Texas Jury Rejects Digital Marketing Company’s $50 Million Trade Secret Misappropriation Claim

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After a weeklong June trial, a Texas federal jury awarded Six Dimensions, Inc. (“Six Dimensions”), a digital marketing firm, $287,000 for its breach-of-contract claim against its former employee but rejected its behemoth $50 million claim for trade secret misappropriation against its competitor, Perficient Inc. (“Perficient”).
 

In 2017, Six Dimensions filed suit against Perficient and one of its former employees, Lynn M. Brading, claiming eight counts of trade-secret-related violations, including violations of employee noncompete agreements and California’s Uniform Trade Secrets Act as well as unjust enrichment from Perficient’s allegedly improper profits. Six Dimensions claimed that Perficient stole seven of its employees and various proprietary training materials as a way to undercut Six Dimensions’ growing success in the market.

Prior to the trial, U.S. District Judge David Hittner ruled that Brading breached her noncompete agreement with Six Dimensions, based in part on Brading’s text messages with targeted employees that read, “I cannot have this conversation with you because of my noncompete.” A winking emoji face at the end of the message implied her noncompliance. The judge sent the damages calculation to the jury. Although the jury awarded damages for Brading’s violation of the noncompete pursuant to the judge’s direction, the jury rejected all of Six Dimensions’ other claims against Perficient.

During the trial, Six Dimensions told the jury that it pioneered a proficiency in Adobe Marketing Cloud, a very profitable and niche platform in the software support space, and claimed trade secrets related to this. Perficient presented a different view of the facts. It denied all wrongdoing and told the jury that the alleged “trade secrets” Six Dimensions put as issue—its training modules/materials, performance evaluations of employees, critical employee list and customer pricing and project information—did not fit the definition “in any sense of the word.” Notably, Perficient emphasized that Six Dimensions was unable to show the existence of any trade secrets in these materials, which Perficient claimed were basic names, experience and contact information of employees.

Additionally, at trial, several former Six Dimensions employees testified to wanting to leave Six Dimensions for many reasons unrelated to trade secrets, including the company’s deteriorating fate, particularly after it was removed from the Nasdaq stock exchange in 2015. Perficient used their testimony to show that the employees at issue had no choice but to leave a failing company.

Ultimately, the lion’s share of the jury’s verdict sided with Perficient. The $287,000 that the jury awarded as damages against Brading’s violation of her noncompete agreement pales in comparison to the damages Six Dimensions sought at trial. This case underscores that, even if a company is able to prove wrongdoing by a former employee, it can be an uphill battle to prove that the former employee’s current employer is embroiled in that wrongdoing as well.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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