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The Seventh Circuit recently affirmed summary judgment in favor of a former employee and his new employer on claims for misappropriation of trade secrets relating to a prototype of an actuator created eleven years prior, holding that the inference that the defendant used his knowledge of the prototype more than a decade later was “barely conceivable” and “exceptionally unreasonable.” REXA, Inc. v. Chester, — F.4th —, 2022 WL 2981167, at *6 (7th Cir. 2022) (internal quotation marks omitted).
Continue Reading Unfashionably Late: Seventh Circuit Rejects Misappropriation Claim Premised On Prototype Created Eleven Years Prior

Why should companies considering trade secret litigation consider their patent portfolios?  After all, trade secrets, by definition, are secret.  They have value in the marketplace by virtue of not being disclosed.  And like the formula for Coca-Cola, that value can continue perpetually as long as the secrecy of trade secrets is maintained.  Patents, on the other hand, represent a limited monopoly granted to the patent-holder in exchange for an enabling disclosure of the patented invention, a disclosure sufficient to enable those skilled in the art to practice the invention.  Of course, this public disclosure requirement for patentability destroys secrecy.  This means that once the invention is disclosed in a published patent or application, it cannot be subject to trade secret protection.  In the context of a litigation concerning whether a claimed trade secret is covered by a patent, the interface between trade secret protection and patent protection can become existential.  The defendant may contend that once the claimed trade secrets found their way into the patent’s enabling disclosure, they lost any trade secret protection.  The plaintiff will try to delineate sharply between technology covered by the patent and its disclosures, and technology that remains undisclosed and thus properly subject to trade secret protection.  So a proper understanding of the interplay between trade secret protection and patent protection can be critical to the outcome in a trade secret case.
Continue Reading Why Patents Can Matter In Trade Secret Cases