As we have previously blogged about, in 2016 the Nevada Supreme Court refused to adopt the “blue pencil” doctrine and held that Nevada courts could not modify over-broad restrictive covenants. The following year, we alerted readers that the Nevada legislature amended Nevada Revised Statute 613, governing non-competition agreements. Among other things, the amendment granted courts the authority to “blue-pencil” non-competition agreements, overturning the Nevada Supreme Court’s 2016 decision in Golden Road Motor Inn, Inc. v. Islam. Continue Reading The Silver State Grips the Blue Pencil
On Friday, June 11, Seyfarth partner and co-chair of the Trade Secrets, Computer Fraud & Non-Competes practice group Robert Milligan is presenting the “Remote Trials and ADR” panel at The 2021 Sedona Conference on Remote Case Management of IP Proceedings, which is being held virtually June 10 and June 11. Other panels at the conference include:
- Remote Conferences, Motions, Ex Parte Applications
- Remote Depositions
- Handling Evidence Remotely: Maintaining Protection of Confidential/Trade Secret Information and Building the Record for Trial and Appeal
- The Future of IP Proceedings: How Should Remote Case Management by Incorporated Going Forward?
- Judicial Roundtable
For more information and to register for the conference, see The Sedona Conference website.
The New York State Legislature is keeping busy with new employment legislation as the local and national economies continue to recover from the COVID-19 pandemic.
On April 21, 2021, both houses of the Legislature announced passage of portions of the NY Hero Act, which requires extensive new workplace health and safety protections in response to the pandemic. The Legislature is also advancing two additional employment-related bills: one would ban “no-rehire” clauses in employment settlement agreements, and the other would prohibit “no-poach” agreements between franchisors and franchisees. Continue Reading New York State Enacts Worker Safety Legislation and Considers Other Employee-Friendly Bills
On Thursday, May 6 at 12 p.m. Eastern, Seyfarth partner Erik Weibust and NERA director Kristopher Boushie will be presenting “Trade Secret Identification and Damages,” a webinar in NERA Economic Consulting’s Developments in Trade Secret Litigation webinar series. This webinar will cover relevant state and federal trade secret statues, discovery issues, and available non-monetary and monetary remedies, including:
- What constitutes a trade secret under relevant state and federal trade secret statutes;
- The determination of actual damages, unjust enrichment, and reasonable royalty; and
- The impact of aggregation and disaggregation of trade secret claims on damages.
For more information and to register, see the NERA website.
Seyfarth is a sponsor of the 2021 Sedona Conference on Developing Guidelines for Trade Secret Issues, taking place on June 21-22, 2021, and is taking place virtually. The conference will present for public dialogue for the first time the consensus, non-partisan publications from the Sedona Working Group 12 on Trade Secrets, including:
- WG12 Commentary on the Proper Identification of Asserted Trade Secrets in Misappropriation Lawsuits
- WG12 Commentary on The Employee Life Cycle Relating to Trade Secrets
- WG12 Commentary on Equitable Remedies in Trade Secret Litigation
- WG12 Commentary on Monetary Remedies in Trade Secret Litigation
- WG12 Commentary on Protecting Trade Secrets in Litigation About Them
- WG12 Commentary on Governance and Management of Information Security and Trade Secrets
- WG12 Commentary on Trade Secret Issues Across International Borders: Extraterritorial Reach
- WG10/12 Joint Commentary on Cross-Border Discovery in Patent Litigation and Trade Secret Litigation
The conference will also include a panel discussing additional current/future trends in trade secret law and litigation and a Judicial Roundtable.
Robert Milligan, Seyfarth partner and co-chair of the Trade Secrets, Computer Fraud & Non-Competes group, is speaking on a panel about the employee life cycle. Erik Weibust, Seyfarth partner, is speaking on the “Tailoring Remedies to the Misappropriation: Equitable Relief, Damages, or Both” panel. Robert Milligan is also on the Trade Secret Steering Committee.
Find more information and register on The Sedona Conference website at https://thesedonaconference.org/tsc2021tradesecrets
In Seyfarth’s second installment in its 2021 Trade Secrets Webinar Series, Seyfarth attorneys Richard Lutkus, Bob Stevens, and Matthew Simmons outlined best practices and steps companies can take to continue to protect intellectual capital, including policies, protections, security concerns, and agreements needed to protect information in a remote environment.
As a conclusion to this webinar, we compiled a summary of takeaways:
Technical takeaways to avoid your trade secrets and IP ending up leaked on the dark web:
- Train your employees to be suspicious of emails and test them against phishing attacks
- Get proper malware detection software for servers and endpoints.
- Turn logging on and retain logs as long as practical so you can have something to investigate if an issue occurs.
- Keep ANY critical IP/trade secrets encrypted at rest on your file servers!
- Update employee policies and procedures regarding confidential information, BYOD policy, obligation of employee to update location, notice of resignation period, non-use of personal and cloud accounts, return of company property and compliance with return obligation, company asset/hard copy tracking, and training on new policies.
- Update restrictive covenants and provide sufficient consideration for the updated covenants at the time the employee executes the new restrictive covenant.
- Complete a company versus personal property assessment.
- Complete pre-termination forensic searches.
Remote employee resignation checklist:
- Notify IT and ensure system access is disabled as soon as possible.
- Ensure all devices (phones, computers, drives, etc.) are returned and postpone reissuance for as long as fiscally able.
- Conduct exit interview and remind resigning employee of restrictive covenant obligations.
- Preserve and monitor email account and phone.
Visit our Trade Secrets Webinar Series page to view recordings of all our webinars.
The Illinois Trade Secrets Act (“ITSA”), which is consistent with both other states that have adopted the Uniform Trade Secrets Act and the federal Defend Trade Secrets Act, allows the recovery of attorneys’ fees for a party who has been forced to defend against a trade secret claim made in bad faith. See 765 ILCS 1065/5. This fee shifting provision provides an important mechanism to obtain relief for defendants who are forced to incur significant legal fees fighting baseless claims. Continue Reading Failure to Tune in to Requirements to Meet Trade Secret Status Under Illinois Trade Secrets Act Results in Award of Attorneys’ Fees Against Radio Advertising Time Business
After a months-long delay due to an outbreak of COVID-19 during the first trial, a federal jury in Texas awarded a $152 million verdict—including $120 million in punitive damages—in a trade secret misappropriation case between rival software development companies.
In 2019, software company ResMan LLC (“Resman”) sued its former customer Karya Property Management LLC (“Karya”), alleging that Karya provided its third party software consultant, co-defendant Expedien, with unauthorized access to Resman’s trade secrets in order to help it develop a competing product. Resman’s proprietary software is used to manage apartment buildings throughout the United States. In the breach-of-contract lawsuit, Resman alleged Karya gave Expedien access to its trade secrets so that it could develop its own rival property management software. Continue Reading Texas Federal Jury Awards $152 Million in Trade Secret Misappropriation Case Interrupted by COVID-19
We want to share some exciting news with our blog followers. Dawn Mertineit, Seyfarth partner and member of the firm’s Trade Secrets, Computer Fraud & Non-Competes group, is co-editor of our Trading Secrets blog. She joins Robert Milligan, Trading Secrets editor, Seyfarth partner, and co-chair of the Trade Secrets, Computer Fraud & Non-Compete group. We’re thrilled to have Dawn’s help in continuing to ensure our blog provides timely information on the latest legal trends and cases across the country.
The California Court of Appeal recently upheld the dismissal of claims against Mattel, which alleged that Mattel stole the idea for its flying Barbie doll from Technology from Heaven Unlimited (“TFHU”). Applying New York law, the Court found that Mattel did not misappropriate TFHU’s idea to create a flying Barbie using drone technology, as this idea did not have general novelty, even if the idea was novel to the buyer. Moving forward, companies should ensure that they have clear policies and procedures in place before accepting ideas and before entering into contracts for the disclosure of ideas, because whether an idea may be novel may depend on the timing of the contract. Continue Reading Hoverboard Barbie: A Novelty Toy Without a Novel Concept