FORT LAUDERDALE BUSINESS LITIGATION: FLORIDA’S PLEADING REQUIREMENTS FOR TRADE SECRET CLAIMS

A common issue in business litigation involving trade secret misappropriation claims under Florida’s Uniform Trade Secrets Act (FUTSA) is whether the plaintiff sufficiently identified its alleged trade secrets in its pleadings. Under Florida law, a “plaintiff must, as a threshold matter, establish that the trade secret exists. To do so, it must disclose the information at issue.” Revello Med. Mgmt., Inc. v. Med-Data Infotech USA, Inc., 50 So. 3d 678 (Fla. 2d DCA 2010). “The term trade secret is one of the most elusive and difficult concepts in the law to define.” Furmanite America, Inc. v. T.D. Williamson, Inc., 506 F. Supp. 2d 1134 (M.D. Fla. 2007). However, a “party proceeding under FUTSA need only describe the misappropriated trade secrets with ‘reasonable particularity.’” Treco Intern. S.A. v. Kromka, 706 F. Supp. 2d 1283 (S.D. Fla. 2010). Peter Mavrick is a Fort Lauderdale business litigation attorney, and represents clients in business litigation in Miami, Boca Raton, and Palm Beach. The Mavrick Law Firm represents businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

A plaintiff must identify its trade secrets to prove trade secret misappropriation in business litigation. Without identifying the specific the trade secret at issue, it is impossible to determine whether the party pled each of the elements of a trade secret, which are: (1) “information”; (2) that “derives independent economic value” “from not being generally known”; (3) that is “not readily ascertainable by proper means”; and (4) “is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” Section 688.02 (4)(a)-(b), Florida Statutes. While it is oftentimes difficult to describe a trade secret without divulging its confidential characteristics, Florida courts require “[a] party proceeding under Florida’s Uniform Trade Secrets Act [to] only describe the misappropriated trade secrets with reasonable particularity.” Textile USA, Inc. v. Diageo N. Am., Inc., 2017 WL 10187642 (S.D. Fla. July 31, 2017). The Court’s determination of whether a particular type of information constitutes a trade secret is a question of fact.” Poet Theatricals Marine, LLC v. Celebrity Cruises, Inc., 307 So. 3d 927 (Fla. 3d DCA 2020).

In Poet Theatricals Marine, LLC v. Celebrity Cruises, Inc., Florida’s Third District Court of Appeal held that the plaintiff sufficiently identified its trade secrets by describing them as “(1) ‘proprietary digital and tracking and management systems over the operation and functioning of equipment used in the shows,’ and (2) a ‘unique training system that enabled a cruise line to hire non[ ]acrobatic performers (dancers) who would be trained to perform as skilled aerialists/acrobats in a fraction of the time typically required for acquiring such skills, all while maintaining a high level of safety of the performers, staff, and passengers.’” 2020 WL 5931884 (Fla. 3d DCA Oct. 7, 2020).

Moreover, in Disability Law Claims, P.A. v. IM Solutions, LLC, the United States District Court for the Southern District of Florida held that a business sufficiently pled the existence of its trade secrets by describing “a confidential and proprietary system that creates leads in the SSD industry and ‘provides a competitive advantage’ which ‘generate[s] a premium marketplace price.’” 2014 WL 12589140 (S.D. Fla. Sept. 5, 2014). In DynCorp Int ‘l v. AAR Airlift Group, Inc., the Eleventh Circuit Court of Appeals recognized a business’ alleged trade secrets as “financial and technical data, but specifically identified financial and technical data related to [the business’] pre-existing . . . contract, including personnel lists, salary and pay differentials, and pricing data related to staffing and business operations.” 664 Fed. Appx. 844 (11th Cir. 2016).

Further, in American Registry, LLC v. Hanaw, the United States District Court for the Middle District of Florida held that the business sufficiently identified its trade secrets by pleading “ten specific categories of trade secrets. 2014 WL 12606501 (M.D. Fla. July 16, 2014). Specifically, the Hanaw plaintiff plead the following trade secrets with particularity: “business plan; customer lists; system architecture; financial data; profits and profit margins; statistical history with its customers and vendors; computer programs and software concerning its entire business operations; research and development information related to its customers and products offered for sale; information about its strategic partners and relationships with them; and data and information on its employees, independent contractors, and third party vendors.”

Peter Mavrick is a Fort Lauderdale business litigation lawyer, and represents clients in Miami, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.