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Court rules in favor of employer in trade secret case
Securities | 2008/02/07 05:20

Trade secrets are trade secrets, even if they're tucked away in the memory of a former employee, the Ohio State Supreme Court has ruled in a dispute involving a Westerville company.

The state's highest court Wednesday unanimously affirmed an earlier judgment that Al Minor & Associates Inc. was right in taking a former worker to court over the issue of trade secrets ownership. The Westerville business sued Robert E. Martin in 2003 after he had solicited 15 clients following a split with the company to start his own management firm. Martin contacted several of Minor & Associates' clients, relying on his recollection, and eventually signed them with his business.

Martin hadn't signed noncompete or trade secrets nondisclosure agreements when he left the business, but Minor & Associates argued before a Franklin County court that his actions constituted a violation of state trade secret laws. Martin's lawyer argued that because the information wasn't in the form of a physical list or obtained through "studied memorization," it was exempt from the rules.

Martin was fined $25,973 when the court ruled in favor of Minor & Associates but he took the case to the 10th District Court of Appeals. The appellate court affirmed the lower court's ruling but passed the dispute on to the state Supreme Court because it conflicted with a decision in a different district on the same issue.

In the ruling this week, authored by Justice Terrence O'Donnell, the high court said protected information doesn't lose its status just because it isn't in a tangible form. State law defines the nature of a trade secret but doesn't specify if casually memorized information is excluded - and it could have, the court ruled.

"We are not in a position to read such language into the statute," O'Donnell wrote.



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