The Fifth Circuit Court of Appeals recently affirmed a jury verdict awarding $26.2 million in compensatory damages and $18.2 million in punitive damages for trade secret misappropriation of software that enabled oil and gas companies to “plan, procure and pay for complex services” online. See Wellogix, Inc. v. Accenture, LLP, Case No. 11-20816 (5th Cir. May 15, 2013). The Fifth Circuit stated: “Had we sat in the jury box, we may have decided otherwise. ‘But juries are not bound by what seems inescapable logic to judges.’ Morissette v. United States, 342 U.S. 246, 276 (1952).”
The case highlights the importance of taking steps to protect the secrecy of confidential and proprietary business information, including securing confidentiality agreements before sharing such information with other parties such as investors, customers and marketing partners. Because the plaintiff — Wellogix, Inc. — established that it had disclosed its proprietary software and technology to the defendant subject to a confidentiality agreement, it was able to meet its burden of showing that it had taken sufficient measures to guard the secrecy of its software and that the defendant had improperly relied on Wellogix’s software to pursue another business opportunity in breach of the parties’ confidential relationship.
Continue Reading Fifth Circuit Affirms $44.4 Million Jury Award for Trade Secret Misappropriation of Software Developed for Oil and Gas Industry