Company Failed To Prove Trade Secret Misappropriation By Former Employee
Yield Dynamics, Inc. v. TEA Systems Corp., 2007 WL 2396109 (Cal. Ct. App. Aug. 23, 2007)
Yield Dynamics, which develops and markets software products designed to facilitate the fabrication of microchips, sued its former employee, Terrence Zavecz, and two business entities of which he is a principal for breach of contract, violation of the Uniform Trade Secrets Act and related claims. After a non-jury trial, the trial court granted judgment for defendants. The Court of Appeal affirmed the judgment, holding that the eight segments of source code that were allegedly misappropriated did not possess the independent value necessary to constitute a trade secret. Further, the Court held that Yield had failed to prove any damages, any unjust enrichment or provide any evidence regarding what a reasonable royalty might be. The Court affirmed judgment for defendants on the various breach of contract, fraud, and unfair competition claims as well as an award of $175,000 in attorneys’ fees to defendants.
