Non-Disclosure Agreements

In EJ Madison, LLC v. Pro-Tech Diesel, Inc., No. 08-17-00229-CV, 2019 WL 6242301, at *1 (Tex. App.–El Paso Nov. 22, 2019, no pet. h.), plaintiff Madison operated a trucking company and defendant Pro-Tech provided maintenance services to the trucks.  The parties entered into a non-disclosure agreement so they could work together on diesel-to-natural gas conversion kits for the trucks.  Additionally, Pro-Tech continued to provide general maintenance work for the trucks.
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Morrison v. Profanchik, No. 05-17-01281-CV, 2019 WL 3798182 (Tex. App.–Dallas Aug. 13, 2019), supplemented, No. 05-17-01281-CV, 2019 WL 5112268 (Tex. App.–Dallas Oct. 10, 2019) is a case involving the summary judgment dismissal of counterclaims for breach of non-disclosure/non-compete agreement and misappropriation of trade secrets.  In Morrison, plaintiff Profanchik approached Stonecoat of Texas about purchasing one of its franchises.  The parties entered into a nondisclosure/noncompete agreement with the understanding that the competitor would be divulging confidential and trade secret information as part of the due diligence process.  Profanchik, however, later walked away from the deal, started a competing limestone veneer company, and sued Stonecoat and its owners for tort causes of action arising from the parties’ negotiations.
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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.
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Texas’s anti-SLAAP statute, the Texas Citizens Participation Act (TCPA), can apply to a variety of commercial litigation claims, including claims for misappropriation of trade secrets and breach of non-disclosure agreements (NDAs).  If the TCPA is invoked in a case and is found to apply, the plaintiff must respond with clear and specific evidence of the prima facie elements of its causes of action.  Recently, the Texas Supreme Court addressed what evidence would satisfy plaintiff’s burden to establish causation and damages.
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As previously mentioned in this blog, one of the biggest issues in trade secrets litigation in Texas is the application of the state’s anti-SLAAP statute the Texas Citizens Participation Act (TCPA) to claims under the Texas Uniform Trade Secret Act (TUTSA). Because of the broad language of the TCPA, defendants can file a TCPA motion to dismiss in almost any trade secrets case.

On June 2, 2019, Governor Abbott signed a bill to change that.
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If you have been reading this blog, you know that I have frequently commented on the use of Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA) to defeat a Texas Uniform Trade Secrets Act (TUTSA) claim. Most of the early cases involved defendants using the TCPA to dismiss a plaintiff’s TUTSA claim. Universal Plant Services, Inc. v. Dresser-Rand Group, Inc., No. 01-17-00555-CV, 2018 WL 6695813 (Tex. App.—Houston [1st Dist.] Dec. 20, 2018, no pet.) involves a plaintiff overcoming defendants’ TCPA motions.
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As previously mentioned in this blog, one of the biggest issues in trade secrets litigation in Texas is the application of the state’s anti-SLAAP statute the Texas Citizens Participation Act (TCPA) to claims under the Texas Uniform Trade Secret Act (TUTSA).  Because of the broad language of the TCPA, defendants can file a TCPA motion to dismiss in almost any trade secrets case.  Texas Representative Jeff Leach, however, has filed a bill to change that.  
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In Thoroughbred Ventures, LLC v. Disman, No. 4:18-CV-00318, 2018 WL 3752852 (E.D. Tex. Aug. 8, 2018), plaintiff Thoroughbred Ventures sued its former manager Disman, alleging that Disman breached his employment agreement, which provided that all client contact and background information belonged to Thoroughbred and constituted “Confidential Information” and a trade secret of Thoroughbred.
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Eagle Oil & Gas Co. v. Shale Exploration, LLC, 549 S.W.3d 256 (Tex. App.—Houston [1st Dist.] 2018, pet., pet. dismissed) involves the familiar situation where a plaintiff sues for both breach of a confidentiality agreement and for misappropriation of trade secrets. Defendant asserted that plaintiff was limited to a breach of contract claim because the misappropriation claim was barred by the economic loss rule, which bars a recovery in tort for economic losses caused by a breach of contract if the losses are due to the failure to fulfill a contractual obligation.
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