You may be able to bring a misappropriation of trade secrets claim even if you do not actually own the misappropriated trade secret.  A growing number of federal cases indicate ownership of a trade secret may not be required in order for a plaintiff to sue for misappropriation; possession alone may be enough to confer standing.
Continue Reading Is Lawful Possession of a Trade Secret Enough for Standing to Sue for Misappropriation?

When filing a claim for trade secret misappropriation under the Defend Trade Secrets Act (DTSA) or a state’s Uniform Trade Secrets Act (UTSA), it is essential to strike the proper balance between sufficiently describing an underlying trade secret and avoiding disclosure of any details that would destroy its secrecy.  A federal court decision issued earlier this month in the Northern District of California, MBS Engineering Inc., et al. v. Black Hemp Box, LLC, et al., No. 20-cv-02825-JD, 2021 WL 2458370 (N.D. Cal. June 16, 2021), highlights this “obvious tension between the right of public access to court proceedings and the ‘secret’ part of a trade secret” and provides a useful example of the factors used by courts to assess an appropriately alleged trade secret claim.
Continue Reading Striking the Balance Between Detailed Description and Unnecessary Disclosure of the “Secret” in Trade Secret Litigation Pleadings

Following a nationwide trend, Illinois has proposed significant legislation affecting employee restrictive covenants, such as non-compete agreements.  While the proposed law does not dramatically change most aspects of the patchwork of Illinois common law, it adds certainty to long-questioned areas and imposes several threshold hurdles and eligibility factors to the test for assessing enforceable restrictive covenants.

Continue Reading What Employers Need to Know About New Non-Compete Legislation in Illinois

The Supreme Court’s recent decision in Van Buren v. United States, — S. Ct. —-, 2021 WL 2229206 (2021) resolved a longstanding Circuit split regarding the scope of liability under the Computer Fraud and Abuse Act of 1986 (CFAA), 18 U.S.C. § 1030 et seq. As we previewed last year, Van Buren addressed whether a person “exceeds authorized access” within the meaning of the CFAA when accessing information on a computer for an improper purpose. In an Opinion authored by Justice Barrett, the Supreme Court ruled, 6-3, that the CFAA does not cover those who have improper motives for obtaining computerized information they are otherwise authorized to access.  
Continue Reading Supreme Court Narrows The Scope of Liability Under The Computer Fraud and Abuse Act

Amidst long-simmering diplomatic tensions between China and the United States, disputes arising out of Chinese companies’ alleged theft of technological trade secrets from rival American companies[1] have found their way to federal courtrooms. This stems, in part, from the availability of worldwide injunctive relief under the Defend Trade Secrets Act (“DTSA”), which provides American companies with a robust tool to combat trade secret misappropriation by foreign entities in cases where “an act in furtherance of the offense was committed in the United States.” 18 U.S.C. § 1837(2).
Continue Reading Illinois Court Finds China Inadequate Forum For Trade Secret Misappropriation Claims Against Chinese Tech Company

The Department of Justice, Antitrust Division (“DOJ”) continues to investigate hiring practices in a number of industries for potential antitrust violations as part of its effort to scrutinize, and in some instances, criminally prosecute, companies and individuals who enter into agreements with their competitors regarding hiring, wages, and solicitation of employees.
Continue Reading Taboola the Latest Target of DOJ’s Aggressive Antitrust Scrutiny of Hiring Practices

California Labor Code Section 925 prohibits employers from requiring employees who reside and work primarily in California, as a condition of employment, to agree to any provision that would require the employee to litigate outside California any claim arising in California, or that would deprive the employee of the benefit of California law with respect to any claim arising in California.  Under Section 925, any such provision is voidable by the employee and if the employee exercises her right to void the provision, then any such claim shall be adjudicated in California under California law.[1]
Continue Reading California Labor Code Section 925 and How Employers Can Avoid It

On January 11, 2021, the mayor of the District of Columbia, Muriel Bowser, signed the Ban on Non-Compete Agreements Amendment Act of 2020 (the “Act”), which is set to be one of the broadest and most expansive bans on non-competes in the country.  The Act bans provisions in employment agreements that forbid any employee from working for a competitor not only after their employment, but also during their employment.  While the Act does not apply retroactively, any non-compete entered into after the Act’s effective date is void and unenforceable.

The Act was submitted for the requisite 30-day congressional review period and is expected to become law in the coming months.
Continue Reading Employment Agreements: DC’s Recent Ban on Non-Competes is One of the Broadest in the Country

The protection and retention of confidential information and trade secrets permeate nearly every transaction. Employment-law successor liability presents a substantial risk in transactions even when purchase agreements seemingly contain protective language. The general rule that an asset buyer does not assume a seller’s liabilities does not necessarily apply in the employment context, at least not in all cases. Targeted labor and employment diligence helps to identify potential areas of post-acquisition risk. Diligence also helps foster a greater understanding of the seller’s business and its workforce, making for a smoother post-acquisition integration effort. Identifying key underlying trade secrets and efforts to safeguard those trade secrets leading up to the transaction, and ensuring appropriate agreements are in place post-transaction to protect such trade secrets, are critical elements to the due-diligence process.
Continue Reading The Critical Nature of Employment and Trade Secret Diligence in Corporate Transactions