Professional Investigating & Consulting Agency, Inc. v. Hewlett-Packard Company

C.A. No. N12C-06-196 MMJ CCLD
State Court
Delaware
New Castle County Superior Court

In this case during a twelve day trial, the jury found that Plaintiff, Professional Investigating & Consulting Agency, Inc.’s (“PICA”) Channel Management Program, was a trade secret and that Defendant, Hewlett-Packard Company (“HP”) wilfully and maliciously misappropriated the Channel Management Proposal. On the Channel Management Proposal misappropriation claim, the jury awarded PICA $300,000 in damages for out of pocket expenses and lost profits as well $700,000 for HP’s unjust enrichment.

On March 23, 2015, the New Castle County Delaware Superior Court decided on the parties’ post-trial motions. The court granted in part and denied in part PICA’s motions for exemplary damages and attorneys’ fees, attorneys’ fees and expenses, and costs and interest. The court also denied HP’s motion for a new trial or remittitur and renewed motion for judgment as a matter of law. Regarding the trade secret misappropriation verdict, HP argued that PICA did not present evidence that it derived any economic value from the Channel Management Program not being generally well-known because “every aspect of PICA’s proposal was generally known”, and that PICA attempted to keep the program confidential. The court, however, applied Delaware’s Uniform Trade Secret Act (“DUSTA”) and found that PICA provided extensive evidence at trial that though some of the components of PICA’s program was a trade secret, the program as a whole was a trade secret and that the jury’s damage award was not duplicative.

The court also applied the DUSTA when it granted in part and denied in part PICA’s motion for exemplary damages and attorneys’ fees. Although PICA moved for the court to grant two million dollars in exemplary damages (the maximum amount allowed under the DUSTA), the court followed the guidance of Agilent Technologies, Inc. v. Kirkland and denied exemplary damages. Agilent took the approach of making the plaintiff “whole and to deprive [the defendant] of unjust rewards.” The court here analogized this case to Agilent, where further punishment through exemplary damages were unnecessary because the court had already granted a “stringent remedy that [would] sufficiently vindicate the interests of [the plaintiff] and those more generally protected by the Delaware Uniform Trade Secrets Act.” In the current case, the court held that “the jury’s $1 million award reasonably compensates PICA for misappropriation of its trade secrets… [and] in light of the total jury verdict, the Court decline[d] to impose an additional amount for exemplary damages for punitive purposes.”
This case is significant because the court demonstrates that though the DUTSA permits a court to award exemplary damages in cases where wilful and malicious misappropriation exists, the bar for granting exemplary damages will be set high in cases where the total jury verdict already reasonably compensates the plaintiff for the misappropriation. Though the bar is set high for exemplary damages, this wasn’t much of a total loss for the plaintiff because the court granted the plaintiff’s requested 75% of attorneys’ fees for the entire litigation of the Channel Management Program misappropriation claim as well as 75% of attorneys’ fees and expenses incurred by PICA since July 29, 2013 due to HP’s bad faith throughout the discovery process. Although PICA was not able to obtain exemplary damages, the court did grant PICA to recover for most of the costs incurred with the claims which it prevailed on.

J., Johnston
INC., Professional Investigating & Consulting Agency
Hewlett–Packard Company
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