Intellectual Property: Trade Secret

Innovative companies around the world rely on their intellectual capital to compete. This competitive drive can lead to legitimate hiring and fair reverse engineering, or to illicit employee raiding and trade secret theft, and eventual high-stakes trade secret cases. We have unparalleled expertise handling such cases on both sides of counsel table. Whether the matter involves alleged wholesale theft of technology or individual employee mobility, from advice and counsel, to injunctions to civil and criminal trials, whether international or local in scope, we deliver results.

Cases of Note

SanDisk Corp. v. SK Hynix Inc.: We represented SanDisk in a massive trade secret misappropriation and corporate espionage case. SanDisk, a global leader in flash memory storage solutions, sued competitor SK Hynix for misappropriating approximately ten gigabytes of highly confidential trade secret information and using that information over the course of six years to revamp Hynix’s technology and unfairly compete with SanDisk. We obtained a sweeping preliminary injunction that barred Hynix from any further use or disclosure of stolen SanDisk information, and fought back efforts to dismiss the case, to send it to arbitration, to transfer it overseas, and to remove it from the court that granted the preliminary injunction. Following a series of courtroom victories for our client, the parties reached a confidential settlement and entered into a product supply agreement.

In the Matter of Certain Standard Cell Libraries Products Containing or Made: We represented Taiwan Semiconductor Manufacturing Company (TSMC) against Tela Innovations in the ITC and in the District of Delaware. Both cases concerned patents that relate to integrated circuit design. Tela attempted to prevent TSMC, the world’s leading pure play foundry, from working with its hundreds of US customers, including Apple and Qualcomm, to manufacture chips that are the heart of nearly every smartphone and television sold in the US. In the offensive case, TSMC asserted that Tela Innovations partnered with TSMC in order to learn about the company’s technology, which it used to build its own patents. After successfully briefing and arguing to limit the ITC investigation only to TSMC’s importations into the US, as opposed to TSMC’s customers, we negotiated a resolution between the two companies that resulted in TSMC purchasing a portion of Tela Innovations.

Former Employee v. Netflix, Inc. and, Inc.: We defended Netflix and several of its senior executives from a high-profile defamation and blacklisting lawsuit. The plaintiff departed Netflix for Amazon, and later claimed that Netflix retaliated against him by making defamatory statements about him, wrongfully accusing him of taking confidential information, and inducing Amazon to fire him. We filed an early special motion to strike plaintiff’s complaint against the Netflix defendants pursuant to California’s anti-SLAPP statute, explaining why the plaintiff’s claims against the Netflix defendants were entirely premised on protected and privileged speech and did not establish a viable claim. The court granted our anti-SLAPP motion in its entirety, dismissing all of the plaintiff’s claims against the Netflix defendants only 5 ½ months after the complaint was filed.

Lam Research Corporation v. Former Employees: We helped Lam Research Corp. bring and successfully resolve a trade secrets misappropriation and breach of contract claim against two employees who departed for their lead competitor, taking with them Lam’s confidential information relating to its R&D prototyping program. Within three months of filing suit, we obtained the return of all stolen materials and a preliminary injunction preventing future use of Lam’s information and trade secrets.

Internet Company v. Internet Company: We represented and advised a startup Internet company regarding claims brought against it by a well-established Internet company that the startup had improperly hired certain employees and that such employees had violated their non-competition and non-solicitation agreements with their former employer. We were able to help resolve those claims without litigation and without interference with the employees' work at the startup company.

Internet Company v. Employee: We represented and advised an Internet company when one of its employees was sued by his former employer in state court for allegedly violating a non-compete agreement and for allegedly misappropriating trade secrets. We helped the Internet company and its employee move the case to a more appropriate jurisdiction and to obtain a favorable ruling on a preliminary injunction motion that allowed early resolution of the claims.

Software Co. v. Software Co.: We defended a red-hot Silicon Valley software company that provides information analysis to the intelligence, defense, and law enforcement communities from trade secret and copyright charges. Our client's competitor brought the charges in the Eastern District of Virginia. We successfully settled the case after five and a half torrid months of rocket docket litigation.

Plaintiff v. Cepia, LLC: A toy developer sued our client Cepia for allegedly using misappropriated trade secrets to develop Cepia’s award-wining line of ZhuZhu robotic toys. We obtained Rule 11 sanctions for the pleading of factually baseless allegations as well as the dismissal of five of the plaintiff’s six claims. Shortly thereafter, the plaintiff agreed to dismiss the final claim and issue a public acknowledgement of no misconduct and independent development by Cepia.

Plaintiff v. Investment Funds: We achieved an early resolution of numerous state and federal court actions for a venture fund company and one of its partners. Our clients faced trade secret misappropriation, copyright infringement, and breach of contract claims in both state court and in federal court. We were able to remove the state court action to federal court, and then secure an early settlement for our clients.

Taiwan Semiconductor Manufacturing Company v. Semiconductor Manufacturing International Corporation: We represented TSMC against China's then-leading semiconductor manufacturer, SMIC, in the largest trade secret misuse case tried to date. SMIC owed its very existence to technology stolen from our client. Following a jury verdict on liability in favor of TSMC, SMIC agreed to pay $200 million in cash and approximately $130 million of its company stock. The case serves as precedent for the strong protection afforded by California's trade secret statute, even where the actual theft occurred in Asia.

Multinational Biotechnology Company v. Biopharmaceutical Company: We won partial summary judgment for a Seattle biopharmaceutical company and its founder in a trade secret and contract action over a cystic fibrosis drug. Aided by that ruling, and the favorable progress of the trial relating to the remaining claims, another biotechnology company acquired our client for $365 million mid-trial.

Plaintiff v. Semiconductor Company: We represented a semiconductor company in a landmark trade secret misappropriation case. Our client sought more than $100 million in damages and an injunction. We won an interlocutory appeal at an early stage of the case, making this the first appellate case in California to address the circumstances in which a trade secret plaintiff may obtain pretrial discovery. We settled the case for a confidential amount while a jury trial was underway. This case remains one of the leading California precedents on this issue.

Key Contacts

Jeffrey R. Chanin

Jeffrey R. Chanin

(415) 391-5400
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Brian L. Ferrall

Brian L. Ferrall

(415) 676-2270
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