Motion to Dismiss DTSA Complaint Granted

Saturday, September 1, 2018

In a case addressing the standards for pleading a cause of action under the federal Defend Trade Secrets Act (DTSA), Chief Judge James K. Bredar granted a motion to dismiss.  The Court found that the complaint failed to adequately allege the factual bases for the existence of trade secrets or the misappropriation of a trade secret by the defendant.  The complaint alleged that the plaintiff’s client contact list constituted a trade secret, but failed to allege that the identities of the clients on the contact list were not readily ascertainable through publicly accessible resources.  The Court found that allegations in the complaint that the client contact list included historical usage of the plaintiff’s service and clients’ purchasing needs and preferences were too “vague” to draw an inference that such information could be accorded the status of a trade secret.  Finally, the Court found that misappropriation under the DTSA could not be inferred from the defendant’s “[m]ere solicitation” of clients on the contact list.  S-E-A, Ltd. v. Cornetto, No. JKB-18-1761, 2018 WL 3996270 (Aug. 21, 2018).