Trade Secrets. Misappropriation.
When collaborating with others, tread lightly, or not at all. Clients always shutter a bit when I suggest that they either not collaborate on projects with others or be extremely careful about the terms of the relationships and get the terms in writing. That way, in the event there is an unauthorized breach of your trade secrets, misappropriation of your proprietary information, or an infringement of your content, you have a solid claim.
Earlier this month, Volans-I, an aerial systems manufacturer that builds and operates long-range, high-payload drones for various applications filed a complaint against its former consultant. The lawsuit asserted that the consultant, SpekterWorks, misappropriated Volans-I’s trade secrets.
Volans-I initially partnered with SpektreWorks in developing an autopilot system that could be controlled through the use of a cellular network. Acting upon the success of this first venture with SpektreWorks, Volans-I hired SpektreWorks as a consultant on a new project Volans-I was developing.
The consultant had access to Volans-I’s proprietary information, but it was made clear that Volans-I owned all rights and title to the work product. Further, SpektreWorks agreed to treat the information it obtained confidential. After the completion of the project, Volans-I took the product to market.
In 2018, SpektreWorks released its own version of the product, and Volans-I asserts the consultant developed its product using trade secrets it obtained while working with Volans-I. Volans-I filed a lawsuit claiming 1) misappropriation of trade secrets, 2) breach of conduct, 3) conversion, and 4) unfair competition.
If you choose to enter into a collaborative relationship, whether a joint venture, partnership, or consulting relation, make sure you:
- Know who you are dealing with,
- Think through potential problems,
- Have written agreements that address those problems, and
- Protect your trade secrets b sharing ONLY what needs to be shared ONLY with those with a valid need to know.