Trade Secrets & Noncompete Blog

Trade Secrets & Noncompete Blog

News & Updates On Developments in the Law of Restrictive Covenants, Unfair Competition & Trade Secrets

Category Archives: Inevitable Disclosure

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Inevitable Disclosure: A Theory, Not A Claim

In a recent decision from the Southern District of New York, Judge William H. Pauley III rejected the use of the “inevitable disclosure” doctrine as a basis for an independent claim and outright granted a Rule 12(6)(6) motion to dismiss the complaint brought by a California employer against its former New York based employee.

Janus et Cie v. Andrew Kahnke, 12 Civ. 7201 (WHP) (U.S. District Court, S.D.N.Y., August 29, 2013) is a case brought by Janus, a provider of high-end residential and commercial furnishings, against Andrew Kahnke, a sales manager in one of its showrooms who was subject … Continue Reading

Federal Court In Chicago Refuses To Issue Injunction Based Upon Either An “Inevitable Disclosure” Claim Or A 24-Month Non-Compete With An “Extremely Broad” Geographic Scope

Co-authored by Viktoria Lovei.

A federal judge in Chicago recently refused to issue an injunction based upon either the “inevitable disclosure” of trade secrets doctrine or a geographically broad, 24-month non-compete that did not have a narrowly drawn activity restriction. Triumph Packaging Group v. Ward, et al., No. 11-cv-7927 (N.D. Ill. Dec. 2, 2011).

The case was brought by Triumph, a manufacturer of packaging for consumer goods suppliers. It sought, among other things, to enjoin Ward, its former Chief Operating Officer, from assuming a position with AGI, a manufacturer of packaging primarily for the media and entertainment industries.

Triumph … Continue Reading

Eleventh Circuit Weighs in on Florida Non-Compete Law

Florida law, specifically section 542.335, Florida statutes, generally authorizes courts to enforce non-compete and other post-employment restrictive covenants, provided the agreements are in writing and signed by the employees against whom enforcement is sought, are reasonable in time, area, and line of business, and are supported by one or more legitimate business interests supporting the restrictive covenants.

Section 542.335 is fairly detailed. The statute defines what a reasonable time period is (it depends on the nature of the restrictive covenant), it lists several legitimate business interests, and it even addresses potential defenses. For example, it states that the court … Continue Reading

Adult Nightclub Seeks Injunctive Relief Against Former Director for Poaching High Revenue Clients and Exotic Dancers

Employers across all sectors of industry rely on narrowly tailored employment agreements to prevent employees from unfairly competing and stealing clients and customers post-employment. Last week, the adult nightclub chain, Penthouse Club, filed a suit seeking a temporary restraining order and other injunctive relief against a former director for violating a noncompete and nondisclosure agreement.

Penthouse claims that after the former director was fired for cause, he became employed at a rival nightclub not far from the Penthouse Club. Such mere employment allegedly directly violated the terms of his noncompete agreement. Penthouse also alleges that he is now using his contacts and … Continue Reading

New York Court Holds That Familiarity with Software Program, Without Evidence of Knowledge of Program’s Source Codes or Imminent Commercial Piracy, Does Not Support Injunction Seeking Enforcement of Restrictive Covenants and Protection of Trade Secrets

In a decision, dated January 26, 2009, in the matter Epiq Systems, Inc. v. Hartie, Index No. 111950/08, the Supreme Court of the State of New York, New York County, by Judicial Hearing Officer (and retired Justice) Ira Gammerman, denied a preliminary injunction in aid of arbitration sought by plaintiffs Epiq Systems, Inc. and related companies (collectively, “Epiq”). Epiq claimed that it faced inevitable disclosure of its trade secrets by three individual defendants formerly employed at Epiq and their new employer Kurtzman Carson Consultants LLC (“KCC”) with respect to three computer programs, including one web-based system, developed and used … Continue Reading

A New Byte of the “Inevitable Disclosure” Apple

A recent decision of the United States District Court, Southern District of New York, entitled International Business Machines Corporation v. Papermaster, No. 08-CV-9078 (KMK), 2008 WL 4974508, 2008 U.S. Dist. LEXIS 95516 (S.D.N.Y. Nov. 21, 2008), appears to have breathed new life into the “inevitable disclosure” doctrine, apparently easing the burden of proof that an employer must satisfy in order to show the irreparable harm necessary for a court to grant an injunction preventing the former employee from working for a competitor.

Under the inevitable disclosure doctrine, certain employees cannot “wipe clean” their knowledge of their former employers’ trade secrets. … Continue Reading