Last year, Sergey Aleynikov, a computer programmer, beat federal charges of trade secret theft under the Economic Espionage Act. Although Aleynikov was initially convicted, the Second Circuit Court of Appeals overturned his conviction, finding that the trade secrets relating to the source code Aleynikov had taken were not related to a product “produced for. . . interstate or foreign
Continue Reading Aleynikov Case Continues to Grab Headlines in Trade Secrets Community

By Joshua Salinas and Jessica Mendelson

The secret is out, Tic Tacs and bubblegum have the most valuable and desirable real estate in the entire grocery store.

On September 27, 2012, a district court for the Eastern District of New York granted in part and denied in part a motion to dismiss in a commercial dispute arising out of the
Continue Reading New York Federal Court Rejects Heightened Specificity Pleading Standard for Breach of Confidentiality and Non-Disclosure Claim

By James Yu

Apparently it’s not just the sweet, delicious taste of Magnolia Bakery cupcakes that had people lining up in droves for a box or three since it opened its first store in Greenwich Village, New York over 15 years ago.

According to a Complaint filed on September 20, 2012 by Magnolia, entitled Magnolia Intellectual Property, LLC v. Buba
Continue Reading The Trade Secret Is In the Swirl Cupcake: Bakery Sues To Protect Its Signature Icing Topping

A Connecticut federal court recently issued a significant decision concerning the rights of a buyer of a business to enforce non-competition agreements against employees who previously worked for the seller under New York law.

In 2003, Milso and each of its employees signed an employment agreement expressly governed by New York law. The agreement contained confidentiality, non-solicitation and non-competition covenants
Continue Reading Connecticut Federal Court Finds That Non-Competition Covenant Which Is Silent Regarding Assignability May Be Enforceable Depending Upon the Parties’ Intent Under New York Law

By Robert Milligan and Jeffrey Oh

In today’s dynamic environment of interstate commerce, including internet transactions, deciding on the proper venue for a trade secret misappropriation dispute can be a complicated process involving a number of different factors particularly if the parties are domiciled and/or transact business in different states.

In the case of GLT Technovations, LLC v. Fownes Brothers

Continue Reading California Federal Court Transfers Trade Secret Dispute Involving High-Tech Gloves To New York

A recent Second Circuit Court of Appeals decision provides guidance regarding New York law concerning permissible and impermissible competitive conduct by the seller of a business, including its “good will,” who — without giving a non-compete covenant — thereafter goes into competition with the purchaser. The Second Circuit was aided by New York’s highest court which answered certified questions concerning

Continue Reading Sale of Business “Good Will” and Subsequent Competition with Purchaser May Subject Seller to Perpetual Restrictions on Contacting Former Customers and Clients

An important procedural issue that often arises in a non-compete dispute is the idea of equitable tolling. This doctrine essentially allows a court to toll, or stay, the time remaining on a non-compete agreement during the period in which the employee is in breach. Equitable tolling, however, is not always available, and the remedy is highly dependent on what state’s

Continue Reading For Whom the Employment Agreement Tolls: New York State Appellate Court Applies Equitable Tolling Doctrine In Non-Compete Dispute

Employers often condition the payment of post-employment or deferred compensation on a departing employee’s compliance with a noncompete agreement. New York is one of the few states that specifically allow for such an arrangement under the "employee choice" doctrine. This doctrine holds that an employee who chooses to voluntarily resign and violate his or her noncompetition obligations can be deemed

Continue Reading A New York Court Holds that Employee Choice Doctrine Does Not Apply to Equitable Relief in a Non-Compete Matter

In Renaissance Nutrition, Inc. v. Jarrett, 2012 WL 42171 (WDNY) (January 9, 2012), Renaissance, a vitamin and pre-mix company serving the dairy industry, alleged that two former top-level employees violated a five year "non-recruitment" or "anti-raiding" clause. In short, Renaissance alleged that these employees resigned in tandem with plans to develop a rival company, Cows Come First, and then

Continue Reading New York Federal Court Finds That Anti-Raiding Clause Is Subject to Rule of Reasonableness Under New York Law

Plaintiff IDG USA, LLC (“IDG”), a Georgia company with its principal place of business in North Carolina, commenced an action against a former employee, Kevin J. Schupp (“Schupp”), a New York resident, alleging breaches of a Non-Compete Agreement, breach of a Confidentiality Agreement, unfair competition, and theft of trade secrets.

In a 12 page decision, IDG USA, LLC v.
Continue Reading Western District of New York upholds Non-Compete and Grants TRO