How to Doom A Trade Secret Case

On October 3, 2012, in Trade Secrets, by Brian A. Hall

UnIP (UnIntellectual Property): Trade Secret for Pricing Information

The United States District Court for the Southern District of Florida decided a case that involved Plaintiff, a national printing and production company, suing its former employee and executive for misappropriation of trade secrets. In particular, the Plaintiff had identified its trade secret as its pricing information. Relying upon Florida’s Uniform Trade Secrets Act, the Court held that the Plaintiff, Hennegan Co., “did not offer sufficient evidence of its efforts to protect the secrecy of Hennegan’s pricing information. To the contrary, the evidence revealed that Hennegan provided Arriola with the pricing information and permitted him to share that information with potential customers without requiring those customers to refrain from disclosing the pricing information to others. In addition, Hennegan did not require Arriola to execute a confidentiality agreement with Hennegan. Accordingly, the Court finds that the pricing lists do not qualify as trade secrets where Hennegan did not take reasonable steps to maintain the confidentiality or limit the dissemination of the pricing information. See, e.g., id. (holding price list was a not a trade secret despite employee’s execution of confidentiality agreement where plaintiff did not take reasonable steps to maintain confidentiality of price list, such as placing limitations on customer’s dissemination of the information, so that a competitor could not acquire the information by simply requesting it from the customer).”

The Court did not end there, however, and ruled in favor of Defendant’s counterclaim for unpaid commissions. Needless to say, this had all the markings of an employer/employee relationship gone terribly wrong, and, as a result, litigation became the sword. But in the end, it was the Plaintiff’s failure to shield its pricing lists from being revealed and disseminated that determined the outcome. In the end, it was the Plaintiff that paid the ultimate price and is now left the owner of UnIP.

Hennegan Co. v. Arriola, 855 F. Supp. 2d 1354, 1357 (S.D. Fla. 2012).


 

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