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6.8M Award for Theft of Company Trade Secrets

A dental technology company has obtained a $6.8 million judgment against a former employee accused of stealing the company’s designs. The federal district court in Central California entered the judgment after finding the defendant, Jian Lu, liable for stealing trade secrets. Sirona Dental Systems Inc., et al. v. Jian Lu, No. 2:15-cv-08777 (C.D. Cal. Oct. 19, 2017). This case highlights the importance of non-disclosure agreements, paying close attention to developments in your industry, as well as vigorously protecting your rights in court.

eLABORate: Social Media Complications in the Enforcement of Non-Solicitation Agreements

Determining whether a former employee has breached a non-solicitation agreement has become a more complicated issue in the social media age. Courts are wrestling with the question of when a former employee’s social media interaction crosses the line into contractually prohibited solicitation.

Are You Doing Enough to Protect Your Company's Secrets?

A decade ago, I litigated a trade secret/unfair competition dispute between two large plastics manufacturers. The Plaintiff was based in southwest Florida, the Defendant in southern Alabama. The factual dispute is interesting, though not necessarily particularly pertinent to the subject I want to address in this post.

Departing Employees: Ensuring Protection of Trade Secrets and Intellectual Property

“Knowledge is power” goes the old adage. Well, that is certainly true in the world of business where secret processes, confidential designs, and even a good customer list can give a business a vital commercial edge over its rivals. Protecting the sanctity of that information on the departure of a key employee is vital.

LinkedIn Over Her Head: When Broadcasting a Change in Employment Counts as Solicitation

Non-Compete and Trade Secrets Blog LinkedIn Over Her Head: When Broadcasting a Change in Employment Counts as Solicitation Sept. 8, 2017 by John Singer A recent blog post discussed an Illinois state court decision evaluating an employer’s claim against a former employee for breach of a non-solicitation agreement, when the employee had added former co-workers on LinkedIn after going to work for a competitor. There, the court determined that the employee had not violated the non-solicitation agreement, finding that merely adding a former co-worker as a LinkedIn connection was a type of “passive” social media activity that did not rise to level of solicitation. The court differentiated between passive, untargeted social media activity and more “active” interactions, such as sending direct messages to former co-workers or targeting former customers with a sales pitch, and suggested that such activity could run afoul of a non-solicitation agreement.

eLABORate: Federal Court Gives Clues as to When "The Nuclear Option" Will Be Ordered under the Defend Trade Secrets Act

In 2016, President Obama signed into law the Defend Trade Secrets Act of 2016 (“DTSA”), allowing businesses nationwide to file suit in federal court to protect their trade secrets from unscrupulous former employees and dishonest business competitors. The law was applauded by the business community, because prior to the enactment of the DTSA, companies were limited to seeking relief in state courts, where the law can vary from state-to-state, yielding inconsistent results.

Who Poked Whom First: Does a Friend Request or Social Media Invite Count as Solicitation?

When Gregory Gelineau quit his job at an Illinois-based insurance company to work for a competitor, he sent LinkedIn invitations to a group of his former co-workers. In response, Gelineau’s former company sued him. The company, Bankers Life, alleged that Gelineau violated the non-solicitation provision in his employment agreement by recruiting or attempting to recruit several of his former co-workers.

The Not-So-Secret Recipe: How Restaurants Can Protect Their Trade Secrets

Restaurant fortunes are often attributable to just one or two signature dishes, and recipe ownership dilemmas can arise in restaurants of all sizes. Recent examples include a joint venture gone awry, resulting in a war over the ownership of a salted caramel brownie recipe; the “Taco Bible” that a former employee allegedly stole and used at another taco restaurant nearby; and a well-known Australian chef demanding that his former employer cease serving the signature dish he created when he worked there.

Is My Noncompete With an Independent Contractor Enforceable?

The Eight Circuit recently addressed this question in Ag Spectrum Co. v. Elder, Case No. 16-3113 (8th Cir. August 2, 2017). In that case, Ag Spectrum contracted with Vaughn Elder to work as an independent contractor. Elder also agreed to a three-year noncompete whereby he would not compete with Ag Spectrum by “marketing to, selling to, or consulting with its customers about similar products for three years after terminating the Agreement.” Elder argued that the Agreement was unenforceable under Iowa law.

Noncompete Agreements Present Challenges for Multistate Employers

Every organization wants to protect its assets, and employees are undoubtedly vital to any employer as one of its greatest resources. Thus, an employer will often use a noncompete agreement, which is a type of restrictive covenant designed to limit an employee’s ability to work in similar employment for a competitor.