A Texas appellate court reversed a $740 million trade secret theft and fraud judgment for real estate analytics company HouseCanary against rival Amrock, holding flawed jury instructions require a new trial.
In 2014, Title Source Insurance (TSI), a property valuation and settlement services company, contracted with HouseCanary, a real estate analytics company, to design an app that would allow TSI to perform appraisals more efficiently. The parties specifically agreed not to “decompile, disassemble, reverse translate, reverse engineer, or otherwise attempt to discover or directly access the source code of [the app] or any component or portion thereof.” HouseCanary’s work on the app involved multiple alleged trade secrets, including a complex data dictionary of property valuation attributes and a number of internal calculations and formulas used to evaluate property value. While HouseCanary built TSI’s app, TSI allegedly started developing its own products, utilizing HouseCanary’s protected data and formulas. Eventually the parties’ relationship deteriorated, and TSI accused HouseCanary of failing to deliver on the parties’ contract and sued for breach of contract and fraud. HouseCanary counterclaimed for breach of contract, misappropriation of trade secrets, and fraud. A jury found for HouseCanary and awarded actual and punitive damages.
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