Court Opinion

ID: 807812
Source: CourtListenerOpinion
Date Created: 2012-08-31 19:55:04+00
Date Added: 2024-06-11T18:00:27.483135
License: Public Domain

FILED
                            NOT FOR PUBLICATION                              AUG 31 2012

                                                                         MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                        U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

U.S. AUTO PARTS NETWORK, INC.,                   No. 10-56129

              Plaintiff - Appellant,             D.C. No. 2:09-cv-04609-JFW-RZ

  v.
                                                 MEMORANDUM *
PARTS GEEK, LLC, a New Jersey limited
liability company; et al.,

              Defendants - Appellees.

U.S. AUTO PARTS NETWORK, INC.,                   No. 10-56194

              Plaintiff - Appellee,              D.C. No. 2:09-cv-04609-JFW-RZ

  v.

PARTS GEEK, LLC, a New Jersey limited
liability company; et al.,

              Defendants - Appellants.

                    Appeal from the United States District Court
                       for the Central District of California
                     John F. Walter, District Judge, Presiding

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                       Argued and Submitted March 6, 2012
                              Pasadena, California

Before: FARRIS, CLIFTON, and IKUTA, Circuit Judges.

      The district court erred in granting summary judgment to Parts Geek,

Thomason, Pine, Tinari, Hendershot, and Mann (collectively, the “Parts Geek

defendants”) on U.S. Auto Parts’ (USAP) claim for misappropriation of its trade

secrets in the Manager software because a jury could reasonably conclude that

USAP owned some rights to Manager. Moreover, in its supplemental response to

Thomason’s Interrogatory No. 1, USAP identified the key functional components

of the Manager software that it claimed to be trade secrets, and thus “describe[d]

the subject matter of the trade secret with sufficient particularity.” IMAX Corp. v.

Cinema Techs., Inc., 152 F.3d 1161, 1164–65 (9th Cir. 1998) (quoting Universal

Analytics v. MacNeal-Schwendler Corp., 707 F. Supp. 1170, 1177 (C.D. Cal.

1989)) (emphasis omitted). We likewise reject Parts Geek’s argument that it

cannot be held liable for misappropriation of trade secrets because it had a license

to use Admin, given that USAP raised a genuine issue of material fact that Parts

Geek had “reason to know” that Thomason acquired the software code in Admin

by improper means. Cal. Civ. Code § 3426.1(b)(1). Further, a jury could

reasonably conclude that Manager derived “actual or potential” economic value

from not being generally known to the public. § 3426.1(d)(1). Because we reverse
the district court’s grant of summary judgment on this claim, we also vacate its

corresponding award of attorney’s fees to the Parts Geek defendants under Section

3426.4 of the California Civil Code. See United States v. 4,432 Mastercases of

Cigarettes, More or Less, 448 F.3d 1168, 1194 (9th Cir. 2006).

      We affirm the district court’s grant of summary judgment to the Parts Geek

defendants on USAP’s claims for misappropriation of trade secrets related to its

keyword return-on-investment (ROI) data. Even assuming there was sufficient

evidence for a jury to reasonably find that Parts Geek used USAP’s ROI data,

USAP failed to state a prima facie claim for trade secret misappropriation because

it did not adduce any evidence that this use damaged USAP. See Sargent Fletcher,

Inc. v. Able Corp., 3 Cal. Rptr. 3d 279, 283 (Cal. Ct. App. 2003). Contrary to

USAP’s assertion at oral argument, such a showing of harm is necessary for its

demand of injunctive relief as well. See DVD Copy Control Ass’n v. Bunner, 10

Cal. Rptr. 3d 185, 191–92 (Cal. Ct. App. 2004).

      We reverse the district court’s grant of summary judgment to Pine and

Tinari on USAP’s breach of contract claim because Pine’s and Tinari’s release

agreements were susceptible to “two different reasonable interpretations” and were

therefore ambiguous. Oceanside 84, Ltd. v. Fid. Fed. Bank, 66 Cal. Rptr. 2d 487,

492 (Cal. Ct. App. 1997). An agreement that is “entered into . . . in connection

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with the acquisition of Partsbin,” may refer to any agreement that Pine and Tinari

signed with USAP as a result of USAP’s acquisition of Partsbin, or it may refer to

the specific documents related to the acquisition itself, such as financing forms or

other shareholder agreements, that Pine and Tinari entered into with USAP. Given

this ambiguity, and the lack of extrinsic evidence that resolves the issue, the intent

of the parties as to the meaning of this provision and whether it was breached must

be decided at trial. See Mattel, Inc. v. MGA Entm’t, Inc., 616 F.3d 904, 913 (9th

Cir. 2010).

      We affirm the district court’s grant of summary judgment to Hendershot on

USAP’s breach of contract claim because USAP adduced no evidence from which

a reasonable factfinder could conclude that Hendershot had access to USAP’s

confidential information.

      We affirm the district court’s grant of summary judgment to USAP on Parts

Geek’s antitrust counterclaims because Parts Geek offered insufficient evidence to

define the relevant market that USAP attempted to monopolize, see Rebel Oil Co.

v. Atlantic Richfield Co., 51 F.3d 1421, 1434–35 (9th Cir. 1995), and failed to offer

evidence such that a jury could reasonably find that there were significant entry

barriers to that market, see Morgan, Strand, Wheeler & Biggs v. Radiology, Ltd.,

924 F.2d 1484, 1490 (9th Cir. 1991). Parts Geek’s claims for predatory pricing fail

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for the same reasons. See W. Parcel Express v. UPS of Am., Inc., 190 F.3d 974,

975 (9th Cir. 1999).

      The parties shall bear their own costs on appeal.1

      AFFIRMED in part, REVERSED in part, VACATED in part.

      1
        In a separate opinion filed concurrently with this memorandum disposition,
we reverse the district court’s grant of summary judgment on USAP’s copyright
infringement claim related to the Manager software and vacate the district court’s
award of attorneys’ fees to Parts Geek on that claim.
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