Labor & Employment – Misappropriation of Trade Secrets Claim – Damages – Unfair Trade Practices – Conspiracy

Even if plaintiff has suffered no damages from defendants’ alleged misappropriation of its trade secrets, plaintiff could still be entitled to nominal damages and punitive damages, and a successful misappropriation of trade secrets claim would support an unfair trade practices claim.

The court grants defendants’ motion for summary judgment on plaintiff’s civil conspiracy claim; otherwise, the parties’ cross-motions for summary judgment are denied.

Defendant Price, plaintiff’s former employee, went to work for plaintiff’s competitor, defendant Camfil USA, Inc., and plaintiff accuses defendants of misappropriating plaintiff’s trade secrets.

Where plaintiff provided a spreadsheet to a customer while defendant Price still worked for plaintiff, and where plaintiff did not ask the customer to maintain the secrecy of the spreadsheet, the spreadsheet is not a trade secret.

Although plaintiff’s Total Cost of Ownership Diagnostics (TCOD) program contains data and information acquired from plaintiff’s customers and prospective customers, the TCOD may also contain certain testing information regarding air filters and filter systems that is widely available. Furthermore, plaintiff gave three distributors access to the TCOD without having the distributors sign plaintiff’s standard TCOD Program Usage Application Agreement. There is a genuine issue of material fact as to whether the information compiled in the TCOD is a protectable trade secret.

Plaintiff has shown that the data and information it has complied in Salesforce.com and the SAP are trade secrets; however, plaintiff has not produced evidence that defendants have actually used or disclosed information complied in the TCOD, Salesforce, or SAP programs.

Although plaintiff has not produced evidence of damages, if plaintiff prevails on its claim for misappropriation of trade secrets, it would be entitled to an award of nominal damages, which would be sufficient to support punitive damages and an unfair trade practices claim.

Summary judgment is not appropriate as to plaintiff’s misappropriation of trade secrets and unfair trade practices claims.

Although plaintiff alleges a civil conspiracy, plaintiff has not put forth evidence that Price entered into any agreement with Camfil to misappropriate trade secrets. The most plaintiff has shown is that, after plaintiff notified Camfil of Price’s alleged obligations under his employment agreement, Armando Brunetti, Executive Vice President of Camfil, discussed the issue with Price and Price subsequently sent Brunetti a list of plaintiff’s customers he had contacted, as well as a copy of the spreadsheet mentioned above. This is not, however, evidence that Camfil and Price made an agreement that Price would misappropriate trade secrets from plaintiff or engage in any other unlawful conduct. Defendants’ motion for summary judgment should be granted as to plaintiff’s claim of civil conspiracy.

Motions granted in part; denied in part.

American Air Filter Co. v. Price (Lawyers Weekly No. 020-046-18, 29 pp.) (Gregory McGuire, J.) Christopher Page and Jonathan Crook for plaintiff; Jeffrey Whitley and George Oliver for defendants. 2018 NCBC 68