Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_13-cv-01081/USCOURTS-cand-5_13-cv-01081-18/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

---

1 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA 

SAN JOSE DIVISION

GSI TECHNOLOGY, INC.,

 Plaintiff,

 v. 

UNITED MEMORIES, INC., et al., 

 Defendants. 

)

) 

) 

) 

) 

) 

) 

) 

) 

)

Case No. 5:13-cv-01081-PSG

ORDERING DENYING MOTION 

FOR SUMMARY JUDGMENT 

(Re: Docket No. 320) 

Plaintiff GSI Technology, Inc. has a problem with its trade secret claim against Defendant 

United Memories, Inc.: GSI doesn’t actually own any of the 576 Mb low latency DRAM 

semiconductor trade secrets that UMI supposedly misappropriated. Or at least that what UMI says

in its motion for summary judgment. UMI and GSI were once partners; UMI designed the 576Mb 

chip for GSI under a now-terminated contract.

1

 GSI claims that after the parties’ falling out, UMI 

put 576 Mb trade secrets that belong to GSI into an “Atris” chip database UMI sold to Defendant 

Integrated Silicon Solutions, Inc.

2

 

Because GSI’s efforts to protect its claimed secrets remain in genuine dispute, the court 

DENIES UMI’s motion.

 

1 See Docket No. 320-1 at 3. 

2 See id.

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 1 of 9
2 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

I.

UMI is a Colorado company that provides integrated circuit design and layout services.3 

GSI is a California corporation that designs, develops and markets computer memory products.4 In 

May 2008, UMI signed an agreement to provide design and layout services for GSI’s 576 Mb 

chip.5 The parties initially planned to leverage UMI’s work in designing a different, more 

advanced chip called “Atris” that GSI would supply to Cisco Systems.

6

 UMI ultimately delivered 

to GSI a final 576 MB chip design, along with various UMI internal emails and communications, 

third-party documents, circuit schematics and a library.

7

 But the relationship between the parties 

had run its course and ultimately terminated.

8

 

More than three years later, Cisco solicited bids for a supply of Atris chips.9 GSI submitted 

a bid, but lost out to ISSI.

10 After GSI learned that ISSI had worked with UMI to prepare its 

winning bid, GSI filed this suit against UMI with claims for breach of contract, violation of 

California’s Unfair Competition Law and a declaratory judgment as to the rights conferred by the 

576Mb agreement.

11 

GSI later amended its complaint, adding ISSI as a party and asserting four more state law 

causes of action: fraud, false promise, misappropriation of trade secrets and intentional 

 

3 See Docket No. 320-1 at 1-2. 

4 See id. at 2. 

5 See id. 

6 See Docket No. 187-4 at ¶¶ 29-30. 

7 See id.; Docket No. 284-8 at 2; Docket No. 284-9 at 2; Docket No. 345-5 at 6.

8 See Docket No. 320-1 at 2. 

9 See id.; see also Docket No. 187-4 at ¶ 63. 

10 See Docket No. 187-4 at ¶ 68; Docket No. 245 at ¶ 64. 

11 See Cal. Bus. & Prof. Code § 17200; see also Docket No. 320-1 at 2. GSI further requested a 

temporary restraining order against UMI, which the court denied. See Docket No. 24. The court 

later denied GSI’s motion for preliminary injunction. See Docket Nos. 160, 176, 203.

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 2 of 9
3 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

interference with prospective economic advantage.12 After the court granted-in-part Defendants’ 

motion to dismiss, a subset of claims remain: GSI’s claims for unfair competition and intentional 

interference with prospective economic advantage against ISSI and GSI’s claim for 

misappropriation of trade secrets against both ISSI and UMI.

13 

The simple matter of identifying the trade secrets at issue has not been simple. For months 

GSI avoided saying exactly what secrets were taken, pointing to the limited discovery tendered on 

the subject by UMI. After a hearing last August on seven discovery motions, the court finally 

ordered GSI to “clearly and specifically identify all its claimed trade secrets to move forward.”14 

GSI identified two sets of trade secrets, one for the 576 Mb chip and another for Atris.15 As to the

576 Mb chip, GSI identified a compilation of roughly 46,000 pages, characterized as “the 576 Mb 

chip layout, library and schematic database, delivered in the final form of June 9, 2009, as an entire 

compilation.”16 In addition, GSI identified five designs within the compilation: the “Coherent 

Register ‘write’ phase design,” “Output Impedance Calibration design,” “Boundary scan design,” 

“Reduced latency design” and “Broadside column address design.”17

Focusing exclusively on GSI’s underlying ownership of the 576 Mb trade secrets it 

identified, and GSI’s reasonable efforts to preserve such secrets, UMI now moves for summary 

judgment on GSI’s claim that it misappropriated GSI’s secrets.

18 

 

12 See Docket No. 159. 

13 See Docket No. 227 at 17. The court dismissed GSI’s federal tort claims. 

14 Docket No. 276 at 1. 

15 See Docket No. 284-9 at 1, 5; Docket No. 346 at 5. 

16 Docket No. 284-8 at 2; Docket No. 284-9 at 2. In its opposition to the pending motion, GSI tried

to trim its definition of its trade secrets, limiting its combination claim (originally the 46,000 page 

compilation) to include only its grouping of circuit schematics. In response, ISSI filed a motion to 

enforce the court’s August order to hold GSI to its earlier identification. Having warned GSI 

earlier that it needed to define its secrets once and for all, the court granted ISSI’s motion. See 

Docket No. 415.

17 See Docket No. 284-9 at 104; Docket No. 346 at 5-6. 

18 See Docket No. 320. A plaintiff must show three elements: the plaintiff’s ownership of the 

secrets, the defendant’s acquisition, disclosure or use of the trade secret through improper means 

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 3 of 9
4 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

II.

This court has jurisdiction under 28 U.S.C. § 1367. The parties further consented to the 

jurisdiction of the undersigned under 28 U.S.C. § 636(c) and Fed. R. Civ. P. 72(a).19

III.

A court may grant summary judgment when the pleadings, depositions and answers to 

interrogatories and admissions on file show no genuine dispute of material fact.20 There is a 

genuine dispute of material fact when a reasonable jury can return a verdict for the nonmovant 

based on the evidence.21 Further, all justified inferences are drawn in favor of the nonmovant.22 

Because a reasonable jury could find that GSI may claim the trade secrets at issue at its own, 

UMI’s motion for summary judgment must be denied.

First, GSI has met its burden to show that the parties’ agreement assigned all rights in the 

claimed secrets to GSI.

23 Article III.1, “Ownership,” provides that: 

GSI has sole ownership of all deliverables and the Product, and all associated 

intellectual property rights (excluding solely any Project Patents that UMI owns 

under the terms of Article IV) and all other works of authorship . . . and other 

intellectual property rights conceived, developed or reduced to practice by GSI, 

alone or with others, during the course of the Project (collectively, the “GSI IP”). 

This includes, without limitation, the following: the specification of the Product, 

the layout (database) of the Product, circuit simulations and/or HDL descriptions of 

the Product.

24

 

and the plaintiff’s harm from the defendant’s actions. See Imax Corp. v. Cinema Techs., Inc., 152 

F.3d 1161, 1164 (9th Cir. 1998) (citations omitted); Berster Techs., LLC v. Christmas, Case No. 

11-cv-1541-KJM, 2012 WL 33031, at *9 (E.D. Cal. Jan. 1, 2012). 

19 See Docket Nos. 7, 15, 236. 

20 See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). 

 

21 See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 258 (1986). 

22 See id. at 255. 

23 Although UMI and GSI disagree as to whether California or Colorado law governs GSI’s trade 

secret claims, both states place the burden of proving ownership on the plaintiff. See Cal. Civ. 

Code § 3426.1(b); Colo. Rev. Stat. Ann. 7-74-102(2). 

24 Docket No. 346-2 at III.1. 

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 4 of 9
5 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

Although “deliverables” is not a defined term, the agreement sets out what UMI was obligated to 

“deliver” to GSI.25 Under the agreement, UMI was to timely “[d]eliver the items listed in Exhibit 

B.”26 The deliverables identified in Exhibit B include all circuit and HSPICE schematics.

27 While 

UMI protests that Exhibit B merely lists milestones, not deliverables, it ignores the clear distinction 

in the exhibit between milestones, which are specific points in time during the project, and 

deliverables, which are the UMI works due. As the schematics are “deliverables” under the 

agreement, they are plainly owned by GSI.28 

 The other claimed secrets also are deliverables under the agreement. For example, the 

compilation is merely the database of information transferred from UMI to GSI—that is, a 

collection of the various deliverables.

29 Because GSI owns the individual deliverables under the 

agreement, it also owns the deliverables collectively.30 Nowhere does the agreement reserve for 

UMI any intellectual property rights in the compilation as a whole.31 Similarly, the library is a 

deliverable. The library is included in the layout database, which even UMI admits belongs to GSI 

 

25 See Docket No. 346-2 at II.1.1(b). 

26 Id.

27 See id. at Ex. B. 

28 See id. at II.1.1(b), III.1 and Ex. B. UMI also makes much of the fact that Exhibit B does not list 

the layout as a deliverable and so cannot be a deliverable assigned to GSI. But the layout is 

specifically called out as being assigned to GSI in the language of Article III.1 itself. See Article 

III.1.

29 See Docket No. 345-8 at 2-3. 

30 Cf. Forro Precision, Inc. v. IBM Corp., 673 F.2d 1045, 1057 (9th Cir. 1982).

31 See Docket No. 346-2, passim and at III.1 (reserving UMI’s intellectual property rights with 

respect to only Project Patents and intellectual property developed prior to or independent of the 

agreement).

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 5 of 9
6 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

under the agreement.32 And as with the compilation, nowhere does the agreement reserve for UMI 

ownership in the library.

33 

 That GSI owns the 576 Mb trade secrets is clear under an additional provision in the 

agreement. No party disputes that GSI owns all intellectual property rights, “excluding solely any 

Project Patents,” associated with the deliverables and the product as a whole.34 Because the trade 

secret rights “associated” with a deliverable or product cannot refer merely to the deliverable or 

product itself, it must refer to the information, methods, techniques or processes used to create the 

product. Nothing in this language limits these rights, as UMI suggests, only to those conceived, 

developed or reduced to practice by GSI. The provision includes such rights for sure, but it does 

not exclude all others, as UMI would have it.

 UMI contends that GSI’s ownership claims are nevertheless undermined by evidence

external to the contract, specifically, UMI’s labeling of the schematics as “United Memories, Inc. 

Confidential” and GSI’s silence in response despite its review and notice obligation under Article 

II.7 following delivery.35 Even so, other extrinsic evidence is consistent with the notion that, 

before the initiation of litigation, UMI agreed that schematics are “deliverables” under the 

agreement:

• At the final design review, UMI presented slides identifying “[s]chematics” among the 

“[d]eliverables” in a slide discussing “[c]ontract items.”36

• In December 2008, UMI’s President Jon Faue identified schematics as “deliverables” 

under the agreement when transferring the deliverables.37 

 

32 See Docket No. 346-18 at ¶ 7; Docket No. 243-1 at III.1.

33 See Docket No. 346-2, passim; Docket No. 320, passim. 

34 “Product” refers to a DRAM chip developed pursuant to the designated specification. See 

Docket No. 346-2 at 1, Recital C.

35 Docket No. 346-2 at II.7.

36 Docket No. 345-11, Ex. G, at UMI_0001178. 

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 6 of 9
7 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

UMI’s final pitch for its interpretation is that at most GSI enjoys a non-exclusive license to 

the trade secrets at issue. But under Article III.1, GSI’s non-exclusive license is to intellectual 

property that UMI contributed to the product or deliverables and which was developed either prior 

to the execution of the agreement or independent from the agreement.38 Under Articles III.1 and 

IV, GSI also enjoys a non-exclusive license to any patentable inventions developed solely by UMI 

in the course of the project.39 And so if UMI brought its own know-how to the project, or solely 

developed a patentable invention in the course of the project, UMI retained its intellectual property 

rights, but granted GSI a license to that intellectual property so that GSI may produce the product 

without infringing. This is anything but, as UMI suggests, a reservation of all intellectual property 

rights in the product and deliverables, whereby GSI owns the physical copy of what it purchased 

and nothing else. 

Second, a reasonable jury could find that GSI took reasonable measures to maintain the 

confidentiality of the alleged trade secrets.40 Trade secrets remain protectable so long as the owner 

has taken “efforts that are reasonable under the circumstances to maintain its secrecy.”41 “Efforts 

at maintaining secrecy need not be extreme, just reasonable under the circumstances.”42 The 

owner must have “intended its [information] to remain secret and under[taken] steps to secure that 

end.”43 

 37 Docket No. 345-8, Ex. D (including among the “[d]eliverables” transferred to GSI all circuit 

schematics and HSPICE schematics and parasitics).

38 See Docket No. 346-2 at III.1, IV. 

39 See id.

40 See Silicon Image, Inc. v. Analogix Semiconductor, Inc., Case No. 3:07-cv-00635-JCS, 2008 WL 

166950, at *14 (N.D. Cal. Jan. 17, 2008). 

41 Cal. Civ. Code § 3426.1(d) (emphasis added).

42 Religious Tech. Ctr. v. Netcom On-Line Comm’ncs Servs., Inc., 923 F. Supp. 1231, 1254 (N.D. 

Cal. 1995); accord Network Telecomm., Inc. v. Boor-Crepean, 790 P.2d 901, 902 (Colo. Ct. App. 

1990) (efforts need not be extreme or unduly expensive). 

43Morlife, Inc. v. Perry, 56 Cal. App. 4th 1514, 1523 (1997). “Reasonable efforts” might include 

advising others of the existence of a trade secret, limiting access to the information on a “need to 

know basis,” or requiring employees to sign confidentiality agreements. See Courtesy Temporary 

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 7 of 9
8 

Case No. 5:13-01081-PSG

ORDER DENYING MOTION FOR SUMMARY JUDGMENT 

1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

United States District Court

For the Northern District of California

While UMI offers evidence to the contrary,44 GSI offers enough evidence of its own to 

carry the day on this issue with a reasonable jury. For example, knowing that UMI would be the 

principal designer, but not the owner, of the trade secrets, GSI contractually obligated UMI—the 

only outside source with access to the trade secrets—to maintain their confidentiality.45 Under the 

agreement, UMI was required to keep confidential information secret and to take “all reasonable 

steps to prevent unauthorized disclosure or use of the disclosing party’s confidential information 

and to prevent it from falling into the public domain or into the possession of unauthorized 

persons.”46 UMI could show trade secret information only to persons requiring access to “effect

the intent of this Agreement.”47 All employees of UMI accessing GSI’s trade secrets were required 

to enter into a written confidentiality agreement with UMI.48 The agreement further requires UMI 

to designate written materials and documents containing trade secret information as confidential 

and secret.49 The agreement further protects GSI from UMI’s use of trade secret information with 

a competitor through a five-year non-compete provision.50 

 

Serv., Inc. v. Camacho, 222 Cal. App. 3d 1278, 1288 (1990); MAI Sys. Corp. v. Peak Computer, 

991 F.2d 511, 521 (9th Cir. 1993); see also Port-a-Pour, Inc. v. Peak Innovations, Inc., Case No. 

13-cv-01511-WYD, 2014 WL 2766775, at *17-18 (D. Colo. June 17, 2014); SBM Site Servs., LLC 

v. Garrett, 2011 WL 7563785, *10 (D. Colo. June 13, 2011); see also Mineral Deposits Ltd. v. 

Zigan, 773 P.2d 606, 608 (1998). 

 44 UMI relies principally on a letter dated in July 2009 in which UMI states that it does not believe 

that it is in possession of confidential information “given to UMI by GSI” (Docket No. 320 at 23; 

see also Docket No 1, Exhibit B). UMI asked GSI to respond if the statement were untrue, but GSI 

said nothing. 

45 See Docket No. 345-1 at III.1.

46 Id. at VI.1. 

47 See id.

48 See id.

49 See id. at VI.3.

50 See id. at VII.5.

Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 8 of 9
Case 5:13-cv-01081-PSG Document 450 Filed 04/20/15 Page 9 of 9