FORT LAUDERDALE BUSINESS LITIGATION: TRADE SECRET CLAIMS BASED ON PUBLIC INFORMATION

Under Florida law, trade secrets may be enforced via a statutory cause of action for trade secret misappropriation. Florida Statute Section 688.002(4) defines the term “trade secret” as: “[I]nformation, including a formula, pattern, compilation, program, device, method, technique, or process that: (a) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (b) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” 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 law, and other legal disputes in federal and state courts and in arbitration.

As the United States District Court for the Middle District of Florida explained in Furmanite Am., Inc. v. T.D. Williamson, Inc., 506 F.Supp.2d 1134 (M.D. Fla. 2007), “[t]he question of whether an item…constitutes a ‘trade secret’ is of the type normally resolved by a fact finder after full presentation of evidence from each side.” This is because a trade secret can take readily available and public information and uniquely assemble or order that information in a manner that creates a competitive advantage. “[A] trade secret can exist in a combination of characteristics and components, each of which, by itself, is in the public domain, but the unified process, design and operation of which in unique combination, affords a competitive advantage and is a protectible trade secret.” In re TXCO Res., Inc., 475 B.R. 781 (Bankr. W.D. Tex. 2012). In Capital Asset Rsch. Corp. v. Finnegan, 160 F.3d 683 (11th Cir. 1998), the United States Court of Appeals for the Eleventh Circuit explained that “[e]ven if all of the information is publicly available, a unique compilation of that information, which adds value to the information, also may qualify as a trade secret.”

For these reasons, trade secret claims often are not amenable to disposition via summary judgment. Summary judgment evidence, considered in the light most favorable to the nonmoving party (often the plaintiff in trade secret litigation), frequently raises factual issues as to the viability of the trade secret claim. For example, in Digiport, Inc. v. Foram Development BFC, LLC, 314 So.3d 550 ( Fla. 3d DCA 2020), the defendant, Foram, moved for summary judgment on the grounds that the plaintiff, Digiport, had no real trade secret. “Forum…first argued Digiport’s proposal for the building was not a trade secret under FUTSA because it was based on overall, general design features of a colocation center, which were well-known in the data center provider industry prior to 2008. Forum…further contended that the concept at issue lacked the ‘genuine novelty’ element required to prevail on a claim for misappropriation of an idea ….” The trial court agreed and granted the motion for summary judgment. Florida’s Third District Court of Appeal reversed, finding there were unresolved factual questions that required trial. The appellate court explained that “although Eloy and Senneff contended through their submission that the centralized data system was not, in an of itself, novel, Billings’ declaration and the internal emails between Foram Group’s agents created a genuine issue as to whether the proposed project contained ‘elements which by themselves may be readily ascertainable in the public domain, but when viewed together may still qualify for trade secret protection.'” It is the context of the use or unique compilation of the information constituting the alleged trade secret that often will require vetting in a trial.

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.