San Diego Estate Planning Lawyer Blog
San Diego has over 1,000,000 residents. Many San Diego residents are on lists of different companies. San Diego residents have to be careful of the companies who keep lists selling their personal information and, in some cases, where it is stolen by a third party. One example of stolen customer lists is below.
Home food service companies sell and deliver food products and appliances to their customers, many of whom later reorder more products. When a home food service company bought a customer list of one of its competitors, what might have been a competitive advantage instead became a legal headache. The list had been stolen and the food service company that bought it knew it was stolen. This can be considered receiving stolen property under the California Penal Code Section 496.
The company whose list got into the wrong hands sued the purchaser of the list for misappropriation of a trade secret. Some courts have refused to recognize customer lists as protected trade secrets when they contain information that is readily available from public sources. The essence of a trade secret is that it has value because it is not easily ascertainable. The customer list for the home food service company was protected because of the time and effort that had been expended to identify particular customers with particular needs or characteristics. The defense that the list contained only information that was easily compiled was undercut by the fact that the defendant had paid a lot of money for it.
A state court found a violation of the law governing trade secrets. It ruled that monetary damages should be awarded to the plaintiff based on net profits earned by the defendant from improper use of the list. The court also barred the defendant from ever using the stolen list again.
Our law firm of Law Office of Scott C. Soady, A Professional Corporation can assist with legal matters. Please feel free to e mail us. If we cannot be of assistance, we can refer you to the San Diego County Bar Association Lawyer Referral Service which offers a complimentary and confidential 30 minute consultation.