9th Circuit Upholds Continuing Use Doctrine Under the DTSA

Topics: Non-Compete and Trade Secrets

Recently, the Ninth Circuit affirmed a matter of first impression holding that an alleged misappropriation of a trade secret that occurred before the Defend Trade Secrets Act (“DTSA”) was enacted in 2016 may form the basis for a DTSA claim based on a continued use of the purloined trade secret by the defendant.  Eli Attia Architect PC v. Google LLC, et al., Case No. 19-15771 (9th Cir. Dec. 16, 2020).  The Ninth Circuit analyzed the Uniform Trade Secrets Act’s express “anti-continued use” language, the lack of such language in the DTSA and Congressional intent.  Unfortunately for the plaintiff, the Ninth Circuit also concluded that publication of the alleged trade secrets in a patent application defeated any claim that the information remained trade secret.

Given the passage of time since enactment of the DTSA and the three year-statute of limitations, the Continuing Use Doctrine has a short shelf life.  However, where patent applications publish aspects of a person’s trade secrets, a claimant will have to identify trade secret information that was stolen beyond that which was published to survive dismissal. 

Therefore employers evaluating whether to bring a DTSA claim should ensure that the alleged misappropriation is more than what was published in a patent application.