Summary
The Utah Supreme Court reviewed summary judgment rulings on claims for trade-secret misappropriation, breach of a confidentiality and nondisclosure agreement, and breach of attorneys’ fiduciary duties of confidentiality and loyalty. The court held that reasonable inferences may controvert a moving party’s asserted facts for summary-judgment purposes and that a compilation or combination of publicly available information may constitute a trade secret. The court reversed the district court’s summary judgment rulings in favor of PacifiCorp, Jody L. Williams, and Holme Roberts & Owen, LLP.
Topics
Practice areas
Questions Presented
- Whether a nonmoving party may controvert a summary-judgment statement of fact by presenting contrary reasonable inferences from undisputed objective facts.
- Whether a compilation or vision consisting of information whose individual components are publicly known or readily ascertainable may constitute a trade secret.
- Whether circumstantial evidence of access to and similarity with alleged trade-secret information may create a genuine issue of material fact concerning misappropriation.
- Whether circumstantial evidence may create a genuine issue of material fact concerning breach of a confidentiality and nondisclosure agreement.
- Whether simultaneous adverse representation and other circumstantial evidence may create a genuine issue of material fact concerning an attorney's disclosure of confidential information.
- Whether genuine issues of material fact remained concerning causation for the alleged breach of fiduciary duty of loyalty.
Holdings
- A nonmoving party may controvert a moving party's statement of fact by specifically presenting reasonable contrary inferences from the objective facts; a separate conflicting factual statement is not always required.
- A compilation, design, or vision consisting of information within the public domain may constitute a trade secret if the compilation itself is not generally known or readily ascertainable, derives independent economic value, and is subject to reasonable efforts to maintain secrecy.
- A jury may infer misappropriation under the Utah Trade Secrets Act from circumstantial evidence showing access to information similar to the alleged trade secret.
- Circumstantial evidence and reasonable inferences may create a genuine issue of material fact concerning whether a defendant used confidential information in breach of a confidentiality agreement.
- Circumstantial evidence, including inferences arising from simultaneous adverse representation, may create a genuine issue of material fact concerning an attorney's disclosure or misuse of a client's confidential information; simultaneous representation alone does not create a presumption of disclosure.
- A breach of fiduciary duty of loyalty claim includes but-for causation, and the evidence and competing inferences concerning Williams's role in PacifiCorp's project could create a genuine issue of material fact on causation.
Key quotations
“We hold that a compilation of information within the public domain may constitute a trade secret. To determine whether the product, design, or vision constitutes a trade secret is an intensely factual inquiry to be conducted by the trial court.” (¶ 45)
“Accordingly, we hold that a jury can infer misappropriation under the Utah Trade Secrets Act if presented with circumstantial evidence that shows access to information similar to the trade secret at issue.” (¶ 50)
“We therefore hold that inferences drawn from circumstantial evidence, including inferences from simultaneous adverse representation, may create a genuine issue of material fact.” (¶ 65)
Factual background
USA Power developed the Spring Canyon power-plant project near Mona, Utah, and provided PacifiCorp with three binders of information marked confidential after PacifiCorp signed a confidentiality and nondisclosure agreement. PacifiCorp later declined to purchase Spring Canyon and developed the substantially similar Currant Creek project. USA Power alleged that PacifiCorp misappropriated its trade secrets and breached the confidentiality agreement, and that its attorney, Jody Williams, simultaneously represented PacifiCorp and disclosed or used USA Power's confidential information. The parties disputed the scope and timing of Williams's representation and the extent to which PacifiCorp used information obtained from USA Power.
Procedural history
USA Power sued PacifiCorp for misappropriation of trade secrets and breach of a confidentiality and nondisclosure agreement, and sued Williams and HRO for breach of fiduciary duties of confidentiality and loyalty. The district court deemed several facts admitted under Utah Rule of Civil Procedure 7(c)(3)(A) and granted summary judgment to all defendants. The Utah Supreme Court reversed and remanded.
Remand instructions
The case was remanded for further proceedings consistent with the opinion, including reconsideration of the summary-judgment issues under the proper standards.