Patents, copyrights, and trademarks indicate clearly that an item of intellectual property belongs to its owner, but not all ideas are eligible for those protections. Good ideas are essential to operating a successful business, and intellectual property laws enable you to protect your original ideas, even the ones that are not covered by trademarks, patents, or copyrights. Trade secrets are the information shared only within your company that enables it to function in a unique way or provide unique products or services; if all your competitors knew your trade secrets, your company would lose its competitive edge. Trade secrets are not just the recipes that make the chicken sandwiches at Chick-fil-A, Wendy’s, and Popeye’s different from each other; every business has trade secrets, even cybersecurity firms. If a competitor or former employee is misusing your company’s trade secrets, contact a San Diego intellectual property business lawyer.
The Perils of Proofpoint
In the past several years, the email security software company Proofpoint, which is based in Sunnyvale, has seen its share of legal trouble because of intellectual property disputes. The trouble started when Proofpoint acquired a company called Cloudmark in 2017 for $110 million. Around the same time, Oliver Lemarie, who had been a vice president at Cloudmark, began working for Vade Secure, which is based in France.
One of the main reasons that Proofpoint chose to buy Cloudmark was because of its cloud-based Mail Transfer Agent (MTA) product. Meanwhile, in June 2019, Vade launched a cloud-based MTA product that was very similar to the one Cloudmark had been producing. The new MTA product enabled Vade Secure to obtain nearly $80 million in funding from an investor called General Catalyst; the General Catalyst investment represented nearly 90% of Vade Secure’s funding. Vade also used Cloudmark trade secrets to develop other products, such as its Microsoft 365 Email Content Filter, Vade MTA Builder, and Vade Cloud.
The following month, Proofpoint filed a lawsuit against Vade Secure, alleging that Lemarie had intentionally misappropriated trade secrets and used them to compete with Proofpoint. In August 2021, the court ruled in favor of Proofpoint. It ordered Vade to pay $13.5 million to Proofpoint for unjust enrichment and $480,000 for breach of contract, although it did not order Vade to pay any compensation for financial losses it had caused Proofpoint to incur. The court will rule later about how much money, if any, in punitive damages Vade Secure must pay.
This is not Proofpoint’s only legal dispute over trade secrets. It also claims that Samuel Boone, a former Director of National Partner Sales at Proofpoint, shared the company’s sales strategies with a competitor company called Abnormal Security. The lawsuit between Proofpoint and Boone is ongoing.
Contact Foldenauer Law Group About Trade Secret Disputes
A business dispute lawyer can help you seek damages from people who have used your company’s trade secrets without your permission. Contact Foldenauer Law Group, APLC in San Diego, California to discuss your case.