FLORIDA TRADE SECRET LAW: PROTECTING TRADE SECRETS DURING LITIGATION

A temporary injunction is often an effective protection for to prevent an adversary from using stolen trade secrets, such as a customer list. Peter Mavrick is a Fort Lauderdale trade secret lawyer who represents businesses in trade secret litigation.

In the case of I.C. Systems, Inc. v. Oliff, 824 So. 2d 286 (Fla. 4^th DCA 2002), an employer sued its former employee for damages and injunctive relief and alleged that the former employee misappropriated its client lists and other trade secrets to be used by the employee’s new employer (i.e. a competitor). The employer had no way to control or mitigate the potential damage that would inevitably occur during the lawsuit because the former employee possessed their confidential information. So, contemporaneous to filing its lawsuit, the employer filed a motion for a temporary injunction to immediately prevent further harm by its former employee while the lawsuit proceeded. A temporary injunction is strategically valuable because it penalizes noncompliance by holding them in contempt and the imposition of sanctions against the former employee if he or she fails to comply with the Court’s Order.

The trial court denied the motion for temporary injunction under the mistaken reasoning that the employer did not need the injunction because it could be fully compensated through its claim for monetary damages. However, in Florida’s Trade Secret Act, the legislature expressly authorized parties to seek both injunctive relief and damages. So, a business should not be limited to recovery of its monetary relief, particularly when its trade secrets could be negatively impacted before a judgment is ever entered by the Court.

In denying the motion, the trial court relied on the cases of Weinstein v. Aisenberg, 758 So. 2d 705 (Fla. 4^th DCA 2000) and Digaeteno v. Perotti, 374 So. 2d 1015 (Fla. 3d DCA 1979) which addressed circumstances where the amount of damages sought by the business was certain, but the monetary value of an asset could dissipate before a monetary judgment could be collected.

The employer immediately appealed and the appellate court reversed the trial court’s order denying the temporary injunction. The appellate court correctly held that the employer was not seeking to guarantee the existence of a fund or an asset to satisfy a monetary judgment. Instead, the employer simply wanted to stop the bleeding that was occurring with the employer’s client list and trade secrets in the hands of its former employee. The former employee was working for a competitor. Nothing short of an injunction could diminish the damages that could occur before the Court reached a final determination of the case. Without the injunction, the employer could have possibly lost its trade secrets and a substantial amount of its clientele to its competitor, to which no monetary relief could restore.

Peter Mavrick is a Fort Lauderdale trade secret attorney. This article is not a substitute for legal advice tailored to a particular situation. Peter T. Mavrick can be reached at: Website: www.mavricklaw.com; Telephone:954-564-2246; Address: 1620 West Oakland Park Boulevard, Suite 300, Fort Lauderdale, Florida 33311.