Under trade secrets law, the inevitable disclosure doctrine is the idea that a defendant’s new employment will lead to the inevitable disclosure of a former employer’s trade secrets. Texas courts have issued mixed holdings on the subject. After the Texas Uniform Trade Secrets Act (TUTSA) was enacted in 2013, some speculated that its language permitting injunctive relief for “threatened misappropriation” was an implicit adoption of the inevitable disclosure doctrine. In a recent decision, the Dallas Court of Appeals seemed to reject that speculation. Continue Reading Dallas Court of Appeals Holds that the Inevitable Disclosure Doctrine Cannot Be Used to Create a Fact Issue on Misappropriation of Trade Secrets
On February 6, I had the pleasure of giving the 2019 Trade Secrets Year in Review at TexasBarCLE‘s annual Advanced Intellectual Property Law seminar. Continue Reading 2019 Trade Secrets Year in Review
Pearl Energy Inv. Mgmt., LLC v. Gravitas Res. Corp., No. 05-18-01012-CV, 2019 WL 3729501 (Tex. App.—Dallas Aug. 7, 2019, no pet.) is a trade secrets case involving the previous version of Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA). (Effective September 1, 2019, the TCPA no longer applies to trade secrets claims.) In Pearl Energy, Gravitas, an oil and gas production company, alleged that it spent years researching and evaluating the purchase of certain natural gas assets in Utah from Anadarko. In 2016, Gravitas approached Anadarko about purchasing the assets. Gravitas eventually won the bid for the assets and began negotiating a purchase and sale agreement for the assets. Continue Reading Dallas Court of Appeals Affirms Denial of TCPA Motion in Trade Secrets Case
In M-I L.L.C. v. Q’Max Sols., Inc., No. CV H-18-1099, 2019 WL 3565104 (S.D. Tex. Aug. 6, 2019) involves the familiar fact of an employee leaving his employer and taking the employer’s trade secrets with him. After the employer conducted a forensic investigation and discovered that the departing employee had downloaded the employer’s confidential documents before he departed, the employer sued the employee for various causes of action, including violations of the Defend Trade Secrets Act (DTSA), violations of the Texas Uniform Trade Secret (TUTSA), and breach of his non-disclosure agreement. Continue Reading Southern District of Texas Denies Summary Judgment In Part for Trade Secrets Claim
Through most of 2019, the Dallas Court of Appeals has refused to apply the Texas Citizens Participation Act (TCPA) to commercial litigation claims. Goldberg v. EMR (USA Holdings) Inc., No. 05-18-00261-CV, 2019 WL 3955771 (Tex. App.–Dallas Aug. 22, 2019, no pet. h.) reverses that trend in part. Goldberg is too complex of a case to summarize here. Therefore, I’ll just hit the highlights: Continue Reading Dallas Court of Appeals Explores the TCPA in Complex New Decision
Most cases that have evaluated the Texas Citizens Participation Act (TCPA) have focused on whether the TCPA applied to the claims. This isn’t the issue in Neurodiagnostic Consultants, LLC v. v. Nallia, No. 03-18-00609-CV, 2019 WL 4231232 (Tex. App.—Austin Sept. 6, 2019, no pet. h.). Instead, Nalia focuses on whether the non-movant offered sufficient proof to defeat a TCPA motion to dismiss. Continue Reading Austin Court of Appeals Issues Opinion on the TCPA and Conspiracy
One of the most difficult things about litigating a trade secrets case is how to handle the introduction of evidence containing the trade secret. The party obviously does not want this information divulged in open court or filed as a public record. Thus, to get around this problem, the party must file a motion to seal the records with the trial court.
Many litigators believed that the Texas Uniform Trade Secrets Act’s (TUTSA) provision on sealing court records provided an efficient means to obtain such an order: Continue Reading How to Keep Trade Secrets Secret While in Trial
Over the past several months, I’ve been tracking the explosion of cases where a defendant uses Texas’s anti-SLAAP statute the Texas Citizens Participation Act (TCPA) as a defense to a misappropriation of trade secrets claim under the Texas Uniform Trade Secrets Act (TUTSA). The Beaumont Court of Appeals case in Callison v. C&C Pers., LLC, No. 09-19-00014-CV, 2019 WL 3022548(Tex. App.–Beaumont July 11, 2019, no pet. h.) is another one of those cases. Callison involves the familiar fact pattern of an employee accused of acquiring her former employee’s trade secrets and then using those trade secrets to solicit her former customers. In defense to those claims, the employee filed a motion to dismiss under the TCPA. The trial court denied employee’s motion by operation of law. The Beaumont Court of Appeals affirmed. Continue Reading Another Trade Secret Case Involving the TCPA
The Dallas Court of Appeals opinion in Damonte v. Hallmark Financial Services, Inc., No. 05-18-00874-CV, 2019 WL 3059884 (Tex. App.–Dallas July 12, 2019) is the latest in a string of cases restricting the application of the Texas’s anti-SLAAP statute the Texas Citizens Participation Act (TCPA). In this case, Hallmark sued Damonte, its former employee, for breach of fiduciary duty, breach of contract, and violations of the Texas Uniform Trade Secret Act (TUTSA) after employees were found to be emailing themselves proprietary information in the weeks immediately before his departure. In response, Damonte filed a motion to dismiss under the TCPA, alleging that Hallmark’s lawsuit was based on, relates to, or in response to his rights of free speech and association. Continue Reading Dallas Court of Appeal Continues Trend Restricting Application of the TCPA to Commercial Litigation Cases
As previously discussed, the current version of the Texas Citizens Participation Act (TCPA) can apply in a variety of commercial litigation cases. One of the exceptions to application of the TCPA, though, is the commercial speech exemption. Under the commercial speech exemption, the TCPA does not apply if (1) the defendant was primarily engaged in the business of selling or leasing goods, (2) the defendant made the statement or engaged in the conduct on which the claim is based in the defendant’s capacity as a seller or lessor of those goods or services, (3) the statement or conduct at issue arose out of a commercial transaction involving the kind of good or services the defendant provides, and (4) the intended audience of the statement or conduct were actual or potential customers of the defendant for the kind of goods or services the defendant provides.
The new Dallas Court of Appeals case of Clean Energy and Clean Energy Fuels Corp. v. Trillium Transportation Fuels, LLC, No. 05-18-01228, (Tex. App.—Dallas July 9, 2019, no pet. h.) interprets the third prong of this exemption. Continue Reading Dallas Court of Appeals Issues Opinion Interpreting the Commercial Speech Exception of the TCPA