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On August 4, 2020, U.S. District Judge for the Northern District of California William Alsup sentenced former Uber executive Anthony Levandowski to 18 months in prison after Levandowksi pleaded guilty to stealing trade secrets relating to Google’s self-driving vehicle project. The judge also ordered Levandowski to pay over $700,000 in restitution.

Levandowski was a Google

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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.
Continue Reading Texas Court Orders New Trial After $740M Judgment

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Computer forensic information often becomes an issue in trade secret cases, as computer artifacts or other electronic information (such as on external hard drives, cell phones, etc.) can sometimes prove or disprove whether a person accessed, used, transferred, or destroyed trade secret material. If the parties or the judge determines that the computer forensic information is relevant, the next key question is how much needs to be exchanged and what limitations will be in place. The producing party often will argue that computers include numerous irrelevant files and artifacts, privileged communications, and private information that should not be subject to discovery. One middle ground is to use a neutral examiner, in which the electronic data is never handed directly to the opposing party. Instead, a neutral computer expert will field requests and/or create reports of the pertinent data.
Continue Reading Chinese Self-Driving Car Company Must Make Its Source Code Available in Lawsuit Against Tesla but Only Through a Neutral Examiner

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UAB dba Planner 5D sued Facebook and Princeton for copyright infringement and trade secret misappropriation under both the Defend Trade Secrets Act and California UTSA, based on use of an AI dataset. The plaintiff alleges that it owns a large dataset of three-dimensional objects and scenes. Princeton allegedly downloaded thousands of scenes by scraping the

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The Southern District of New York denied defendant Lionbridge Technologies, Inc.’s (Lionbridge) motion to dismiss, holding that TransPerfect Global, Inc. (TransPerfect), sufficiently pleaded that information disclosed to potential bidders in an online auction constituted trade secrets and that Lionbridge misappropriated these trade secrets. In 2014, the Delaware Chancery Court ordered the dissolution through modified auction of TransPerfect, a translation, website localization, and litigation support company. The auction had three phases. At each phase the bidding pool narrowed, and the bidders received increasingly detailed and sensitive information about TransPerfect. HIG, an investment firm that had just submitted a bid to purchase Lionbridge (TransPerfect’s largest competitor), participated in the auction. According to TransPerfect’s complaint, HIG participated in all three phases, even though it never intended to purchase TransPerfect because TransPerfect would not agree to require its former owner to enter into a noncompetition agreement. During the final stages of the auction, HIG gained access to thousands of competitively sensitive documents, including detailed pricing and cost information. TransPerfect alleged that after the sale, HIG shared this confidential information with Lionbridge, which then used the information to undercut TransPerfect’s pricing.
Continue Reading Use of Information Outside Scope of Confidentiality Agreement as Misappropriation

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In March 2018, HouseCanary won a $706M trade secrets verdict against Title Source Inc., a Quicken loans affiliate.  After a seven-week jury trial, HouseCanary moved the court to seal fourteen trial exhibits because they purportedly revealed HouseCanary’s trade secrets, although the parties discussed and displayed these fourteen exhibits in open court at trial (they asked witnesses questions about the exhibits, displayed portions of the exhibits in the courtroom, and read portions of the exhibits to the jury). The trial court ultimately ruled to seal the exhibits.  Last week, the Fourth Court of Appeals in Texas ruled on appeal that the trial court erred by granting HouseCanary’s motion to seal the exhibits after trial, concluding that the Texas Uniform Trade Secrets Act does not require courts to set aside valid protective orders and that HouseCanary didn’t follow the proper procedure, laid out in Texas Rule of Civil Procedure 76a (and agreed to by the parties in their stipulated protective order), for sealing the documents.  
Continue Reading Title Source Inc. v. HouseCanary, Inc.