Communications Corp., 15 F.3d 1427, 1432 (7th Cir. 1994)Gury entitled to draw inference of
misappropriation based on defendants access to plaintiff's trade secrets and development of similar
product),

The jury could reach the same conclusion regarding Kirix. An employer may be held liable
for misappropriation of a trade secret as a consequence of hiring a competitor’s employee and
placing the employee in a position resulting in the inevitable disclosure or use of the trade secret.
PepsiCo, Inc. v. Redmond, 54 F.3d 1262, 1269 (7th Cir. 1995). The employer’s liability is premised
on the realization that unless an employee possesses “an uncanny ability to compartmentalize
information, he will necessarily” be relying on and using his former employee’s trade secrets. Jd.
at 1269. ProfitPoint is Kirix’s only software program. Drawing all inferences in plaintiffs’ favor,
a reasonable jury could infer the individual defendants created Kirix for the sole purpose of
developing and marketing ProfitPoint based on knowledge obtained from their exposure to
SUREF!ND. Based on this record, defendants’ motion for summary judgment on plaintiffs’ ITSA
claim must be denied as to all defendants.

B. Breach of Contract

Finally, defendants claim plaintiffs cannot establish their breach of contract claims against
Nathanael and Aaron Williams under Texas law. Each contract contains a choice of law provision
designating Texas law as the applicable substantive law.

Ina diversity case, the court must apply the forum state's choice of law rules to determine the
applicable substantive law. Klaxon Co. v. Stentor Elec, Mfg. Co., 313 U.S. 487, 496 (1941). Ilinois
applies a contract's choice of law provision as long as the contract is valid, the chosen law is not

contrary to I!linois' fundamental public policy and there is a reasonable relationship between the

13


B. Facts

Despite the contentious way in which the parties have presented the complex issues in this
case, the underlying facts are relatively straightforward and undisputed. In January 2002, plaintiffs
merged with Howard Schultz & Associates International, Inc. (“HS&A”). Prior to the merger,
HS&A provided audit recovery services to customers through independent contractors. HS&A’s
independent contractors often engaged other independent contractors (“secondary contractors”) to
assist in their audits.

Between 1997 and 2001, HS&A invested substantial resources in developing a computer
program called SUREF!ND. SUREF!ND identifies lost profits due to payment errors. SUREF!ND
is password-protected and licensed for exclusive use of those under contract with plaintiffs. The
licensing agreement specifically provides that SUREF!ND is not be sold or redistributed to any other
person for any reason. Since 2001, HS&A has maintained an employee handbook containing
policies and guidelines concerning protection and non-disclosure of confidential information.

HS&A provided SUREF!ND, along with access codes, to its independent contractors to
perform accounts payable auditing services for its customers. SUREF!ND contains several recovery
audit tools, including various modules called Analyzer Module, Charge-Back Module, Deal Link
Pro Module, Duppro Module, Extract Module, Group Options Module, Late Notification Module,
Price Decline Module and Short Ship Module. According to plaintiffs, the business logic underlying
SUREF!ND’s recovery audit modules is dependent upon “years of audit recovery experience” and
knowledge of its auditors. Pl. Facts at {J 42-43. Specifically, plaintiffs claim the interaction

between its auditors and programmers is instrumental in the development of the recovery audit



idea, process or method of operation”). Based on this record, plaintiffs’ copyright infringement
claim fails as a matter of law.
Ul. State Law Claims

The court may relinquish supplemental jurisdiction over state law claims when all federal
claims have been dismissed. 28 U.S.C. § 1367(c)(3). According to the general rule, “when all
federal claims are dismissed before trial, the pendent claims should be left to the state courts.”
Wright v. Associated Ins. Cos., Inc., 29 F.3d 1244, 1252 (7th Cir. 1994). However, plaintiffs claim
the court may exercise diversity jurisdiction over its state law claims.

The parties agree jurisdiction is proper under 28 U.S.C. § 1332. However, diversity
jurisdiction requires a controversy between citizens of different states, not residents of different
states. 28 U.S.C. § 1332(a)(1); Guaranty National Title Co., Inc. v. J.E.G. Associates, 101 F.3d 57,
58 (7th Cir. 1996). In the second amended complaint, plaintiffs allege the individual defendants’
residency, rather than citizenship. Moreover, plaintiffs fail to allege PRGRS, Inc.’s principal place
of business. Defendants’ jurisdictional statement in support of their motion for summary judgment
suffers from the same defects, Therefore, the parties must submit jurisdictional statements that
include the citizenship of each party as well as PRGRS, Inc.’s principal place of business.

Assuming the parties confirm the individual defendants’ citizenship is the same as their
residency and PRGRS, Inc.’s principal place of business is the same as its parent corporation, there
is complete diversity of the parties. According to the parties’ pleadings, the individual defendants
are Illinois residents. Kirix is an Illinois corporation with its principal place of business in Elmhurst,
Ulinois. On the other side, PRG-Schultz International, Inc. is a Georgia corporation with its principal

place of business in Georgia. PRGRS, Inc. is a Delaware corporation and a wholly-owned subsidiary


to import larger quantities of data into the software and process it quickly. Kirix sells ProfitPoint
to customers in the recovery audit industry, including plaintiffs’ customers.

According to defendants, similarities between ProfitPoint and SUREF!ND include “user
interface elements such as menus, toolbars, or right click menus for accessing common functions
such as sorting records, inserting columns, hiding columns or coloring columns, dockable frames
for organizing the user workspace or status bar for displaying table metrics, grid components for
displaying data, tree controls for managing projects, dialogs or panels for creating or modifying
formulas or for creating, modifying, or representing relationships between tables; and tabbed list
controls for storing and displaying formulas.” Def. Ex. 3 at 743. Both SUREF!ND and ProfitPoint
contain promotional analysis tools that help auditors identify overpayments arising from missed
promotions and recovery audit tools targeting duplicate payments and missed floorstock protection.
Id, at §§ 46-47.

DISCUSSION
I. Standard of Review

Summary judgment is appropriate when the moving papers and affidavits show there is no
genuine issue of material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ.
P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once a moving party has met its
burden, the non-moving party must go beyond the pleadings and set forth specific facts showing
there is a genuine issue for trial. Fed. R. Civ. P. 56(e); Silk v. City of Chicago, 194 F.3d 788, 798
(7* Cir. 1999). A genuine issue of material fact exists when “the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

248 (1986).



functionality and business logic underlying SUREF!ND. On April 3, 2003, plaintiffs received
copyright registration for SUREF!ND.

HS&A required confidentiality agreements with their independent contractors. The parties
dispute whether HS&A required their independent contractors to enter into confidentiality
agreements with their secondary contractors. Defendants offer evidence that approximately four or
five independent contractors, 35 secondary contractors and one customer had access to SUREF!ND,
or a version of SUREF!ND, without entering into a confidentiality agreement with HS&A.' HS&A
presented SUREF!ND to several prospective customers without first entering into a confidentiality
agreement. The parties dispute the extent of plaintiffs’ presentations. Neither party provides
evidence as to the total number of individuals given access to SUREF!ND with or without
confidentiality agreements.

In January 2001, Nathanael and Aaron Williams formed Kirix with Kenneth Kaczmarek.
David and Benjamin Williams joined the company in August 2001. Prior to forming Kirix, the
individual defendants worked for plaintiffs. Nathanael and Aaron Williams signed confidentiality
agreements with HS&A, while David and Benjamin did not. During their employment with
plaintiffs, the individual defendants were exposed to SUREF!ND.

After forming Kirix, the individual defendants created a software program called ProfitPoint.
ProfitPoint is Kirix’s only software program available for license. ProfitPoint enables internal audit

departments to increase the efficiency of identifying and recovering overpayments by allowing them

Defendants fail to offer evidence to support their assertion “hundreds of independent contractors in Europe
received copies of SUREF!ND along with the access codes necessary to use the software with no contracts,”
Reply at 11 (emphasis added). Rather, the individual responsible for distributing SUREF!ND in Europe simply
avers he “was never directed by HS&A to keep SUREF!ND confidential or to distribute SUREF!ND subject
to any confidentiality agreement.” See also Def. Facts at 63, citing Ex. 19 at 95. This testimony does not
establish independent contractors in Europe did not have confidentiality agreements with HS&A.

5


approximately fimit{ing] the extent of that protection as to avoid the effects of monopolistic
stagnation.” Computer Assoc. Int’l, Inc. y. Altai, 982 F.2d 693, 696 (2d Cir. 1992).

Inits statement of facts, plaintiffs claim “[t]he recovery audit tools, including the underlying
business logic and recovery audit practices and techniques coded into the tools, are packaged in
SUREFIND as a single piece of software.” Pl. Facts at ]47. See also Pl. Facts at § 43 (“In creating
and modifying SUREF!ND, HS&A and now PRG-Schultz’ programmers rely heavily on the years
of audit recovery experience and knowledge of HS&A and PRG-Schultz auditors”) and § 44 (“The
interaction between auditors and programmers is instrumental in the development of the recovery
audit functionality and business logic underlying SUREF!ND”). In other words, plaintiffs take issue
only with what ProfitPoint does, not how it does it, Drawing all inferences in plaintiffs’ favor,
SUREF!ND’s modules are unprotected processes.

“Patent and copyright laws protect distinct aspects of a computer program.” Atari Games
Corp. v. Nintendo of America, Inc., 975 F.2d 832, 839 (Fed. Cir. 1992). Patent law “provides
protection for the process or method performed by a computer in accordance with a program,”
whereas copyright protects only “the expression of that process or method.” Jd. However, if the
patentable process and its expression are indistinguishable or inextricably intertwined, then “the
process merges with the expression and precludes copyright protection.” Jd. at 839-40, According
to plaintiffs, SUREF!ND embodies years of auditing experience. Nevertheless, an author cannot
achieve protection for a process simply by embodying it in a computer program. Jd. at 842 (“An
author cannot acquire patent-like protection by putting an idea, process, or method of operation in

an unintelligible format and asserting copyright infringement against those who try to understand that


Minute Order Form (96/97)

United States District Court, Northern District of Illinois

NameotAespred uae | Suzanne B. Conlon | Siig Judge er

CASE NUMBER 03 C 1867 DATE 9/19/2003
CASE PRG-SCHULTZ INTL., INC. vs. KIRIX, CORP., et al.
TITLE

[In the following box (a) indicate the party filing the motion, e.g. plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented.)

MOTION:

DOCKET ENTRY:

a) Qa Filed motion of [ use listing in “Motion” box above]

(2) oO Brief in support of motion due

(3) Bb Answer brief to motion due___. Reply to answer brief due__

(4) oO Ruling/Hearingon___setfor____at

(5) QO Status hearing[held/continued to] [set for/re-set for]on____setfor__-_at

(6) o Pretrial conference[held/continued to] [set for/re-set for]on__setfor_ ss at_
7) a Trial{set for/re-set for] on__at

(8) a [Bench/Jury trial] [Hearing] held/continued to__at

(9) Oo This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

COFRCP4(@m) CLocal Rule 41.1 CFRCP41(a\(i) 0 FRCP41(a)(2).

(ao) [Other docket entry] Defendants’ motion for summary judgment [101-1] is granted on Count I and
denied on Counts {I through V. The joint final pretrial order and agreed pattern jury instructions shall be
submitted on October 9, 2003 at 9:00 a.m. Plaintiffs’ draft shall be submitted to defendants by October
2, 2003. Trial is set on October 20, 2003 at 9:00 a.m. The parties shall submit jurisdictional statements
that include the citizenship of the individual defendants and the principal place of business of plaintiff
PRGRS, Inc. by September 29, 2003. ENTER MEMORANDUM OPINION AND ORDER.

al @ [For further detail see order attached to the original minute order.] Sey a. Ob

No nolices required, advised in open court. - “Docusnent
Number

No notices required.

V | Notices maited by judge’s staff.

Notified counsel by telephone.

Docketing to mail notices.

Mail AO 450 form.

Copy to judge/magistrate judge.

Wr

date maited notice
courtroom

cB deputy’s
initials

pw

railing deputy initials



handled by means reasonably designed to maintain secrecy.” IDX Systems Corp. v. Epic Systems
Corp., 285 F.3d 581, 584 (7th Cir. 2002).

Defendants first claim plaintiffs’ designation of the entire SUREF!ND program as a trade
secret is insufficient under JDX Systems. In IDX Systems, the Seventh Circuit found that “a plaintiff
must do more than just identify a kind of technology and then invite the court to hunt through the
details in search of items meeting the statutory definition.” Jd. However, the court made this
statement in addressing the plaintiffs’ claim that software sold to third parties constituted a trade
secret. Jd. Defendants fail to show this standard applies to software unavailable on the commercial
market. Indeed, the ITSA specifically contemplates the protection of a computer program as a trade
secret. 765 ILCS 1065/2(d).

Nor do defendants show that SUREF!ND’s inclusion of elements contained in commercially
available software defeats its possible status as a trade secret. To the contrary, “[a] trade secret can
exist in a combination of characteristics and components, each of which, by itself, is in the public
domain, but the unified process, design and operation of which, in unique combination, affords a
competitive advantage and is a protectable secret.” Minnesota Mining & Mfg. Co. v. Pribyl, 259
F.3d 587, 595-96 (7th Cir. 2001). Accordingly, the court must focus on the secrecy of the
information in determining whether SUREF!ND qualifies as trade secret. Mangren Research & Dev.
Corp. v. National Chem. Co., Inc., 87 F.3d 937, 942 (7th Cir. 1996).

Plaintiffs provide evidence of measures taken to protect the secrecy of SUREF!ND.
Specifically, plaintiffs require confidentiality agreements from its independent and secondary
contractors. Plaintiffs maintain an employee handbook containing guidelines regarding the

protection and nondisclosure of confidential information. SUREF!ND is password-protected and

11


of PRG-Schultz International, Inc. Moreover, the parties agree the amount in controversy exceeds
$75,000. If the amount in controversy is uncontested, the court must accept the parties’
representation unless it “appears to a legal certainty that the claim is really for less than the
jurisdictional amount.” Target Market Publishing, Inc. v. ADVO, Inc., 136 F.3d 1139, 1141-42 (7th
Cir. 1998), quoting St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 US. 283, 289 (1938).
Given the significant resources plaintiffs invested to develop SUREF!ND, it does not appear to a
legal certainty that their claim is for less than $75,000.
A. The ITSA Violation

To state a claim for trade secret misappropriation under ITSA, plaintiffs must demonstrate:
(1) a trade secret, (2) misappropriated by defendants, and (3) used by defendants for business
purposes. Composite Marine Propellers, Inc. v. Van Der Woude, 962 F.2d 1263, 1265-66 (7th Cir.
1992). Defendants claim plaintiffs cannot prove SUREF!ND is a misappropriated trade secret.

Under the ITSA, a "trade secret" is defined as:

information, including but not limited to, technical or non-technical data, a formula,

pattern, compilation, program, device, method, technique, drawing, process, financial

data, or list of actual or potential customers or suppliers, that:

qd) is sufficiently secret to derive economic value, actual or potential, from not

being generally known to other persons who can obtain economic value from

its disclosure; and

(2) is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy or confidentiality.

765 ILCS 1065/2(d). “Thus to show that particular information is a trade secret, [plaintiffs]] must

demonstrate that it is valuable, not known to others who might profit by its use, and has been

10



i Copyright Infringement

To establish copyright infringement, plaintiffs must prove: “(1) ownership of a valid
copyright; and (2) copying of constituent elements of the work that are original.” Feist Publ’ns, Inc.
v. Rural Tel. Serv. Co., Inc., 499 U.S. 340, 361 (1991). Defendants assert plaintiffs cannot prove
either element.

In general, software is amendable to copyright protection. Lotus Dev. Corp. v. Borland Int'l,
Inc,, 49 F.3d 807, 813 n. 5 (1st Cir. 1995). A certificate of copyright registration creates a rebuttable
presumption that the assignee is the owner of a valid copyright. Mid America Title Co. v. Kirk, 59
F.3d 719, 721 (7th Cir. 1995), citing 17 U.S.C. § 410(c). Plaintiffs obtained copyright registration
for SUREF!ND 3.1.1 on April 3, 2003. Therefore, plaintiffs’ copyright infringement claim turns on
whether defendants copied SUREF!ND’s protected elements.

According to plaintiffs, “[t]his case, first and foremost, involves infringement and
misappropriation of SUREF!ND’s recovery audit functionality, including, but not limited to, its
confidential and proprietary recovery audit modules and the proprietary business logic underlying
the modules.” Response at 4 (emphasis in original). The Copyright Act provides:

In no case does copyright protection . . . extend to any idea, procedure, process,

system, method of operation, concept, principle, or discovery, regardless of the form

in which it is described, explained, illustrated, or embodied in such work.

17 U.S.C. § 102(b). Thus, the Copyright Act delineates between an idea, which cannot be
copyrighted, and the expression of an idea, which may be copyrighted. Harper & Row Publishers
v. Nation Entertainment, 47) U.S. 539 (1985). In drawing this line, copyright law seeks to strike a

“delicate equilibrium” between “afford[ing] protection to authors as an incentive to create, and []


of facts. In doing so, defendants fail to provide proper support for many of their ill-advised denials.
For example, defendants deny ff 1-5, 7-9, 11-12, 14-22, 25-32, 35-47, 49, 51-60, 62, 66, 69, 74-75,
85-86, 88-91, 93, 97-100, 102-118, 122, 124-125, 134-140, 145, 148 and 150-151 of plaintiffs’
statement of facts by claiming, in whole or in part, that “plaintiffs solely rely on self-serving party
declarations to support this alleged undisputed fact.” See also Response at 1 n. 1, citing Hall v.
Bodine, 276 F.3d 345, 354 (7th Cir. 2002)(affidavits that contain conclusory allegations unsupported
by the record are insufficient to defeat summary judgment) and Amadio v. Ford Motor Company,
238 F.3d 919, 926 (7th Cir. 2001)(affidavits contradicting prior sworn testimony cannot be used to
manufacture factual dispute). Defendants do not claim plaintiffs’ allegations are conclusory or
contradictory. Absent such a showing, self-serving testimony is sufficient to support a party’s factual
statement. See Payne v. Pauley, 337 F.3d 767, 772 (7th Cir. 2003)(“It is not the self-serving nature
of the affidavits, however, that sealed their fate in these cases. After all, most affidavits submitted
for these purposes are self-serving”).

Inany event, defendants are not solely to blame for the chaotic state of the record. Plaintiffs’
statement of additional facts is peppered with legal and factual arguments. See Pl. Facts at Ff] 1-9,
18, 21, 36-39, 45-46, 54, 57-60, 69, 74, 85-86, 88-89, 93, 96-98 102-105, 107, 111, 113, 115-118,
134-140 and 145, As is defendants’ statement of facts. See Def. Facts at {J 16, 19-21, 23, 27, 29,
33-35, 38-43, 45-48, 50-52, 54-55, 57-59, 62-63, 69, 81-84, 90, 94-95, 113, 159, 169. “The purpose
of the 56.1 statement is to identify for the Court the evidence supporting a party’s factual assertion
in an organized manner; it is not intended as a forum for factual or legal argument.” Malec v.
Sanford, 191 F.R.D. 581, 585 (N.D. Ill. 2000). As a result, the court will only consider the parties’

factual statements to the extent they are properly supported by the record.


chosen law and the parties or transaction. Fulcrum Financial Partners v. Meridian Leasing Corp.,
230 F.3d 1004, 1011 (7th Cir. 2000). Plaintiffs do not contest the enforcement of the contractual
choice of law provision.

To establish a breach of contract claim under Texas law, plaintiffs must demonstrate: (1)
existence of a valid and enforceable contract; (2) its performance; (3) breach by defendants; and (4)
resultant injury. Petri v. Gatlin, 997 F. Supp. 956, 964 (N.D. Ill. 1997) and cases cited therein.
Defendants claim plaintiffs cannot establish Nathanael or Aaron Williams breached their contracts
because the information they allegedly disclosed was not confidential. As discussed above, plaintiffs
raise a genuine issue of material fact as to whether SUREF!ND is confidential and whether
defendants used SUREF!ND to create ProfitPoint. As a result, defendants’ summary judgment

motion as to Counts III through V must be denied.

14


submit a statement of material facts, including, “specific references to the affidavits, parts of the
record, and other supporting materials relied upon.” Local Rule 56.1(a)(3); Local Rule
56.1(b)(3)(B). Evidence submitted at summary judgment must be admissible at trial under the
Federal Rules of Evidence. Woods v. City of Chicago, 234 F.3d 979, 988 (7th Cir. 2000). All facts
not properly supported by the record evidence must be disregarded. Brasic v. Heinemann’s Inc., 121
F.3d 281, 284 (7th Cir. 1997).

In response to a motion for summary judgment, Local Rule 56.1 requires the non-moving
party to submit a response “to each numbered paragraph in the moving party’s statement [of material
facts], including, in the case of any disagreement, specific references to the affidavits, parts of the
record, and other supporting materials relied upon.” Local Rule 56.1(b)(3)(A). All relevant facts
denied without supporting documentation must be accepted as true provided the facts are “properly
supported by references to the record or other evidentiary material.” Jupiter Aluminum Corp. v.
Home Ins. Co.,225 F.3d 868, 871 (7th Cir. 2000); Stewart v. McGinnis, 5 F.3d 103 1, 1034 (7th Cir.
1993).

Rather than fulfilling their obligations under Local Rule 56.1, the parties and/or their counsel
have continued the heated and contentious exchanges that defined their relationship during
discovery. Not only does this animosity impact the parties’ discussion of the complex issues
presented by this case, it affects the court’s ability to properly assess the merits of each party’s
position. Nowhere is this more apparent than in defendants’ response to plaintiffs’ statement of
facts.

Although defendants have the burden of demonstrating the absence of a genuine issue of

material fact, defendants dispute virtually all 151 factual statements contained in plaintiffs’ statement



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
PRG-SCHULTZ INTERNATIONAL, INC. and
PRGRS, INC.,
No. 03 C 1867
Plaintiffs,
Suzanne B. Conlon, Judge
v.

KIRIX CORPORATION, NATHANAEL B.
WILLIAMS, AARON L. WILLIAMS,
DAVID Z. WILLIAMS and BENJAMIN L..
WILLIAMS,

)
)
)
)
)
)
)
)
)
)
)
)
)

Defendants.

MEMORANDUM OPINION AND ORDER

PRG-Schultz International, Inc. and PRGRS, Inc. (collectively, “plaintiffs”) sue Kirix
Corporation (“Kirix”) and four former employees, Nathanael, Aaron, David and Benjamin Williams
(collectively, “the individual defendants”) for copyright infringement in violation of the Copyright
Act of 1976, 17 U.S.C. § 101 et seg. (Count I) and trade secret misappropriation in violation of the
Illinois Trade Secrets Act (“ITSA”), 765 ILCS 1065/1 et seq. (Count II). Plaintiffs also bring claims
for common law breach of contract against Nathanael (Counts II and IV) and Aaron (Count Vv)
individually. Kirix and the individual defendants (collectively, “defendants”) move for summary
judgment on all claims pursuant to Fed. R. Civ. P. 56,

BACKGROUND
A. Local Rule 56.1
Local Rule 56.1 requires litigants to follow a detailed procedure in filing and responding to

summary judgment motions. Local Rule 56.1 requires both the moving and non-moving parties to

1A

1



licensed for exclusive use of those under contract with plaintiffs. On the other hand, defendants
offer evidence of specific instances where plaintiffs failed to implement these measures. For
example, defendants show that several independent contractors, secondary contractors and customers
had access to SUREF!ND without confidentiality agreements. However, it is difficult to assess the
significance of plaintiffs’ failures without evidence indicating the total number of individuals with
access to SUREF!ND. In any event, “[w]hether or not the actions plaintiffs actually took [are]
sufficient to satisfy the ITSA’s reasonableness standard [is] a question for the jury.” Jd. at 943. See
also Rockwell Graphic Sys., Inc. v. DEV Indus., Inc., 925 F.2d 174, 179-80 (7th Cir. 1991)(“But only
in an extreme case can what is a ‘reasonable’ precaution be determined on a motion for summary
judgment because the answer depends on a balancing of costs and benefits that will vary from case
to case and so require estimation and measurement by persons knowledgeable in the particular field
of endeavor involved”).

Moreover, plaintiffs raise a genuine issue of material fact as to whether the individual
defendants misappropriated SUREF!ND. Misappropriation includes breach of a confidential
relationship to obtain a trade secret. 765 ILCS 1065/2(a)-(b). Employees have a common law duty
to protect an employer’s confidential information even after termination. SEC v. Cherif, 933 F.2d
403, 411 (7th Cir. 1991). See also AMP Inc. v. Fleischhacker, 823 F.2d 1199, 1202 (7th Cir.
1997) (Illinois law prevents an employee from taking confidential information disclosed during the
employmentrelationship). Defendants concede the individual defendants had access to SUREF!ND
during their employment with plaintiffs and thereafter, created a software program similar to
SUREF!IND. Under these circumstances, a reasonable jury could conclude that the individual

defendants misappropriated a trade secret from plaintiffs. See Sokol Crystal Products, Inc. v. DSC

12


CONCLUSION
Defendants are entitled to judgment as a matter of law on Count I. The motion for summary

judgment as to Counts II through V is denied.

September 19, 2003 ENTER:

Duspcas fi . Onebnn
Suzanne(B. Conlon

United States District Judge

15