Carolyn Hoecker Luedtke Shares Insights on Ninth Circuit Trade Secrets Dispute 

Munger, Tolles & Olson Partner Carolyn Hoecker Luedtke was recently featured in three publications discussing the Ninth Circuit September 19 oral argument in the appeal in Comet Technologies v. XP Power, a closely watched trade secrets dispute.

In the IAM Trade Secrets article, titled “$40 million trade secrets win on the line in appeal over flawed jury instructions,” Carolyn discussed how the court’s ruling could clarify best practices for trial counsel, particularly on the importance of preserving objections, even when overruled.

In the MLex article, titled “Comet, XP Power’s US dispute underscores need for clearly defined trade secrets,” she emphasized how the Ninth Circuit’s analysis of whether Comet’s trade secrets were “readily ascertainable” underscores the importance of careful trade secret definitions throughout litigation.

In her authored piece for World IP Review, titled “Lessons for trade secret counsel as Comet v XP Power heats up,” Carolyn explored the broader implications of the case, including questions around double recovery, attorneys’ fees and how courts balance remedies under the Defend Trade Secrets Act.

The appeal stems from a 2022 jury verdict awarding Comet $40 million in damages, $17 million in attorneys’ fees and a permanent injunction after finding that XP Power misappropriated trade secrets by hiring former Comet engineers. Central to the appeal is a jury instruction error that wrongly shifted the burden of proof on whether Comet’s trade secrets were “readily ascertainable by proper means.” The Ninth Circuit is now evaluating whether that error was harmless as well as challenges to attorneys’ fees and the remedies awarded.

Carolyn emphasized that the court’s decision “will be important guidance for trial counsel on whether and how much they push back on objections that are overruled, but that they still believe are incorrect.” She also noted that the definition of trade secrets remains a critical issue throughout litigation, adding that “determining whether the trade secret is readily ascertainable underscores for trade secret counsel how important that trade secret definition is throughout the litigation including at trial.”

Read the IAM Trade Secrets, MLex and World IP Review articles. (Subscriptions may be required)