuit held that reformation of an overly broad covenant not to compete agreement was warranted at the preliminary injunction stage. Calhoun v. Jack Doheny Companies, Inc., No. 20-20068, — F.3d —, 2020 WL 4557641 (5th Cir. Aug. 7, 2020). Continue Reading Fifth Circuit Holds that Reformation of Texas Non-Competes Is Authorized, and Perhaps Required, at Preliminary Injunction Stage

In a strengthening of company contractual rights, the Louisiana Legislature recently expanded its state non-compete statute by permitting a corporation, partnership, or limited liability company to enter into agreements with their shareholders, partners, or members, respectively, that prevent them from becoming employees of a competing company under certain circumstances. Continue Reading Louisiana Expands its Non-Compete Statute in Favor of Companies

Called upon by the Ninth Circuit in Ixchel Pharma, LLC v. Biogen, Inc. to answer two key questions concerning the validity of a settlement provision requiring a party’s termination of a collaboration agreement with a third-party, the California Supreme Court unanimously held:

  1. to state a claim for tortious interference with an at-will contract, a plaintiff must allege that the defendant engaged in an independently wrongful act, and
  2. in determining the validity of a competitive restriction in a business-to-business agreement under Business and Professions Code section 16600, the rule of reason applies and such restriction is not per se void.

The Court’s decision will impact how companies contracting under California law decide to set up their contracts and whether they will agree to the at-will termination of such contracts. The decision also provides some clarity for businesses that include competitive restraints with other companies in their commercial dealings, such as exclusive dealing and collaboration agreements, licenses, leases, and franchise agreements, as such restraints are not per se void under Section 16600 but subject to a rule of reason analysis. Continue Reading California Supreme Court Clarifies Pleading Requirements for Claims of Tortious Interference with At-Will Contracts and Adopts Rule of Reason in Evaluating Competitive Restraints in Contracts Between Businesses

On Thursday, August 20 at 3-5 p.m. Eastern, Robert Milligan is presenting “How to Manage and resolve Complex Commercial Disputes: A Practice Guide” for The Knowledge Group. Speakers on the panel will discuss the use of process maps in identifying breakdowns, current settlement dynamics, and economic loss quantification.

Robert is presenting Segment 3 of the webinar and is focusing on:

  • How use of process maps can help identify breakdowns in complex process and areas for improvements on efficiencies
  • How effectively managing teams, assigning responsibilities, and accountability checks can help breakdown complex disputes into their constituent parts
  • How isolating core exposure issues and preparing targeted motions on such items with the backdrop of using a well suited discovery referee or mediator can more efficiently resolve complex disputes

Find more information and register for the webinar on The Knowledge Group’s website.

The much-ballyhooed legal battle over trade secrets concerning self-driving automobile technology involving Uber took its latest (and perhaps final) turn last week, when engineer Anthony Levandowski was sentenced to 18 months in prison and ordered to pay over $700,000 in restitution.

Embroiled in the middle of a billion-dollar dispute between tech giants, Levandowski had previously pled guilty to the single count of trade secret theft and was already facing a $179 million judgment awarded to his former tech employer. Naturally, the length of prison sentence and the amount of restitution had been of particular interest to the business and legal communities to see what kind of message would be sent by US District Judge William Aslup. But interestingly, it was another (non-traditional) aspect of the sentence that perhaps sent the clearest and most impactful message to tech companies and their employees: the requirement that Levandowski, whom the judge described as a “good person” and a “brilliant man”, must give speeches to the public entitled “Why I Went to Federal Prison.” Continue Reading Self-Driving to Federal Prison: The Trade Secret Theft Saga of Anthony Levandowski Continues

In a rare appellate decision on enforceability of non-disclosure agreements and a plaintiff’s burden to establish the existence of trade secrets, the First Circuit recently overturned a district court summary judgment order and trial verdict. This decision serves as an important reminder for both those who litigate trade secrets claims and those who draft restrictive covenants agreements.

Background

TLS Management and Marketing Services, LLC, a tax planning and consulting firm, sued its former employee, Ricky Rodríguez-Toledo, for alleged misappropriation of trade secrets under Puerto Rico’s misappropriation law and breach of his NDA with TLS. TLS claimed two trade secrets germane to the litigation, the “US Possession Strategy”—essentially a tax arbitrage strategy designed to help clients avoid higher mainland taxes—and “Capital Preservation Reports” or “CPRs,” client-specific reports with tax recommendations based on an analysis of applicable statutes and regulations. Continue Reading Rare First Circuit Decision Invalidating NDA and Overturning Misappropriation Verdict Serves as a Cautionary Tale

The American Intellectual Property Law Association’s (AIPLA) Trade Secret Committee (of which partner Erik Weibust is Vice Chair) is taking its annual Trade Secret Law Summit online this year, with a series of weekly webinars. The first of the series, on Wednesday, August 12, 2020, at 2:00 p.m. EST, features partner Scott Humphrey, who will be moderating a panel entitled “Litigation Funding in Trade Secrets Cases.”

Litigation finance is one of the hottest trends and topics in the legal industry.  In today’s economic and legal climate, companies and individuals are looking for alternative ways to fund their trade secret cases, and are turning to litigation funders for assistance. AIPLA’s panel on the “Use of Litigation Funding in Trade Secret Cases” will look at the use of litigation funding in the trade secret space both before and during the COVID pandemic, examine recent trends and likely future trends of the industry, discuss what litigation funders look for in a case, and provide tips on what an individual or company should consider when evaluating whether litigation finance is a viable funding mechanism for their case.

The full schedule for this year’s remote Summit, which features weekly 90-minute presentations covering two topics each, is as follows:

Session 1 (August 12)
What You Need to Know About Ex Parte Seizures under the DTSA
Litigation Funding in Trade Secrets Cases

Session 2 (August 19)
Judicial Perspectives on Trade Secret Matters
Legislative and Judicial Trends in Trade Secret Law

Session 3 (August 26)
Proving Damages in Trade Secret Litigation
Arbitration and Jury Trials in Trades Secrets Disputes

Session 4 (September 2)
Forensics and Artificial Intelligence in Trade Secret Protection and Litigation
Ethics in Trade Secret Investigations and Litigation

Participants can register for the entire Summit or individual sessions. Each session begins at 2:00 p.m. EST and will be followed by online networking beginning at 3:30 p.m. EST. Additional information and registration can be found here.