Like Mushrooms After A Rainstorm: Trade Secret Cases, and Lawyers, Are Growing Exponentially

There were also numerous unanswered legal questions, such as whether claim construction was a fact or legal question, which was not settled until the U.S. Supreme Court's ruling in Markman v. Westview Instruments, 517 U.S. 370 (1996). Methods for calculating damages in patent cases were uncertain — today, all patent litigators are familiar with concepts such as "apportionment" and the "entire market value" rule. In many cases, it is inappropriate to apply a royalty on the entire value of an item being sold. Instead, the royalty base should be limited to the portion of the value derived from the use of the patent invention. And of course there is the whole evolution of what inventions are considered "patent eligible" under Section 101 of the Patent Act — a standard which has been (and to some degree remains) a moving target over the last 30 years.

Why do I tell this story? Because what happened in patent law 30 years ago is now happening in trade secrets law. Although patents had been around for hundreds of years and even though there were some memorable patent fights before the 1990s, such as that between Edison and Westinghouse (dramatically portrayed in on one of my favorite books of all time, "Last Days of Night" by Graham Moore), patent litigation did not quite hit its prime until around 2000. So too with trade secrets, which dates back to at least the Romans and the Guilds in the Middle Ages (depending on whom you ask). In modern times, trade secrets have long been considered mainly the province of employment lawyers dealing with more mundane issues such as customer relationships. To many, even those in the IP bar, trade secrets were certainly not a type of IP (or even properly considered property). Today, it seems trade secrets lawyers are multiplying like mushrooms after a rainstorm — coming not only from the employment bar, but also from IP, particularly the patent bar.