Trade Secrets Cases To Watch in 2024: A Midyear Report

Director Paul Ainsworth was quoted in Law360 regarding some of the year’s more notable trade secrets cases, including Pegasystems Inc. v. Appian Corp., which involved a dispute between two software companies. Appian was awarded $2 billion in damages for theft of trade secrets by a Virginia state jury. That judgment was later reversed by the Court of Appeals of Virginia, which ordered a new trial, concluding that there were errors by the trial court. Paul commented “We have two errors there. One, the court didn’t require a showing of proximate causation, and two, this burden shifting made it an even worse situation in terms of allowing the jury to, as the appellate court said, have ‘runaway damages.”

Paul also commented on a dispute between Insulet Corp., which manufactures wearable insulin pumps, and a South Korean company that manufactures an insulin pump patch. In this case, the Federal Circuit criticized a district court’s decision to grant a preliminary injunction to Insulet.

“What strikes me as interesting is the level of scrutiny that the Federal Circuit took to the district court’s preliminary injunction,” Ainsworth said. “There seemed to be very little deference whatsoever to the district court decision and the district court’s findings of fact that supported the preliminary injunction.”

“Are we going to see an era of greater Federal Circuit interest in trade secret issues?” Ainsworth said. “This one seemed to be trying to lay some boundaries on a number of issues where there’s not a lot of Federal Circuit precedent.”