A federal district court recently issued summary judgment in favor of a retail defendant in a trade secret misappropriation case involving the alleged misappropriation of a CBD cream formula. On September 3, 2020, Healthcare Resources Management Group, LLC (“HRMG”) filed suit in the Southern District of Florida against several parties, including hemp products retailer Medterra CBD, LLC (“Medterra”), alleging that Medterra misappropriated its proprietary trade secret formula for a CBD cooling cream by selling a product similar to HRMG’s cream. On May 14, 2021, Medterra filed an amended motion for summary judgment against HRMG, arguing that HRMG’s claims for trade secret misappropriation could not stand, as the partial list of HRMG’s ingredients disclosed to it did not constitute a protectable trade secret formula, nor did Medterra “use” or “disclose” any secret formula owned or controlled by HRMG. The court agreed with Medterra, granting its summary judgment motion in full on October 27, 2021. This case serves as an important reminder that trade secret misappropriation claims require proof that a trade secret was either wrongfully acquired, used, or disclosed by the alleged wrongdoer—mere similarity of products is insufficient to succeed on a claim absent these additional elements.
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