Home Pride Foods, Inc. v. Johnson, 262 Neb. 701

Summary

The Supreme Court of Nebraska held that a customer list may qualify as a trade secret under Nebraska's Trade Secrets Act and that the evidence supported findings that Home Pride's list was a trade secret and had been used by the appellants. The court reversed the damages award because it was based on unsupported net-profit assumptions and improperly included damages for future use despite a permanent injunction. The case was remanded for recalculation of damages based on unjust enrichment.

Holdings

1. A customer list can be included within the definition of a trade secret under Neb. Rev. Stat. § 87-502.
2. The district court was not clearly erroneous in finding that Home Pride's customer list was a trade secret.
3. The district court was not clearly erroneous in finding that Consumer's Choice used the customer list.
4. A lost-profit award is clearly erroneous when the plaintiff presents only gross-profit evidence and no financial data establishing net profits, expenses, or overhead costs.
5. An award for the value of future sales resulting from misappropriation is an impermissible double recovery when the court also enters a permanent injunction prohibiting future use of the trade secret.
6. The appellants waived any error concerning denial of their motion for dismissal by presenting evidence and failing to renew the motion at the close of their case.

Questions Presented

1. Whether a customer list can constitute a trade secret under Nebraska's Trade Secrets Act.
2. Whether the customer list qualified as a trade secret on the facts of the case.
3. Whether the appellants used the customer list.
4. Whether the district court's lost-profit award was supported by competent evidence.
5. Whether damages for future use of the customer list could be awarded when a permanent injunction prohibited further use.
6. Whether the appellants waived their challenge to denial of the motion for directed verdict or dismissal.

Disposition

reversed_and_remanded