Intellectual Property

An Intellectual Property Litigation Attorney Can Protect You from Trade Secret Theft

September 24, 2021 by foldenauer.law

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.

Man Whose Nude Baby Picture Appears on Iconic Album Cover Sues Band Members and Record Companies

September 17, 2021September 15, 2021 by foldenauer.law

Each of the big moments in music history made a few people rich but left most of the people who contributed to it empty-handed. Sure, Elvis Presley got rich singing “Hound Dog,” but he copied it note for note from Willie Mae “Big Mama” Thornton. Presley continues to draw millions of dollars in income each year, decades after his death, while Thornton died destitute in a Los Angeles boarding house. Music history is also replete with unsung contributors who sued, decades after the fact, for their fair share of the proceeds from the hit songs they helped to create. This month, after years of soul searching, the man who was photographed as an infant for the cover of Nirvana’s Nevermind, has decided to sue the surviving band members and relevant companies for damages. Whether you are in the music business or any other industry, a San Diego business dispute lawyer can help you collect damages if you contributed to something big but were shut out when the money started coming in.

Nevermind Baby Grows Up and Demands His Day in Court

In 1991, the band Nirvana had asked photographer Kirk Weddle to take a picture of a baby in a swimming pool; they planned to use the image on the cover of their upcoming album. On a whim, Weddle asked his friend Rick Elden to have his four-month-old son Spencer photographed naked in the pool. Rick agreed and received $200 for his trouble. The image of baby Spencer Elden appeared on the cover of Nirvana’s album Nevermind, with an image of a dollar bill on a fishhook, which the baby appears to be swimming toward. Nirvana lead singer Kurt Cobain envisioned the cover as a statement on capitalism.

Capitalism did its thing, and 30 years later, the Nevermind cover is one of the world’s most recognizable album covers. Spencer Elden has had conflicting feelings about the image over the years. He has recreated the photo several times (always with a swimsuit), and as a young man, he got a tattoo of the word “Nevermind” on his chest. At age 30, he lives with his mother and spends his time growing tomatoes and making artwork. The thought passed through his mind several times over the years that he could be rich if he had been paid royalties for the use of his image. Things changed when he went to a baseball game a few years ago and realized that, thanks to the Nevermind cover, everyone in the audience had seen him naked. This year, Elden filed a lawsuit against the surviving members of Nirvana, Cobain’s widow Courtney Love, and various record companies, seeking $150,000 from each defendant. The lawsuit raises larger questions, though, about parents publicizing images of their young children.

Contact Foldenauer Law Group, APLC in San Diego, California to discuss potential liability and damages in your business dispute.

Are Your Trade Secrets Safe Under the New Restrictions on Non-Compete Agreements?

August 17, 2021August 4, 2021 by foldenauer.law

If you were dating someone, and they told you that you could never have another romantic relationship after breaking up with them, you would either say “pffft!” or file for a restraining order. Why do employees tolerate such behavior from employers and former business partners, then? Non-compete clauses are a common feature of employment contracts in some industries. As of 2021, approximately one in five workers has signed a non-compete agreement with their current employer. At their worst, non-compete agreements harm the economy by limiting workers’ ability to seek employment and companies’ ability to recruit new employees. On the other hand, companies have the right to protect their trade secrets. If you are involved in a dispute about the use of privileged information by a former partner or employee of a company, contact a San Diego intellectual property business lawyer.

Executive Order Protects Workers from Overreach by Non-Compete Clauses

An executive order issued by President Biden in July 2021 targeted overreach by non-compete clauses in employment contracts. The ostensible purpose of non-compete clauses is to prevent employees from taking the business secrets and innovative business practices they learned in the scope of their work and using it to open a new business that competes directly with their former employer. Despite this, many businesses require employees who do not have specialized insider knowledge to sign non-compete agreements that limit their ability to seek employment in their geographic area after their employment ends. In fact, over 20% of employees who do not have bachelor’s degrees are subject to non-compete agreements. The executive order authorizes, and even encourages, the Federal Trade Commission to “address agreements that may unduly limit workers’ ability to change jobs.” Meanwhile, California courts have consistently ruled that most workers have the right to “job hop,” and that this right is an essential component of fair market competition.

How California Law Keeps Your Trade Secrets Safe

If you are trying to protect your trade secrets, California is a good place to do it. With or without non-compete agreements, the Uniform Trade Secrets Act, which is part of the California Civil Code, acknowledges that trade secrets are a kind of intellectual property, and businesses have the right to protect their intellectual property. Whether client lists count as trade secrets depends on the circumstances. President Biden’s executive order implies that, the more specific the agreement is about which information the former employee or partner may not share, the better, and it is sufficient to specify that a party to the agreement may not share client lists. Meanwhile, California courts have ruled that “general business know-how” is not a trade secret, but rather expertise that the employee has gained in the course of their work for the employer.

Contact Foldenauer Law Group About Protecting Trade Secrets

An intellectual property lawyer can help you enforce your trade secrets or fight for your right to fairly compete in the marketplace. Contact Foldenauer Law Group, APLC in San Diego, California to discuss your case.

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