First Fin. Bank, N.A. v. Scott Bauknecht & State Bank of Graymont

Summarized by:

  • Court: Intellectual Property Archives
  • Area(s) of Law: Trade Secrets
  • Date Filed: 10-24-2014
  • Case #: 12-cv-1509
  • Judge(s)/Court Below: United States District Court for the Central District of Illinois, Peoria Division
  • LexisNexis Citation: 2014 U.S. Dist. LEXIS 151244
  • Full Text Opinion

A Defendant May be Liable for the Misappropriation of a Trade Secret if Defendant Acquired the Information Through Improper Means and Disclosed the Information Without Authorization.

Opinion (McDade): Plaintiff First Financial Bank (First Financial) is a regional bank. Defendant Bauknecht is a former employee of First Financial and Defendant Graymont is a competitor of First Financial. First Financial claimed that Bauknecht misappropriated its trade secret by disclosing customer financial information to Graymont Bank after signing a confidentiality agreement with First Financial. Additionally, First Financial claims that Graymont misappropriated its trade secret by having knowledge “that the trade secret was acquired by improper means or obtained in violation of a duty of confidence.” Pursuant to the Illinois Trade Secret Act (ITSA), First Financial “must show that (1) a trade secret existed; (2) it was misappropriated through improper acquisition, disclosure, or use; and (3) the misappropriation damaged the trade secret's owner.” As to the first element, the Court found that the customer financial information was a trade secret because it was “economically valuable” and First Financial “took reasonable steps to keep the information confidential.” As to the second element, the Court determined that Bauknecht misappropriated First Financial’s trade secret because Bauknecht acquired the information through improper means and divulged the information to Graymont Bank without authorization from First Financial. As to the third element, there is sufficient evidence that Bauknecht misappropriated First Financial’s trade secret and First Financial would likely be awarded damages. Whether or not Graymont misappropriated First Financial’s trade secret is still in dispute. Motion for Summary Judgment against Bauknecht by Plaintiff was GRANTED.

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