Intellectual Property

The recent decision by the U.S. Court of Appeals, Sixth Circuit, Caudill Seed & Warehouse Co. v. Jarrow Formulas, Inc., illustrates the flexible approach taken by courts when considering the calculation of compensatory damages in trade secrets cases. No. 21-5345, 2022 WL 16846585 (6th Cir. Nov. 10, 2022) There, the Sixth Circuit affirmed a jury’s compensatory damages verdict which awarded the plaintiff its research and development costs for its misappropriated trade secret even though the underlying trade secret was not destroyed through disclosure or other means. Id. at *15.
Continue Reading Reap What You Sow – Sixth Circuit Affirms Recovery of Research and Development Costs to Agricultural Company in Trade Secret Case

The tension between encouraging free and fair competition and protecting competitive advantages derived from hard work and ingenuity is at the very heart of trade secrets law. Among other things, this tension manifests itself in the gray areas endemic to any legal analysis of what information may constitute a “trade secret.” In comparison, assessing the behavior of those accused of misappropriating trade secrets can sometimes be a much more straightforward exercise. And it seems that the more egregious (and less “gray”) the behavior, the more likely a court is to exercise its limited discretion to restrain competition at the preliminary
Continue Reading One Bad Apple Won’t Spoil the Rest of the Bunch’s Ability to Fairly Compete in Matthews International Corp. v. Lombardi

Should a defendant found liable for stealing trade secrets have to fork over all of the research and development costs it theoretically avoided by misappropriating the secrets? Yes, according to the “avoided costs” theory of unjust enrichment that is gaining traction and resulting in large verdicts in DTSA and UTSA cases around the country.[1] 
Continue Reading The Developing “Avoided Costs” Remedy in Trade Secret Litigation

The strength of the US dollar against the British pound – at present, the pound has dropped nearly 18% since the beginning of 2022 – would appear to make the purchase of art and other cultural property in the UK and Europe far less expensive for Americans. But the tumultuous state of the world has thrown a multitude of wrenches into British art exports to the US. The (not over yet) pandemic, (nor over yet) Brexit crisis, growing inflation, expanding regulations to prevent anti-money laundering, frustrating global supply chain backups and other issues have made it maddeningly difficult for US-based
Continue Reading For US Art Collectors Shopping in the UK, the Dollar’s Strength is Deceiving

On September 22, 2022, the U.S. Patent and Trademark Office (USPTO) directed patent practitioners to current case law and sections of the Manual of Patent Examining Procedure (MPEP) as reminders as the patent practitioners continue to work in the Artificial Intelligence (AI) technology space. A summary of these reminders (and links to more information) are provided herein.
Continue Reading Key Rules and Cases for Patent Practitioners Working on AI Patent Applications

On September 22, 2022, the U.S. Patent and Trademark Office (USPTO) conducted a live meeting for its Artificial Intelligence (AI) and Emerging Technologies (ET) Partnership Series. During this meeting, panelists from industry and the USPTO provided helpful tips on drafting and prosecuting patent applications that include AI components, including special tips for the biotech industry. Key takeaways from the meeting and published materials will be summarized in our Three-Part Blog Series.
Continue Reading Takeaways From the U.S. Patent and Trademark Office’s Artificial Intelligence and Emerging Technologies Partnership Series – Part Two of Three

The rising prevalence of crypto and virtual currencies has invited the scrutiny of several regulatory bodies who continue to grapple with the unique challenges posed by blockchain technology, FinCEN being one prime example. The Financial Crimes Enforcement Network (“FinCEN”) is an arm of the United States Department of Treasury that seeks to impede financial crimes such as money laundering and terrorist financing, and was the first financial regulator in the U.S. to address virtual currency.
Continue Reading Blockchain Game Developers and FinCEN: When are State Money Transmission Laws Applicable?

On September 22, 2022, the U.S. Patent and Trademark Office (USPTO) conducted a live meeting for its Artificial Intelligence (AI) and Emerging Technologies (ET) Partnership Series. During this meeting, panelists from industry and the USPTO provided helpful tips on drafting and prosecuting patent applications that include AI components, including special tips for the biotech industry. Key takeaways from the meeting and published materials will be summarized in our Three-Part Blog Series.
Continue Reading Takeaways From the U.S. Patent and Trademark Office’s Artificial Intelligence and Emerging Technologies Partnership Series – Part One of Three

Effective September 12, 2022, the New York Commercial Division Rules will require parties preparing responsive pleadings to “interlineate” the allegations which they are responding to within the responses themselves. Under new rule 202.70(g), titled “Interlineation of Responsive Pleadings”, counsel will essentially be required to restate the allegations of the complaint before responding to them in an answer. The rule change will likewise apply to answers to counter-claims and cross-claims.
Continue Reading Commercial Division to Adopt New Rule Requiring Interlineation of Responsive Pleadings

The artworks stolen by the Nazis are the last prisoners of World War II.

 – Ronald Lauder, Woman in Gold

Ferdinand Bloch-Bauer was a wealthy sugar magnate in Vienna, Austria where his six Gustav Klimt paintings were housed. His wife, Adele Bloch-Bauer, was the subject of two of the paintings. On March 12, 1938, the Nazis invaded and claimed to annex Austria. Ferdinand, who was Jewish and had supported efforts to resist annexation, fled the country ahead of the Nazis, ultimately settling in Zurich. In his absence, the Nazis took over his home and seized his artworks, which included the
Continue Reading NY Museums Required to Label the Last Prisoners of World War II

While preliminary injunctions are not uncommon in trade secrets misappropriation cases, a recent Fifth Circuit decision highlighted the importance that the movant put forth colorable evidence of misappropriator “use” of the trade secrets in preliminary injunction cases. In CAE INTEGRATED, L.L.C.; Capital Asset Exchange and Trading, L.L.C. v. MOOV TECHNOLOGIES, INCORPORATED; Nicholas Meissner — F.5th — (2022) 2022 WL 3210358 , the Fifth Circuit affirmed denial of a preliminary injunction for the lack of evidence showing such use. In this case, CAE sued Meissner, a former employee, and MOOV, his subsequent employer, for trade secret misappropriation in the Western District
Continue Reading Insufficient Evidence: Fifth Circuit Affirms Denial of Preliminary Injunction for Trade Secret Misappropriation

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

When a patent owner loses at the International Trade Commission (“ITC”), can it hire new counsel and try again in district court? That question will be answered in Gamevice, Inc. v. Nintendo Co., Ltd. et al, No. 3-18-cv-01942 (N.D. Cal.), where plaintiff Gamevice is asserting three patents against Nintendo despite losing on those same patents in two prior ITC proceedings.
Continue Reading Too Many Bites at the Apple?

Litigators know it is generally not easy to recover attorneys’ fees in defense of a trade secret misappropriation action. The Federal Defend Trade Secrets Act (“DTSA”) permits a court to “award reasonable attorneys’  fees” to the defendant when a claim of misappropriation  is “made in bad faith,” which “may be established by circumstantial evidence.”[1] But what exactly does bad faith mean and what is the threshold?
Continue Reading A High Mountain to Climb: Filing DTSA Claims Without any Evidence is Not Enough to Meet “Bad Faith” Standard for Awarding Attorneys’ Fees to Opponent

Trade secret litigation presents a variety of procedural and practical complexities at every stage of the proceeding. One of the most important—yet often overlooked—issues in these cases can be summarized by the following question:
Continue Reading Signed, Sealed, Delivered? Fifth Circuit Finds Sealing of Sensitive Information Requires Far More Than a Protective Order

A recent decision from the Eastern District of California illustrates the sometimes fine line between the need for plaintiffs to allege a claim for trade secret misappropriation in sufficient detail, while avoiding disclosing the trade secret in so much detail as to destroy it.

In Dairy, LLC v. Milk Moovement, Inc., Dairy, LLC (“Dairy”) sued Milk Moovement, Inc. and Milk Moovement, LLC (collectively, “Defendants”), alleging trade secret misappropriation under both the Defend Trade Secrets Act and the California Uniform Trade Secrets Act and intentional interference with contractual relations.  No. 2:21-cv-02233, 2022 WL 1103822, at *1 (E.D. Cal. Apr. 13, 2022)
Continue Reading Dairy, LLC v. Milk Moovement, Inc.: Identifying Software Trade Secrets With Particularity to State a Claim for Trade Secret Misappropriation