Key Trade Secret Takeaways From Recent 9th Circuit Beer Recipe Ruling

Dan M. Forman discusses the key trade secret takeaways from the recent 9th circuit beer recipe ruling in the attached article published by Law360.

"For the second time in six years, the U.S. Court of Appeals for the Ninth Circuit weighed in, via an unpublished opinion in Anheuser-Busch Companies v. Clark, on a former employee’s claim that any theft of trade secret recipes and other information was protected speech under California’s anti-SLAPP laws.

On March 20, 2019, the Ninth Circuit upheld the lower court’s decision to deny the anti-SLAPP motion and allow Anheuser-Busch to prosecute its civil claims against a former employee even where the former employee provided the trade secret information to lawyers to support a separate class action lawsuit and where an insider/current employee provided the trade secret information to the former employee. Further, the Ninth Circuit concluded that employers can hold their employees to post-employment confidentiality and certification agreements.

The opinions arising in this case demonstrate the importance of long-term planning and that protecting trade secrets can involve protracted litigation. Moreover, the outcome of the case, thus far, underscores the importance of confidentiality agreements, maintaining trade secrets and confidential materials, and providing the court with ample evidence of the employer’s efforts to maintain its secrets in confidence in the face of an anti-SLAPP motion or on summary judgment.

Two interesting takeaways, described in further detail below, include: (1) the defendant's efforts to have a current employee provide him with trade secret information that caused the employee to breach his confidentiality agreement helped to support the “misappropriation” prong of the California Uniform Trade Secrets Act claim; and (2) an employment agreement that requires employees, after their employment has ended, to certify that the employee has not utilized trade secret information after the employee’s departure is an enforceable agreement."

To continue reading the full article, click HERE.

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