USA – D.C. METROPOLITAN AREA Trends and Developments Contributed by: Linda M. Jackson, Andrew Baskin, Pascal “Pat” Naples and John M. Hindley, ArentFox Schiff LLP
where the defendant announced an acquisition shortly after requesting the plaintiff’s confidential information and declined to certify its destruction or return. No 22-cv-741, 2023 WL 1469038, at *9 (D.D.C. Feb. 2, 2023). Standing to bring a misappropriation claim is a signifi - cant issue. Though some courts describe DTSA and the DCUTSA as identical, an important textual differ - ence is that the DCUTSA does not limit those who can bring trade secrets claims to “owners”; rather, it permits “complainant[s]” to bring claims for misappro - priation. Though DC courts have yet to address this issue, Maryland courts applying similar language in the Maryland trade secrets statute (discussed below) recognise that, unlike DTSA, standing is not limited to owners but rather may include other parties, such as legitimate holders of trade secrets. Maryland: The Maryland Uniform Trade Secrets Act (MUTSA) To prevail on a MUTSA claim, the plaintiff must show: “(1) that [the plaintiff] possessed a valid trade secret, (2) that the defendant acquired its trade secret, and (3) that the defendant knew or should have known that the trade secret was acquired by improper means”. AirFacts, Inc. v de Amezaga , 909 F.3d 84, 95 (4th Cir. 2018); see Md. Code Ann., Com. Law § 11-1201 et seq. Like DCUTSA, courts applying MUTSA are guided by the Restatement of Torts § 757 to determine if infor - mation is a trade secret. Maryland courts have rec - ognised that a wide range of information can qualify as a trade secret, including customer lists, pricing information, profit margins, vendor pricing, marketing strategies, and budget software, so long as the infor - mation derives independent economic value from not being generally known and the owner takes reason - able measures to maintain its secrecy. See Ingram v Cantwell-Cleary Co., Inc. , 306 A.3d 1205, 1228–34 (Md. App. 2023). For example, the Fourth Circuit reversed a lower court’s post-trial finding that infor - mation was not a trade secret because it contained publicly available information. AirFacts, 909 F.3d at 96. It reasoned that, although the trade secret contained data that can be accessed by anyone with a subscrip - tion, the defendant spent months compiling the data
in particular groupings and applying his expertise to display that compiled information in a useful format. As to reasonable efforts to maintain secrecy, Mary - land courts have taken a totality of the circumstances approach. Common measures recognised as reason - able include requiring employees and third parties to sign confidentiality or non-disclosure agreements; maintaining employee handbooks with confidentiality provisions; implementing electronic security meas - ures such as password-protected systems, encrypted servers, and firewalls; limiting access to trade secret information on a need-to-know basis and restricting the number of employees who can view sensitive data; and labelling documents as confidential. MUTSA incorporates the same definition of “misap - propriation” as DCUTSA. Under MUTSA, a plaintiff can prove misappropriation “simply by demonstrat - ing that the defendant acquired the trade secret by improper means, even if the plaintiff cannot show use of that trade secret”. Brightview Grp., LP v Teeters , 441 F. Supp. 3d 115, 132 (D. Md. 2020). Because direct evidence of misappropriation is often unavail - able, plaintiffs may rely on circumstantial evidence as proof. MUTSA permits “complainants” to bring a claim, meaning that possessors of a trade secret can sue for misappropriation. AirFacts , 909 F.3d at 95. Unlike DTSA, ownership is not a prerequisite to bringing a Maryland trade secrets claim. Virginia: The Virginia Uniform Trade Secrets Act (VUTSA) In analysing VUTSA, Va. Code § 59.1-336 et seq., Virginia courts have recognised that “just about any - thing can constitute a trade secret under the right set of facts”, including customer lists, pricing informa - tion, marketing and sales techniques, and informa - tion about products. MicroStrategy Inc. v Business Objects, S.A. , 331 F. Supp. 2d 396, 416 (E.D. Va. 2004). This is because the “crucial characteristic of a trade secret is secrecy rather than novelty”. Dionne v Se. Foam Converting & Packaging, Inc. , 397 S.E.2d 110, 113 (Va. 1990). Such efforts include the use of confidentiality agreements, marking and controlling
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