Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca6-14-03563/USCOURTS-ca6-14-03563-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 

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RECOMMENDED FOR FULL-TEXT PUBLICATION 

Pursuant to Sixth Circuit I.O.P. 32.1(b) 

File Name: 15a0264p.06 

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT 

_________________ 

ALLIED ERECTING AND DISMANTLING CO., INC.;

ALLIED-GATOR, INC., 

Plaintiffs-Appellants, 

v. 

GENESIS EQUIPMENT & MANUFACTURING, INC., 

Defendant, 

GENESIS ATTACHMENTS, LLC; INTERNATIONAL 

EQUIPMENT SOLUTIONS, LLC, 

Defendants-Appellees. 

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No. 14-3563 

Appeal from the United States District Court 

for the Northern District of Ohio at Youngstown. 

No. 4:13-cv-01716—Benita Y. Pearson, District Judge. 

Argued: January 15, 2015 

Decided and Filed: November 3, 2015 

Before: NORRIS, ROGERS, and WHITE, Circuit Judges. 

_________________ 

COUNSEL 

ARGUED: Christopher R. Opalinski, ECKERT SEAMANS CHERIN & MELLOTT, 

Pittsburgh, Pennsylvania, for Appellants. Eric J. Magnuson, ROBINS, KAPLAN, MILLER & 

CIRESI L.L.P., Minneapolis, Minnesota, for Appellees. ON BRIEF: Christopher R. Opalinski, 

F. Timothy Grieco, Audrey K. Kwak, ECKERT SEAMANS CHERIN & MELLOTT, 

Pittsburgh, Pennsylvania, for Appellants. Eric J. Magnuson, Thomas C. Mahlum, Katherine S. 

Barrett Wiik, ROBINS, KAPLAN, MILLER & CIRESI L.L.P., Minneapolis, Minnesota, for 

Appellees. 

 NORRIS, J., delivered the opinion of the court in which ROGERS and WHITE, JJ., 

joined. WHITE, J. (pg. 12), delivered a separate concurring opinion. 

>

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_________________ 

OPINION

_________________ 

ALAN E. NORRIS, Circuit Judge. Plaintiffs Allied Erecting and Dismantling Co., Inc. 

and Allied-Gator, Inc. (together, “Allied”) appeal the district court’s Federal Rule 12(b)(6) 

dismissal of their Ohio Uniform Trade Secrets Act (“OUTSA”) lawsuit based on diversity of 

citizenship jurisdiction against Genesis Attachments, LLC and its parent company, International 

Equipment Solutions, LLC (together, “Genesis”). For the reasons that follow, the judgment of 

the district court is affirmed. 

I.

Allied was founded as a family-owned business in 1973 by John Ramun. Allied and 

Genesis compete in the field of industrial dismantling and scrap processing, including the design, 

development, and manufacture of related specialized equipment. From May 1992 through June 

2001, John’s son Mark worked in various positions at Allied, including as a manager. By 1999, 

Allied developed an innovative series of multiuse demolition machine attachments called the 

Allied MT. A variety of sizes and types of jawsets, including a steel beam cutter and a concrete 

crusher, were available for the Allied MT allowing the operator to perform different tasks with 

just the one tool. At its introduction, this product was novel because the jawset could be changed 

without removing the main pin, saving time and enhancing productivity. 

Mark Ramun was responsible for presenting the Allied MT technology to possible 

investors, although Allied eventually obtained sufficient capital to produce the attachment on its 

own. Because Mark’s presentations contained detailed information regarding the design and 

function of the attachment, they were highly confidential. 

Mark and John’s relationship was a tense one, and in 2001 Mark left his employment 

with Allied. Mark took with him a laptop containing approximately 15,000 pages of Allied 

documents, including detailed technical information about the Allied MT. After working for a 

New Zealand-based attachments company, Mark joined Genesis in 2003. He was quickly 

promoted to director of development and demolition services at Genesis. Sometime thereafter, 

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Genesis released its own multiuse tool, the LXP and later, the Versi Pro. The similarity of these 

tools to the Allied MT is the crux of Allied’s trade secrets claims against Genesis. 

II.

In 2010, a jury rendered a verdict in favor of Allied based on the misappropriation of the 

Allied MT trade secrets by Genesis and Mark Ramun. The lawsuit before us was filed in 

2013 and alleges continued misappropriation by Genesis since the 2010 verdict. Before delving 

into the procedural history and analysis, we review Ohio law on trade secrets. 

A. OUTSA Trade Secret Protection 

The protection of trade secrets largely was a common law concept until the Uniform 

Trade Secrets Act (“UTSA”) was promulgated by the National Conference of Commissioners on 

Uniform State Laws, and recommended for adoption in all states. Ohio adopted the UTSA in 

1994 with only minor changes.1

 The OUTSA expressly provides that it “shall be applied and 

construed to . . . make uniform the law with respect to their subject among states enacting them.” 

Ohio Rev. Code Ann. § 1333.68. 

The OUTSA provides that “trade secrets” include “scientific or technical information, 

design, process, procedure, formula, pattern, compilation, program, device, method, technique, 

or improvement” provided the secret has “independent economic value, actual or potential,” 

derived from the fact that it is not known or easily discoverable by others. Ohio Rev. Code Ann. 

§ 1333.61(D). Third party discovery through “proper means,” including through observation of 

the item or acquiring and reverse engineering a product, destroys a trade secret. UTSA § 1 cmt. 

However, “Acquisition of a trade secret of another by a person who knows or has reason to know 

that the trade secret was acquired by improper means” is defined as a “misappropriation” of the 

trade secret. Ohio Rev. Code Ann. § 1333.61(B)(1). Improper means “includes theft, bribery, 

misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage 

through electronic or other means.” Ohio Rev. Code Ann. § 1333.61(A). 

 1

For example, Ohio adopted a four-year statute of limitations, while the model act provides for a three-year 

limitations period. Compare Ohio Rev. Code § 1333.66 with Uniform Trade Secrets Act § 6. 

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B. OUTSA Statute of Limitations 

The OUTSA contains a four-year statute of limitations which begins to run when “the 

misappropriation [of the trade secret] is discovered or by the exercise of reasonable diligence 

should have been discovered.” Ohio Rev. Code. Ann. § 1333.66. Before the UTSA, courts split 

on how to apply a statute of limitations in trade secrets claims, with some courts applying a 

“continuing wrong” approach, and others a “single claim” approach. The UTSA “rejects a 

continuing wrong approach to the statute of limitations . . . . If objectively reasonable notice of 

misappropriation exists, three years is sufficient time to vindicate one’s legal rights.” UTSA § 6 

cmt.; see also Ohio Rev Code Ann. § 1333.66 (“For the purposes of this section, a continuing 

misappropriation constitutes a single claim.”). 

To better understand the “single claim” approach, it is instructive to contrast it with 

copyright and patent protections, which apply a “continuing wrong” approach, also known as a 

“separate-accrual” rule, to infringement suits. 

A claim ordinarily accrues when a plaintiff has a complete and present 

cause of action. In other words, the limitations period generally begins to run at 

the point when the plaintiff can file suit and obtain relief. A copyright claim thus 

arises or accrues when an infringing act occurs. 

It is widely recognized that the separate-accrual rule attends the copyright 

statute of limitations. Under that rule, when a defendant commits successive 

violations, the statute of limitations runs separately from each violation. Each 

time an infringing work is reproduced or distributed, the infringer commits a new 

wrong. Each wrong gives rise to a discrete claim that accrues at the time the 

wrong occurs. In short, each infringing act starts a new limitations period. 

Petrella v. Metro-Goldwyn-Mayer, Inc., 134 S. Ct. 1962, 1969 (2014) (citations omitted); 

see also 17 U.S.C. § 507 (“No civil action shall be maintained under the provisions of this title 

unless it is commenced within three years after the claim accrued.”). Patent law operates in a 

similar fashion, with a six-year limitations period. See A.C. Aukerman Co. v. R.L. Chaides 

Constr. Co., 960 F.2d 1020, 2031 (Fed Cir. 1992) (en banc) (noting “each act of [patent] 

infringement is deemed a separate claim”); 35 U.S.C. § 286 (“[N]o recovery shall be had for any 

infringement committed more than six years prior to the filing of the complaint or counterclaim 

for infringement in the action.”). 

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Trade secret law is different, and states that have adopted the UTSA consistently apply a 

single claim theory to misappropriations of trade secrets. See, e.g., Adcor Indus., Inc. v. 

Bevcorp, LLC, 252 F. App’x 55, 62 (6th Cir. 2007) (noting that “the Ohio statute clearly 

forecloses [a multiple misappropriation] argument”); Cadence Design Sys., Inc. v. AvantA Corp., 

57 P.3d 647, 651 (Cal. 2002) (“[A] claim for misappropriation of a trade secret arises for a given 

plaintiff against a given defendant only once, at the time of the initial misappropriation, subject 

to the discovery rule . . . .”); Manturuk v. Gen. Motors Corp., No. 211722, 2000 WL 33416876, 

at *5 (Mich. Ct. App. July 14, 2000) (per curium) (“[T]he misappropriation of trade secrets is not 

a continuing offense. The wrong occurs at the time of the improper acquisition.”) (citations and 

quotations omitted). 

C. OUTSA Remedies 

It is important to note the variety of remedies that may be available to a successful trade 

secret misappropriation plaintiff before turning to the details of the dispute between Allied and 

Genesis. 

First, “Actual or threatened misappropriation may be enjoined. . . . [A]n injunction shall 

be terminated when the trade secret has ceased to exist, [except] the injunction shall be continued 

for a reasonable time in order to eliminate commercial advantage that otherwise would be 

derived from the misappropriation.” UTSA § 2; Ohio Rev. Code Ann. § 1333.62. “[A]n 

injunction should last for as long as is necessary, but no longer than is necessary, to eliminate the 

commercial advantage or ‘lead time’ with respect to good faith competitors that a person has 

obtained through misappropriation . . . .” UTSA § 2 cmt. “It would be anti-competitive to 

continue to restrain [a misappropriator of a trade secret] after any lead time . . . derived from 

misappropriation had been removed.” Id. Injunctive relief is not designed to be punitive, but 

rather “to place the injured party in the position that he would have been in had the 

misappropriation not taken place.” Valco Cincinnati, Inc. v. N & D Machining Serv., Inc., 

492 N.E.2d 814, 820 (Ohio 1986); see also 88 Ohio Jur. 3d Trade Secrets § 25. 

Second, as to monetary damages: 

[A] complainant is entitled to recover damages for misappropriation. Damages 

can include both the actual loss caused by misappropriation and the unjust 

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enrichment caused by misappropriation that is not taken into account in 

computing actual loss. In lieu of damages measured by any other methods, the 

damages caused by misappropriation may be measured by imposition of liability 

for a reasonable royalty for a misappropriator’s unauthorized disclosure or use of 

a trade secret. 

If willful and malicious misappropriation exists, the court may award 

exemplary damages in an amount not exceeding three times2

 any award made 

[above]. 

Ohio Rev. Code Ann. § 1333.63. The UTSA commentary notes that “recovery of both a 

complainant’s actual losses and a misappropriator’s unjust benefit that are caused by 

misappropriation” is permitted provided there is no double counting. UTSA § 3 cmt. (emphasis 

added); see also MAR Oil Co. v. Korpan, 973 F. Supp. 2d 775, 781-82 (N.D. Ohio 2013) (“Ohio 

law treats actual loss and unjust enrichment caused by misappropriation as two distinct theories 

of recovery.”). Where damages are otherwise difficult to measure, “the value of the secret” to 

the misappropriating party can “be a proper yardstick for a damage award.” MAR Oil Co., 973 

F. Supp. 2d at 782. 

III.

Allied sued Genesis in 2006 seeking damages for violation of the OUTSA and the 

Lanham Act, as well as other state-law claims. The district court granted summary judgment in 

favor of Genesis as to Allied’s Lanham Act claim and the rest of its state-law claims, but allowed 

the OUTSA claim to proceed to trial. Allied Erecting & Dismantling Co. v. Genesis Equip. 

& Mfg., Inc., 649 F. Supp. 2d 702, 710 (N.D. Ohio 2009). The jury found Genesis and Mark 

Ramun jointly and severally liable for misappropriation of Allied’s trade secrets and awarded 

$3,046,800 in damages based on unjust enrichment. The jury did not award damages for 

Allied’s lost profits, nor punitive damages against Genesis. 

Allied filed a post-trial motion seeking a permanent injunction against Genesis to prevent 

future use of the trade secrets or, in the alternative, seeking royalties on the sale of any Genesis 

products derived from the misappropriated secrets. The district court denied the motion, noting 

that Allied failed to establish that an injunction was necessary and was unable to demonstrate 

 2

The UTSA provides a cap on exemplary damages at two times ordinary damages, UTSA § 3, but the 

OUTSA adopts a cap of three times ordinary damages. Ohio Rev. Code Ann. § 1333.63. 

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that the jury’s unjust enrichment award did not fully compensate Allied. Allied Erecting 

& Dismantling Co. v. Genesis Equip. & Mfg., Inc., No. 4:06CV114, 2010 WL 3370286, at *3 

(N.D. Ohio Aug. 26, 2010) aff’d, 511 F. App’x 398 (6th Cir. 2013). 

Genesis filed its own post-trial motion seeking judgment as a matter of law with respect 

to damages, which the district court granted. According to the court, Allied had failed to present 

sufficient evidence to support the jury’s award. Allied Erecting & Dismantling Co. v. Genesis 

Equip. & Mfg., Inc., No. 4:06CV114, 2010 WL 4818367, at *7 (N.D. Ohio Nov. 19, 2010) 

(“Because the Court finds that Plaintiffs failed to present any evidence upon which the jury could 

reasonably have found the existence or amount of unjust enrichment damages, Defendants are 

entitled to judgment as a matter of law with respect to unjust enrichment damages.”). Allied 

appealed the denial of its motion and the grant of the Genesis motion. 

On appeal, this court reinstated the jury’s unjust enrichment damages against Genesis, but 

also affirmed the district court’s refusal to grant Allied an injunction or any royalties going 

forward. Allied Erecting & Dismantling Co. v. Genesis Equip. & Mfg., Inc., 511 F. App’x 398, 

399 (6th Cir. 2013). 

After this court reinstated the award of damages, Allied filed a motion for supplemental 

relief with the district court, insisting that it is entitled to ongoing damages or royalties for 

continued use of its trade secrets. Allied argued that even after the jury verdict, Genesis 

wrongfully persisted in its misconduct and continued to enrich itself through the use of the 

misappropriated trade secrets in its products. The district court denied Allied’s motion, noting 

that Allied raised no new claims, but instead sought the same previously denied prospective 

relief, for the same claim. The district court suggested that if Allied had claims based on any 

new violations, it should bring a separate action. 

In response to the district court’s suggestion, in August 2013 Allied brought the instant 

action against Genesis and its parent company International Equipment Solutions, LLC (“IES”). 

The complaint alleges that Genesis continues to sell equipment that is based on technology 

Genesis learned from the misappropriated Allied MT trade secrets. Allied claims that Genesis 

has expanded its misappropriation by adding at least two new sizes of the attachments, 

expanding its dealer networks and manufacturing facilities for the products, and disclosing 

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Allied’s trade secrets in marketing materials. Allied maintains that Genesis was unjustly 

enriched by these new and expanded uses of its technology. Against IES, Allied alleges that IES 

purchased Genesis in 2011 knowing Genesis was engaged in improper use and disclosure of 

Allied’s trade secrets and therefore improperly profited from the misappropriation by Genesis. 

Genesis filed a motion to dismiss claiming that the suit was barred both by the four-year 

statute of limitations and by the doctrine of claim preclusion. The district court held that the use 

of Allied’s trade secrets by Genesis constituted a continuing misappropriation that related back 

to a single claim: the wrongful acquisition of the Allied MT secrets in 2003, discovered by 

Allied in 2005. Therefore, the district court reasoned, Allied’s 2013 lawsuit was time-barred. 

Allied Erecting & Dismantling Co. v. Genesis Equip. & Mfg., Inc., No. 4:13CV1716, 2014 WL 

2442221, at *5 (N.D. Ohio May 30, 2014). The district court did not address the issue of claim 

preclusion. Id.

IV.

“We review de novo a motion to dismiss invoking Federal Rule of Civil Procedure 

12(b)(6), construing the complaint in the light most favorable to the plaintiffs, accepting their 

well-pleaded factual allegations as true, and drawing all reasonable inferences in their favor.” 

Russell v. Lundergan-Grimes, 784 F.3d 1037, 1045 (6th Cir. 2015) (citing Jackson v. Sedgwick 

Claims Mgmt. Servs., Inc., 731 F.3d 556, 562 (6th Cir. 2013) (en banc)). 

Allied argues that the district court erred, and the case at hand is based on 

misappropriation acts by Genesis commencing after the July 2010 jury verdict in the original 

misappropriation suit. If the claim accrued July 2010 or later, it follows that an August 2013 

filing is within the OUTSA’s four-year statute of limitations. Allied concedes that what it calls 

the post-verdict acts of misappropriation by Genesis stem from the same Allied MT 

trade secrets that were misappropriated by Genesis in 2003. Although Allied successfully 

sued Genesis based on that misappropriation, Allied argues that the jury verdict effectively 

ended that misappropriation claim. Because Genesis continuously made use of the previously 

misappropriated information, Allied argues, use by Genesis following the verdict triggered a new 

claim, and started the running of a new statute of limitations. Allied is mistaken. Such an 

interpretation would eviscerate the single claim approach codified in the UTSA and the OUTSA. 

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Under the single claim approach, all of the wrong done by Genesis to Allied happened in 

2003 when Genesis improperly acquired the Allied MT trade secrets. Allied claims that it 

learned of the misappropriation in late 2005, which triggered the running of the OUTSA statute 

of limitations period. Allied sued in 2006, well within the four-year statute of limitations period. 

Once Allied convinced the jury that Genesis misappropriated trade secrets in 2003, the claim was 

proven and the only thing left to do was to determine the appropriate remedy. 

As described in Section II.C, supra, there were myriad possible remedies to put Allied 

and Genesis in the position each would have been in but for the misappropriation. The jury 

considered and expressly rejected Allied’s claim that they lost customers to Genesis as a result of 

the misappropriation; therefore, the jury declined to award any damages for lost profits. The jury 

also declined to award punitive damages. However, the jury did find that Genesis was unjustly 

enriched by its misappropriation. The jury was instructed to consider the improper financial 

enrichment of the defendant as (1) what a reasonably prudent investor would pay for the trade 

secrets, (2) savings to Genesis because of increased productivity, or (3) savings in research costs. 

The jury awarded $3,046,800 in unjust enrichment damages. As described above, the district 

court refused any prospective remedy—injunction or royalties—and this court affirmed that 

decision in Allied Erecting & Dismantling Co. v. Genesis Equip. & Mfg., Inc., 511 F. App’x 398, 

399 (6th Cir. 2013). That should have ended the litigation surrounding the trade secrets 

misappropriated in 2003. 

Allied argues, pointing to this court’s non-precedential decision in Amalgamated 

Industries Ltd v. Tressa, Inc., 69 F. App’x 255 (6th Cir. 2003), that because it has consistently 

and diligently pursued its claims Allied should not be denied a remedy for the continuing 

violation by Genesis. However, Amalgamated is inapposite here. The plaintiff in Amalgamated

sued for misappropriation of trade secrets related to hair color shade formulas. Id. at 257. The 

plaintiff prevailed, and as part of the trade secrets judgment was awarded a prospective licensing 

fee: 1.68% of the revenue derived from any product incorporating the secret formula. Id. The 

plaintiff successfully reopened the litigation after the limitations period and was awarded 

additional damages because the defendant had expanded its product line to include other shades 

based on the same secret formula, without paying the licensing fee. Id. at 258. 

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In Amalgamated the suit was, at its core, about enforcing the prior judgment and awarded 

relief. Here, Allied’s request for prospective injunctive relief or royalties was flatly denied by 

the district court, and that denial was affirmed by this court. There is no prospective relief from 

the prior litigation for Allied to enforce against the continued sale by Genesis of its products that 

Allied claims are based on the Allied MT trade secrets. 

Genesis filed its motion to dismiss, citing both the statute of limitations and claim 

preclusion as grounds for dismissal. The question remains whether the district court was correct 

in determining that the instant action was barred by the statute of limitations rather than by claim 

preclusion. If Allied had alleged that Genesis was making use of new or different secrets or 

technology misappropriated in 2003, then the statute of limitations likely would be the correct 

ground for dismissal. However, because Allied is claiming only that Genesis continues to make 

use of the same misappropriated secrets that were exhaustively litigated in the prior suit, in our 

view claim preclusion is the more appropriate ground. 

As this case involves successive diversity actions, federal res judicata 

principles apply. J.Z.G. Res., Inc. v. Shelby Ins. Co., 84 F.3d 211, 214 (6th Cir. 

1996). “A final judgment on the merits of an action precludes the parties or their 

privies from relitigating issues that were or could have been raised in that action.” 

Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394, 398, 101 S. Ct. 2424, 69 

L.Ed. 2d 103 (1981) (emphasis added). We use a four-part test for determining 

whether a subsequent action is barred by the doctrine of res judicata, or to be 

more precise in this circumstance, claim preclusion. “[R]es judicata has four 

elements: (1) a final decision on the merits by a court of competent jurisdiction; 

(2) a subsequent action between the same parties or their privies; (3) an issue in 

the subsequent action which was litigated or which should have been litigated in 

the prior action; and (4) an identity of the causes of action.” Kane v. Magna 

Mixer Co., 71 F.3d 555, 560 (6th Cir. 1995). 

Rawe v. Liberty Mut. Fire Ins. Co., 462 F.3d 521, 528 (6th Cir. 2006) (footnotes omitted). The 

instant claim against Genesis satisfies each of the elements of res judicata. 

Though we rely on different grounds for the dismissal, the district court’s judgment need 

not be disturbed. We may affirm the district court judgment on any grounds supported by the 

record. See Santiago v. Ringle, 734 F.3d 585, 590 (6th Cir. 2013). 

With respect to Allied’s claim against IES, the parent of Genesis, we agree with the 

district court’s judgment but again question whether the passage of the limitations period is the 

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correct justification. For instance, there have been rare cases when later misappropriation by a 

third party investor may constitute a new claim. See, e.g., PMC, Inc. v. Kadisha, 93 Cal. Rptr. 

2d 663, 675 (Cal. Ct. App. 2000) (finding misappropriation when investors “invested at a 

bargain price in a corporation whose sole business assets consisted of stolen confidential 

information and processes”). This is not such a case. Finding liability under the OUTSA 

requires misappropriation of a trade secret—acquisition by improper means, disclosure, or use—

and Allied does not allege that IES has engaged in any of these acts directly. Assuming for the 

sake of argument IES indirectly acquired the Allied MT technology from Genesis when it 

purchased Genesis in 2011, this acquisition was after the conclusion of the prior litigation. 

Especially in the absence of any injunction preventing Genesis from disclosing the trade secret, 

such an incidental acquisition of information by a company that does not even operate in the 

same industry cannot satisfy the requirement that IES acquired Allied’s trade secrets by 

“improper” means. Allied’s arguments seem to suggest a theory of vicarious liability or piercing 

the corporate veil to reach IES, but its arguments are not persuasive. Though this claim may not 

be neatly resolved based on the statute of limitations, it is clear that Allied’s complaint against 

IES fails to advance a claim for which relief may be granted, and so the district court’s judgment 

dismissing the suit under rule 12(b)(6) was proper. 

V.

The judgment of the district court is affirmed. 

 

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_________________ 

CONCURRENCE

_________________ 

HELENE N. WHITE, Circuit Judge, concurring. I agree that the prior judgment bars the 

instant litigation. As noted, the prior action resulted in the award of $3,046,800 in unjustenrichment damages, defined as including “(1) what a reasonably prudent investor would pay for 

the trade secrets.” This unjust-enrichment award compensated Allied fully for the 

misappropriated trade secrets. Genesis effectively paid for what it had misappropriated, and 

Genesis/IES’ later use of the same trade secrets in the next generation of its product does not 

entitle Allied to additional damages. 

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