IP Law Daily, TRADE SECRETS—10th Cir.: Regional director failed to prove misappropriation by former employer, (Aug 6, 2025)

By Cheryl Beise, J.D.

The former regional director failed to establish that a broker contact list he had taken from a prior employer constituted a trade secret.

A Colorado federal district court properly dismissed trade secret misappropriation claims by a former employee alleging that his employer misappropriated a list of broker contacts that he had created by downloading data from a prior employer, the U.S. Court of Appeals in Denver has ruled. Substantial evidence supported the district court’s finding that the former employee as a matter of law did not prove his trade secret claims, albeit on different grounds. The district court found that the former director did not establish ownership of a trade secret, whereas the appellate court found the broker contact list did not qualify for trade secret protection. One judge on the panel filed a dissenting on part opinion to express his view that the trade secret claims should have been remanded to the district court. The panel unanimously determined that the district court erred in precluding the former employee from offering evidence or presenting any witnesses, including fact witnesses, on lost wages in connection with his remaining state law claims pending at that time. The case was remanded for the district court to reconsider its order under Federal Rule of Evidence 702 (Snyder v. Beam Technologies, Inc., No. 24-1136 (10th Cir. Aug. 5, 2025)).

Background. The employee, John Snyder, was previously employed by Guardian Life Insurance Company for around 10 years. Throughout this period, he was part of a group responsible for creating and managing broker contact information within Guardian’s client-relationship-management (CRM) software. Before being terminated by Guardian, Snyder downloaded the broker data from Guardian’s CRM onto a Microsoft Excel spreadsheet. After creating the spreadsheet of over 40,000 insurance broker names (the Guardian Broker List), Snyder made only one modification to it three minutes after it was created. Subsequently, he sent the Guardian Broker List spreadsheet from his Guardian email address to his personal email address. Shortly thereafter, he was terminated by Guardian.

Snyder remained unemployed for nearly two years until receiving a job offer from Beam Technologies as a Regional Director of Broker Success. To induce Snyder to work for Beam Snyder alleged that Beam promised to pay him for the Guardian Broker List spreadsheet. At some point, Snyder accidentally emailed the Guardian Broker List spreadsheet to several Beam employees. A few months later, Beam terminated Snyder's employment.

In October 2020, Snyder filed suit against Beam, asserting claims for the misappropriation of trade secrets under the federal Defend Trade Secrets Act (DTSA) and the Colorado Uniform Trade Secrets Act (CUTSA), as well as obtaining employment through misrepresentation under Colorado statutory law, common law fraudulent misrepresentation, and promissory estoppel. Beam moved for summary judgment.

The district court granted Beam’s motion for summary judgment on Snyder’s DTSA and CUTSA claims, finding that no reasonable jury could conclude that Snyder owned Guardian Broker List. The court denied summary judgment on the remaining state law claims.

Both parties filed motions under Federal Rule of Evidence 702 to exclude certain expert witnesses from testifying at trial. The district court granted Beam's motion to exclude Snyder's damages expert. The district court concluded that Snyder failed to show that he could obtain lost wages damages on any of the claims. The district court's Rule 702 Order stated that the court “will not permit any evidence or argument as to lost wages, regardless of the witness.” Because Snyder was not permitted to offer any evidence or witnesses to prove his alleged lost wages on any of his three remaining claim, Snyder and Beam settled the promissory estoppel claim, and jointly asked the district court to dismiss the two remaining claims.

Snyder appealed the district court’s summary judgment ruling and Rule 702 Order.

Ownership of trade secrets. To establish a claim under the DTSA or the CUTSA, among other things, a plaintiff must establish the existence of a trade secret, and that the plaintiff took reasonable measures to keep the information secret. The district court determined that “ownership” is an element of both trade secret statutes at issue. The district court then found that Snyder offered insufficient evidence for a reasonable jury to conclude that Snyder “owned” the Guardian Broker List.

On appeal, Snyder argued that the district court erred in finding ownership to be a prerequisite to a claim under the CUTSA. The Tenth Circuit acknowledged that the DTSA expressly allows only an “owner” to pursue a claim for misappropriation. See 18 U.S.C. § 1836(b)(1), while the CUTSA lists “possession” rather than ownership as an element for bringing a claim under the statute. The appellate court accordingly declined to affirm summary judgment on the CUTSA claim based on Snyder’s lack of “ownership” of the Guardian Broker List.

However, the appellate court affirmed the dismissal of Snyder’s CUTSA claim because he failed to meet the “threshold issue” of establishing the existence of a trade secret. There was sufficient evidence in the record below to find that Synder failed to take reasonable measures to maintain the secrecy of the Guardian Broker List under the circumstances. Snyder did not designate the spreadsheet as confidential, restrict Beam’s access to it, protect it with a password, or inform Beam that it contained trade secrets. After discovering his mistake of emailing the Guardian Broker List spreadsheet to ten Beam employees, Snyder did not claw back the Guardian Broker List or notify Beam’s employees of his mistake. Snyder did not object to Beam’s use of the broker contacts. Snyder affirmatively ratified his disclosure by telling Beam’s Chief Executive Officer that he had purposefully shared the Guardian Broker List with Beam’s employees.

“Because no reasonable jury could conclude that Snyder’s actions meet the minimum definition of reasonable measures or efforts to maintain secrecy under the CUTSA or the DTSA, the appellate court affirmed summary judgment on both claims.

Rule 702 Order. On appeals, Snyder did not question the district court’s decision to exclude Adamy from testifying at trial under Rule 702. Rather, he challenged using the Rule 702 Order to exclude all evidence and block all witnesses from testifying on lost wages damages at trial.

The Tenth Circuit agreed with Snyder. The district court’s 702 Order effectively granted summary judgment on the substance of the remaining claims by examining the factual record without the procedural safeguards. The court reversed the district court’ 702 Order to the extent it applied to witnesses other than Snyder’s expert witness.

Dissenting in part opinion. Circuit Judge Robert E. Bacharach filed a separate opinion dissenting in part from the majority’s opinion affirming dismissal of the trade secret claims. Judge Bacharach would have remanded the trade secret claims for the district court to address the open question of whether Snyder lawfully possessed the Guardian Broker List. “Like the majority, I believe that Colorado law allows suit by lawful possessors of the information even if they aren’t considered owners in a conventional sense,” Jude Bacharach said. In Judge Bacharach’s view, the district court erred in considering ownership rather than lawful possession. He would remand the case for the district court to consider the existence of a trade secret, including arguments regarding maintaining secrecy, in the first instance.

The case is No. 24-1136.

Judge: Frederico, R.

Attorneys: Spencer J. Kontnik, Austin M. Cohen, and Matthew L. Fenicle (Kontnik Cohen, LLC) for John Snyder. Donald E. Lake, III (Dickinson Wright PLLC) for Beam Technologies, Inc.

Companies: Beam Technologies, Inc.

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