By Tamlin H. Bason
The court dissolved a temporary restraining order that it had issued three weeks prior after determining that the plaintiff had not demonstrated a likelihood of success on the merits in its misappropriation of trade secrets claim.
The court was not swayed by undisputed evidence that the employee emailed her husband a copy of the plaintiff's customer list just five days before she resigned her sales position with the plaintiff and immediately began her work for a competitor. Those documents have been expunged from the husband's computer, the court said, and there is no evidence that either the husband or the employee retained additional printed copies of the customer list. Accordingly, the court said that the plaintiff could not demonstrate that the employee was using its trade secrets during sales calls for her new employer.
Craigo resigned her position on March 12, 2012. She then immediately bean working for Sientra Inc., a company that on March 9 received approval from the Food and Drug Administration to sell silicon gel breast implants.
In the days leading up to her resignation, Craigo emailed her husband three copies of her Mentor customer list. These three emails, dated March 7 and 8, contained Excel spreadsheets detailing customer contact information, and quota information.
Craigo's husband printed at least one copy of the spreadsheets, but he never downloaded the documents onto his own computer. However, the files were automatically stored in the computer's temporary files folder.
Within days of her new position Craigo was contacting former Mentor customers pursuant to her duties with Sientra.
Mentor filed a complaint March 27 alleging that Craigo misappropriated the company's trade secrets, breached her duty of loyalty, interfered with Mentor's prospective business advantage, and breached a confidentiality agreement.
Mentor moved for a temporary restraining order and sought a preliminary injunction preventing Craigo from disclosing Mentor trade secrets, barring her from working with Sientra, and mandating that she return all Mentor property.
The court granted the temporary restraining order on April 6, and set an oral hearing April 20.
Here, the court said that Mentor's lists were protectable to the extent that they contain information beyond data that is publicly available. Specifically, Judge Robert E. Blackburn said “sales histories, buying patterns, pricing arrangements, customer consignment arrangements, and customer preferences, likely are a trade secrets.”
The question was whether Craigo was using that privileged information in her new capacity as a salesperson for Sientra. The court determined that there was no evidence that she was.
Mentor alleged, but could not demonstrate, that Craigo had additional copies of the customer list. The court was unconvinced, noting, “There is little, if any, evidence in the record that Ms. Craigo now possesses any physical items owned by Mentor that contain Mentor's trade secret information.”
Craigo undoubtedly knows privileged information about Mentor, the court said, but there is no evidence that she is relying on that information. Indeed, the evidence presented during the April 20 hearing demonstrated that Sientra, and not Craigo, determines what customers Craigo should contact. The board said:
“Ms. Craigo says Sientra tells her what potential customers to contact and, as a result, Ms. Craigo says she is not using information from her Mentor customer list. The record contains no evidence that, in making those contacts on behalf of Sientra, Ms. Craigo is using Mentor's trade secret information. There is significant evidence in the record indicating that Sientra repeatedly has instructed Ms. Craigo not to use any information she acquired while working for Mentor.”
Mentor was represented by Daniel Mitchell Combs of Littler Mendelson, Denver. Craigo was represented by John Patrick Barry of Proskauer Rose, Newark, N.J.
Opinion at /uploadedFiles/Content/News/Legal_and_Business/Bloomberg_Law/Legal_Reports/12776April2612(1).pdf
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