Partner
Here’s What Happened:
Justin Pethick worked for DeWolff, Boberg & Associates (DBA), a consulting company. Justin left DBA to work for a competitor, Randall Powers Company (Powers), and some potential clients of DBA hired Powers instead.
DBA sued Justin and Powers for trade secret misappropriation. DBA claimed that Justin and Powers used DBA’s trade secrets to poach clients. The court granted Justin and Powers’ motion for summary judgment and DBA appealed.
The Fifth Circuit Court of Appeals affirmed the district court ruling. The Fifth Circuit held that DBA failed to identify the trade secrets. DBA had submitted a large cache of data but did not identify any confidential or non-public information. The Fifth Circuit noted that courts have no obligation to sift through the record to find trade secrets.
Even if DBA had identified its trade secrets, DBA did not provide any evidence that Justin had access to the information after he went to work for Powers. DBA apparently relied on a specific document to prove trade secret misappropriation. Justin had requested a copy of a specific document while he worked for DBA but DBA’s own forensic expert could not find the document on Justin’s computer.
WHY YOU SHOULD KNOW THIS: Many trade secret misappropriation claims arise when key employees leave to work for a competitor. If the employee has access to trade secrets, employers need to properly identify them before the employee leaves. Then, after the employee leaves remind the employee of the trade secrets and notify the new employer.
Cited Authority_:_ DeWolff, Boberg & Associates, Inc. v. Justin Pethick and The Randall Powers Co., Case No. 24-10375 (5th Cir. Apr. 3, 2025)