*

The Honorable Gregory F. Van Tatenhove, United States District Judge for the Eastern District of Kentucky,

sitting by designation.

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

File Name: 08a0349p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT _________________

RICHARD K. NIEMI, doing business as RICHARD K.

NIEMI DESIGN AND ENGINEERING SERVICES; and

RKN TECHNOLOGY, L.L.C.,

 Plaintiffs-Appellants,

v.

NHK SPRING CO., LTD.; NHK INTERNATIONAL,

LTD.; and NEW MATHER METALS, INC.,

 Defendants-Appellees.

X

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-

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>

,

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-

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No. 07-3536

Appeal from the United States District Court

for the Northern District of Ohio at Toledo.

No. 03-07512—James G. Carr, Chief District Judge.

Argued: July 31, 2008

Decided and Filed: September 19, 2008 

Before: DAUGHTREY and McKEAGUE, Circuit Judges; VAN TATENHOVE, District Judge.*

_________________

COUNSEL

ARGUED: Robin H. Kyle, ROBIN H. KYLE, J.D., LL.M., Detroit, Michigan, for Appellants.

Patrick F. Hickey, DYKEMA GOSSETT, Detroit, Michigan, for Appellees. ON BRIEF: Robin

H. Kyle, ROBIN H. KYLE, J.D., LL.M., Detroit, Michigan, Donald E. Schlyer, SCHLYER &

ASSOCIATES, Merrillville, Indiana, for Appellants. Patrick F. Hickey, Michael A. Little,

DYKEMA GOSSETT, Detroit, Michigan, for Appellees. 

_________________

OPINION _________________

McKEAGUE, Circuit Judge. Plaintiff Richard K. Niemi devised a new method of

manufacturing stabilizer bars for automobiles in 1990, a “trade secret.” He alleges he disclosed this

method to defendant New Mather Metals, Inc., only after entering into an oral confidentiality

agreement. Pursuant to this agreement, New Mather was allowed to use the manufacturing process

in exchange for its promise to maintain its secrecy and to grant plaintiff the exclusive right to

1
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 2

1

No copy of this exclusivity agreement was ever produced in discovery or made a part of the record.

perform all design work for New Mather. In 1998, Niemi learned that New Mather had breached

the agreement by entering into design contracts with other parties. Niemi brought suit for

misappropriation of trade secret, breach of contract, and promissory estoppel. The district court

dismissed the claims against New Mather’s parent corporation, NHK Spring Co., Ltd., for lack of

personal jurisdiction and awarded summary judgment to New Mather on all of Niemi’s claims.

Niemi has timely appealed these rulings. 

On careful consideration of the record, we uphold the district court’s dismissal of the claims

against NHK Spring Co., but conclude there is sufficient evidence to create genuine issues of

material fact on the trade secret and promissory estoppel claims. For the reasons that follow, the

summary judgment rulings on these two claims are vacated and the matter remanded for further

proceedings. 

I. FACTUAL BACKGROUND

Despite having little more than a high school education, plaintiff Richard K. Niemi has, since

the 1960s, made a living in the engineering design business in the metropolitan Detroit area.

Although his employment situation has been subject to numerous changes over the years, his

involvement in the “bender business,” i.e., creating machines and tools to manufacture stabilizer bars

for automobiles, has been a constant, as he has serviced customers like New Mather Metals, Inc. of

Toledo, Ohio (defendant herein), General Motors Corporation, and Chrysler Corporation. Niemi

performed engineering design work for New Mather from 1967 to 1998. During this period, Niemi

conducted his business operations informally; apart from quotations, purchase orders and invoices,

written documentation was rarely used. During the early 1990s, when the transactions giving rise

to this action took place, Niemi operated under the name “Richard K. Niemi Design and

Engineering,” as a sole proprietorship. Since 1997, Niemi has conducted business, as “50/50

partners” with his son Mark, under the name “RKN Technology, LLC.” RKN Technology operates

out of Mark’s home in South Lyon, Oakland County, Michigan. 

In 1990, Niemi approached Denzil Sheckler, of New Mather, to discuss a new method of

manufacturing stabilizer bars for automobiles. New Mather was interested in the new method and,

in September 1990, issued the first purchase order requesting Niemi to incorporate the new method

design into the manufacturing tooling. Although the purchase order was accompanied by a

statement of standard terms and conditions providing that “no other or different terms or conditions

shall apply to this order unless specifically agreed to in writing by the authorized officer of

Purchaser,” Niemi contends he obtained New Mather’s assurance that the new method “would

remain confidential” even before he disclosed it. Niemi aff. ¶ 3, JA 37. He did not reduce this

“confidentiality agreement” to writing in the form of a license because he trusted New Mather as

“honorable people of integrity I’ve dealt with for thirty years.” Niemi dep. at 238-39, JA 98. 

Thereafter, in 1993 or ‘94, Niemi remembers that Albert Blackwood, New Mather’s

Engineering Manager, approached him with a request that he sign a reciprocal “exclusivity

agreement.” Blackwood explained that New Mather, cognizant of the competitive advantage it had

gained by using the new bar-forming method, wanted to ensure that its use remained exclusive and

that Niemi would not disclose the method to other manufacturers. In exchange for this restriction,

Niemi sought assurance that he would continue to receive all of New Mather’s design work, as he

had for the previous 25 or 30 years, as well as the opportunity to bid on design needs of New

Mather’s parent corporation, NHK Spring Co., Ltd. After receiving the requested assurance from

Blackwood, Niemi signed the exclusivity agreement, but was not given a copy.1

 Although New

Mather’s reciprocal assurance was not reduced to writing, Niemi believed that he and Blackwood
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 3

2

Blackwood testified that he is unaware of any agreement between New Mather and Niemi restricting New

Mather’s use of Niemi’s drawings or obligating New Mather to send all of its design needs exclusively to Niemi. It was

Blackwood’s understanding, however, that Niemi had been New Mather’s “primary, if not exclusive designer.” 

3

Plaintiffs had voluntarily dismissed the claims against NHK International on September 22, 2005. 

4

The district court’s ruling that Niemi’s breach of contract claim is barred by the statute of frauds is not

challenged on appeal.

both understood that New Mather was obligated to continue using Niemi for its design needs

perpetually as long as Niemi maintained the confidentiality of the design. No further writing was

needed, in Niemi’s estimation, because New Mather’s obligation represented a continuation of an

arrangement that had been in place for 25 or 30 years, an arrangement with people who Niemi had

come to believe were honest and trustworthy.2

In 1998, Niemi learned of reason to believe New Mather had disclosed his trade secret to,

and ordered design work from, other designers, actions which he believed were in violation of the

parties’ reciprocal exclusivity agreement. Niemi confronted Blackwood and New Mather’s

President, Ron Malcolm. He learned that Raul Cornieles was the new Engineering Manager. When

he confronted Cornieles, Cornieles said he was unaware of any agreement, but would look into it.

In his next conversation with Mark Niemi, Cornieles asked whether RKN Technology wanted to be

New Mather’s design source. Mark Niemi responded affirmatively and “assumed” that Cornieles

was thereby ratifying and reaffirming the preexisting mutual exclusivity agreement. Yet, apparently,

New Mather did not live up to Niemi’s understanding of the exclusivity agreement and Niemi

commenced this action. 

II. PROCEDURAL HISTORY

Niemi filed suit in the Eastern District of Michigan on February 28, 2002, invoking federal

jurisdiction based on the parties’ diversity of citizenship. Named plaintiffs include Niemi, d/b/a

Richard K. Niemi Design and Engineering Services, and RKN Technology, LLC (referred to

collectively as “Niemi”). Named defendants include New Mather, its parent corporation NHK

Spring Co., Ltd. (a Japan corporation), and another subsidiary of NHK Spring, NHK International

Ltd. (a Delaware corporation). The original complaint included two counts, asserting claims for

misappropriation of trade secret and breach of contract. On August 8, 2003, the district court,

Honorable John Feikens, ruled on NHK Spring’s motion to dismiss for lack of personal jurisdiction.

The court concluded that personal jurisdiction over NHK Spring was lacking. Rather than

dismissing the claims against NHK Spring, however, the district court transferred the case to the

Northern District of Ohio, where the actions giving rise to Niemi’s claims took place.

On transfer of the case to the Northern District of Ohio, NHK Spring again moved to dismiss

for lack of personal jurisdiction on November 21, 2003. The district court, Honorable James G.

Carr, Chief Judge, granted the motion on April 12, 2006.3

 In the meantime, the district court had

on September 2, 2005, granted New Mather’s motion for summary judgment on the

misappropriation of trade secret claim, but allowed the breach of contract claim to proceed and

allowed Niemi to amend the complaint so as to add a promissory estoppel claim. After a further

period of discovery on the remaining claims, New Mather filed a second motion for summary

judgment on December 1, 2006. The district court granted the motion on March 23, 2007, awarding

judgment to New Mather on the breach of contract and promissory estoppel claims and, to the extent

Niemi tried to advance a claim for quantum meruit relief in his briefing, dismissed the claim as

untimely. On appeal, Niemi challenges the dismissal of NHK Spring, the summary judgment rulings

on the trade secret and promissory estoppel claims, and the summary dismissal of his quantum

meruit theory.4
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 4

5

New Mather has not contested the assertion that Niemi’s method derived independent economic value from

not being generally known and not being readily ascertainable by others.

III. ANALYSIS

In challenging the district court’s summary judgment rulings, Niemi contends the court failed

to view the entire the record in the light most favorable to him and insists that he presented sufficient

evidence to create genuine issues of material fact on both his trade secret and promissory estoppel

claims. The court of appeals reviews de novo an order granting summary judgment. Johnson v.

Karnes, 398 F.3d 868, 873 (6th Cir. 2005). Summary judgment “should be rendered if the

pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no

genuine issue as to any material fact and that the movant is entitled to a judgment as a matter of

law.” Fed. R. Civ. P. 56(c). The court must view the evidence in the light most favorable to the

non-moving party and draw all reasonable inferences in its favor. Id. Not just any alleged factual

dispute between the parties will defeat an otherwise properly supported motion for summary

judgment; the dispute must present a genuine issue of material fact. Leadbetter v. Gilley, 385 F.3d

683, 689-90 (6th Cir. 2005). A dispute is “genuine” only if based on evidence upon which a

reasonable jury could return a verdict in favor of the non-moving party. Hedrick v. W. Reserve

Care Sys., 355 F.3d 444, 451 (6th Cir. 2004). A factual dispute concerns a “material” fact only if

its resolution might affect the outcome of the suit under the governing substantive law. Id.

A. Misappropriation of Trade Secret

There is no dispute between the parties as to the legal standards governing Niemi’s claim for

misappropriation of his trade secret, set forth in Count I of the first amended complaint. The

viability of the claim depends fundamentally on whether Niemi’s stabilizer bar manufacturing

method is a “trade secret.” Under Ohio law, “trade secret” is defined as follows:

(D) "Trade secret" means information, including the whole or any portion or phase

of any scientific or technical information, design, process, procedure, formula,

pattern, compilation, program, device, method, technique, or improvement, or any

business information or plans, financial information, or listing of names, addresses,

or telephone numbers, that satisfies both of the following:

(1) It derives independent economic value, actual or potential, from not being

generally known to, and not being readily ascertainable by proper means by, other

persons who can obtain economic value from its disclosure or use.

(2) It is the subject of efforts that are reasonable under the circumstances to maintain

its secrecy.

Ohio R.C. § 1333.61. Focusing on the last element in this definition, the district court held that

Niemi had presented “no evidence of affirmative acts . . . to maintain the secrecy of the designs.”5

The court held that Niemi’s allegation of an oral confidentiality agreement between himself and

New Mather was “entirely unsupported.” Niemi objects to this characterization of the record and

points to several items which he insists give rise to genuine issues of material fact.

First, Niemi contends the district court totally ignored his affidavit, in which he details the

measures he took to safeguard the secrecy of his trade secret. Specifically, Niemi states that he

maintained complete control over his drawings and blueprints for the new manufacturing process

in a secret, locked location in his house. Niemi aff. at ¶¶ 2-4, JA 36. He did not disclose them to

anyone other than his son and partner Mark Niemi, and agents of New Mather—and to them only

after receiving assurances of confidentiality. Id. at ¶ 3. When drawings were transported to and
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 5

6

New Mather argues that even if there were an oral reciprocal exclusivity agreement, its enforcement would

be barred by the statute of frauds. The argument misperceives the nature of Niemi’s misappropriation of trade secret

claim. It is not a breach of contract claim. The evidence of the exclusivity agreement is not asserted—in this context—

in furtherance of enforcing its specific terms, but as evidence of the reasonableness of Niemi’s efforts to secure the

secrecy of his trade secret. The protection afforded by trade secret laws is not a function of property interests or contract

rights, but of “equitable principles of good faith applicable to confidential relationships.” Valco Cincinnati, Inc. v. N

& D Machining Service, Inc., 492 N.E.2d 814, 817 (Ohio 1986). Whether the statute of frauds would bar enforcement

of the agreement is therefore irrelevant to the question whether the agreement nonetheless evidences a confidential

relationship such that unauthorized use of information disclosed in that relationship would be inequitable. The statute

of frauds defense plays a more significant role, however, in relation to the promissory estoppel claim, discussed below.

from New Mather’s place of business in Toledo, they were always personally hand-delivered either

by Niemi or his son or by New Mather personnel, who were required to sign for them. Id. at ¶ 11.

No trade secret information was ever communicated by Niemi via electronic media. Id. at ¶ 12. In

addition, Niemi was well aware of the security measures consistently employed by New Mather at

its facility. Id. at ¶¶ 5-10. 

New Mather contends the affidavit is entitled to little weight, arguing it was manufactured

in response to the motion for summary judgment. New Mather has not, however, otherwise refuted

the contents of the affidavit. Granted, apart from Niemi’s affidavit statement that he received

assurances of confidential treatment before he disclosed the method to Sheckler, there appears to

be no evidence of a confidentiality agreement. Still, Niemi’s statement has not been contradicted

on the record. Though Sheckler was deposed and expressly acknowledged the manufacturing

improvement effected by Niemi’s new method, neither side has identified evidence of Sheckler’s

recollection of the asserted assurance of confidentiality. Blackwood testified that he was unaware

of any restriction on New Mather’s use of Niemi’s drawings, but he did not directly refute the

allegation that Niemi was given assurance of confidentiality before disclosing the method to

Sheckler. In sum, Niemi’s affidavit averment regarding the existence of an oral confidentiality

agreement is unrefuted and is not “no evidence.” 

Second, Niemi relies on his deposition testimony detailing the conversation he had with

Blackwood in 1993 or ‘94, when he remembers signing the exclusivity agreement and Blackwood

reportedly assured him that New Mather would continue to direct its design needs to him as long

as he maintained the secrecy of his new method. There is otherwise no substantiation of a written

exclusivity agreement. Blackwood testified that he is unaware of any such written agreement and

he doesn’t recall agreeing that Niemi would be New Mather’s exclusive designer. However,

Blackwood acknowledged that Niemi had been New Mather’s “primary, if not exclusive designer.”

Hence, although Blackwood’s testimony does not directly corroborate Niemi’s averment that there

was an exclusivity agreement, his recollection of the parties’ relationship and course of dealing from

1991 to 1997 affords de facto corroboration.6

 

Third, in support of the argument that his reliance on New Mather’s oral assurances of

confidentiality was reasonable, Niemi points to the declarations of three experts. Phillip S. Szuba,

Ph.D., P.E. (automotive systems engineer), James R. Childs, Jr. (automotive design supervisor), and

Eugene Friedman (patent lawyer), have all stated that it is customary in the automotive industry for

small companies such as RKN Technology to rely on oral assurances of confidentiality regarding

proprietary information when dealing with large automotive companies. 

New Mather has not contested the contents or significance of these declarations, except to

argue they are not relevant because Niemi has submitted no evidence of an oral confidentiality

agreement. As explained above, Niemi’s affidavit, albeit arguably self-serving, is not “no

evidence.” Given that Niemi’s sworn averment of an oral confidentiality agreement is probative

evidence and is not refuted, the experts’ opinions afford facially significant evidence of the

reasonableness of Niemi’s reliance on such an oral agreement. Absent such evidence of customary
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 6

7

New Mather contends this fact issue is not material, because under Valco Cincinnati, Inc. v. N & D Machining

Service, Inc., 492 N.E.2d 814 (Ohio 1986), Niemi’s standardization of drawings is not recognized as a reasonable effort

to maintain secrecy. For the reasons set forth below in our discussion of Valco, we disagree.

practice in the industry, reliance on an oral promise could well be deemed not to represent a

“reasonable effort” to maintain secrecy. Yet, when Niemi’s statement is viewed in the light of this

customary practice and the parties’ 25-to-30 year relationship, a genuine issue of material fact

begins to emerge.

Fourth, relying on his own deposition testimony and that of Denzil Sheckler, Niemi contends

that he created standardized drawings of standardized manufacturing machine parts. This enabled

New Mather to order the fabrication of different tools by different manufacturing or “build” shops

without needing to disclose the complete set of prints to any one shop, thereby preserving the

secrecy of the trade secret method. 

New Mather has not identified any record evidence refuting this testimony. Instead, New

Mather proposes a different view of the evidence. New Mather contends that Niemi’s knowledge

of New Mather’s disclosure of his drawings to different shops without requiring that the drawings

be labeled “confidential” evidences his carelessness. To this, Niemi responds that his

standardization of the drawings, facilitating distribution of tool manufacturing jobs to different

shops, obviated the need to label drawings “confidential.” He contends that drawings of individual

machine part designs alone, unaccompanied by a complete set of drawings, failed to disclose the

overall method. Hence, this standardizing technique is said to represent a reasonable and effective

effort to preserve secrecy even without labeling the individual drawings “confidential.” 

 At oral argument, however, counsel for New Mather interjected a new argument—again

without record support—contending that a complete set of the drawings was disclosed, with Niemi’s

knowledge and without being labeled “confidential,” to at least two design shops. Counsel for

Niemi quickly responded that any such disclosure would have been in direct breach of the parties’

confidentiality agreement. In our opinion, it suffices at this stage to observe that the parties’

positions, though finding disappointingly little support in the record, are conflicting and

irreconcilable. Their dispute substantiates the existence of a genuine fact issue.7

 

In further support of his argument that summary judgment was premature, Niemi relies

heavily on Learning Curve Toys, Inc. v. PlayWood Toys, Inc., 342 F.3d 714 (7th Cir. 2003).

Learning Curve teaches simply that whether efforts taken to maintain the secrecy of a trade secret

are reasonable under the circumstances depends on the circumstances; that what is reasonable for

a small company may be different from what is reasonable for a large company; and that the

determination ordinarily represents a question for the jury. Id. at 724-25. The court observed that

“only in an extreme case can what is a ‘reasonable’ precaution be determined as a matter of law,

because the answer depends on a balancing of costs and benefits that will vary from case to case.”

Id. at 725 (quoting Rockwell Graphic Sys., Inc. v. DEV Indus., Inc., 925 F.2d 174, 179 (7th Cir.

1991) (internal brackets omitted). 

In Learning Curve, the Seventh Circuit upheld a jury verdict for the smaller company,

PlayWood, on its misappropriation of trade secret claim, thereby reversing the trial court’s contrary

judgment as a matter of law. The court upheld the jury’s verdict based on evidence of an oral

confidentiality agreement, coupled with evidence that oral confidentiality agreements were

customarily relied on. Id. at 725-26. The court readily acknowledged that PlayWood could and

should have done more to protect its secret, but concluded the evidence was sufficient for the jury

to determine that PlayWood, the smaller and less sophisticated of the parties, took reasonable

precautions under the circumstances. Id. 
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 7

New Mather contends first that Learning Curve does not apply Ohio law and is therefore not

controlling. Yet, both the Illinois and Ohio versions of the Uniform Trade Secrets Act include the

same definition of “trade secret.” Further, the Ohio Revised Code expressly provides that its trade

secrets provisions “shall be applied and construed to effectuate their general purpose and to make

uniform the law with respect to their subject.” Ohio R.C. § 1333.68. It follows that the Learning

Curve analysis, though certainly not controlling, is probative. 

New Mather’s attempt to factually distinguish Learning Curve also falls short. New Mather

contends that the Learning Curve jury’s verdict was based in part on evidence (1) of a written

confidentiality agreement, and (2) that PlayWood stamped documents “confidential.” A careful

reading of Learning Curve reveals, however, that this evidence pertained to PlayWood’s efforts, in

its dealings with its own manufacturer, to protect the confidentiality of materials it had received

from Learning Curve. Learning Curve, 342 F.3d at 719. The evidence did not pertain to efforts

taken by PlayWood to protect the trade secret disclosed to and misappropriated by Learning Curve.

The pertinent analysis in Learning Curve includes neither reference to nor reliance on any such

evidence in its recapitulation of the evidence deemed sufficient to support the jury’s verdict. Id. at

725-26. In truth, the operative facts in Learning Curve, consisting essentially of an oral

confidentiality agreement and evidence of customary usage in the industry, are very similar to the

instant facts. 

Neither has New Mather identified any Ohio authority suggesting that Learning Curve is

contrary to or inconsistent with Ohio law. Ohio law recognizes that a party claiming trade secret

status has the burden of demonstrating that it took reasonable steps to maintain the secrecy of the

protected information. State ex rel. Carr v. Akron, 859 N.E.2d 948, 955 (Ohio 2006); Valco

Cincinnati, Inc. v. N & D Machining Service, Inc., 492 N.E.2d 814, 819 (Ohio 1986). New Mather

argues that Valco presents an example of the kinds of reasonable efforts that are required to make

out a valid claim under Ohio law and contends that Niemi’s efforts do not measure up. 

In Valco, the court upheld the trial court’s issuance of an injunction, holding that the security

measures undertaken by Valco at its manufacturing plant and in relation to its drawings were

sufficient (notwithstanding Valco’s failure to obtain a non-disclosure agreement from the

misappropriating employee) to create a question for the trier of fact, the resolution of which was

entitled to deference by the reviewing court. Id. Yet, while the efforts taken by Valco were

deemed sufficient to create a triable fact issue, the Ohio Supreme Court’s opinion cannot be read

as establishing a mandatory minimum standard below which any efforts taken are necessarily

deemed insufficient or unreasonable as a matter of law. The instant record indicates that some of

the measures identified in Valco were used and some were not. On the other hand, the record also

evidences measures taken in this case that were not employed in Valco, e.g., a pre-disclosure

confidentiality agreement between the parties. 

Yet, our task is not to compare and contrast the quantum and quality of reasonable efforts

taken in the two cases to determine which set of facts is superior. The question before us is whether

the instant record, viewed in the light most favorable Niemi, contains sufficient evidence to enable

a reasonable fact finder to conclude that Niemi took reasonable steps to safeguard the secrecy of his

method, such that New Mather’s alleged unauthorized use of the information could be deemed a

breach of good faith in the parties’ confidential relationship. Valco, 492 N.E.2d at 817. And on this

question, Valco, like Learning Curve, honors the fact finder’s prerogative to determine

reasonableness.

New Mather also cites Hoffman-La Roche Inc. v. Yoder, 950 F. Supp. 1348 (S.D. Ohio

1997). In Hoffman-La Roche, the district court denied injunctive relief, finding that controverted

evidence of a confidentiality agreement and other reasonable efforts was insufficient to sustain the

plaintiff’s burden. In some respects, the factual record presented in Hoffman-La Roche is analogous
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 8

to the instant record. However, the Hoffman-La Roche court premised its award of judgment to the

defendant on detailed fact findings only after conducting a full-blown trial, making credibility

determinations, and carefully weighing the evidence. The plaintiff in Hoffman-La Roche thus

received precisely what Niemi wants: his day in court. Although Niemi’s showing of reasonable

efforts, on paper, may appear to be no stronger than that described in Hoffman-La Roche, it is

nonetheless sufficient to win for Niemi what Hoffman-La Roche was granted, the opportunity to tell

his story in a trial. 

In R & R Plastics, Inc. v. F.E. Myers Co., 637 N.E.2d 332 (Ohio App. 6 Dist. 1993), we find

an example of an Ohio court ruling against a trade secret claimant as a matter of law. The R & R

Plastics court upheld summary judgment for the defendant where there was “no evidence” of a

confidentiality agreement, express or implied, and “no evidence” of “effective security measures.”

Id. at 341-43. In other words, the record contained so little evidence supporting the plaintiff’s claim

that “reasonable minds [could] only conclude” that the defendant was entitled to judgment as a

matter of law. Id. at 342-43. R & R Plastics represents what Learning Curve characterized as the

“extreme case,” where the evidence of reasonable efforts is so utterly lacking in substance as to

warrant judgment as a matter of law. In our opinion, for all the reasons set forth above, Niemi’s

showing of reasonable efforts is not such an “extreme case.” It is not as weak as the showing made

in R & R Plastics. Contrary to the lower court’s characterization, Niemi’s showing is not “no

evidence.”

In sum, then, we conclude that the teaching of Learning Curve is entirely consistent with

Ohio law. The lesson is that, except where the evidentiary showing of reasonable efforts could not

conceivably support a judgment in favor of the plaintiff, the reasonableness of the efforts is a

question for the trier of fact. Because, depending on the credibility of the witnesses, it is

conceivable, based on the present record, that a reasonable jury could find that Niemi’s efforts to

maintain the secrecy of his trade secret were reasonable, in light of his long term relationship with

New Mather and the relative sophistication of the parties, we conclude that the district court’s

summary judgment ruling on the claim for misappropriation of trade secret was in error.

B. Promissory Estoppel

In Count III of the first amended complaint, Niemi asserts a promissory estoppel claim based

on the alleged exclusivity agreement. Under Ohio law, “[a] promise which the promisor should

reasonably expect to induce action or forbearance on the part of the promisee or a third person and

which does induce such action or forbearance is binding if injustice can be avoided only by

enforcement of the promise.” Shampton v. City of Springfield, 786 N.E.2d 883, 887 (Ohio 2003)

(quoting Restatement 2d, Contracts (1981), Section 90). To prevail on his promissory estoppel

claim, Niemi must show that he reasonably relied on New Mather’s representations in such a way

as to change his position for the worse. Id. The district court rejected New Mather’s statute of

frauds defense, finding Ohio law unsettled, but awarded summary judgment to New Mather on the

ground that Niemi’s reliance was not shown to be reasonable.

1. Statute of Frauds

The statute of frauds provides in relevant part:

No action shall be brought whereby to charge the defendant . . . upon an agreement

that is not to be performed within one year from the making thereof; unless the

agreement upon which such action is brought, or some memorandum or note thereof,

is in writing and signed by the party to be charged therewith or some other person

thereunto by him or her lawfully authorized.
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 9

Ohio R.C. § 1335.05. The exclusivity agreement asserted by Niemi appears to have been indefinite

in duration and there is no evidence that it was ever reduced to writing. Yet the district court refused

to apply the statute of frauds to bar the claim because Ohio courts have sometimes allowed

promissory estoppel claims to proceed in avoidance of the statute of frauds. 

Indeed, Ohio law is unsettled on the application of the statute of frauds to a promissory

estoppel claim. In McCarthy, Lebit, Crystal & Haiman Co., LPA v. First Union Mgmt., Inc., 622

N.E.2d 1093, 1102 (Ohio App. 8 Dist. 1993), the Eighth District Court of Appeals purported to

adopt a rule restricting the extent to which promissory estoppel could be used to avoid the statute

of frauds. Under its formulation, “the doctrine of promissory estoppel may be used to preclude a

defense of statute of frauds, but only when there has been (1) a misrepresentation that the statute’s

requirements have been complied with or (2) a promise to make a memorandum of the agreement.”

Id. at 1102. This rule has been followed in Spectrum Benefit Options, Inc. v. Medical Mutual of

Ohio, 880 N.E.2d 926, 937 (Ohio App. 4 Dist. 2007), and Landskroner v. Landskroner, 797 N.E.2d

1002, 1016 (Ohio App. 8 Dist. 2003). If the teaching of McCarthy were followed in this case, the

statute of frauds would operate to bar Niemi’s promissory estoppel claim. Despite the bald

allegation in the first amended complaint of “representations regarding execution of a written

agreement which would meet the requirements of the law,” Niemi has not identified any

representation by Blackwood or anyone else to the effect that the alleged reciprocal exclusivity

agreement was or would be reduced to writing. 

However, the Ohio courts have not been uniform in their approach to the interplay of

promissory estoppel and the statute of frauds. See Heffner Investments, Ltd. v. Piper, 2008 WL

2168781 at *4-5 (Ohio App. 3 Dist.) (recognizing conflict among courts of appeals decisions, but

refraining from reaching issue); Martin v. Friedberg, 2007 WL 2206019 at *3 (Ohio App. 5 Dist.)

(acknowledging McCarthy, but concluding that defendant was nonetheless estopped from asserting

statute of frauds defense); ESKE Properties, Inc. v. Sucher, 2003 WL 22880782 at *13 (Ohio App.

2 Dist.) (implying that continued vitality of McCarthy is in doubt); Connolly v. Malkamaki, 2002

WL 31813040 at *4-5 (Ohio App. 11 Dist.) (refusing to apply McCarthy limitations due to patent

unfairness to unsophisticated plaintiff); Poskocil v. Cleveland Inst. of Music, 1997 WL 209265 at

*3-4 (Ohio App. 8 Dist.) (holding McCarthy limitations inapplicable to employer-employee

relationships due to unequal bargaining positions and resultant injustice). Despite this apparent

inconsistency, the Ohio Supreme Court has not had occasion to clarify the matter. 

 Given this uncertainty in Ohio law, and recognizing that “Niemi was relatively less

sophisticated than Mather,” the district court refused to enforce the statute of frauds to bar the

promissory estoppel claim. In this we find no error. Ultimately, all of the Ohio appellate decisions,

irrespective of their particular construction of the promissory-estoppel exception to the statute of

frauds, may be viewed as turning on the specific equities of the claims and parties at issue. Indeed,

McCarthy itself recognizes that both the statute of frauds and the doctrine of promissory estoppel

are designed to prevent fraud and that “the statute of frauds may not be interposed in furtherance of

fraud.” McCarthy, 622 N.E.2d at 1100. The willingness of the Ohio courts to enforce the statute

of frauds in the face of a promissory estoppel claim thus appears to depend fundamentally on

consideration of the totality of the circumstances. 

Considering the totality of the present circumstances, we conclude that the equities favor the

result reached by the district court. Niemi was less sophisticated than his bargaining partner. His

belief that a reciprocal exclusivity agreement had been reached was based on oral representations

by a representative of New Mather whom he had come to trust during a long-term course of dealing.

In reliance on the parties’ agreement, Niemi assertedly refrained from pursuing other business

opportunities that would otherwise have been available to him. Further, New Mather undoubtedly

benefitted from Niemi’s having granted it exclusive permission to use the stabilizer bar

manufacturing method. Considering these circumstances and the relative equities of the parties, we
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 10

find no error in the district court’s rejection of the statute of frauds in defense of the promissory

estoppel claim. 

2. Reasonable Reliance?

 Upon addressing the merits of the claim, the district court concluded, however, that Niemi

had failed to demonstrate reasonable reliance. This conclusion is based largely on Niemi’s supposed

admission that Blackwood lacked authority to bind New Mather. If Niemi knew that a midmanagement-level employee like Blackwood lacked authority to enter into the exclusivity agreement

on behalf of New Mather, the district court reasoned, then Niemi’s reliance on Blackwood’s oral

representation could not have been reasonable. Niemi contends the district court ignored his

argument that his reliance on Blackwood’s apparent authority was reasonable and ignored other

evidence corroborating the reasonableness of his reliance, such as Blackwood’s acknowledgment

that Niemi had in fact been New Mather’s exclusive designer and Cornieles’s recognition of his

exclusive designer status after having been confronted by Niemi with the parties’ earlier agreement.

In Master Consol. Corp. v. BancOhio Nat’l Bank, 575 N.E.2d 817 (Ohio 1991), the contours

of the apparent authority doctrine are defined as follows:

“Apparent authority” has been defined as “. . . the power to affect the legal relations

of another person by transactions with third persons . . . arising from . . . the other's

manifestations to such third persons.” 1 Restatement of the Law 2d, Agency (1958)

30, Section 8. This court, in Miller v. Wick Blg. Co., 154 Ohio St. 93, 93 N.E.2d 467

(1950), paragraph two of the syllabus, held that:

“Even where one assuming to act as agent for a party in the making of a contract has

no actual authority to so act, such party will be bound by the contract if such party

has by his words or conduct, reasonably interpreted, caused the other party to the

contract to believe that the one assuming to act as agent had the necessary authority

to make the contract.” See also, Cascioli v. Central Mut. Ins. Co., 4 Ohio St. 3d 179,

181, 448 N.E.2d 126, 128 (1983).

Further, this court in General Cartage & Storage Co. v. Cox, 74 Ohio St. 284, 294,

78 N.E. 371, 372 (1906), explained that, “‘[w]here a principal has by his voluntary

act placed an agent in such a situation that a person of ordinary prudence, conversant

with business usages, and the nature of the particular business, is justified in

assuming that such agent is authorized to perform on behalf of his principal a

particular act, such particular act having been performed the principal is estopped as

against such innocent third person from denying the agent’s authority to perform it.’

. . .” 

Id. at 822. 

Applying these standards, we hold there is a question of fact as to the reasonableness of

Niemi’s reliance on Blackwood’s apparent authority, based on: 

(1) Blackwood’s representation that his principal, New Mather, to maintain its competitive

edge, wanted to “tie Niemi up” through the exclusivity agreement; 

(2) Niemi’s extensive dealings with New Mather through its agent Blackwood, who served

New Mather in a variety of capacities and ostensibly enjoyed his superiors’ favor; 

(3) Niemi’s understanding that the exclusivity agreement was merely a perpetuation of a

relationship that had been in existence since 1967;

(4) Blackwood’s corroboration that Niemi had in fact been New Mather’s primary, if not

exclusive, designer;
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 11

(5) Niemi’s familiarity with New Mather over a 25-30 year course of dealing, in which he

had come to view New Mather as an honorable and trustworthy business partner; 

(6) record evidence that oral agreements are a matter of customary usage in the automotive

industry; and 

(7) Cornieles’s “ratification” or renewal of the exclusivity agreement in 1998 after Niemi

brought it to his attention and Cornieles had a chance to confer with his superiors. 

 In concluding there is no question of fact, the district court did not consider Blackwood’s

apparent authority or the significance of the above considerations under the teaching of Master. New Mather has not effectively refuted these facts. New Mather argues about the significance of

some of the above considerations, but fails to demonstrate that, considering the totality of the

circumstances in the light most favorable to Niemi, no reasonable jury could find for Niemi on the

question of Blackwood’s apparent authority. If Blackwood were shown to have had apparent

authority, the basis for the district court’s holding that Niemi’s reliance was not reasonable would

be undercut. Niemi’s factual showing may not be compelling, or even strong, but it is more than a

mere scintilla of evidence. The promissory estoppel claim, like the misappropriation of trade secret

claim, presents questions that simply call for live testimony and an opportunity for the fact finder

to see and hear the witnesses and assess their credibility. The summary judgment ruling on the

promissory estoppel claim is therefore vacated as well. 

C. Quantum Meruit Relief

The first amended complaint does not include a claim for quantum meruit relief. In response

to New Mather’s motion for summary judgment, however, Niemi argued that the record evidence

substantiated his entitlement to quantum meruit relief based on a quasi-contract, or contract-impliedat-law, theory. As no such claim had been pleaded, the district court correctly treated Niemi’s

argument as an implicit motion to amend the complaint. See Super Sulky, Inc. v. U.S. Trotting Ass’n, 174 F.3d 733, 740 (6th Cir. 1999). The court examined the elements of such a quantum meruit

theory and concluded that permitting the “eleventh hour” amendment (i.e., after the court had just

concluded the properly pleaded claims were meritless) would result in unfair prejudice to New

Mather. In particular, the court noted that discovery had been limited to liability issues and had not

included matters of damages which are integral to a quantum meruit theory of relief. 

Under Fed. R. Civ. P. 15(a)(2), leave to amend is to be freely given when justice so requires.

The district court’s decision to disallow amendment is reviewed for abuse of discretion. Super

Sulky, 174 F.3d at 740. Considering the context in which the district court ruled, it cannot be said

to have abused its discretion in denying the implied motion for leave to amend. Given our remand

of the case for further proceedings on the trade secret and promissory estoppel claims, however, the

discretionary equation changes dramatically. Remand will almost certainly entail a re-opening of

discovery on damages, which may legitimize Niemi’s prospective request for leave to assert a claim

for quantum meruit relief without causing unfair prejudice to New Mather. This is particularly true

in connection with continued proceedings on the promissory estoppel claim, the elements of which

are analogous to the elements of a claim for quantum meruit relief based on a quasi-contract theory.

Compare Anderson, Inc. v. Consol, Inc., 348 F.3d 496, 503 (6th Cir. 2003) (defining elements of

promissory estoppel under Ohio law as including a promise, reasonable reliance, and resulting injury

under circumstances where injustice can be avoided only by enforcing the promise), and Reisenfeld

& Co. v. Network Group, Inc., 277 F.3d 856, 860 (6th Cir. 2002) (defining elements of quasicontract claim under Ohio law as “(1) a benefit conferred by the plaintiff upon the defendant;

(2) knowledge by the defendant of the benefit; and (3) retention of the benefit by the defendant

under circumstances where it would be unjust to do so without payment.”). In addition, continued

proceedings on the trade secret claim, which also implicates “equitable principles of good faith in

confidential relationships,” Valco, 492 N.E.2d at 817, might also justify reconsideration of a

prospective quantum meruit claim. 
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 12

8

This holding has not been challenged by Niemi.

Accordingly, though the district court did not abuse its discretion when it denied Niemi’s

implied motion for leave to amend the complaint so as to state a claim for quantum meruit relief, if

Niemi were to renew his motion on remand, the district court may entertain it afresh. 

D. Personal Jurisdiction over NHK Spring

Finally, Niemi challenges the district court’s dismissal of his claims against New Mather’s

parent corporation, NHK Spring, for lack of personal jurisdiction. The district court noted that

although Niemi presented evidence of NHK Spring’s interactions with its subsidiary New Mather

in Ohio, Niemi failed to show that such actions by NHK Spring caused tortious injury to Niemi. In

challenging this ruling, Niemi argues first that the district court was precluded, pursuant to the lawof-the-case doctrine, from revisiting an issue already decided by the District Court for the Eastern

District of Michigan before the case was transferred to the Northern District of Ohio.

Under the law-of-the-case doctrine, rulings made at one point in the litigation should

continue to govern in subsequent stages of that litigation. Scott v. Churchill, 377 F.3d 565, 569 (6th

Cir. 2004); Rouse v. DaimlerChrysler Corp. UAW, 300 F.3d 711, 715 (6th Cir. 2002). The doctrine

merely directs the court’s discretion; it does not limit the court’s power. Scott, 377 F.3d at 569. The

doctrine has no application where the issue in question was not previously decided. United States

v. Graham, 327 F.3d 460, 464 (6th Cir. 2003). 

When Judge Feikens, in the Eastern District of Michigan, transferred the case, he was ruling

on a motion to dismiss by NHK Spring, contending that it was not amenable to suit in Michigan. Judge Feikens agreed, holding that Niemi had not shown that the cause of action arises out NHK

Spring’s contacts in Michigan. Judge Feikens did not purport to rule that NHK Spring is amenable

to suit in Ohio. Rather, the case was transferred to the Northern District of Ohio because it was

undisputed that New Mather is located in Toledo and that NHK Spring’s interactions with New

Mather, whether or not sufficient to support exercise of personal jurisdiction in Ohio, occurred in

Ohio. Because Judge Feikens was not asked to, and did not, in fact, rule on the sufficiency of NHK

Spring’s contacts in the State of Ohio, Chief Judge Carr was not constrained by any such ruling after

the case was transferred.

In ruling on NHK Spring’s new motion to dismiss the claims against it, however, Chief

Judge Carr did hold that Judge Feikens’s ruling was, in one respect, controlling as the law of the

case. That is, Chief Judge Carr acknowledged Judge Feikens’s holding that New Mather was not

an alter ego of NHK Spring. 8

 Consequently, Niemi had the burden to show that NHK Spring was

subject to the court’s exercise of personal jurisdiction in Ohio based on its own conduct in Ohio,

rather than New Mather’s. The court concluded that Niemi had not carried this burden because he

failed to demonstrate that NHK Spring’s conduct in Ohio caused him tortious injury, as required by

Ohio R. C. § 2307.382(A). The court held that Niemi’s evidence of a causal connection between

NHK Spring’s conduct and his claims was too speculative.

Niemi has not shown that this ruling was in error. His perfunctory argument is effectively

undermined by one of the very cases he relies on, Dean v. Motel 6 Operating L.P., 134 F.3d 1269

(6th Cir. 1998). In Dean, the court recognized that a company does not purposefully avail itself of

the privilege of doing business in the forum state merely by owning a corporation subject to

jurisdiction. Id. at 1273-74. Further, like the plaintiff in Dean, Niemi has failed to show, despite

extensive discovery, that NHK Spring, through a network of simultaneous board memberships or

otherwise, actually controlled New Mather or controlled the decisions and actions made by New

Mather that resulted in Niemi’s alleged injuries. Id. at 1274-75. Though the “evidence” adduced
No. 07-3536 Niemi, et al. v. NHK Spring Co., Ltd., et al. Page 13

by Niemi is to be viewed in the light most favorable to him, here, as in Dean, the evidence is simply

too amorphous and speculative to justify stretching the long arm of personal jurisdiction across

national borders to reach a Japanese corporation. See id. at 1275. 

Accordingly, the district court’s dismissal of NHK Spring from the action for lack of

personal jurisdiction was proper.

IV. CONCLUSION

In sum, for the reasons set forth above, the district court’s order dismissing the action against

NHK Spring is AFFIRMED, but the summary judgment rulings in favor of New Mather on Niemi’s

misappropriation of trade secret and promissory estoppel claims are VACATED, and the case is

REMANDED for further proceedings on these two claims.