[co-author: Izzy Ercan, Summer Associate]
Former Toronto Blue Jays pitcher Michael Bolsinger has not played Major League Baseball (MLB) since his lackluster performance against the Houston Astros on Aug. 4, 2017. In only 29 pitches, Bolsinger allowed four runs, four hits and three walks to the eventual World Series Champions, the Astros. Unbeknownst to him, the Astros were elaborately "sign-stealing," using a television feed from the center field camera to read the opposing team's signs and informing their batters of the pitch type by banging a trash can in the dugout.1
Believing that the Astros' cheating "ultimately cost him his job," Bolsinger sued the Astros in Texas under the 2013 Texas Uniform Trade Secrets Act (TUTSA). Because 12 of his 29 (41 percent) pitches to the Astros were precipitated by trashcan banging to signal the type of pitch, Bolsinger alleges a "willful and intentional misappropriation of trade secrets," citing the trade secrets are the signs used to call his pitches. More broadly, the case may address whether a plaintiff can claim trade secret protection when some aspects were displayed in a public setting.
To assert a TUTSA claim, a plaintiff must show 1) the existence of a trade secret, 2) that the trade secret was acquired by the defendant through a breach of a confidential relationship or discovered by improper means and 3) that the trade secret was used without the plaintiff's approval or authorization. Wellogix Inc. v. Accenture LLP, 716 F.3d 867, 874 (5th Cir. 2013). TUTSA defines trade secrets as all forms and types of information that the owner of the trade secret has taken reasonable measures under the circumstances to keep secret and that derives independent economic value (actual or potential) from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information. (See Texas Civil Practice and Remedies Code § 134A.002(6), emphasis added).
In his lawsuit, Bolsinger alleges that he and the Blue Jays "had taken the reasonable measures customary in the baseball industry to keep his signs secret" and that his signs had independent economic value from not being known by the opposing team. Catchers who give the signs to the pitchers typically try to shield them from the batter, who can benefit from them. To prevail on his claim, however, Bolsinger will address that the knowing display of the pitching signs in a manner that could be (and was in fact) seen by the public – or at least a well-positioned camera – did not destroy any secrecy the signs once enjoyed. The analysis may turn on whether it is reasonable "under the circumstances" to potentially display a trade secret to the public, including a competitor, when the disclosure was necessary to compete, narrow and still required knowledge of a code to break, and whether sign stealing constituted "improper means," in a sport where cheating has been considered part of the game.2 Bolsinger will likely argue that this type of determination may be deemed a question of fact that a jury must determine.
The determinations of these issues could clarify what it means to take reasonable measures to protect confidential business information and what crosses the line to improper means in Texas. In trade shows, articles, interviews, responses to requests for proposals (RFPs), client recruitment, investor meetings, etc., a trade secret owner may disclose portions of its protected information but seek to maintain their trade secret, and competitors could seek to take advantage by obtaining such information. Consider the competitor who impersonates a customer or potential investor to obtain pricing data or proposals that are willingly provided. It may also lead to other claims in sports. The New England Patriots' "Spygate" and the Wake Forest playbook theft come to mind.
But even if the court finds that the public display of pitching signals does not automatically bar Bolsinger's claims, Bolsinger faces several other challenges. Among other things, Bolsinger may have to prove that the Astros actually misappropriated the signals, that he and not the Blue Jays owned the signals, that his claims are not preempted or subject to arbitration under any collectively bargained or other agreements, and that the alleged misappropriation caused Bolsinger's MLB exit and damages. After all, despite having played well overseas following that fateful evening on Aug. 4, 2017, Bolsinger's 2017 campaign with the Blue Jays was not stellar. Bolsinger went 0‑3, with a 6.31 earned run average (ERA) over 11 games. His overall MLB career record is an unremarkable 8-19, with a 4.92 ERA. In other words, to prevail, Bolsinger may need a perfect game.
1 The Astros' sign-stealing scandal is well documented, as reported in a CBS Sports article.
2 As the baseball player Mark Grace once said, "If you're not cheating, you're not trying." Levitt, Steven D., and Stephen J. Dubner. Freakonomics: a rogue economist explores the hidden side of everything. William Morrow, 2005.