Book Review: The Law of Trade Secret Litigation Under the Uniform Trade Secrets Act

It arrived in the dead of night, cloaked in appropriate secrecy and ensconced in a black and gold gloss binding. Or at least, that's how I imagined The Law of Trade Secret Litigation Under the Uniform Trade Secrets Act (UTSA), by J. Patrick Huston, made its international way to my desk. The book “organizes, analyzes and synthesizes all of the 48 UTSA-adopting states’ published court opinions (state and federal).” It seeks to create a coherent and uniform construction of the UTSA, and serve as a guide for practitioners and a reference in teaching. It focuses on three aspects of trade secrets litigation: 1) whether the information constitutes a trade secret, 2) whether the defendant’s conduct constitutes misconduct and 3) the appropriate remedies. These are then broken down to focus on more granular topics such as reasonable efforts, injunctions, attorney fees and many more.

With a tome as large as this, reading the section on how the book is organised is a good start. [Difficult for Merpel, as she likes to start without reading the instructions first.] The opinions and analyses are organised by 1) the issues addressed in opinions, 2) the type of information covered by the trade secret and 3) the type of industry. Sections 1-4 cover the four elements of proof, Section 5 addresses misappropriation, and Section 6 tackles remedies. Detailed synopses, citations and narration facilitate the use of the book as an important reference. Additional text, such as the history of the UTSA and state-level trade secret statutes, provide a comprehensive view of trade secrets. The main book covers court opinions from 1980 through 2010, and the supplement extends that coverage to 2011 to 2014 (with additional supplements to be made available.) Clearly a significant amount of time and effort has been devoted to its development.

I was naturally drawn to the section on the economic value derived from trade secrecy – the third element of proof in trade secrets - where I learned some interesting points. For example, evidence of independent economic value often relies on expert testimony and can include time, effort and expense in developing or duplicating information; the defendant's conduct (e.g. if it was worth copying, it was worth something); negative information (my favourite, it helps competitors understand what doesn't work) and a host of others points as considerations. Following this categorisation, Huston then details synopses of relevant cases by type of information and industry.

In Part 4 on remedies, a section of actual damages discusses the actual loss caused by misappropriation, and unjust enrichment. I was curious as to the justification for including unjust enrichment as actual damages, which the text answers and explains the fairly broad interpretation of 'actual' includes things such as future damages. Huston also explains the limits; for example, costs incurred in investigating potential misappropriation (in one case, actions by a former employee) are not considered actual damages. The authors points to nuances and cases in determining what constitutes actual damages.

Mmm, ice cream
Lotta v. ice-cream by
Niklas Pivic (Flickr)

This is the first time I have reviewed both the electronic and physical copies of a book. As this Kat does not have feline night vision, she tends to prefer hard copies. But, as this Kat also lacks feline spinal mobility, the lightweight electronic copy has its benefits. Readers will likely have their own preferences.

The electronic copy of The Law of Trade Secret Litigation has a distinct advantage over the hard copy – the extensive and quick ability to search.   I started off, as every cool kat does, by searching self-indulgent terms. Whereas “chocolate” turned up blank,  “ice cream” got me to the Dippin’Dots case (In Re Dippin'Dots Patent Litigation).  Nothing says “flash frozen novelty ice cream” like a lack of making reasonable secrecy efforts. (In that case, the company let the cat out of the bag by disclosing the process to potential dealers and in contracts, and then later attempting to impose a confidentiality clause.)  The search also led me to a case on Ice Cream Sandwich Wafers (Interbake Foods vs. Tomaseillo), where the court found reasonable efforts, but with only a wafer thin margin. (I scream, you scream, we all scream for reasonable efforts!) While “ice cream” was a fun sojourn into the book, it demonstrates the power of searching – it was very fast to find two cases based on frozen treats. In addition, all entries have cross-references to related topics (but, alas, not toppings.)

I cannot imagine a more complete book on the UTSA. In 4,000 pages, Hutson pokes and prods 630 UTSA cases and constructs a comprehensive, detailed analysis. I enjoyed the narrative style of the writing as quotes from judgements and key texts are pieced together smoothly with commentary from the author.  I imagine that this treatise will be useful for legal practitioners and trade secrets scholars. I, for one, will be delving into the case synopses related to damages to inform my research.

The Law of Trade Secret Litigation Under the Uniform Trade Secrets Act, by J. Patrick Huston (2016), Juris Publishing, ISBN: 978-1-57823-250-5 is available here for USD $595 in hard copy or PDF. Rupture factor: high, 4,000 pages (but spread over three bindings.)