UCB Manufacturing, Inc. v. Tris Pharma, Inc.

Summarized by:

  • Court: Intellectual Property Archives
  • Area(s) of Law: Trade Secrets, Contracts
  • Date Filed: 08-27-2013
  • Case #: No. C–0200–10
  • Judge(s)/Court Below: Superior Court of New Jersey, Appellate Division
  • LexisNexis Citation: 2013 N.J. Super. Unpub. LEXIS 2126
  • Westlaw Citation: 2013 WL 4516012
  • Full Text Opinion

Trade secret protection cannot be claimed when information is available in the public domain or through an employee's general knowledge or experience.

Opinion (Per Curiam): UCB Manufacturing, Inc. ("UCB") brought suit against Tris Pharma, Inc. ("Tris") and former employee Yu Hsing Tu ("Tu") for misappropriation of trade secret information in relation to the production of a generic version of Tussionex, a cold medication. Tu was employed by UCB and worked on Tussionex. In 1996 while employed UCB Tu was required to sign a non-disclosure agreement which stated that he would not disclose any of his work, or any of UCB procedures to any current employee without a need to know, nor to an future employer. Tu left UCB and joined Tris in 2001. He immediately began working on a generic version of Delsym, another cold medication, and two years later began working on a generic version of Tussionex. In 2007, Tris filed for abbreviated new drug applications with the FDA and filed for a patent on their new production process. In 2007, UCB sued Tris and Tu for use of its trade secrets in formulating the generic version of Tussionex. The initial suit went to a court of chancery in New York, which found that the information used by Tris in its generic could be found in the public domain and by reverse engineering Tussionex. The appeals court focused first on the claim of trade secret violations and concurred with the chancery judge that a company cannot claim information as trade secret if it is in the public domain. The court also noted that under confidential information may be protected even if it is not a trade secret if the employee's talents are truly unique. However, the employee cannot be considered truly unique if his talents are merely of high value to the former employer. As a result the court held that Tu did not use any of UCB's trade secrets by applying his general knowledge and skill, and employing negative reasoning (knowing what wouldn't work). The court next examined the confidentiality agreement that was signed by Tu while he was employed by UCB. The court recognized the reasoning behind this type of agreement but held that the one signed by Tu was overly broad and would have effectively held Tu "hostage" to his current employer if it were to be enforced. As a result of the court finding that there was no use of trade secret information by Tris. Additionally, the confidentiality agreement was overly broad, so the chancery court's holding was AFFIRMED.

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