Trade Secret Filings

I pulled up 10 recent federal complaints alleging trade secret misappropriations to get a sense of what filings look like today.  All 10 involved allegations against former employees.  Most focused on sales folks leaving and soliciting customers.  A couple of cases involve employees forming allegiances with  the competitor before leaving.  One involves a competitor trying to hire-away employees. And, one includes a text full of explicit emoji.  Overall, about 50 new Federal trade secret cases were filed in the past 30 days with about 600 over the past 12 months.

  1. MGA Home Healthcare Colorado, LLC v. Thun, Docket No. 1:22-cv-02534 (D. Colo. Sep 28, 2022).  According to the complaint: Former employee (Thun) was lead client manager but was terminated by MGA. Thun then joined a competitor Amazing Health Care and began soliciting clients.  The employment agreement included a non-solicitation clause extending for 12-months following the end of employment.
  2. Schnitzer Steel Industries, Inc. v. Dingman et al, Docket No. 1:22-cv-00361 (D.R.I. Oct 03, 2022). According to the complaint: Former employee (Dingman) had signed both a non-compete and non-disclosure agreement with scraper Schnitzer.  Dingman was fired in June 2022 and then formed a competing company to purchase and recycle catalytic converters.  He then started calling all of the same suppliers and has “successfully stolen business” from Schnitzer. 
  3. H.B. Fuller Company v. Strzegowski, Docket No. 0:22-cv-02389 (D. Minn. Sep 28, 2022). According to the complaint: Former employee (Strzegowiski) joined competitor and began soliciting former customers. 
  4. Cartiga, LLC v. Robles, Docket No. 9:22-cv-81612 (S.D. Fla. Oct 19, 2022). According to the complaint: Former employee (Robles) began soliciting former customers.  Attachments to the complaint include a nice row of middle fingers in response to the cease and desist letter.  
  5. NEBCO, Inc. v. Butler, Docket No. 4:22-cv-03217 (D. Neb. Sep 29, 2022). According to the complaint: Employee (Butler) allegedly began doing a bit of self dealing with a competitor with plans to join that company. 
  6. MERIDIAN BANK v. SANDY SPRING BANK et al, Docket No. 2:22-cv-03951 (E.D. Pa. Oct 04, 2022). According to the complaint: Nine former employees were hired away by competing bank who had been given confidential information regarding salary, benefits, and customer lists. 
  7. TRANSACTLY, INC. v. MOVE-IN READY, LLC et al, Docket No. 1:22-cv-00987 (W.D. Tex. Sep 29, 2022). According to the complaint: Employees formed a competing company and sent confidential information to the new company before quitting. 
  8. BIGRENTZ, INC. v. KGM Enterprises, LLC, Docket No. 1:22-cv-00430 (D. Idaho Oct 13, 2022). According to the complaint: Former employee formed competing company and began recruiting more employees with knowledge of customers lists and have begun soliciting those customers. 
  9. Gartner, Inc. v. G2.com, Inc., Docket No. 3:22-cv-01291 (D. Conn. Oct 13, 2022). According to the complaint: Competitor is hiring former employees seeking to “steal” plaintiff’s market share.  Sued both competitor and former employees. 
  10. BMO Harris Bank, N.A. v. Eimen et al, Docket No. 1:22-cv-05378 (N.D. Ill. Sep 30, 2022). According to the complaint: Former wealth management employees joined competitors and began soliciting former clients. 

3 thoughts on “Trade Secret Filings

  1. 2

    Several problems in either defending or suing departed employees on non-compete and/or non-disclosure agreements include inconsistent statutes and court decisions between different states,* which state’s laws will apply to that former employee, and varying judicial public policy enforcement attitudes towards depriving the former employee of its present or other employment and its use of non-trade-secret knowledge and experience.* The fact that employees are usually in no position to negotiate or change any of the terms of such contracts, especially if already employed, is another reason such contracts may not be treated like a normal business contract. Large companies trying to use a standard such employee contract nationally may well run into trouble in states like California having more employee protection.
    *Especially as to the length of time and/or the scope of such personal restrictions that will be held enforceable.
    Of course for provable actual trade secret takings the employer can also rely on state or federal trade secrecy laws.
    [Someone regularly currently doing trade secret CLE should chip in here.]

  2. 1

    I guess slavery is still in vogue in this day and age. Sad.

    1. 1.1

      +1

      I know and people don’t even acknowledge the relationship between trade secrets and slavery.

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