Top 10 Trade Secret Verdicts

A trade secret, according to the World Intellectual Property Organization, is defined as:

Broadly speaking, any confidential business information which provides an enterprise a competitive edge may be considered a trade secret. Trade secrets encompass manufacturing or industrial secrets and commercial secrets. The unauthorized use of such information by persons other than the holder is regarded as an unfair practice and a violation of the trade secret. Depending on the legal system, the protection of trade secrets forms part of the general concept of protection against unfair competition or is based on specific provisions or case law on the protection of confidential information.

The subject matter of trade secrets is usually defined in broad terms and includes sales methods, distribution methods, consumer profiles, advertising strategies, lists of suppliers and clients, and manufacturing processes. While a final determination of what information constitutes a trade secret will depend on the circumstances of each individual case, clearly unfair practices in respect of secret information include industrial or commercial espionage, breach of contract and breach of confidence.”

In a recent article written by Cam Phan and Rob Shwarts of Orrick, Herrington & Sutcliffe LLP’s Trade Secrets Group, they summarized the top ten verdicts on record:


Rank Award Prevailing Party Case Name Post-Verdict Result
#1 $2.3 billion St. Jude Medical Pacesetter Inc. v. Nervicon Co., BC424443, California Superior Court, Los Angeles County (April 2011) Reduced to $947 million
#2 $919.9 million E.I. du Pont de Nemours E.I. du Pont de Nemours & Co. v. Kolon Industries, Inc., 3:09-cv-00058, U.S. District Court, Eastern District of Virginia (Sept. 2011) Currently on appeal in the Fourth Circuit
#3 $465.4 million Lexar Media Lexar Media, Inc. v. Toshiba Corp., CV-812458, California Superior Court, Santa Clara County (March 2005) Trial court ordered new trial on damages; parties later settled for $288 million
#4 $310 million
($88.4 milliontrade secret award, plus attorneys’ fees and punitive damages)
MGA Entertainment Bryant v. Mattel, 2:04-cv-09049, U.S. District Court, Central District of California (April 2011) On re-trial of Bryant v. Mattel (see below);
trial judge reduced trade secret award to $85 million but awarded $85 million in punitive damages and $139 million in legal fees; Ninth Circuit vacated $172 million judgment but upheld $137 million in legal fees
#5 $192 million Sven Peter Mannsfeld Sven Peter Mannsfeld v. Phenolchemie Inc. et al., CV-2006-001956.00, Alabama Circuit Court, Mobile County (Oct. 2008) Settled for $40 million
#6 $134 million USA Power USA Power LLC v. PacifiCorp, 050903412, Utah Third District Court, Salt Lake County (May 2012)
#7 $118 million Bancorp Services Bancorp Services LLC v. Hartford Life Insurance, 4:00-CV-70, U.S. District Court, Eastern District of Missouri (March 2002)
#8 $112 million Brocade Communications Systems Brocade Communications Systems Inc. v. A10 Networks Inc., 5:10-cv-03428, U.S. District Court, Northern District of California (Aug. 2012) Trial judge reduced to approximately $62 million and granted A10’s motion for a new damages trial; parties later settled for $75 million
#9 $100 million Mattel Bryant v. Mattel, 2:04-cv-09049, U.S. District Court, Central District of California (Aug. 2008) Ninth Circuit vacated the award and judgment; case re-tried (see above)
#10 $94 million Wellogix Wellogix Inc. v. BP America Inc. et al., 3:08-cv-00119, U.S. District Court, Southern District of Texas (May 2011) Trial judge reduced to $44.4 million;Fifth Circut

The article goes on to state:

“Trials are expensive. They’re also unpredictable. So when a plaintiff seeking damages in a trade secret case decides to take the case all the way through trial, it’s hoping for a jackpot. Otherwise the costs and risks of trial likely wouldn’t make it worth gambling the result on a jury.”

A critical step in assessing the worth of a trade secrets claim is understanding the damages. At least a preliminary assessment of damages should be reached early in the process with the assistance of an expert who can help you understand the value of your case.  See here for advice on how to value intellectual property.

Permanent link to this article:

Leave a Reply

Your email address will not be published.