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Sometimes a big problem for plaintiffs in trade-secret lawsuits
is identifying precisely what was stolen. In
a recent case out of California, a plaintiff employer
sued a former employee who was hired by a competitor for
misappropriation of trade secrets. The employee had backed up
his company laptop on a hard drive, and he did not return the hard
drive after switching jobs. The hard drive contained over
4,000 files that the employer alleged contained trade
secrets. The employee moved for summary judgment to have the
trade-secret claim dismissed. In response, the employer
argued that all 4,000 files contained its trade secrets, but
it didn't say what in each file was a
trade secret. The court dismissed the claim against the
employee because the employer did not meet the requirement
under California law that a trade secret be
identified "with sufficient particularity" to
separate trade secrets from public information or the general
knowledge of those skilled in the trade. Massachusetts
law on this issue is the same. See Sutra, Inc. v. Iceland Express, ehf, C.A. No.
04-11360-DPW, 2008 WL 2705580, *4 (D. Mass. July 10, 2008)
(unpublished) ("A plaintiff has no cognizable trade secret
claim until it has adequately identified the specific trade secrets
that are at issue." (quotation omitted)) (interpreting
Massachusetts law).
This requirement can be a real challenge for employers when they
know that an employee took something, but they just don't know
what. It's particularly difficult when there's not a
lot of time for an employer to investigate what the employee did,
which frequently is the case in trade-secret cases. (An
employer will often file a lawsuit and move to have the former
employee and his new employer enjoined from using any of its trade
secrets right away, to prevent harm to its business.)
Nevertheless, it is a requirement, so employers need to
describe what's at issue with specificity up front or run
the risk of having their claims dismissed.
To view Foley Hoag's Massachusetts Noncompete Law
Blog please click
here
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