SW Legal Educational Publishing

Memorized Customer List May Be Trade Secrets
Description Washington high court held that valuable customer lists, which had been reasonably protected by an employer, were protected under the Uniform Trade Secrets Act. Former employees who memorized the list and used the information in competition with their former employer were liable for damages.
Topic Intellectual Property
Key Words Trade Secrets, Uniform Trade Secrets Act, Memory
C A S E   S U M M A R Y
Facts An insurance agency sued three former employees for soliciting its clients, after they went to work for a competitor, by using confidential information. The trial court determined that the employees had violated the Uniform Trade Secrets Act and awarded damages, but held that an employee does not violate the Act by using information from his head to solicit business from his former employer. The employer appealed, and the appeals court agreed, that use of "memorized, confidential client information to solicit his former employer's customers" violated the Act. Employees appealed.
Decision Affirmed. "The nature of the employment relationship imposes a duty on employees and former employees not to use or disclose the employer's trade secrets." A valuable customer list, which has been protected by an employer, may be due trade secret protection. "The fact that the former employee memorized the information, rather than taking it in written form, made no difference." .
Citation Ed Nowogroski Insurance, Inc. v. Rucker, 971 P.2d 936 (Sup. Ct., Wash., 1999)

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