Trade secrets suit against Miami Beach dismissed
A judge has thrown out one of the first lawsuits brought under the US’s new trade secrets statute, ruling that the standards for filing the suit had not been met.
In the dispute Virginia-based engineering contractor MC Dean accused the City of Miami Beach of improperly passing on confidential information about staff to an electricians’ union.
The complaint, filed in May at the US District Court for the Southern District of Florida, Miami Division, was one of the first under the newly introduced Defend Trade Secrets Act (DTSA), which was signed into law that month.
MC Dean said information about staff salaries, hours worked and qualifications were passed on to the City of Miami Beach and the Local 349 union.
MC Dean is a subcontractor of Clark Construction Group, the general contractor for the Miami Beach Convention Center renovation project. As part of its contractual obligations, MC Dean provides Clark with information about its employees but did not provide the information to the City of Miami Beach.
Local 349 requested copies of some of MC Dean’s payrolls from the city in March this year. MC Dean objected to the disclosure and said the records constituted trade secrets and could not be disclosed.
But, according to the lawsuit, “on or about the afternoon of March 21”, a city clerk improperly and “inadvertently” disclosed unredacted copies of the payrolls to Local 349.
Judge Cecilia Altonaga, in a ruling handed down on Monday, August 8, said MC Dean did not show that it took reasonable steps to protect the information at issue and that provisions of Clark’s contract with the city of Miami Beach, which were also incorporated in MC Dean’s subcontract, required Clark to provide information to the city without restrictions.
The DTSA gives victims of trade secrets theft the power to sue in a federal court, bringing trade secrets laws into line with other forms of intellectual property.
Also, under “extraordinary circumstances”, a judge may order the seizure of another party’s property in order to “prevent the propagation or dissemination of the trade secret that is the subject of the action”.
