USA Law and Practice Contributed by: Claudia Ray, Joseph Loy, Brandon R. Weber and Andrew (Keum Yong) Lee, Kirkland & Ellis LLP
appropriation of the trade secret(s) under any number of potential damages theories.
2009)). In addition, an unreasonable delay in bringing a trade secret misappropriation claim or the motion for a preliminary injunction will weigh against granting the injunction. Courts are increasingly moving towards requiring sufficient precision in the identification of the trade secret such that defendants receive fair and precise notice of what the injunction actually prohibits. See Carl Zeiss Meditec, Inc v Topcon Medical Sys., Inc, 2022 WL 1530491 (Fed. Cir. May 16, 2022). 7.2 Measures of Damages Damages available to a trade secret plaintiff will vary depending on the federal and state claims asserted and the theories of recovery. Under the DTSA, damages for trade secret misappropria - tion can be calculated in at least three ways (18 USC Section 1836(b)(3)(B)): • actual loss caused by the misappropriation; • unjust enrichment caused by the misappropriation, which may be sought in addition to actual loss to the extent that damages calculations do not overlap, or in lieu of either actual loss or unjust enrichment; and • a reasonable royalty. Damages under the UTSA similarly include actual loss in addition to unjust enrichment not included in calculating actual loss, or a reason - able royalty in lieu of actual damages (UTSA Section 3(a)). Additionally, some state trade secret laws do not require putting a trade secret to commercial use before royalty damages may be obtained. See AirFacts, Inc v Amezaga, 30 F.4th 359, 369 (4th Cir. 2022). In some situations, lost profits may be shown by directly establishing that certain sales expected by the plaintiff were lost to the defendant as a result of trade secret misappropriation. More commonly, however, a plaintiff will argue that the
7. Remedies 7.1 Preliminary Injunctive Relief To obtain a preliminary injunction, a trade secret plaintiff generally must establish that: • it is likely to succeed on the merits of its trade secret misappropriation claim; • it is likely to suffer irreparable harm in the absence of preliminary relief; • the balance of equities tips in its favour; and • an injunction is in the public interest. To show irreparable harm, a plaintiff will need to demonstrate that monetary damages would be inadequate, which is more likely where the trade secret owner previously had market exclu - sivity and therefore the misappropriation results in reduced market share, lost customers, lost business opportunities and/or price erosion. Whereas lost sales alone may be insufficient to establish irreparable harm if such losses can readily be calculated, damage to the trade secret owner’s good will, reputation or other intangi - ble factors, and any other harms that result in a decrease in revenue available for employee attraction and retention, or for R&D activities on which the business relies for continued profit - ability, may be relevant to establishing the inad - equacy of monetary damages. In some jurisdictions, a party moving for a pre - liminary injunction must also show that there is a risk of further dissemination of its trade secrets beyond the misappropriation already complained of – eg, Faiveley Transp. Malmo AB v Wabtec Corp, 559 F.3d 110, 118 (2d Cir.
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