Employees can’t disclose your trade secrets, even to themselves, NJ federal court rules

The U.S. District Court for the District of New Jersey recently considered a request to dismiss a complaint against an employee who allegedly misappropriated her employer’s trade secrets. The court denied the request in part, finding the employer sufficiently pled causes of action for violations of the Defense of Trade Secrets Act (DSTA) and the New Jersey Trade Secrets Act (NJTSA) as well as breach of contract and breach of the duty of loyalty.

Facts

Before working for Bramshill Investments LLC, Ashley Pullen operated her own advisory firm, SparHawk, assisting alternative asset managers with raising capital. When Bramshill (an alternative asset management firm specializing in investment opportunities) hired her, she denied operating any competing businesses and maintained she had ceased all SparHawk operations.

In addition to signing a noncompete arrangement, Pullen agreed to Bramshill’s policies for safeguarding its proprietary and confidential information. While she was working for the company, it was discovered she was sending its client, marketing, investor, and contact lists to her SparHawk e-mail account. Critically, a social media review demonstrated her own advisory firm was “alive and well.”

Bramshill filed a complaint alleging violations of the DTSA, the NJTSA, the New Jersey Computer Related Offenses Act (NJCROA), breach of contract, breach of the duty of loyalty, and unjust enrichment. Pullen lodged a request to dismiss the complaint.

District court’s ruling