Client Spotlight: Stoel Rives Prevails for NAPSteel in Case Over Alleged Trade Secret Misappropriation

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Stoel Rives congratulates its client R&R Trading d/b/a NAPSteel on its recent victory in the U.S. District Court for the Western District of Washington in a case in which Stoel Rives defended a NAPSteel employee against claims of trade secret misappropriation made by his previous employer. The Stoel Rives litigation team was led by Karin Jones and included Chris Wall, Jim Shore, Sandra Watanabe, and Sarah Arnett.

The defendant left his position as a sales representative with an industrial products distributor in August 2016 and accepted a sales job with competitor NAPSteel. His previous employer alleged that he had misappropriated its customer list and a company cellphone programmed with customer contact information. Significantly, the defendant had never entered into a non-competition, non-solicitation, or non-disclosure agreement with his former employer. Despite that fact, the plaintiff’s lawsuit centered on its claims that the customer contact information constituted a trade secret and that the defendant thus acted improperly in contacting customers he knew from his previous job.

The Court first noted that the plaintiff “failed to explain how the names and locations of its customers are ‘not generally known in the industry’ or how they have ‘substantial economic value,’ particularly given that the [] Customer List had not been updated for nearly five years prior to the alleged misappropriation.” Ultimately, the Court found that the plaintiff failed to identify any “non-speculative damages” from the defendant’s alleged misappropriation, while conceding that its revenues had, in fact, increased since the defendant resigned. Because the plaintiff had not proved that it was damaged by the alleged misappropriation, the judge awarded summary judgment to the defendant, dismissing the plaintiff’s claims in their entirety.

The final decision can be found here.

Key Contributors

Karin D. Jones
James M. Shore
Christopher T. Wall
Sandra L. Watanabe, RP
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