Jury Awards $58.7 Million for Trade Secret Misappropriation After Technology Disclosure Pursuant to NDA

Carlton Fields
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On March 6, in a U.S. District Court for the Eastern District of Texas case, Texas Advanced Optoelectric Solutions (TAOS) Inc. obtained a verdict against Intersil Corp. (Nasdaq: ISIL) for trade secret misappropriation, breach of contract, patent infringement, and tortious interference. The jury found that Intersil used TAOS's patented technology for dual-diode ambient light sensors without consent. The jury also found that the defendant used TAOS's business trade secrets to obtain a competitive advantage.

The verdict included $48.7 million for trade secret misappropriation and $10 million in punitive damages for trade secret misappropriation and tortious interference. In 2004, Intersil sought to purchase TAOS to enter the light sensor market. Both companies executed non-disclosure agreements. TAOS shared details about its technology and business secrets including vendor information and pricing details. After receiving the information Intersil failed to go forward with the purchase. A year after the talks ended, Intersil entered the light sensor market and undercut TAOS to win major supply contracts.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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