Trade Secret Misappropriation and a Data Subject Request
Brightline Analytics Inc. develops demand-forecasting software. Its senior data scientist, Dr. Lena Rao, resigned on 1 June and joined Nova Metrics on 15 June as 'head of product.' Brightline has no non-compete agreement with Rao; her offer letter includes a confidentiality clause and assigns all inventions to Brightline. Before leaving, Rao copied 2,300 files-including source code, customer pricing models, and a 2024 roadmap-to her personal cloud drive. A forensic image shows she accessed the files on 28 May and deleted 1,100 local files on 2 June. Brightline also received a data-subject access request from a European customer, asking for all personal data held about it and deletion of marketing data. Brightline's trade secret policy is unsigned. It wants an injunction and plans to preserve evidence.
1. What must Brightline prove to obtain a preliminary injunction for trade secret misappropriation, and how strong is its case?
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Elements. Brightline must show (1) a trade secret-information with independent economic value that is not generally known and is subject to reasonable measures to maintain secrecy; (2) misappropriation-improper acquisition, disclosure, or use; and (3) for a preliminary injunction, likelihood of success, irreparable harm, balance of hardships, and public interest.
Strengths. Source code, pricing models, and the roadmap qualify as trade secrets. The confidentiality clause, access controls, and forensic evidence of copying 2,300 files and deleting 1,100 local files support both secrecy and misappropriation. Rao's new role as head of product creates a risk of use.
Weaknesses. The unsigned trade secret policy undermines 'reasonable measures.' Brightline must show the policy was communicated and enforced, not just drafted. No non-compete is not fatal; trade secret law protects against misuse, not competition. The inevitable disclosure doctrine is jurisdiction-dependent; some courts require evidence of actual use or threatened use. A court may enjoin use of the specific files and require return, not bar Rao from working.
Conclusion. Likely a narrow injunction: preserve and return files, bar use of Brightline's trade secrets, allow employment subject to a firewall. Brightline should seek expedited discovery and a forensic protocol.
2. How should Brightline respond to the data-subject access and deletion request without compromising the litigation hold?
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Access request. If a GDPR-style law applies, Brightline must verify the customer's identity, search all systems including personal cloud and backups, and provide a copy of personal data within the statutory period (often one month). It may redact third-party personal data, privileged material, and trade secrets, but must explain the redactions. The request is narrow-personal data about the customer-so Brightline should not hand over its source code or internal analyses.
Erasure request. The right to erasure is not absolute. Exceptions include compliance with legal obligations and the establishment, exercise, or defense of legal claims. The litigation hold is a legal obligation to preserve relevant evidence. Brightline should suspend deletion for any data within the hold, segregate it, and document the legal basis. It should not delete the customer's marketing data if that data is relevant to the dispute.
Coordination. Issue a written litigation hold that overrides routine deletion, notify the customer of the extension or refusal with reasons, and keep a data map. Deleting now would create spoliation risk. The privacy team and litigation counsel must agree on scope before any erasure.