CACI 4410 Unjust Enrichment

California Civil Jury Instructions CACI

4410 Unjust Enrichment

[Name of defendant] was unjustly enriched if [his/her/nonbinary pronoun/its] misappropriation of [name of plaintiff]’s trade secret[s] caused [name of defendant] to receive a benefit that [he/she/nonbinary pronoun/it] otherwise would not have achieved.

To decide the amount of any unjust enrichment, first determine the value of [name of defendant]’s benefit that would not have been achieved except for [his/her/nonbinary pronoun/its] misappropriation. Then subtract from that amount [name of defendant]’s reasonable expenses[, including the value of the [specify categories of expenses in evidence, such as labor, materials, rents, interest on invested capital]]. [In calculating the amount of any unjust enrichment, do not take into account any amount that you included in determining any amount of damages for [name of plaintiff]’s actual loss.]

Directions for Use

Give this instruction with CACI No. 4409, Remedies for Misappropriation of Trade Secrets, if unjust enrichment is alleged and supported by the evidence. If it would be helpful to the jury, specify the categories of expenses to be allowed to the defendant. Include the last sentence if both actual loss and unjust enrichment are alleged.

Sources and Authority

Remedies for Misappropriation of Trade Secret. Civil Code section 3426.3.

“In general, ‘[a] person who has been unjustly enriched at the expense of another is required to make restitution to the other.’ (Rest., Restitution, § 1.) ‘Ordinarily the benefit to the one and the loss to the other are co-extensive, and the result … is to compel the one to surrender the benefit which he has received and thereby to make restitution to the other for the loss which he has suffered.’ [¶] ‘In other situations, a benefit has been received by the defendant but the plaintiff has not suffered a corresponding loss or, in some cases, any loss, but nevertheless the enrichment of the defendant would be unjust. In such cases, the defendant may be under a duty to give to the plaintiff the amount by which he has been enriched.’ ” (Unilogic, Inc. v. Burroughs Corp. (1992) 10 Cal.App.4th 612, 627–628 [12 Cal.Rptr.2d 741].)

“A defendant’s unjust enrichment is typically measured by the defendant’s profits flowing from the misappropriation. A defendant’s profits often represent profits the plaintiff would otherwise have earned. Where the plaintiff’s loss does not correlate directly with the misappropriator’s benefit, … the problem becomes more complex. There is no standard formula to measure it. A defendant’s unjust enrichment might be calculated based upon cost savings or increased productivity resulting from use of the secret. Increased market share is another way to measure the benefit to the defendant. Recovery is not prohibited just because the benefit cannot be precisely measured. But like any other pecuniary remedy, there must be some reasonable basis for the computation.” (Ajaxo Inc. v. E*Trade Financial Corp. (2010) 187 Cal.App.4th 1295, 1305 [115 Cal.Rptr.3d 168], footnote and internal citations omitted.)

“[W]here a defendant has not realized a profit or other calculable benefit as a result of his or her misappropriation of a trade secret, unjust enrichment is not provable within the meaning of section 3426.3, subdivision (b), whether the lack of benefit is determined as a matter of law or as a matter of fact.” (Altavion, Inc. v. Konica Minolta Systems Laboratory, Inc. (2014) 226 Cal.App.4th 26, 66 [171 Cal.Rptr.3d 714].)

“Another crucial point is that unjust enrichment, as the phrase is used here, is, in effect, synonymous with restitution. ‘ “ ‘The phrase “unjust enrichment” is used in law to characterize the result or effect of a failure to make restitution of or for property or benefits received under such circumstances as to give rise to a legal or equitable obligation to account therefor.’ ” ’ ” (Ajaxo Inc.supra, 187 Cal.App.4th at p. 1305, internal citations omitted.)

Restatement of Restitution, section 1, comment a, states: “A person is enriched if he has received a benefit (see Comment b). A person is unjustly enriched if the retention of the benefit would be unjust (see Comment c).”

Restatement of Restitution, section 1, comment b, states: “What constitutes a benefit. A person confers a benefit upon another if he gives to the other possession of or some other interest in money, land, chattels, or choses in action, performs services beneficial to or at the request of the other, satisfies a debt or a duty of the other, or in any way adds to the other’s security or advantage. He confers a benefit not only where he adds to the property of another, but also where he saves the other from expense or loss. The word ‘benefit,’ therefore, denotes any form of advantage. The advantage for which a person ordinarily must pay is pecuniary advantage; it is not, however, necessarily so limited, as where a physician attends an insensible person who is saved subsequent pain or who receives thereby a greater chance of living.”

Restatement of Restitution, section 1, comment c, states: “Unjust retention of benefit. Even where a person has received a benefit from another, he is liable to pay therefor only if the circumstances of its receipt or retention are such that, as between the two persons, it is unjust for him to retain it. The mere fact that a person benefits another is not of itself sufficient to require the other to make restitution therefor. Thus, one who improves his own land ordinarily benefits his neighbors to some extent, and one who makes a gift or voluntarily pays money which he knows he does not owe confers a benefit; in neither case is he entitled to restitution. The Restatement of this Subject states the rules by which it is determined whether or not it is considered to be just to require restitution.”

Secondary Sources

13 Witkin, Summary of California Law (11th ed. 2017) Equity, § 93
1 Milgrim on Trade Secrets, Ch. 13, Issues Prior to Commencement of Action, § 13.03[2][a] (Matthew Bender)
3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts, § 40.54[4] (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition, § 565.103[7][b] (Matthew Bender)
Edelson & Kay, eds., Trade Secret Litigation and Protection in California (State Bar of California 2009) § 11.03