Here are the noteworthy trade secret, non-compete and cybersecurity stories from the past week, as well one or two that I missed over the past couple of weeks:
Noteworthy Trade Secret and Non-Compete Posts and Cases:
- A California federal jury has ordered Best Buy Co. Inc. to pay $22 million for unjust enrichment after finding the retailer willfully stole TechForward Inc.’s trade secrets and breached a confidentiality agreement concerning an electronics buy-back program, reports Law360. Best Buy’s efforts at an electronic buy-back program had been unsuccessful, so it approached TechForward, signing a NDA in 2008, and collaborated on a pilot program that rolled out in April 2010 in a dozen Best Buy stores in southern California. Several months after the pilot launch, however, Best Buy allegedly ended the relationship “hastily and unexpectedly,” saying it planned to move forward on a buy-back program by itself, according to TechForward. When Best Buy unveiled its national program in January 2011, it was “nearly identical in its key components to TechForward’s,” the suit said.
- The arbitratability of non-compete and trade secret disputes are in the news this week. Josh Salinas has an excellent post for Seyfarth Shaw’s Trading Secrets Blog on a recent federal decision out of California affirming that an arbitration provision may properly exclude injunctive relief for trade secret and similar emergency proceedings, in my view a correct result. (Anyone who has had to deal with the delays accompanying arbitration should know this and should check out one of my first posts on why companies, especially small companies, should make sure that they carve out injunctions for trade secret and IP disputes from any arbitration provision).
- Similarly, a non-compete arbitration/case out of Oklahoma has made its way to the U.S. Supreme Court, which has decided that any decision as to the enforceability (or validity) of the non-compete should be made by the arbitrator, not the court. Both Kenneth Vanko’s Legal Developments in Non-Competition Agreements Blog and Epstein Becker’s Trade Secrets & Noncompete Law Blog have posts on this decision. Again, I cannot emphasize this enough: if you truly want to screw up your own trade secret and non-compete case, make sure that you have an arbitration provision that does not clearly carve those disputes out. You have been warned.
- “Chinese Professor Asserts Chinese Companies are Victims of Unfair Espionage Laws – And Then Argues China Should Adopt Similar Laws To Avoid Victimization,” writes Todd Sullivan’s Trade Secrets & Employee Defections Blog.
- “Will Tolling Provisions Gain Popularity?” in non-competes asks Jackson Lewis’ Non-Compete & Trade Secrets Report Blog.
- In a decision that will have ripple effects in many trade secret and IP disputes, the federal magistrate in the Apple v. Samsung case has ordered that Apple’s license with HTC be produced to Samsung in connection with the discovery for the upcoming permanent injunction hearing.
- For the latest on IP ownership agreements between employers and employees, check out “Ex-IBM Worker Can’t Get High Court Review In Patent Row” in Law360.
- Healthcare non-competes appear to be rise, sparking an article “Negotiation Tips For Non-Compete Clauses In Physician Employment Contracts” by the Pennsylvania Medical Society.
- “How Public Interest May Limit Enforcement of a Non-Compete Agreement” advises John Paul Nefflen for Burr & Forman’s Non-Compete Trade Secrets Blog.
- For “Common Defenses to Enforcement of a Non-Compete Agreement in Florida,” see Fox Rothschild’s South Florida Trial Practice Blog.
- Russell Beck’s Fair Competition Law Blog has issued its always superb and comprehensive monthly “Issues and Cases” Update which has a wealth of information. If there is one link to check out this week, it is this one.
- For more on the recent Trade Secret Clarification Act by the U.S. Senate, see Ryan Davis’ article, “Senate Bill Could Bring More Criminal Trade Secrets Cases” for Law360. My post on the recent bill can be found here.
Computer Fraud & Abuse Act Posts and Articles:
- Are you in the Fourth Circuit or Ninth Circuit and looking for a federal statute to protect your trade secrets? Then see “An Employee Downloaded Our Trade Secrets. Can I Make A Federal Case Of It, Part II” in Poyner Spruill’s Under Lock & Key Blog. The post analyzes the viability of the EEA and NSPA for potential claims.
Cybersecurity Articles and Posts:
- “When It Comes to Security, We’re Back to Feudalism” laments Bruce Schneier for Wired.
- “Patent trolls and their effect on security” writes Eugene Kaspersky for SC Magazine.
- For a good summary of President Obama’s recent cybersecurity directive, see The Washington Post’s article, “Obama signs secret directive to help thwart cyberattacks.”
- “When Banks are Left on the Hook for Cybertheft” reports Joe Palazzolo for The Wall Street Journal’s Law Blog.
News You Can Use:
- “The Rising Science Of Social Influence — How Predictable Is Your Online Behaviour” advises Ferenc Huszár for TechCrunch.