CACI 4408 Improper Means of Acquiring Trade Secret

California Civil Jury Instructions CACI

4408 Improper Means of Acquiring Trade Secret

Improper means of acquiring a trade secret or knowledge of a trade secret include, but are not limited to, [theft/bribery/misrepresentation/breach or inducing a breach of a duty to maintain secrecy/ [or] wiretapping, electronic eavesdropping, [or] [insert other means of espionage]].

[However, it is not improper to acquire a trade secret or knowledge of the trade secret by [any of the following]:

[1.Independent efforts to invent or discover the information;]

[2.Reverse engineering; that is, examining or testing a product to determine how it works, by a person who has a right to possess the product;]

[3.Obtaining the information as a result of a license agreement with the owner of the information;]

[4.Observing the information in public use or on public display;] [or]

[5.Obtaining the information from published literature, such as trade journals, reference books, the Internet, or other publicly available sources.]]

Directions for Use

In the first paragraph, include only those statutory examples of “improper means” supported by the evidence. (See Civ. Code, § 3426.1(a).) The option for “wiretapping, eavesdropping, [or] [insert other means of espionage]” expresses the statutory term “espionage.”

Include the optional last paragraph if any of those methods of obtaining the information are supported by the evidence. Omit any methods that are not at issue. If only one is at issue, omit “any of the following.”

Sources and Authority

“Improper Means” Defined. Civil Code section 3426.1(a).

Electronic Eavesdropping. Penal Code section 630.

“The Restatement of Torts, Section 757, Comment (f), notes: ‘A complete catalogue of improper means is not possible,’ but Section 1(1) includes a partial listing. Proper means include: 1. Discovery by independent invention; 2. Discovery by “reverse engineering,” that is, by starting with the known product and working backward to find the method by which it was developed. The acquisition of the known product must of course, also be by a fair and honest means, such as purchase of the item on the open market for reverse engineering to be lawful; 3. Discovery under a license from the owner of the trade secret; 4. Observation of the item in public use or on public display; 5. Obtaining the trade secret from published literature. … [T]he assertion that a matter is readily ascertainable by proper means remains available as a defense to a claim of misappropriation. Information is readily ascertainable if it is available in trade journals, reference books, or published materials.” (Civ. Code, § 3426.1, Legis. Comm. Comment (Senate), 1984 Addition.)

Secondary Sources

13 Witkin, Summary of California Law (11th ed. 2017) Equity, § 83
Gaab & Reese, California Practice Guide: Civil Procedure Before Trial—Claims & Defenses, Ch. 10(II)-A ¶ 10:250 (The Rutter Group)
3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts, § 40.53[1][b] (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition, § 565.103[4][b] (Matthew Bender)
Edelson & Kay, eds., Trade Secret Litigation and Protection in California (State Bar of California 2009) § 2.01(D)