An Exit Strategy Doesn’t Include Taking Trade Secrets
Bradley Summers was a technical service representative for Bemis Company, Inc., a packaging manufacturer. Bradley’s job was to perform customer audits and film trials. Bradley had signed a non-disclosure agreement with Bemis.
According to Bemis, the following happened when Bradley decided to leave:
Bradley planned his departure long before he gave notice. During the planning stage, Bradley uploaded confidential information from Bemis’ system to a non-Bemis cloud-based storage provider. Bradley also began removing materials from his work computer and uploading them onto a personal external storage drive. When Bradley resigned, he told Bemis that he and his wife planned to go into real estate. Then Bradley removed even more confidential and proprietary documents that contained trade secrets. Unbeknownst to Bemis, Bradley wasn’t going into real estate. He had accepted a position with Bemis’ competitor, Winpak. Once Bemis figured out that Bradley was working for a competitor, Bemis did a forensic analysis of Bradley’s computers and found out about Bradley’s pre-resignation activities.
Bemis filed suit against Bradley alleging misappropriation of trade secrets and breach of contract. Trade secrets have 3 major elements. First, they have to be not generally known or readily ascertainable. Second, the owner of the trade secrets gets economic value from them because they’re not generally known. Third, they have to be the subject of reasonable measures of protection from disclosure. Bemis successfully alleged these elements. Bemis obtained an ex parte temporary restraining order and rule to show cause why a preliminary injunction shouldn’t be entered barring Bradley from using Bemis’ trade secrets until a final trial. The parties then entered into a stipulation requiring Bradley to return any trade secrets in his possession, an inspection of all of Bradley’s personal devices and an inspection of any devices he’s using in his employment with Winpak.
WHY YOU SHOULD KNOW THIS. Bemis obtained an ex parte order without notice to Bradley. Ex parte orders are especially important when trade secrets are being misappropriated. The longer the misappropriation goes on, the less likely it is that a plaintiff is going to be able to support allegations that it took reasonable measures to protect the trade secrets from disclosure.
On another note, the scenario of a departing employee methodically copying and removing trade secrets is not unusual. In this case, according to Bemis’ complaint, there are a few strikes against Bradley going into this litigation. First, he signed a non-disclosure agreement. Second, he told Bemis that he was going into real estate when actually he had accepted a position with a competitor. No matter what, the wrong thing to do is to methodically copy and store an employer’s confidential information and trade secrets to use in a new job.