Trade secrets are a valuable form of IP which need to be protected. In 2019, the FBI reported that the annual cost to the US economy of counterfeit goods, pirated software, and theft of trade secrets is between $225 and $600 billion. To further the protection of U.S. trade secrets, President Obama signed into law the 2016 Defend Trade Secrets Act (DTSA), creating a federal cause of action for trade secret misappropriation and providing trade secret owners with several measures of monetary recovery.
Significantly, some federal courts interpreting the Act have found that it may be applied extraterritorially to misappropriation that occurs outside the US if the misappropriator is a US citizen or entity, or “an act in furtherance of” the misappropriation occurs domestically. In the recent case of Motorola Solutions, Inc. v. Hytera Communications Corp. Ltd. for example, the Northern Illinois District Court found that, although most of the illegal conduct occurred overseas, certain illegal acts in furtherance of the misappropriation occurred within the US, which triggered extraterritorial application. Following a trial on the merits, the Court awarded Motorola $543.7 million which award included Hytera profits from accused products manufactured, distributed, and sold entirely outside of the US. Counsel for Motorola retained Ocean Tomo to determine the measures and amounts of monetary recovery due Motorola. Ocean Tomo quantified Motorola’s lost profits, Hytera’s avoided R&D costs, and Hytera’s profits from US and foreign accused product sales.
Robert McSorley is a Managing Director in Ocean Tomo’s Intellectual Property Disputes Financial Expert Testimony practice, out of the firm’s Chicago headquarters. The practice area quantifies economic damages arising from intellectual property disputes and provides general litigation support.
To explore this topic and how it could influence your case, please contact: Robert McSorley, JD, CPA at firstname.lastname@example.org or +1 (312) 327-4412.