Trade Secret

In Trial: Lawyers Battle Over Client… Information

SAN FRANCISCO, CA – According to defendant’s trial brief, a Los Angeles firm, SwedelsonGottlieb, sent an associate, William Noland, to open an office in San Francisco, which he did successfully. When the associate did not make partner, he went off on his own and got sued by his former employer out of “anger and spite.” According to the Complaint, Mr. Noland solicited SwedelsonGottlieb’s clients to go with him before and after his departure and took/used proprietary client data in the process.

Litigation is about storytelling as much as anything else. The stories told in almost every trade secret case of this type are the same. The defendant says the employer is just trying to bury their startup with attorney’s fees and costs. The plaintiff claims legitimate trade secret information existed and was misused.

In many instances, both stories are true. Often plaintiffs are disgruntled and looking for revenge. Equally as often, departing employees do not get good advice, or do not listen to it, and use more information than they should. Emotion, and specifically anxiety, drives the parties to costly outcomes.

Per defendant’s brief, Mr. Noland had incurred $500,000 in legal fees and costs, and trial obviously had not yet begun.

This blog reports on cases filed in and around the San Francisco Bay Area. The statements made are based on the allegations in court-filed documents. Allegations are just accusations, and may or may not be true.
The authors of the blog are attorneys at the San Francisco litigation firm, Wood Robbins, LLP. If you have a legal issue, send them an email. If they cannot help you, they will try and point you in the right direction.
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When to Leave Your Employer, Before Competing with Them

SAN FRANCISCO, CA – An interesting complaint was filed on the 30th by Bette Solis against Worldpay US, Inc. Ms. Solis alleges that she was an account executive at the payment processing company and, per contract, was entitled to commissions on accounts she procured. The complaint says defendant stopped paying, claiming Ms. Solis started a new competing business while still working for them.

The case raises a few questions that come up often. First, is it ok to work for two places at once? In general, employees owe fiduciary duties to their employers and cannot secretly compete with them. There are a line of cases that say it is ok to prepare to start a new job/company while still on payroll, but not to the point of compeintg. There is also some authority saying moonlighting is ok, but again probably not if the gig directly competes.

There is another legal rule in play here and that is with respect to contractual obligations post-breach. In general, if one party breaches a contract, the other party is excused from further performance. Whether forming a new competing company constitutes a breach will depend on the facts. There are also issues in the Solis case related to terms and conditions allegedly never provided, and potentially unenforceable non-compete clauses therein.

This blog reports on cases filed in and around the San Francisco Bay Area. The statements made are based on the allegations in court-filed documents. Allegations are just accusations, and may or may not be true.
The authors of the blog are attorneys at the San Francisco litigation firm, Wood Robbins, LLP. If you have a legal issue, send them an email. If they cannot help you, they will try and point you in the right direction.