South-Western Legal Studies in Business

Swimming Program May Be Protected Trade Secret
Description A group of swim instructors left their employer who had developed a special swim program for infants. The former employees went into direct competition. An appeals court held it was to be determined at trial if the program was due trade secret protection.
Topic Intellectual Property
Key Words Trade Secret; Misappropriation; Swimming Instructions
C A S E   S U M M A R Y
Facts Barnett founded Infant Swimming Research (ISR) in 1966. It is described as a “scientific, behavioral approach to pediatric drowning prevention” utilizing a method known as “swim, float, swim” and containing nearly 2,000 “prompts and procedures” for teaching infants as young as six-months old how to survive in water. In a five-week course, ISR trains and certifies instructors who then teach survival skills to infants in private lessons, ten minutes a day, five days a week for three to four weeks. ISR instructors sign nondisclosure agreements and covenants not to compete. Several former ISR instructors started a competing firm, Infant Aquatic Survival that uses the ISR methods. Barnett sued the former employees for misappropriation of trade secrets. The district court dismissed the suit. Barnett appealed.
Decision

Reversed. Factors considered to determine if a trade secret exists under Colorado law include: 1) the extent to which the information is known outside the business; 2) the extent to which information is known by those inside the business; 3) the precautions taken by the holder of the trade secret to guard secrecy of information; 4) the savings effected and the value to the holder in having information as against competitors; 5) the amount of effort or money expended in obtaining and developing the information; and 6) the amount of time and expense it would take for others to acquire and duplicate the information. It is an issue of material fact as to whether the swimming program qualified as a trade secret under Colorado law, even though some elements were in the public domain. The suit will proceed.

Citation Harvey Bennett, Inc. v. Shidler, 338 F.3d 1125 (10th Cir., 2003)

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