And Then There Was One…Massachusetts Adopts Uniform Trade Secrets Act

17 08 2018
Lex Blog
AUGUST 14, 2018
Almost every state in the nation has adopted some version of the Uniform Trade Secrets Act (UTSA). For many years, the two biggest holdouts had been Massachusetts and New York, which both stubbornly clung to a mélange of common law principles to protect trade secrets.
As of Friday, August 10, Massachusetts joined the UTSA club by adopting its own version of the UTSA. However, that adoption was part of a larger effort to regulate employment non-competes…
The content in this post was found at https://www.lexblog.com/2018/08/14/and-then-there-was-one-massachusetts-adopts-uniform-trade-secrets-act/ Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com

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Diversity is Important – But Is It A Trade Secret?

7 03 2018

Trade Secret Trends

Mark Romeo and Helen Osun on March 5, 2018

On January 14, 2018, IBM’s Chief Diversity Officer resigned to go work for Microsoft in the same role. The caveat: she had a twelve month non-compete clause.

On February 12, 2018, IBM filed a lawsuit to enjoin its former diversity officer to honor her non-compete agreement with IBM and to recover damages. The suit, filed in Southern District New York court, alleges that the IBM non-compete agreement that the defendant signed has a New York federal and state choice of forum provision and is, therefore, enforceable. In addition to a breach of the non-compete agreement, IBM asserts a claim for misappropriation of its trade secrets. According to IBM, if its former diversity officer “is permitted to work for Microsoft, [she] will inevitably (if inadvertently) use and/or disclose IBM trade secrets for her own benefit and for the benefit of Microsoft.” In addition to injunctive relief (seeking an order requiring its former employee to honor the non-compete agreement), IBM is also seeking compensatory damages. It has also demanded that its former employee remit to them her equity compensation because of this alleged breach of her employment agreement. As to the demand that the employee return the equity compensation she had earned as an employee, IBM’s theory is that the employee is engaging directly in a business which is competitive with IBM. Furthermore, IBM asserts that this is considered a “detrimental activity” under the Long Term Performance Plan agreement in which the employee’s equity awards are governed by and, subject to cancellation and in certain circumstances like this, are subject to repayment.

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The content in this post was found at https://www.crowelltradesecretstrends.com/2018/03/diversity-is-important-but-is-it-a-trade-secret/
Clicking the title link will take you to the source of the post. and was not authored by the moderators of freeforafee.com.

Clicking the title link will take you to the source of the post.

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NuCurrent Alleges Patent Infringement After Samsung Feigns Interest in Business Relationship

14 02 2018

Chicago, IL-based wireless power solutions provider NuCurrent filed a complaint alleging trade secret misappropriation and patent infringement against Korean tech giant Samsung Electronics (KRX:005930). The case, filed in the Eastern District of Texas, alleges that wireless charging technologies incorporated by Samsung into their Galaxy S7 and S8 product lines copies technology which was presented to them by NuCurrent under the terms of a confidentiality agreement.

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The content in this post was found at http://www.ipwatchdog.com/2018/02/11/nucurrent-alleges-patent-infringement-samsung-feigns-interest/id=93485/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Webinar Recap! 2017 National Year In Review: What You Need to Know About the Recent Cases/Developments in Trade Secrets, Non-Compete, and Computer Fraud Law

27 01 2018

In Seyfarth’s first webinar in its 2018 Trade Secrets Webinar Series, Seyfarth attorneys Michael Wexler, Robert Milligan, and Joshua Salinas presented 2017 National Year In Review: What You Need to Know About the Recent Cases/Developments in Trade Secrets, Non-Compete, and Computer Fraud Law. The panel reviewed noteworthy cases and other legal developments from across the nation over the last year in the areas of trade secrets and data theft, non-competes and other restrictive covenants, and computer fraud. Plus, they provided their predictions for what to watch for in 2018.

As a conclusion to this well-received webinar, we compiled a summary of takeaways:

  • While the Defend Trade Secrets Act provides for an ex parte seizure order, courts have been very unwilling to provide such relief except in extraordinary circumstances.
  • In light of recent state laws and appellate court decisions at both the federal and state level in 2017, choice of venue and choice of law provisions must be carefully considered and strategically implemented.
  • The ABA’s May 4, 2017, Ethics Opinion encourages lawyers to have an open exchange of communication with their clients about the securities measures their firms are taking to safeguard the clients’ confidential information.

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The content in this post was found at https://www.tradesecretslaw.com/2018/01/articles/trade-secrets/webinar-recap-2017-national-year-in-review-what-you-need-to-know-about-the-recent-cases-developments-in-trade-secrets-non-compete-and-computer-fraud-law/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Key Employee Departures and Trade Secret Risk Assessment

30 12 2017

As a special feature of our blog—special guest postings by experts, clients, and other professionals—please enjoy this blog entry from Charlie Platt, a director at iDiscovery Solutions.

It’s Friday afternoon and the conversation goes a little like this, “Wait, what? They’re leaving? Where are they going? Is there any opportunity to help them reconsider?”

When a key employee departs an organization, it can take a toll on clients and colleagues, productivity, and morale. What follows is a rush of activity: current projects are reviewed, transition plans are quickly drawn up and put in place, and decisions are made about how to replace the departing employee and how to communicate the departure to the rest of the firm and clients.

Unfortunately, this can also raise questions of concern for the organization, such as, “Did they take any electronic documents with them and, if they did, how can we tell?” Today, employees have easy access to more information than ever before and even greater opportunity to walk away with company data. While most don’t, too many make the choice to take something. Despite best efforts and safeguards, the prevalence of mobile devices, cloud storage, USB devices, etc. provide several possible avenues for a misguided employee to take sensitive company data with them when they depart.

Assessing a single avenue (e.g., USB devices) is not very complicated and can be very insightful. One of my iDS colleagues, Arnold Garcia, recently wrote about USB devices and how we can determine the history of their usage on a computer. This can be a big help in understanding if an employee took electronic documents upon departing an organization. Along with USB issues, some other questions to consider are:

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The content in this post was found at https://www.tradesecretslaw.com/2017/08/articles/data-theft-2/key-employee-departures-and-trade-secret-risk-assessment/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Non-Compete Applies To Facebook Page for Unlaunched Business–Joseph v. O’Laughlin

29 12 2017

This is another case where the defendant allegedly solicits customers or employees over social media in the face of a restrictive covenant. We recently blogged a couple of cases involving solicitations over LinkedIn. This case involves solicitations over Facebook.

O’Laughlin sold his vet clinic to Joseph. The sale agreement contained a non-compete clause that prohibited him from opening a clinic or soliciting patients or employees within 50 miles of the location he sold. The covenant was valid for five years. He sold the clinic for $750,000.

Six months later, O’Laughlin filed a zoning petition to operate a clinic at a location which was 8 miles from the clinic he sold. He formed an entity, create a Facebook page, purchased equipment, and published a “coming soon” page on Facebook. A link directed users to the prospective location in question.

Joseph filed a lawsuit seeking to enforce the covenant and sought injunctive relief. The trial court entered the injunction. O’Laughlin appealed. On appeal, O’Laughlin argued that he did not actually operate a clinic within the prohibited area, and merely creating a Facebook didn’t amount to a violation. He tried to bill these actions as merely “preparatory”. The court is not persuaded.

As an initial matter, the language of the restrictive covenant was broad. It did not cover just the veterinary practice. It also covered engaging or participating in a competitive business. In the court’s view, this encompasses forming an entity, purchasing an equipment, and applying for a zoning exception.

The court also focuses on his solicitation of customers through social media. The court finds his operation of a Facebook page and communications with prospective customers violated the clause:

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Case citation: Joseph v. O’Laughlin, 2017 WL 3599048 (Pa. Super Ct. Aug. 22, 2017)

 

The content in this post was found at http://blog.ericgoldman.org/archives/2017/09/non-compete-applies-to-facebook-page-for-unlaunched-business-joseph-v-olaughlin.htm and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Zynga sues 2 former employees over alleged massive data heist

5 02 2017
On Tuesday, Zynga sued two of its former employees. The company claims they stole confidential information and took it to their new employer, rival social gaming startup, Scopely.

Massimo Maietti and Ehud Barlach worked as higher-up employees for the San Francisco-based Zynga until they left in July and September, respectively. Scopely, which makes Dice with Buddies, Wheel of Fortune Free Play, and others, is also named as a co-defendant in the case.

According to Zynga’s 28-page civil complaint, Maietti was the creative director on “one of Zynga’s most ambitious soon-to-be released games, which goes by the code name ‘Project Mars.’” Barlach, for his part, was the general manager of Hit It Rich! Slots.

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The content in this post was found at https://arstechnica.com/tech-policy/2016/11/zynga-sues-2-former-employees-over-alleged-massive-data-heist/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Top Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2016

1 02 2017

Continuing our annual tradition, we present the top developments/headlines for 2016 in trade secret, computer fraud, and non-compete law. Please join us for our first webinar of the New Year on February 2, 2017, at 12:00 p.m. Central, where we will discuss these new developments, their potential implications, and our predictions for 2017.

1. Defend Trade Secrets Act

2. EU Trade Secrets Directive

3. Government Agencies Continue to Scrutinize the Scope of Non-Disclosure and Restrictive Covenant Agreements

4. New State Legislation Regarding Restrictive Covenants

 

5. Noteworthy Trade Secret, Computer Fraud, and Non-Compete Cases

 

6. Forum Selection Clauses

7. Security Breaches and Data Theft Remain Prevalent

8. The ITC’s Extraterritorial Authority in Trade Secret Disputes

 

more

The content in this post was found at http://www.tradesecretslaw.com/2017/01/articles/dtsa/top-developmentsheadlines-in-trade-secret-computer-fraud-and-non-compete-law-in-2016/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



D.C. Circuit Upholds NLRB Finding that Employment Agreement’s Confidentiality and Non-Disparagement Provisions Violated the NLRA

30 01 2017

 

Back in 2013, an NLRB administrative law judge found that certain confidentiality and non-disparagement provisions contained in Quicken’s Mortgage Banker Employment Agreement violated the NLRA (see our earlier blog post here). The Board agreed with the ALJ, and the Company petitioned the D.C. Circuit for review. Recently a three-judge panel of the D.C. Circuit denied the Company’s petition for review and granted the NLRB’s cross-application for enforcement, finding that there was nothing arbitrary or capricious about the Board’s decision and there was no abuse of discretion in the Board’s hearing process (Case No. 14-1231).

Facts

As a condition of employment, mortgage bankers were required to sign a Mortgage Banker Employment Agreement that included a confidentiality provision and a non-disparagement provision. The confidentiality provision prohibited employees from disclosing nonpublic information regarding the company’s personnel, including personnel lists, handbooks, personnel files, and personnel information of coworkers such as phone numbers, addresses, and email addresses. The non-disparagement provision prohibited employees from publicly criticizing, ridiculing, disparaging or defaming the company or its products, services, policies, directors, officers, shareholders or employees.

Court’s Reasoning

….

In finding that the Board properly determined that the confidentiality provision violated employees’ Section 7 rights, the court noted that the very information the provision forbids employees from sharing (i.e., personnel lists and employee rosters) has long been recognized as information that employees must be permitted to gather and share among themselves and with union organizers. With respect to the non-disparagement provision, the court found that the Board “quite reasonably found that such a sweeping gag order would significantly impede mortgage bankers’ exercise of their Section 7 rights because it directly forbids them to express negative opinions about the company, its policies, and its leadership in almost any public forum.”

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The content in this post was found at http://www.tradesecretslaw.com/2016/08/articles/restrictive-covenants/8146/and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



Top Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2016

27 01 2017

Continuing our annual tradition, we present the top developments/headlines for 2016 in trade secret, computer fraud, and non-compete law. Please join us for our first webinar of the New Year on February 2, 2017, at 12:00 p.m. Central, where we will discuss these new developments, their potential implications, and our predictions for 2017.

1. Defend Trade Secrets Act

 

2. EU Trade Secrets Directive

3. Government Agencies Continue to Scrutinize the Scope of Non-Disclosure and Restrictive Covenant Agreements

4. New State Legislation Regarding Restrictive Covenants

 

5. Noteworthy Trade Secret, Computer Fraud, and Non-Compete Cases

6. Forum Selection Clauses

 

7. Security Breaches and Data Theft Remain Prevalent

8. The ITC’s Extraterritorial Authority in Trade Secret Disputes

 

more

The content in this post was found at http://www.tradesecretslaw.com/2017/01/articles/trade-secrets/top-developmentsheadlines-in-trade-secret-computer-fraud-and-non-compete-law-in-2016/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.