Recent Blog Posts
- Tenth Circuit Holds That Irreparable Harm Cannot Be Presumed for Trade Secret Injunction In First Western Capital Management Co. v. Malamed, Case Nos. 16-1434, 16-1465 & 16-1502 (10th Cir. Oct. 30, 2017), the Tenth Circuit Court of Appeals held that a district court erred in issuing a preliminary injunction to a party under federal and state trade secret law where the court presumed that the party would be irreparably harmed absent the injunction.
Ordinarily, in order to obtain a preliminary injunction, a moving party needs to establish, among other things, that it will suffer... More
- New York District Court Denies Preliminary Injunction Motion Sought Under the Defend Trade Secrets Act Plaintiff Art & Cook, Inc., a cookware and kitchenware company, brought suit in New York federal court against a former salesperson, Abraham Haber, when a search of his work computer revealed that he had emailed to his personal email account two categories of documents alleged by Art & Cook to be trade secrets: (i) its customer contact lists and (ii) its designs and branding/marketing strategies. Although the court already had issued a temporary restraining order, in Art & Cook, Inc.... More
- Eighth Circuit Finds Independent Contractor’s Non-Compete Unreasonable It is fairly uncommon for a circuit court to opine on the reasonableness of a restrictive covenant. In Ag Spectrum Co. v. Elder, No. 16-3113, 2017 U.S. App. LEXIS 14128 (8th Cir. Aug. 2, 2017), the Eighth Circuit issued a decision holding that an independent contractor’s non-compete was unreasonable and unenforceable.
Applying Iowa law, the Eighth Circuit explained that reasonableness depends on the circumstances, including consideration of several factors such as: (1) the employee’s closeness to customers; (2) the employee’s peculiar... More
- New Changes to Nevada’s Noncompete Law Nevada employers be advised: on June 3, 2017, Governor Brian Sandoval signed into law Assembly Bill 276, which amends Chapter 613 of the Nevada Revised Statutes and sets forth a new framework in which noncompetes are evaluated. The amended law includes the following four changes:
A noncompete is void and unenforceable unless the noncompete:
Is supported by valuable consideration;
Does not impose any restraint that is greater than is required for the protection of the employer for whose benefit the restraint is imposed;
- Defendants’ Timing Defense to DTSA Claims Faces Mixed Results With the law’s first anniversary in the rear view mirror, defendants have established a viable defense to claims arising under the Defend Trade Secrets Act (“DTSA”) – a plaintiff may be precluded from bringing a claim under DTSA if it only alleges facts that show acts of misappropriation occurring prior to May 11, 2016 (the date of DTSA’s enactment). In the last few months, four different courts have tackled this “timing defense,” and defendants raising it in motions to dismiss... More
- Which States Are Likely to Enact Laws Restricting Non-Compete Agreements in 2017? In 2016, several states enacted laws that were designed, in varying degrees, to limit non-competes, including Illinois, Utah, Connecticut and Rhode Island. Which states are most likely to do the same in 2017?
Idaho: A bill proposed in January, House Bill 61, would amend an existing Idaho law that has made it easier for employers to enforce non-competes against the highest paid 5% of their employees and independent contractors. The bill would alleviate the burden placed on such “key” personnel by... More
- Recent Federal Decisions Confirm That DTSA Claims Must Follow Longstanding Pleading Standards
As the law’s first anniversary approaches, federal courts continue to adjudicate claims arising under the Defend Trade Secrets Act (“DTSA”). Enacted on May 11, 2016, DTSA provides the first private federal cause of action for trade secret misappropriation, allowing parties to sue in federal court for trade secret misappropriation. Although the law is in its infancy, employers and legal practitioners filing complaints that assert DTSA claims must nevertheless adhere to longstanding rules of pleading set forth by the Supreme Court... More
- A Temporal Limitation on the Reach of DTSA Claims As we have written about and discussed extensively on this blog over the past year, the Defend Trade Secrets Act (“DTSA”) – enacted on May 11, 2016 – provides the first private federal cause of action for trade secret misappropriation, allowing parties to sue in federal court for trade secret misappropriation regardless of the dollar value of the trade secrets at issue. Given that the law is less than a year old, federal courts seeing DTSA cases for the first... More
- Trade Secret Preemption: A Possible Defense To A Trade Secrets Claim? Two recent decisions by the Fifth Circuit Court of Appeals clarify the intersection between federal copyright law and state trade secret law. In GlobeRanger Corp. v. Software AG United States of America, Inc., 836 F.3d 477 (5th Cir. Sep. 7, 2016), the Fifth Circuit rejected an appeal in which the defendant argued that a plaintiff’s trade secret misappropriation claim was preempted by federal copyright law. Just four months later, in Ultraflo Corp. v. Pelican Tank Parts, Inc., No. 15-20084, 2017... More