On November 4, a jury in Sonoma County, California returned a unanimous defense verdict for three former employees on trade secret allegations made by their former employer, a reseller of a hardware and software products. The firm represented the defendants in the case of G.C. Micro Corporation v. Robert Brown, et al., Case No. SCV-254684 (Superior Court for the County of Sonoma, California).
Plaintiff G.C. Micro alleged that its former employees used trade secrets comprised of information about customers of G.C. Micro that was in the heads of the three defendants when they left to go to a competitor. G.C. Micro resells computer hardware and software to the federal government and to prime contractors, such as Boeing and Lockheed. The defendants argued that the information they used was merely the names and contact information of the customers of G.C. Micro, which is public information or readily ascertainable to any business competitor.
After a month long trial, the jury decided that G.C. Micro did not prove that it possessed any trade secrets, and the jury's unanimous verdict, after less than two hours of deliberations, was that defendants did not use any trade secrets and that the defendants did not breach their employment agreements with G.C. Micro.
The case involved the tension between, on the one hand, the right of employees to work for competitors of their former employers, and, on the other hand, employers' rights in trade secrets. Noncompetition agreements are unlawful in California under Cal. Business and Professions Code § 16600, so the California trade secret law is a frequently used tool of employers in California to protect their intellectual property. Customer lists, however, are often difficult to protect as trade secrets, as many customer lists do not have the requisite value to be deemed a trade secret.
In the G.C. Micro v. Brown, et al. case, the jury found that the information about G.C. Micro’s customers used by the former employees was not a trade secret, and for that reason returned a unanimous verdict for the defendants.
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Kronenberger Rosenfeld, LLP is a San Francisco-based Internet, technology and media law firm. The firm counsels clients across the United States and internationally on a variety of Internet and intellectual property matters, including trade secret litigation, trademark and copyright infringement, spam litigation defense, Internet defamation and false advertising, cybersquatting, website agreements, and privacy matters.
This entry was posted on Friday, November 07, 2014 and is filed under Trademarks Copyrights and Trade Secrets, Internet Law News.