Columbus Managing Partner Greg Brunton and Senior Counsel Eric Bravo obtained a victory in the United States Court of Appeals for the Sixth Circuit, winning affirmance of a summary judgment in favor of firm client SOS Security, LLC on claims of misappropriation of trade secrets, breach of contract, and quantum meruit.
The legal dispute between SOS Security and Professional Investigating and Consulting Agency Inc. ("PICA") traces back to 2014 when SOS considered acquiring PICA. The parties signed a nondisclosure agreement, initiated purchase negotiations, and collaborated on specific projects. The agreement required PICA to share its financial and operational information with SOS, including customer and vendor lists, salaries, pricing schedules, and anticipated growth opportunities, and limited SOS's use of the information to a potential purchase of PICA. Despite presenting two purchase offers, both of which PICA rejected, SOS eventually halted its acquisition efforts, leading to the termination of their collaboration.
SOS continued to grow, acquiring other security companies and being then acquired by a larger company. PICA, however, struggled, with profits falling and clients being lost to SOS.
PICA then sued SOS for numerous claims, including misappropriating trade secrets. SOS won a dismissal of some claims via a motion to dismiss and, following discovery, prevailed on the rest of the claims on summary judgment. PICA appealed three claims subject to summary judgment: misappropriation of trade secrets, breach of contract, and quantum meruit.
In a May 10, 2024 decision, the U.S. Sixth Circuit Court of Appeals affirmed summary judgment on all three claims. The court's ruling was based on the argument that although SOS had access to the plaintiff's trade secrets and then used a system or process with similar features to the plaintiff's, "broad similarities are not enough," and that "defendant's product or process must bear substantial similarities to plaintiff's secret, not plaintiff's product or process more generally." The court further held that PICA "hasn't shown the connection between SOS's services and PICA's trade secrets necessary to support an inference of misappropriation."
Law360 quoted Bravo, who stated that SOS and GRSM are "very pleased with the Sixth Circuit's decision, as [they] believe the Southern District of Ohio Court ruled correctly in granting summary judgment for SOS in March 2023, and that the Sixth Circuit therefore ruled correctly in accepting every one of [the] arguments for affirming the District Court."
Law360 covered this successful result here. Intellectual Property Law News Daily also covered this success here. Subscription may be required.
(Professional Investigating and Consulting Agency Inc. v. SOS Security LLC, No. 23-3344, 2024 WL 2106223 (6th Cir. May 10, 2024))