IP Law Daily, TRADE SECRETS NEWS: IP Law firm sues former clerk for trade secret misappropriation, (Oct 31, 2023)

By Patricia K. Ruiz, J.D.

The law firm alleged it suffered lost value of misappropriated information, lost profits, and the impairment of future earning capacity and goodwill.

A boutique intellectual property law firm has filed a complaint in the Southern District of Texas alleging its former law clerk misappropriated the firm’s trade secrets after the firm failed to offer him an associate attorney position due to his poor performance. The law firm alleged violations of the Defend Trade Secrets Act and the Texas Uniform Trade Secrets Act (Lloyd & Mousilli, PLLC v. Egan, filed October 27, 2023).

Trade secrets. According to the complaint, Lloyd & Mousilli, PLLC, (L&M) is a boutique law firm specializing in intellectual property and technology law. It developed a valuable brand identity and reputation as the go-to law firm for early-stage startups, including securing a strategic collaboration with a national online trademark provider with whom the collaboration terms were strictly confidential and of great commercial value. The brand value and substantial goodwill is directly attributable to L&M’s extensive and confidential client list, confidential legal strategies, practice group handbooks, and value-driven pricing models.

Alleged misappropriation. L&M alleges that its former law clerk provided subpar services as an independent contractor. Due to his performance, L&M declined to offer him an associate attorney position. L&M alleges that, disgruntled and upset that he had not received a job offer from any other law firm, the former law clerk retaliated by unlawfully misappropriating L&M’s trade secrets. The complaint alleges that, prior to being terminated, the former law clerk had access to L&M’s confidential information and trade secrets, including valuable strategic collaborations, practice group strategy handbooks, the identity of L&M’s clients, their matter and billing histories, information concerning the unique needs of L&M’s clients, vendor lists, business prospects, business opportunities, process methods and controls, and other information. L&M does not publicize this information and has spent considerable time, effort, and resources to maintain its confidential nature.

Damages. L&M alleges that, as a probable and foreseeable consequence of the former law clerk’s theft of trade secrets, the firm suffered significant damages, including lost value of the misappropriated information, lost profits, and the impairment of L&M’s future earning capacity and goodwill. L&M seeks exemplary damages against the former law clerk for willful and malicious misappropriation of the firm’s trade secrets under the DTSA. It also seeks injunctive relief, interest, and costs and attorney fees.

The Case is No. 4:23-cv-04094.

Attorneys: Feras Mousilli (Lloyd & Mousilli, PLLC) for Lloyd & Mousilli, PLLC.

Companies: Lloyd & Mousilli, PLLC

News: TradeSecrets TexasNews GCNNews