Trade Secrets & Transitions

Important Legal News and Analysis on Employee Mobility & Trade Secrets Law

The New York University Law Review recently published an article suggesting that the ex parte seizure provision of the Defend Trade Secrets Act (DTSA) would not survive due process scrutiny and therefore should be eliminated. Of the hundreds of claims brought under the DTSA since it went into effect in May 2016, we are unaware of any cases where litigants have attacked its constitutionality, much less successfully. Although the note raises some due process concerns…
Last month, a tech giant (IBM) sued one of its former executives who went to work for another tech giant (Microsoft), alleging that she breached her non-compete agreement and misappropriated trade secrets. Given the parties involved, you probably assume that the trade secrets at issue were source codes or algorithms. In fact, they were IBM’s diversity initiatives, strategies, and data. In IBM v. McIntyre, IBM alleged that its former chief diversity officer, Lindsay-Rae McIntyre, misappropriated…
Many will be surprised to learn that a company may need to advance attorney’s fees to a former director or officer being sued by the company for theft of trade secrets or other misconduct while serving as an officer or director, and to indemnify that director or officer if she or he prevails at the end of the lawsuit. This article describes how a company’s articles of incorporation, organic documents or contracts may require such…
Many will be surprised to learn that a company may need to advance attorney’s fees to a former director or officer being sued by the company for theft of trade secrets or other misconduct while serving as an officer or director, and to indemnify that director or officer if she or he prevails at the end of the lawsuit. This article describes how a company’s articles of incorporation, organic documents or contracts may require such…
Employers commonly include prohibitions against post-employment soliciting of customers and employees in employment agreements. Most states simply treat prohibitions against soliciting customers like non-compete agreements—they are generally unenforceable unless narrowly tailored.[1]  Other states go beyond the non-compete analysis and apply additional factors to determine whether a customer non-solicit is enforceable.[2] When it comes to non-solicits of employees, it’s commonly thought that they are easier to enforce than full-blown non-compete restrictions—but are they? The…
The Federal Rules of Civil Procedure were amended in December 2015 to help mitigate the risk of inadvertent disclosure of privileged information present in virtually every litigation. Such risk, however, is particularly acute in litigation involving trade secrets, non-competition, non-solicitation, and/or non-disclosure agreements. Employee mobility litigation poses a special risk for inadvertent disclosure because of the email address “autofill” function common in various email programs. Needless to say, employees use work-issued email accounts.  Even after…
The Federal Rules of Civil Procedure were amended in December 2015 to help mitigate the risk of inadvertent disclosure of privileged information present in virtually every litigation. Such risk, however, is particularly acute in litigation involving trade secrets, non-competition, non-solicitation, and/or non-disclosure agreements. Employee mobility litigation poses a special risk for inadvertent disclosure because of the email address “autofill” function common in various email programs. Needless to say, employees use work-issued email accounts.  Even after…
The past two years have marked a seemingly volatile time for non-compete law in the United States, traditionally a state issue. National political forces—the United States Department of the Treasury, the White House, and Senators Al Franken and Chris Murphy—showed an interest in attempting to limit the enforceability of non-competes. We have previously covered this shift here and here. But in 2017, that federal tide has turned with the arrival of the Trump administration.…
We’ve previously explained the foolishness of trying to destroy or alter electronically stored information that qualifies as evidence in litigation. Why foolish?  Because the attempt implies a belief that such misconduct won’t be detected. When scrutinized by the right experts, the attempt will be detected; when properly presented to a court, it likely will be sanctioned. Take the recent case of Organik Kimya, San. ve Tic., A.S. v. ITC, an appeal from the U.S. International…