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Trade Secret Litigation

Trade Secret Litigation is a highly complex area of law involving a company’s or person’s valuable and most confidential, technical or financial information, which the company or person considers to be “trade secrets.” The Fort Lauderdale trade secret litigation attorneys at the Mavrick Law Firm have extensive experience in representing businesses trade secrets litigation. Florida is one of forty-eight states that have adopted the Uniform Trade Secrets Act. This uniform law was created by the National Conference of Commissioners on Uniform State Laws to effectively protect trade secrets for businesses operating in multiple states. Florida’s Uniform Trade Secrets Act (“FUTSA”), § 688.001 et seq., Fla. Stat., mirrors the federal Uniform Trade Secrets Act and defines trade secrets as follows:

“Trade secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process that:
  1. Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and
  2. Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

The definition of trade secrets was drafted broadly to encompass a wide-range of information that a business could seek to protect as a trade secret. A few cases in Florida have narrowed FUTSA’s broad definition of trade secrets, creating some inconsistencies concerning whether certain information should qualify as a trade secret. However, a recent case in the Middle District of Florida provides a general rule regarding what information should not be considered a “trade secret.” As stated in WellCare Health Plans, Inc. v. Preitauer, 2012 WL 1987877, at *3 (M.D. Fla. May 23, 2012):

In Florida, a trade secret is defined as information, including a formula, pattern, compilation, program, device, method, technique, or process that (1) derives independent economic value from not being generally known to and not readily ascertainable by others who can obtain economic value from its disclosure or use and (2) is the subject of reasonable efforts to maintain its secrecy. In an action involving alleged trade secrets, the plaintiff bears the burden of demonstrating both that the specific information it seeks to protect is secret and that it has taken reasonable steps to protect this secrecy. Information generally known or readily accessible to third parties cannot qualify for trade secret protection.

Despite the general rule that “information generally known or readily accessible to third parties cannot qualify as a trade secret,” the Fort Lauderdale trade secret litigation attorneys at the Mavrick Law Firm know that there is a long-standing exception under Florida law. In Sun Crete of Florida, Inc. v. Sundeck Products, Inc., 452 So. 2d 973, 975 (Fla. 4th DCA 1984), the Fourth District Court of Appeal interpreted trade secrets as “a plan or process, tool, mechanism or compound [including] a unique combination of otherwise known components, if the combination differs materially from other methods known in the trade.” As such, even if all the information is publicly available, a unique compilation of that information may qualify as a trade secret, so long as the combination adds value to the information.

In addition to defining “trade secrets,” FUTSA also establishes a cause of action for trade secret misappropriation. Under FUTSA, trade secret misappropriation means:

  1. Acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or
  2. Disclosure or use of a trade secret of another without express or implied consent by a person who:
    1. Used improper means to acquire knowledge of the trade secret; or
    2. At the time of disclosure or use, knew or had reason to know that her or his knowledge of the trade secret was:
      1. Derived from or through a person who had utilized improper means to acquire it;
      2. Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or
      3. Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or
    3. Before a material change of her or his position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake.

In cases of actual or threatened misappropriation, FUTSA permits an injured party to obtain injunctive relief to enjoin such misappropriation. See § 688.003, Fla. Stat. If a company’s or person’s trade secrets are misappropriated in violation of FUTSA, the injured party may be entitled to damages. Additionally, in cases of “willful and malicious misappropriation,” the injured party may recover exemplary damages and attorney’s fees. See §§ 688.004, 688.005, Fla. Stat.

Because the vast majority of states have adopted the Uniform Trade Secrets Act, trade secret misappropriation claims for the most part have been litigated in state court. However, in 2016, federal law was expanded to include protection of trade secrets in the Defend Trade Secrets Act (“DTSA”), 18 U.S.C. § 1836 et seq. DTSA created a federal cause of action for trade secret misappropriation which allows businesses to litigate their trade secret misappropriation claims in federal courts throughout the United States. DTSA expands the definition of trade secrets beyond what is found in the Uniform Trade Secrets Act:

The term “trade secret” means all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if—
  1. the owner thereof has taken reasonable measures to keep such information secret; and
  2. the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information

18 U.S.C. § 1839.

For example, one of the first federal cases in Florida to allege a claim under DTSA was M.C. Dean, Inc. v. City of Miami Beach, Florida, 199 F. Supp. 3d 1349 (S.D. Fla. 2016), wherein a city subcontractor brought trade secret misappropriation claims under both DTSA and FUTSA against the City of Miami Beach and a local union. The federal court ultimately dismissed the subcontractor’s claims. The Judge determined that the trade secret claims failed as a matter of law under both DTSA and FUTSA because (1) the subcontractor did not take reasonable steps to protect the information as a trade secret, and (2) there was a contractual disclosure requirement that precluded the subcontractor from bringing claims for misappropriation.

The Fort Lauderdale trade secret litigation attorneys at the Mavrick Law Firm have substantial experience in trade secret litigation and have successfully litigated many significant trade secret cases.

For 25 years, Peter Mavrick has successfully represented clients in trade secret litigation and has substantial trial and arbitration experience, obtaining favorable jury trial, bench trial, and arbitration verdicts. Mr. Mavrick has the highest peer-review rating from Martindale-Hubbell, of AV.  He also has a rating of 10 out of 10 from lawyer rating service AVVO.  Mr. Mavrick graduated with honors from Harvard Law School in 1992.  He was awarded entry to Phi Beta Kappa.