law-trade-secrets | noncompete clauses

Misappropriation of trade secrets

The elements of a statutory claim and a common law claim of misappropriation are not
exactly the same, we conclude the same evidence supports both causes of action.  Under a
statutory claim, "[a] person commits an offense if, without the owner's effective consent, he
knowingly: (1) steals a trade secret."  Tex. Penal Code Ann. ' 31.05(b)(1); see Tex. Civ. Prac. &
Rem. Code Ann. ' 134.002(2).  "Steals" is defined as A[acquiring] property or services by theft,"
and "theft" is defined as "unlawfully [appropriating] property with intent to deprive the owner of
property." Tex. Penal Code Ann. '' 31.01(7), 31.03(a) (Vernon 2003).  We find Space Place's
evidence, explained in detail in this section, supports a reasonable inference that Midtown
knowingly stole Space Place's trade secrets, as defined in the Penal Code.  See id. '' 31.01(7),
31.03(a) - (b), 31.05(b)(1); Tex. Civ. Prac & Rem. Code Ann. ' 134.002(2).

Under the Texas Theft Liability Act, "trade secret" is defined as "the whole or any part of any
scientific or technical information, design, process, procedure, formula, or improvement that has
value and that the owner has taken measures to prevent from becoming available to persons other
than those selected by the owner to have access for limited purposes."  Tex. Penal Code Ann. '
31.05(a)(4) (Vernon 2003); See Tex. Civ. Prac. & Rem. Code Ann. ' 134.002(2) (incorporating
definitions from the Penal Code).  We conclude the statutory definition of trade secret is consistent
with the common law definition; therefore we will conduct only one analysis.  See Klumpe, 101 S.
W.3d at 472 ("The statutory definition of trade secret comports with the definition used when tort
and contract trade secret law is considered.").

08-0593  
SP MIDTOWN, LTD. D/B/A SPACE PLACE MIDTOWN v. URBAN STORAGE, L.P. AND MIDTOWN
STORAGE, L.L.C.; from Harris County; 14th district (14‑07‑00717‑CV, ___ SW3d ___, 05-08-08)
SP Midtown Ltd. v. Urban Storage, LLC (Tex.App.- Houston [14th Dist.] May 8, 2008)(Anderson)
(trade secrets, tortious interference , civil conspiracy)

07-0995  
HB TURBO, L.P. v. TURBONETICS ENGINEERING & SERVICES, INC.; from Nueces County; 13th district
(13-06-00083-CV, ___ SW3d ___, 06-07-07, pet. denied April 2008)
By two issues, HB contends the trial court erred in granting Turbonetics' no-evidence motion for summary
judgment because more than a scintilla of evidence exists as to its causes of action for trade secret
misappropriation and non-trade secret misappropriation (more appropriately referred to as unfair
competition). (1) By a third issue, HB contends the trial court erred in granting Turbonetics' traditional
motion for summary judgment because material fact questions exist as to its non-trade secret
misappropriation claim. We affirm.

Under Texas law, a plaintiff can recover for misappropriation of a trade secret by establishing that (1) a
trade secret existed, (2) the trade secret was acquired through a breach of a confidential relationship or
was discovered by improper means, (3) the defendant used the trade secret without the plaintiff's
authorization, and (4) the plaintiff suffered damages as a result. IAC, Ltd. v. Bell Helicopter Textron, Inc.,
160 S.W.3d 191, 197 (Tex. App.-Fort Worth 2005, no pet.); Trilogy Software, Inc. v. Callidus Software, Inc.,
143 S.W.3d 452, 463 (Tex. App.-Austin 2004, pet. denied).