Trade Secrets: Failure To Identify Trade Secret With Particularity Meant Plaintiff’s Case Was Baseless, Justifying A Fee Award Of More Than $202,291.50 To Defendant

Civil Code Section 3426.4 Was the Fee Entitlement Predicate.

     Civil Code section 3426.4 allows a prevailing party in a trade secret misappropriation case to obtain a discretionary award of attorney’s fees and costs if the claim is made in bad faith. Case law has clarified that both objective speciousness and subjective bad faith are required to demonstrate “bad faith” in bringing or prosecuting the claim. (SASCO v. Rosendin Elec., Inc., 207 Cal.App.4th 837, 844-845 (2012).)

     Plaintiff, after suffering a summary judgment defeat in which it failed to prove the nature of the trade secret with particularity, then was hit with $202,291.50 in fees under section 3426.4.

     That result was affirmed on a 3-0 panel in All American Semiconductor, LLC v. APX Technology Corp., Case Nos. G046605 et al. (4th Dist., Div. 3 Aug. 14, 2013) (unpublished), authored by Justice Aronson.

     Plaintiff’s failure to even identify the trade secret was damning before both the trial and appellate courts, with a defense bare, conclusory declaration not overcoming the complete lack of evidence on the particulars of the alleged trade secret design.