Trade secret misappropriation defendants were unable to prevail on summary judgment merely by showing that they had not used one particular element that plaintiff chose to use in describing its trade secrets, where the evidence showed a genuine issue of material fact regarding whether defendants had misappropriated “other fundamental elements of those trade secrets.” Triple Tee Golf, Inc. v. Nike, Inc., 82 U.S.P.Q.2d (BNA) 1452 (5th Cir. 2007).
The dispute in this case began when Jack Gillig of Triple Tee Golf (“TTG”) attempted to hire Tom Stites, a golf club designer, to design a new TTG club. Soon after viewing TTG’s designs, Stites was hired by Nike as its Director of Product Creation, and turned down the TTG project. At a subsequent trade show, Gillig noticed that a Nike golf club resembled designs he had shown to Stites. Triple Tee responded by suing Nike and Stites, asserting trade secret misappropriation, among other claims. The district court granted defendants’ summary judgment motion, holding that all trade secrets asserted by TTG related to a user-adjustable golf club weighting system, and none of defendants’ clubs were user-adjustable.
On appeal, the Fifth Circuit rejected TTG’s argument that their trade secrets were improperly limited to weighting systems adjustable by the user, excluding adjustability at the factory before being sold to the user. The court agreed with the district court that TTG’s trade secrets were properly construed to include only user-adjustable systems. Nonetheless, the court continued beyond the district court’s analysis to examine whether lack of user-adjustability necessarily eliminated any genuine issue of material fact regarding the trade secrets claims. The court considered whether defendants had misappropriated TTG’s trade secrets by incorporating other proprietary TTG elements into the Nike club design, even though Nike chose to make it permanently weighted rather than user-adjustable.
In reversing the district court’s grant of summary judgment, the Fifth Circuit concluded that TTG presented enough evidence to create an issue of material fact regarding whether the defendants misappropriated “other fundamental elements of those trade secrets.” The court found that adjustability is “but one of several design elements,” and thus is “merely an abstract concept that must be implemented in some very real way.” This implementation is at least as important to TTG’s trade secret definition as the adjustability itself. If TTG could prove that defendants used fundamental elements of TTG’s design in the permanently weighted club, TTG would have a viable trade secrets claim. The court found that, in fact, TTG had already produced enough such evidence to meet the genuine issue of material fact standard.