Party Claiming Misappropriation Must Identify Trade Secrets
Topics: Court Decisions
California employers who have litigated claims for misappropriation of trade secrets are likely familiar with the requirement that the party claiming its trade secrets were misappropriated must identify, with “reasonable particularity,” the trade secrets that were misappropriated. Until this identification is made, that party cannot take discovery from the other side regarding the trade secret claims. A California court reiterated this principle this week in Perlan Therapeutics, Inc. v. Superior Court (NexBio). The Perlan case involves alleged trade secrets related to development of treatments for viral infections. The court, holding that Perlan did not sufficiently identify its trade secrets, applied the principle that “in a highly specialized technical field, a more exacting level of particularity may be required to distinguish the alleged trade secrets from matters already known to persons skilled in that field.” The court found that Perlan’s vague description of its alleged trade secrets failed to meet this standard.
Interestingly, the court also frowned on Perlan’s attempt to include broad, catch-all language in its identification statement, to preserve the ability to add additional trade secrets to the list of those misappropriated later in the case. “Perlan is not entitled to include broad, catch-all language as a tactic to preserve an unrestricted, unilateral right to subsequently amend its trade secret statement. If Perlan does not know what its own trade secrets are, it has no basis for suggesting defendants misappropriated them. Nor is Perlan entitled to hide its trade secrets in plain sight by including surplusage and voluminous attachments in its trade secret statement.”
The case contains a good discussion of what identification with “reasonable particularity” means under Code of Civil Procedure section 2019.210, and canvasses some of the recent California cases addressing this issue. The decision is here.