Texas Causes of Action & Affirmative Defenses

Texas Causes of Action & Affirmative Defenses

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Wednesday, April 18, 2012

Is misappropriation of trade secrets actionable under the TTLA? [Texas Theft Liability Act]

   
TRADE SECRETS & Texas Theft Liability Act Claim

Is the misappropriation of trade secrets actionable under the TTLA?
  
The Texas Theft Liability Act. See Tex. Civ. Prac. & Rem. Code Ann. §§ 134.001-.005.

The Texas Theft  Liability Act imposes civil liability for, among other actions, “unlawfully appropriating property” as described by Texas Penal Code section 31.05. Id. §§ 134.002(2), 134.003.

Under penal code section 31.05(b), a person commits theft of trade secrets if, without the trade-secret owner's consent, he knowingly: (1) steals a trade secret; (2) copies an article representing a trade secret; or (3) communicates or transmits a trade secret. Tex. Penal Code Ann. § 31.05(b) (West  2011).
 
A person who sustains damages resulting from the unlawful appropriation of property under section 31.05 may recover actual damages, as well as additional damages not to exceed $1,000 and  attorney's fees. Tex. Civ. Prac. & Rem. Code Ann. § 134.005.

SOURCE: DALLAS COURT OF APPEALS – 05-11-00409-CV – 4/11/12

Read more from the opinion …


Twister claims the theft of trade secrets, if any, occurred in

the Netherlands. But section 31.05(b) provides that a person commits the

offense if he steals, copies, or communicates a trade secret if such

actions are without the owner's consent. Tex. Penal Code Ann. §

31.05(b). Newton alleged Twister “unlawfully misappropriated Newton's

Technologies by using and/or disclosing such trade secrets without

consent” and that Twister “has directed communications to persons and

entities in Texas regarding the Newton technology at issue.” Newton also

alleged Twister markets and sells its products in Texas that contain the

trade secrets at issue. There is no dispute that Twister's Texas

contacts concerned its marketing and sales efforts related to its

products, which Newton claims incorporate Newton's technology. While the

evidence at trial will be directed to the question of whether Twister

stole Newton's trade secrets, the evidence also will concern Twister's

acts with respect to its communications about the technology directed to

persons and entities in Texas. Thus, there is a substantial connection

between the operative facts of Newton's civil theft claim and Twister's

marketing activities in Texas. We conclude the trial court properly

denied Twister's special appearance with respect to Newton's civil theft

claim.

SOURCE: DALLAS COURT OF APPEALS – 05-11-00409-CV – 4/11/12