Punitive Damage Ruling Did Not Dispositively Bind Trial Judge From Awarding Fees Under Civil Code Section 3426.4.
For those of you who follow our blog (or, for first time viewers, welcome), we have discussed many cases under our category “Trade Secrets” to the lefthand side of our Home Page. That happens to be the case because Civil Code section 3426.4, a provision in the Uniform Trade Secrets Act (UTSA), has a fee-shifting provision which allows for fees to be awarded if a judge concludes that a claim of misappropriation was made in bad faith or that the proven misappropriation against the defendant was willful/malicious in nature.
In S.O. Tech/Special Operations Technologies, Inc. v. Berge, Case No. B243795 (2d Dist., Div. 7 Oct. 9, 2013) (unpublished), plaintiff was denied a request for fees after prevailing in a UTSA case based on the lower court’s perception that a jury’s failure to award punitives damages by clear and convincing evidence deprived him of discretion of being able to award fees even though plaintiff won trade secret damages of $29.036 and was later granted a permanent injunction by the trial judge.
The appellate court reversed and remanded. It found that the punitive damage determination did not usurp the lower court’s ability to award fees, because different standards of proof were involved and the punitive damages denial did not necessarily mean there was no willfulness/maliciousness for fee-shifting purposes.
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