Houston’s First District Court of Appeals reversed a trial court’s dismissal of a misappropriation of trade secrets claim based on the Texas’s anti-SLAPP law the Texas Citizens Participation (TCPA) because both the right of association and the right of free speech require some showing of a public good. Nat’l Signs, Inc. v. Graff, 01-18-00662-CV, 2020 WL 2026321 (Tex. App.—Houston [1st Dist.] Apr. 28, 2020, no pet.).
Continue Reading Houston Court of Appeals Holds that the The Texas Citizen’s Participation Act Requires a Showing of Some Public Benefit
Trade Secrets
Proving the Element of “Use” for a Trade Secrets Claim Requires Either Harm to the Defendant or Enrichment of the Plaintiff
Recently, the First District Court of Appeals, Houston affirmed a take-nothing judgment against all parties. Malone v. PLH Group, Inc., 01-19-00016-CV, 2020 WL 1680058, at *1 (Tex. App.—Houston [1st Dist.] Apr. 7, 2020, pet. denied). The defendant in Malone Power Line Services, Inc. (PLS) constructed electrical transmission lines, built distribution systems, and provided construction services. The plaintiff Thomas Malone (Malone) entered into a three-year employment agreement with PLS in 2014 to serve as its Vice President of Operations. The employment agreement prohibited Malone from competing against PLS, soliciting PLS’s employees, and disclosing confidential information through restrictive covenants.
Continue Reading Proving the Element of “Use” for a Trade Secrets Claim Requires Either Harm to the Defendant or Enrichment of the Plaintiff
Dallas Court of Appeals Reverses Trial Court on TCPA Because There Must Be a Showing of a Public Good
The Dallas Court of Appeals recently reversed a trial court’s decision to grant a motion to dismiss under the previous version of Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA). BusPatrol Am., LLC v. Am. Traffic Sols., Inc., 05-18-00920-CV, 2020 WL 1430357 (Tex. App.—Dallas Mar. 24, 2020, no pet.). The case revolved around a commercial dispute between two companies competing in the “smart bus technology market.”
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First District Court of Appeals Affirms Trial Court’s Decision to Reject a Motion to Dismiss under the TCPA
Houston’s First District Court of Appeals affirmed a trial court’s refusal to grant a dismissal of a misappropriation of trade secrets claim based on the previous version of Texas Citizen Participation Act (TCPA) because both the right of association and the right of free speech require some showing of a public good. Newpark Mats & Integrated Services, LLC v. Cahoon Enterprises, LLC, 01-19-00409-CV, 2020 WL 1467005, at *4 (Tex. App.—Houston [1st Dist.] Mar. 26, 2020, no pet.). The plaintiff-appellee in this case Cahoon Enterprises, LLC (Cahoon) is a small, family-owned business in North Dakota that provides roustabout services including the installation and removal of mats used under the sand boxes of oil fracking sites. The defendant-appellant Newpark manufactures the matting systems that Cahoon installs.
Continue Reading First District Court of Appeals Affirms Trial Court’s Decision to Reject a Motion to Dismiss under the TCPA
Fifth Circuit Affirms Trial Court’s Judgment that Competitor Did Not Misappropriate Trade Secrets
In Six Dimensions, Inc. v. Perficient, Inc., No. 19-20505, 2020 WL 4557640 (5th Cir. Aug. 7, 2020), the Fifth Circuit explores the issue of what happens when an employer hires a new employee who is in possession of his former employer’s trade secrets. In Six Dimensions, plaintiff Six Dimensions’ former employee left his Six Dimensions employment with a USB drive of Six Dimensions’ training materials. The employee started work at competitor Perficient and brought with him the USB drive. The evidence at trial demonstrated that there was discussion between the employee and Perficient about uploading the Six Dimensions’ training materials to Perficient’s server, but Perficient ultimately decided not to use the training materials.
Continue Reading Fifth Circuit Affirms Trial Court’s Judgment that Competitor Did Not Misappropriate Trade Secrets
Fort Worth Court of Appeals Analyzes the Evidence for Misappropriation in a TCPA Trade Secrets Case
The Fort Worth Court of Appeals recently examined an accelerated interlocutory appeal under the previous version of the Texas Citizens Participation Act (TCPA), ultimately determining that an allegation of misappropriation of trade secrets must be specifically proven. In Phuong Nguyen v. ABLe Communications, Inc., 02-19-00069-CV, 2020 WL 2071757 (Tex. App.—Fort Worth Apr. 30, 2020, no pet.), the plaintiff ABLe Communications (ABLe) sued the three defendants, Phuong Nguyen (Nguyen), E2 Optics, LLC (E2), and Southwest Networks, Inc. (Southwest), after Nguyen left ABLe to work for Southwest.
Continue Reading Fort Worth Court of Appeals Analyzes the Evidence for Misappropriation in a TCPA Trade Secrets Case
Dallas Court of Appeals Rejects Application of TCPA to Trade Secrets Case
Collaborative Imaging, LLC v. Zotec Partners, LLC, No. 05-19-01256-CV, 2020 WL 3118614 (Tex. App.–Dallas June 12, 2020, no pet. h.) is another example of the courts’ increasing unwillingness to apply the previous version Texas’s anti-SLAPP statute the Texas Citizens Participation Act (TCPA) to cases involving the Texas Uniform Trade Secrets Act (TUTSA). In Collaborative Imaging, an employee of a healthcare practice management services provider quit his job with that provider and went to work for a company started by the doctors from one of the provider’s clients. A few months after the employee made the change in employment, the client terminated its contract with the provider. The provider sued the former employee and his new company, alleging that they disclosed trade secrets relating to billing practices that result in termination of the contract between the provider and client.
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More Lessons from Title Source v. HouseCanary
Title Source, Inc. v. HouseCanary, Inc., No. 04-19-00044-CV, 2020 WL 2858866 (Tex. App.–San Antonio June 3, 2020, pet. granted) is a new case addressing the jury charge in Texas Uniform Trade Secrets Act (TUTSA) cases. In my previous post about the case, I discussed the Casteel problem in the misappropriation instructions that resulted in reversal of this multi-million dollar judgment. (For a complete discussion of the facts, please see this previous blog post.) The court, however, addressed more than the just the misappropriation question.
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A Practitioner’s Guide to the Texas Uniform Trade Secret Act
Last fall, the Texas Journal of Business Law, the journal of the Business Law Section of the State Bar of Texas, published my colleagues Joe Cleveland and Kevin Smith‘s article A Practitioner’s Guide to the Texas Uniform Trade Secret Act. It’s a great resource for any trade secret litigator.
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TCPA’s Commercial Speech Exemption Applies to Employer’s Claims Against Former Employee
For the last few years, defendants in trade secrets and other commercial litigation claims have used the previous version of Texas’s anti-SLAAP statute the Texas Citizens Participation Act (TCPA) as a defense to those claims. Langley v. Insgroup, Inc., No. 14-19-00127-CV, 2020 WL 1679625 (Tex. App.–Houston [14th Dist.] Apr. 7, 2020, no pet. h.) is another example of this strategy. In Langley, an insurance salesman left his employer to work for a competitor. The former employer accused the salesman of violating his non-compete agreement, tortious interference with the employer’s contracted clients, breach of fiduciary duty, and violation of the Texas Uniform Trade Secret Act. The new employer was also a defendant to several of those causes of action.
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