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A California federal district court recently granted a TRO and preliminary injunction against a general manager who allegedly misappropriated customer information from his previous employer in violation of the California Uniform Trade Secrets Act (CUTSA), Defend Trade Secrets Act (DTSA), and his employment agreement.  Sun Distributing Company v. Corbett, No. 18-cv-2231, 2018 WL 4951966 (S.D. Cal. Oct. 12, 2018).

Background

Sun Distributing is a distribution company that works with major national logistics companies to provide last-mile distribution to residences and businesses in California. Paul Corbett worked as a general manager at Sun Distributing. While employed, Corbett signed an employment agreement in which he agreed to a confidentiality provision stating that he would not use Sun Distributing’s trade secrets, including customer lists, needs, and pricing structures, in order to compete with Sun Distributing after he left the company. Corbett later resigned from Sun Distributing to work for Pacblue, a company that distributes free newspapers and other print media for publishers in California.
Continue Reading California Federal District Court Grants TRO and Preliminary Injunction to Protect Trade Secret Customer Lists

On November 13, 2018, the United States Court of Appeals, Fifth Circuit, affirmed the United States District Court for the Western District of Texas’s denial of prevailing party attorneys’ fees in a matter of first impression under the Defend Trade Secrets Act (“DTSA”). In short, the Fifth Circuit held that a dismissal without prejudice of a DTSA case does not support an award of prevailing party attorney’s fees.
Continue Reading The Limits of “Taking the Lead Early”: A Dismissal Without Prejudice Will Not Support Defend Trade Secrets Act Attorney’s Fees

Massachusetts Federal Court Enjoins Seafood Supplier Executive from Working for Competitor After Downloading Trade Secrets

A Massachusetts Federal Court recently enjoined the former Director of Research and Development and Quality Assurance of National Fish & Seafood, Inc. (“National Fish”) from working for a competing seafood supplier based in Florida after it determined that she had downloaded thousands of documents from National Fish’s computer systems during her final days with the company.  Kathleen Scanlon had worked for the Gloucester, Massachusetts-based seafood supplier for twenty-three years when she was approached by the CEO of Tampa Bay Fisheries, Inc. (“Tampa Bay Fisheries”) to see if she was interested in taking a position as director of food safety for the company.
Continue Reading There’s Something Fishy Going on Here: MA Federal Court Enjoins Seafood Supplier Executive

In Seyfarth’s fourth webinar in its series of 2017 Trade Secrets Webinars, Seyfarth attorneys Robert Milligan and Joshua Salinas were joined by Jim Vaughn, one of California’s leading computer forensics experts, presented Trade Secret Protection: What Every Employer Needs to Know. The panel focused on how to help employers navigate the tricky trade secrets waters and provided best practices for trade secret protection.

As a conclusion to this well-received webinar, we compiled a summary of takeaways:
Continue Reading Webinar Recap! Trade Secret Protection: What Every Employer Needs to Know

shutterstock_318803609We are pleased to announce the webinar “So You Want An Injunction in a Non-Compete or Trade Secret Case? ” is now available as a podcast and webinar recording.

In Seyfarth’s seventh installment in its series of 2015 Trade Secret Webinars, attorneys Justin K. Beyer, Eric Barton and Robert C. Stevens focused on the issues confronting plaintiffs in preparing…
Continue Reading Webinar Recap! So You Want An Injunction in a Non-Compete or Trade Secret Case?

A Texas federal trial court, finding the absence of any legal precedence to award an ongoing royalty in a trade secret misappropriation case, looked to the patent laws to impose an ongoing royalty. As a result, rather than permanently enjoining the misappropriator from continuing, the trial court imposed a royalty, thereby allowing the victim some compensation but allowing the other…
Continue Reading Texas Federal Court Imposes Ongoing Royalty Rather Than Permanent Injunction Against Alleged Trade Secret Misappropriator

The former employer failed to prove that the parties entered into an effective non-compete agreement, and also failed to prove that the ex-employee had disclosed or had threatened to disclose trade secrets.  But, an Ohio federal judge entered a preliminary injunction forbidding her, until further order, from contacting her former employer’s clients and certain of its prospects.  PharMerica Corp. v. …
Continue Reading Employee’s Competition With Former Employer Restricted Despite Absence Of Signed Non-Compete

In a stunning per curiam ruling, the Fourth Circuit Court of Appeals last week vacated a judgment of nearly $1 billion, and a 20-year non-compete injunction, entered by an Eastern District of Virginia judge in favor of the DuPont Company.  The appellate tribunal held that the lower court committed prejudicial error by granting DuPont’s pre-trial motion in limine to bar …
Continue Reading Jury’s $920 Million Trade Secret Misappropriation Verdict Vacated

An employment agreement non-competition provision stated that, for 18 months after termination, the employee shall not become employed by or act “directly or indirectly, as an advisor, consultant, or salesperson for, or become financially interested, directly or indirectly, [in an entity] engaged in the business of selling flavor materials.” Earlier this month, the North Carolina Court of Appeals held that…
Continue Reading Beware: Over-Inclusive Non-Compete Agreement May Be Unenforceable

In two unrelated cases decided earlier this month, employers failed in their attempts to enjoin former employees from competing. The Texas First District Court of Appeals vacated parts of the lower court’s injunction order, one part because it did not detail with sufficient specificity the conduct that was enjoined, and another part where the order was sufficiently specific but erroneously…
Continue Reading Texas And North Carolina Appellate Courts Repulse Efforts To Enforce Restrictive Covenants