Facts

Hill Phoenix Inc., a subsidiary of Dover Corporation, made a written employment offer to both David Rogers and Thomas Lowe. Both agreed to the Dover Corporation's Code of Business Conduct and Ethics, which provides that employees must use their business devices for business purposes and prohibited them from using confidential information or trade secrets obtained while on the job. In December 2018, Rogers and Travis VanderLoon formed a new company called Tyler Refrigeration SoCal LLC, later changed to Classic Refrigeration SoCal, Inc. Rogers and Lowe left Hill Phoenix for Classic Refrigeration on January 3, 2019, and March 14, 2019, respectively. Many of Hill Phoenix's employees have since left to work for Classic Refrigeration. Hill Phoenix brought suit against Classic Refrigeration, Rogers, Lowe, and VanderLoon, alleging eight causes of action related to the use of trade secrets acquired while working for Hill Phoenix and the founding and conduct of Classic Refrigeration. Hill Phoenix and VanderLoon reached a settlement, so the case was only tried as to the remaining defendants.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendants misappropriated trade secrets learned during their employment with plaintiff to start their new business, including using a customer list, master location list, wage matrix, costing templates, a sales contract with detailed pricing information, and an installation proposal with confidential information. Plaintiff further alleged that Classic Refrigeration misappropriated and misused Hill Phoenix's confidential and trade secret information, giving it an unfair and illegal competitive advantage. Additionally, plaintiff argued that Rogers and Lowe violated their employment contracts by disclosing and utilizing trade secrets or other confidential materials after their employment.

DEFENDANTS' CONTENTIONS: Defendants contended that the alleged trade secrets were not eligible for protection because the information allegedly was easily obtainable online and not proprietary or unique. Rogers and Lowe also disputed whether their employment contracts were ever formed (an issue disposed of against them on summary judgment), whether they performed under the terms of the employment contracts, and whether they breached any contractual confidentiality obligation. In particular, defendants argued that they did not breach the contract because the information obtained from plaintiff was allegedly information generally known in the relevant refrigeration industry and thus, not confidential. Defendants also contended that they did not misuse any Hill Phoenix information in forming and operating Classic Refrigeration. Rogers also asserted a dozen counterclaims against Hill Phoenix arising from Hill Phoenix's alleged breach of the employment agreement and related theories.

Result

On July 14, 2021, the jury found in favor of Hill Phoenix, Inc. and against Rogers and Lowe, on Hill Phoenix's claims for breach of contract and breach of fiduciary duty. The jury also found both Lowe and Classic liable for violations of the California Uniform Trade Secrets Act, and awarded Hill Phoenix $2,875,000 in damages against Classic. No damages were awarded against Rogers or Lowe. The jury also found against Rogers on each of his counterclaims.