Can a trade secrets claim bar a plaintiff from pursuing other claims?
Trade-secret claims provide powerful remedies, but they can also present challenges for other types of claims that may arise from the same facts. Individual states have their own statutes that govern trade-secret claims, and several have enacted provisions stating that trade-secret laws preempt other types of state claims. In other words, if you bring a trade-secret claim, you cannot bring certain other claims. States justify such provisions on the basis that permitting other claims to proceed would allow plaintiffs to get around limitations imposed by trade-secret law.
Preemption provisions often prohibit a plaintiff from filing state tort claims that depend on the misappropriation of trade secrets. Nevertheless, these preemption provisions do not bar a plaintiff from pursuing any other state claim alongside a trade-secret claim. Courts apply two different tests to determine whether a claim is preempted. In some states, courts ask whether a tort claim is part of the same “common nucleus” of facts as the trade-secret claim. If another tort claim arises from different facts, it would not be preempted. Other states ask whether a tort claim depends on the misappropriation of trade secrets. Under that test, a tort claim is not preempted if it would still be viable absent any theft of trade secrets.
The federal Defend Trade Secrets Act does not have a preemption provision. But that does not mean that plaintiffs can simply avoid preemption by pleading a federal, rather than state trade-secret claim. Courts are generally reluctant to allow litigants to bypass state preemption provisions by simply declining to plead a state trade-secret claim. After all, the restrictions that the preemption provision seeks to enforce are most likely to be relevant where a plaintiff does not have a viable state trade-secret claim.
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