Trade Secrets

Not Every Great Idea Is a Trade Secret

March 7, 2009

You have a brainstorm: there is a market for dumpster rentals, and what better place to make the rentals than The Home Depot? You go to Home Depot and have it sign a non-disclosure agreement before you disclose this idea to it. You disclose the dumpster idea to Home Depot executives, but after much discussion and a great deal of back and forth over several years with many Home Depot employees, Home Depot turns you down. The next thing you know, Home Depot is renting dumpsters, using a business model not too different from the one you proposed. You cry foul. You sue Home Depot in Massachusetts state court for misappropriation of trade secrets. Home Depot removes the case to Massachusetts federal district court where it grinds through a couple of years of discovery. During that process you claim that the damages you’ve suffered are between $19 and $60 million. Home Depot files a motion for summary judgment. U.S. District Court Judge Douglas Woodlock grants summary judgment. Judge Woodlock observes that the idea of renting dumpsters through Home Depot is not a trade secret. (1) the idea of Home Depot renting and (2) the idea of renting dumpsters [was not a trade secret] . . . anyone even vaguely familiar with the home improvement industry could have put these two concepts together easily based upon information in the public domain….

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Uniform Trade Secret Act Legislation – In Massachusetts, the Sixth Time May Be a Charm

November 6, 2008

Steve Chow at Burns & Levinson has sent me the legislation attached below, which the Massachusetts Uniform Law Commission, of which he is a member, filed with the Massachusetts House of Representatives on November 5, 2008. This is the sixth attempt since 1995 to get the 1985 Uniform Trade Secret Act (UTSA) enacted in Massachusetts; although there was no opposition, the furthest that a prior attempt progressed was to third reading in the House. The uniform act has been adopted by 45 states and the District of Columbia. Apart from Massachusetts, the only other states that have not adopted the act are New York, New Jersey, Texas and Wyoming. Steve Chow advises me that, because of some interest from the Joint Committee on Economic Development and Emerging Technologies and the Associated Industries of Massachusetts, there is a better than even chance that the legislation will be adopted in Massachusetts before the end of this legislative session, which ends in July 2010. Here is a link to the proposed legislation

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