Last May, I published a post on Versata Software, LLC v. Ford Motor Co., a case in which a panel of the Federal Circuit held that, under the federal Defend Trade Secrets Act (DTSA) and the Michigan Uniform Trade Secrets Act, a plaintiff is entitled to recover “unjust enrichment” damages as a matter of statutory right. The panel issued a modified opinion today, though only in respect of correcting its previous statement that Ford did not “claim” that certain costs should have been deducted from the breach of contract damages the plaintiff also sought (see p.15). The holdings with regard to trade secret law therefore remain intact, in particular the panel’s conclusion that unjust enrichment is a remedy available at the plaintiff’s option (a position that, as noted in my previous post, some other courts have endorsed, while others have rejected it); and that an unjust enrichment award can exceed the royalty the parties would have negotiated, based on their licensing history. (Compare this with the outcome of the recent Lucent v. Astronics case in the U.K., as discussed here.) For now, I remain somewhat skeptical that disgorgement of profits or avoided costs should be available as a matter of course in trade secret litigation, but I am still thinking through the issues in anticipation of writing a paper on trade secret remedies sometime next year. I'll just note, as I did in May, that U.S. courts are somewhat divided on the relevant issues, and that approaches to unjust enrichment outside the U.S. also reflect a range of perspectives.
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