Intellectual Property Law

Trade Secret Identification Under California Statute Need Not Always Include Differentiation From Skill in the Art

The One Sentence Summary: In a trade secret action against Sylvester Stallone and others, plaintiff's identification of its trade secret formula for body building supplement pudding was sufficient to comply with section 2019.210 of the California Code of Civil Procedure, and plaintiff did not need to include details distinguishing the trade secret from the knowledge of those skilled in the field.

California Court of Appeal Circuit Holdings:

• The court summarized its holding as follows:

  "Code of Civil Procedure section 2019.210 (hereafter section 2019.210) provides: ?In any action alleging the misappropriation of a trade secret under the Uniform Trade Secrets Act (Title 5 (commencing with Section 3426) of Part 1 of Division 4 of the Civil Code), before commencing discovery relating to the trade secret, the party alleging the misappropriation shall identify the trade secret with reasonable particularity subject to any orders that may be appropriate under Section 3426.5 of the Civil Code.? In the published portion of our opinion, we hold that section 2019.210 does not require in every case that a trade secret claimant explain how the alleged trade secret differs from the general knowledge of skilled persons in the field to which the secret relates. Rather, such an explanation is required only when, given the nature of the alleged secret or the technological field in which it arises, the details provided by the claimant to identify the secret are themselves inadequate to permit the defendant to learn the boundaries of the secret and investigate defenses or to permit the court to understand the designation and fashion discovery. Further, the trade secret designation is to be liberally construed, and reasonable doubts regarding its adequacy are to be resolved in favor of allowing discovery to go forward."



• Plaintiff could not complain about ad hoc dismissal of its complaint by demurrer where plaintiff had invited error by agreeing to that method of obtaining review of the trial court's discovery ruling regarding the adequacy of plaintiff's section 2019.020 ruling.
• The court wrote:

  "We conclude that whether a trade secret designation adequately distinguishes the allegedly protected information from the general knowledge of skilled persons in the field is a function of the particularity of the designation ? that is, a function of whether the stated details themselves are sufficient, given the nature of the alleged secret and the technology in which it arises, to permit the defendant to ascertain whether and in what way the information is distinguished from matters already known, and to permit the court to fashion appropriate discovery. Absent a showing that the details alone, without further explanation, are inadequate to permit the defendant to discern the boundaries of the trade secret so as to prepare available defenses, or to permit the court to understand the identification so as to craft discovery, the trade secret claimant need not particularize how the alleged secret differs from matters already known to skilled persons in the field. Further, consistent with precedent, the trade secret designation is to be liberally construed, and reasonable doubts regarding its adequacy are to be resolved in favor allowing discovery to go forward."

  
  

Full post as published by IP Law Observer on March 30, 2009 (boomark / email).