USA – TEXAS Trends and Developments Contributed by: Jeff Homrig, Gaby LaHatte and Heather Blacklaws, Weil, Gotshal & Manges LLP
ket, unjust enrichment can dwarf the plaintiff’s direct losses. Courts have also endorsed avoided develop - ment costs as a measure of damages, essentially ask - ing what it would have cost the defendant to develop the information legitimately, a theory that can produce substantial awards even where direct proof of lost profits is difficult to establish. In cases of wilful and malicious misappropriation, both the DTSA and most state trade secret statutes also authorise exemplary damages of up to two times the actual damages, along with attorneys’ fees. That enhancement can dramatically increase exposure in an already high-value case and sends a clear deter - rent signal. Combined with the possibility of parallel criminal liability under the Economic Espionage Act for the most egregious cases, the consequences of misappropriation can be severe. Injunctive relief is also another powerful remedy. A plaintiff that makes a credible showing of misappro - priation may be able to stop the defendant’s con - tinued use of the trade secrets and, in some cases, restrict what the defendant can do with employees, products, or business relationships affected by the misconduct. And a preliminary injunction can reshape the entire dispute – it can block a product launch or sideline a key hire pending resolution of the case. For plaintiffs, it is often the most valuable remedy in the toolkit, not because of what it awards, but because of what it stops. Collectively, when warranted, this potent combination of remedies can deliver more pressure on an oppo - nent than any other form of IP. It thus serves as a powerful weapon, not only to obtain the return of sto - len intellectual property, but also to legitimately put transformative pressure on a competitor, failed suitor, self-dealing partner, or other market participant. Why has Texas become a hotbed for trade secret claims? Texas courts are a natural destination for trade secret actions because they have a wealth of experience with complex trade secret and technology cases, embody the view that juries should decide colourable cases, and have built high-functioning court systems with streamlined procedures that make it easy for lawyers
across the country to file and prosecute actions in Texas. As noted, the Texas federal bench is one of the most experienced trade secret benches in the country, with three of the five busiest trade secret judges nation - wide. Although Judge Albright announced that he will be stepping down from the Western District of Texas bench at the end of summer 2026, the factors drawing plaintiffs to the Western District of Texas, and other federal courts in Texas, remain. For example, Texas federal judges handle a substantial number of patent and other technology cases, making them a strong fit for tech-heavy trade secret cases. Lawyers value that experience. They also know that statistics show that federal judges in Texas are less likely to resolve trade secret claims at the pleading or summary judgment stage than judges in other regions. For example, in the Eastern District of Texas, 8% of motions to dismiss are granted in DTSA cases, whereas other jurisdictions grant them at a substan - tially higher rate – in the Northern District of California, for example, more than 40% of motions to dismiss DTSA claims have been granted. See Lex Machina statistics. Similarly, in the Western District of Texas, 21% of summary judgment motions in DTSA cases have been granted, compared with 40% in the North - ern District of California. Id. In addition to shaping how trade secret cases are decided (eg, by written motion or jury trial with witnesses), these trends affect settle - ment of Texas cases: defendants may feel increased pressure to engage with these claims early and seri - ously. Plaintiffs are also aware that Texas juries that find liability routinely award substantial damages, and that those awards consistently hold up on appeal. For example, in Computer Sciences v Tata Consul- tancy , the Court entered a permanent injunction and awarded more than USD56 million in actual damages and more than USD112 million in exemplary dam - ages, a result the Fifth Circuit later upheld. Comput. Sciences v Tata Consultancy , 3:19-cv-00970, Dkt. 532 (N.D. Tex. June 13, 2024); 24-cv-10749, Dkt. 93 (5th Cir. 2025). Likewise, in ResMan v Karya , the court entered a permanent injunction and awarded more than USD62 million in combined unjust enrich -
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