Intellectual Property

Article excerpt

Intellectual property. A Maryland appeals court has rejected the use of the inevitable disclosure doctrine--in which a departing employee is prohibited from working for a competitor because that employee would inevitably be required to disclose trade secrets--in a case of intellectual property theft. The court ruled that because the victimized company did not implement protections such as noncompete or confidentiality agreements with employees, it could not argue that such protections be applied after an employee's departure.

Coin Acceptors, Inc., headquartered in Missouri, designs, manufactures, and services coin-accepting machines such as vending machines, video games, and self-check-out services such as machines at transit companies. William LeJeune was hired by Coin Acceptors in 1993 as a sales representative. In his position, LeJeune sold equipment, serviced equipment, and led seminars on repair and maintenance.

LeJeune was promoted in 1997 to branch manager of the Baltimore, Maryland, field office. He was promoted again in 2002 to area account manager of the Maryland, Virginia, Delaware, and West Virginia markets.

LeJeune did not enter into a non-compete or a confidentiality agreement while employed with Coin Acceptors. He worked in sales and was never involved with manufacturing, research, or development. However, LeJeune did develop an understanding of the company's pricing, marketing, and selling strategies.

In May 2003, LeJeune was looking for a new job and was interviewed by Mars Electronics, Coin Acceptors' primary competitor. LeJeune accepted a sales position in the company's amusement division. In his job, he would sell coin-accepting equipment, such as video games.

On July 14, 2003, LeJeune informed his supervisor, William Morgan, that he was leaving the company to work for Mars. LeJeune said that his position at Mars would be "unique" because of his experience at Coin Acceptors. Morgan viewed this statement as acknowledgement that LeJeune planned to use his knowledge of Coin Acceptors' business strategies to aid Mars.

Before informing Morgan of his new job, LeJeune transferred several Coin Acceptors documents to CD. Those items included the company's budgeting software, pricing information, and marketing and strategic plans. When asked whether he was taking any documents with him, LeJeune said that he had only taken the items in the "My Documents" folder because the folder contained some personal items such as wedding photos. If any company documents were in that folder, LeJeune insisted, he had no plans to use the information. …