Legal regimes are shifting, including in the intellectual property world as businesses increasingly seek the protection of trade secrets rather than patents to secure their confidential information. When the Defend Trade Secrets Act was passed in 2016, trade secret litigation skyrocketed, increasing more than 25 percent in a single year. While the number of trade secret cases
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Virginia Court of Appeals Reverses Record $2 Billion Verdict, Emphasizing Damages Resulting from Misappropriation Must Actually Be Proved Under Virginia Trade Secrets Law
The Virginia Court of Appeals recently issued a consequential trade secrets ruling, reversing a jury’s multi-billion dollar damages award, and finding that the trial court committed several legal errors which improperly led to the largest damages verdict in Virginia’s history. The case, Pegasystems Inc. v. Appian Corp., No. 1399-22-4, involved two companies in the business…
Attorney’s Fees May Be Recoverable in Trade Secret Cases, Even Without Damages
In California, although the prevailing rule is that each party in litigation must cover their own fees and costs, a litigant can be awarded reasonable attorney’s fees and costs if expressly permitted in a contract. Proprietary information agreements often include an award of attorney’s fees and costs if a company prevails in seeking injunctive relief for…
California Court of Appeal Rules That Partial Sale of Business Can Bind Seller-Owner to a Noncompetition Agreement
In Samuelian v. Life Generations Healthcare, LLC, — Cal. App. 5th —, 2024 WL 3878448 (Cal. App. Aug. 20, 2024), the California Court of Appeal answered two long outstanding questions of California law concerning the enforceability of noncompetition agreements in the context of the sale of a business:…
Maine Governor’s Veto of Non-Compete Ban Bucks Growing Trend Among States and Federal Trade Commission
Amidst a wave of non-compete bans sweeping California, North Dakota, Oklahoma, Minnesota and, most recently, the nation via the Federal Trade Commission’s non-compete prohibition, Maine Governor Janet Mills departed from this growing trend and vetoed L.D. 1496, An Act To Prohibit Noncompete Clauses (“L.D. 1496”) in April 2024. If enacted, the L.D. 1496…
Mind Your Audience: Disclosure of Confidential Information to AI Programs Can Give Rise to Trade Secret Misappropriation Claims
AI tools such as Chat GPT and Otter are becoming common programs that employees use to help streamline business tasks. Otter, for example, is an AI Meeting Assistant that automatically transcribes and summarizes meetings in real time, records audio, captures slides, extracts action items, and generates content such as e-mails and status updates. While tools…
California Strengthens Non-Competition Law
California has passed two new items of legislation, Senate Bill 699 and Assembly Bill 1076, which will further regulate and restrict the enforcement of employment non-compete agreements in California, and expand the scope of remedies for those affected by them. These new laws will become effective on January 1, 2024, and now is the time for…
Ninth Circuit Denies Sherman Act Challenge To No-Poach Provision
In an important decision on August 19, 2021, the Ninth Circuit Court of Appeals in Aya Healthcare Services, Inc. v. AMN Healthcare, Inc. affirmed the grant of summary judgment in favor of AMN, finding that the non-solicitation provision in the parties’ agreement was not an unreasonable restraint in violation of the federal antitrust law known…
Trade Secret Litigants Take Note: California District Court Provides Guidance on Obtaining a Preliminary Injunction and Expedited Discovery
In trade secrets litigation, it is often critical to expeditiously obtain protection from further disclosure or continued misappropriation of the trade secret at issue through a motion for preliminary injunction. Courts are quick to point out, however, that preliminary injunctions are “an extraordinary and drastic remedy,” and are only to be granted if the movant,…
Is Lawful Possession of a Trade Secret Enough for Standing to Sue for Misappropriation?
You may be able to bring a misappropriation of trade secrets claim even if you do not actually own the misappropriated trade secret. A growing number of federal cases indicate ownership of a trade secret may not be required in order for a plaintiff to sue for misappropriation; possession alone may be enough to confer…