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Employee with Stolen Trade Secrets & New Employment Enjoined


A company’s trademarked materials, copyrighted information, and competitively valuable trade secrets need to be protected and closely watched. Otherwise, a crafty or disgruntled employee might try to steal away with the information for their own profit, or the benefit of a competitor, which is arguably worse. Such was the case in a recent trade secret litigation case MKT Law and our Minneapolis business lawyers managed.

A sale representative for an equipment supply company – we can call them Company X to uphold privacy in this matter – copied trade secrets before resigning in the early hours of a Monday morning. Later that same day, this sales representative went to go work in his former sales territory for another company – Competitor Y – that directly competed with Company X. This was a serious problem, but MKT Law had the solution.

You Can Get a New Job, Just Not Here

We obtained an injunction that prohibited the former employee from working in the seven-county metro area under the non-compete, non-disclosure, and non-solicitation agreement that was signed by the very same employee two years earlier. However, the non-compete agreement was overly-broad and was purported to restrict related employment for a large section of the country. In order to increase its validity in court, MKT Law narrowed the geographic scope it covered proactively in the motion for a temporary injunction that was filed a few days after the sale representative’s abrupt and unannounced decision to quit from Company X.

Injunctions, E-Mails & Appeals

MKT Law immediately had our client, Company X, provide a copy of the former employee’s email account that was linked to the company’s servers and data. We found an e-mail – this time the “e” in e-mail stands for “evidence” — that showed the former employee had already referred one of Company X’s clients to Competitor Y, even before quitting. Subsequent investigations found that the employee had also taken a large amount of bidding and contract information with him, which had been downloaded from the company’s industry-standard estimating program. The employee took that downloaded information, which was clearly considered a trade secret, to his new employer, Competitor Y, and even went as far as to upload the stolen data to a computer in his new employer’s office.

After MKT Law filed its lawsuit and obtained the temporary injunction, the former employee appealed to the Minnesota Court of Appeals while the case was proceeded through discovery process. After filing a responsive brief with the appellate court that argued the trial court indeed properly granted the temporary injunction, the court of appeals eventually issued its decision and affirmed the legal validity and necessity of the temporary injunction. In the meantime, with all of the electronically stored evidence in hand, MKT Law was able to keep the temporary injunction in place for longer than a year while the case proceeded to trial stages.

The eve before the trial was to take place, seeing the legal strength of the case that that MKT Law had built, the case was settled in favor of our client, Company X. A favorable settlement from Competitor Y and the former sales representative – who had since been fired by Competitor Y – was given to our client. While the settlement was beneficial and appreciated, the most important part of this case result is the prevention of the former employee’s attempts to sell for a competitor in the same sales territory he had for over a year, and that the company’s business in that major metropolitan area market was preserved.

MKT Law is a reputable business litigation law firm headquartered in Minneapolis and serving clients all throughout the region, from St. Paul to Plymouth to Bloomington and more. Our lead attorney, Mr. Mark K. Thompson, has nearly 20 years of business law experience under his belt and a strong backing of positive client testimonials. If you need legal representation of this caliber for a business law issue or contract dispute of your own, you can request a confidential case review today.

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