IP Law Daily, TRADE SECRETS—M.D. Fla.: Misappropriation of trade secrets claims dismissed against ex-employees turned competitors, (Aug 13, 2026)

By Jonathan Anderson

Plaintiff did not take reasonable measures to protect the allegedly confidential information and therefore did not establish the existence of a trade secret.

The Federal District Court in Tampa, Florida, dismissed a lawsuit alleging misappropriation of trade secrets and other related claims against two former employees of a coating company who started their own competing business. The court held that plaintiff did not take reasonable measures to protect the allegedly confidential information regarding a coating process, therefore failing to establish the existence of a trade secret. The court also declined to exercise supplemental jurisdiction over state law claims of breach of fiduciary duty and tortious interference (Surface Engineering v. US Thermal Spray, LLC, No. 8:24-cv-00483-JLB-AEP (M.D. Fla. Aug. 6, 2026)).

Background. Surface Engineering and Alloy Company, Inc. d/b/a Extreme Coatings, sued two former employees and a new competing business they formed, US Thermal Spray, LLC. Count I alleges misappropriation of trade secrets under the federal Defend Trade Secrets Act of 2016 (DTSA), and Count II alleges misappropriation of trade secrets under the Florida Uniform Trade Secrets Act (FUTSA). Count III alleges breach of fiduciary duty. Count IV alleges tortious interference. Extreme alleges that the totality of its feed screw refurbishment and recoating process constitutes a trade secret.

Defendants filed a Motion for Summary Judgment on all Four Counts of the Amended Complaint. Plaintiff filed a Corrected Motion for Partial Summary Judgment as to Liability for Breach of Fiduciary Duty.

Non-existence of trade secret. The court granted summary judgment in favor of defendants on Counts I and II, finding that plaintiff failed to take reasonable measures to protect its information. Under Fla. Stat. § 688.002(4), to prove a trade secret, a plaintiff must show that it possessed confidential information and took reasonable steps to protect its secrecy. The court wrote that no reasonable jury could conclude that plaintiff reasonably protected the secrecy of the information on Extreme’s coating process. The court observed that Extreme’s employment manual did not address trade secrets or their confidentiality, and that Extreme has no written non-disclosure or confidentiality agreements with defendants. Further, the court noted that training manuals containing technical procedures are not required to be returned to the company and are not stamped confidential. The company’s manuals are stored on a server where access is permitted without a password. Therefore, the court found that no genuine issues of material fact remain on the existence of a trade secret, and that defendants are entitled to judgment as a matter of law.

Breach of fiduciary duty and tortious interference. The court declined to exercise supplemental jurisdiction over the state law claims of breach of fiduciary duty and tortious interference as set forth in Counts III and IV, respectively. The court wrote it found, in its discretion, that it should avoid deciding any independent state law claims that may or may not exist, instead leaving that evaluation to the Florida courts. Thus, the court dismissed Counts III and IV without prejudice and denied Plaintiff’s motion as moot.

The Case is No. 8:24-cv-00483-JLB-AEP.

Judge: Badalamenti, J.

Attorneys: Frank R. Jakes (Ruppel & Burns, LLP) for Surface Engineering and Alloy Co., Inc. Richard Gale Porter, Jr. (Porter Law Group Inc.) for US Thermal Spray, LLC.

Companies: Surface Engineering and Alloy Co., Inc.; US Thermal Spray, LLC

Cases: TradeSecrets FloridaNews