Raytheon Co. v. Indigo Systems Corp., Docket No. 16-1945

Trade secret misappropriation: Labor law:

The parties agree that California law governs Raytheon’s trade secret misappropriation claim. To prevail on its claim under the California Uniform Trade Secrets Act (CUTSA), Raytheon was required to prove, among other things: (1) it owned a trade secret; and (2) Indigo misappropriated the trade secret, either by acquisition, use, or disclosure. See Sargent Fletcher, Inc. v. Able Corp., 3 Cal. Rptr. 3d 279, 283 (Ct. App. 2003); see also MedioStream, Inc. v. Microsoft Corp., 869 F. Supp. 2d 1095, 1114 (N.D. Cal. 2012).

Under California law, a trade secret must “(1) derive independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and (2) be the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” CAL. CIV. CODE § 3426.1(d). Thus, information that is generally known to the public cannot qualify as a trade secret; nor can it form the basis for a misappropriation claim. See Ultimax Cement Mfg. Corp. v. CTS Cement Mfg. Corp., 587 F.3d 1339, 1355 (Fed. Cir. 2009) (applying California law).

A defendant misappropriates a trade secret if it acquires, discloses, or uses a trade secret. “Misappropriation” is defined as: (1) Acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or (2) Disclosure or use of a trade secret of another without express or implied consent by a person who:

(A) Used improper means to acquire knowledge of the trade secret; or

(B) At the time of disclosure or use, knew or had reason to know that his or her knowledge of the trade secret was: (i) Derived from or through a person who had utilized improper means to acquire it; (ii) Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or (iii) Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or

(C) Before a material change of his or her position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake. CAL. CIV. CODE § 3426.1(b).

The CUTSA defines the term “improper means” to include “theft, bribery, misrepresentation, breach or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other means.” Id. § 3426.1(a). Reverse engineering and independent derivation do not qualify as improper means. Id.

(Here neither party asked the district court to explicitly define the contours of the trade secrets before sending the misappropriation inquiry to the jury.)

(U.S. Court of Appeals for the Federal Circuit, July 12, 2018, Raytheon Co. v. Indigo Systems Corp., Docket No. 16-1945 (2016-1945, 2016-2050), J. Chen)

L’action en violation du secret des affaires en droit californien. Notamment, un ancien employeur peut agir contre un nouvel employeur si un employé qui passe de l’un à l’autre dévoile de tels secrets.