Biggest Trade Secret Case in History?

Is an Alameda County jury verdict earlier this week the biggest in the nation's history? Maybe so. Many attorneys are calling Tuesday’s Alameda County jury verdict in favor of Taiwan Semiconductor Manufacturing Company (“TSMC”) and against competitor Semiconductor Manufacturing International Corporation (“SMIC”) of Shanghai, China potentially the single biggest trade secret misappropriation case in U.S. history. Even though the damages phase of the trial did not begin until today, estimated damages could exceed SMIC’s market capitalization of $1.09 billion.

At the center of the lawsuit was TSMC’s claim that SMIC continued to use confidential technology it had obtained from TSMC even after the parties had reached a $175 million settlement of California state and Federal court actions in 2005. While rejecting SMIC’s counterclaims, the jury decided in favor of TSMC on 18 different issues, including misappropriation of confidential TSMC technology and failure to abide by the terms of the 2005 settlement agreement. Trade secret cases are not easy to win, but they can result in significant monetary damages, as this case illustrates.

One moral of the story – Abide by the terms of settlement agreements and, at all costs, avoid infringing on your competitor’s misappropriated trade secrets.

David Baker
The Airsoft Lawyer