Opinion ID: 6496059
Heading Depth: 2
Heading Rank: 3

Heading: Arrive’s Failure to Protect its Information

Text: Arrive contends the defendants’ use of its confidential information requires a finding of irreparable harm, and it argues the district court clearly erred in concluding otherwise. But the company’s conduct upon the individual defendants’ departures tells a different story. Because of policies that Arrive put in place at the onset of the pandemic, the individual defendants had access to the Accelerate platform on their personal devices. Thus, as a result of Arrive’s business decisions, the individual defendants were able to use their personal devices to retrieve and download the categories of information the company categorizes as trade secrets. Arrive does not contest this. 4The parties disagree about whether the district court erred in concluding that Arrive was not likely to succeed on the merits of its claims for breach of contract against the individual defendants. We do not address that dispute because we resolve this case on other grounds. 20 No. 21-3101 Nevertheless, a human resources manager conducted exit interviews of Scott, Mayer, Hernandez, and Hoffman without asking them to produce their personal devices for inspection, state whether they had company data on those devices, or remove company data. Defendants also maintain that they were willing to return or destroy the information Arrive characterizes as confidential, but they were unable to do so because of a litigation hold. Arrive failed to take basic steps to prevent the individual defendants from possessing its purportedly confidential information. So, the company’s claim that their possession qualifies as irreparable harm rings hollow. Arrive could have prevented the claimed harm by taking greater care in executing information-security procedures prior to, or immediately following, the termination of the individual defendants’ employment. 5 Even though Arrive failed to do so, the defendants have offered the company the opportunity to remedy the harm by turning over or destroying the information at issue. Arrive has evidently refused that offer. Accordingly, it cannot show 5 As the district court noted, to succeed on a claim for misappropriation of trade secrets, a company must take reasonable measures to protect the secrecy of its information. This requirement is codified within the Defend Trade Secrets Act as part of the definition of the term “trade secret.” 18 U.S.C. § 1839(3)(A). Courts evaluate the question of whether efforts to keep information confidential were sufficient “on a case-by-case basis, considering the efforts taken and the costs, benefits, and practicalities of the circumstances.” Tax Track Sys. Corp. v. New Inv. World, Inc., 478 F.3d 783, 787 (7th Cir. 2007); see also Rockwell Graphic Sys., Inc. v. DEV Indus., Inc., 925 F.2d 174, 179–80 (7th Cir. 1991). In some circumstances, judgment as a matter of law for defendants is appropriate because it is “readily apparent that reasonable measures simply were not taken.” Tax Track, 478 F.3d at 787. This could be such a case, considering the facts. No. 21-3101 21 irreparable harm arising from the defendants’ alleged use of the information claimed to be confidential.