Bump in Federal Trade Secrets Litigation Seen in 2023: Report

Statistics from the Lex Machina 2024 Trade Secret Litigation Report reveal an increase in trade secret cases filed in federal district court in 2023, along with the continued and steady trend of trade secret cases involving Defend Trade Secret Act (DTSA) claims.

Financial institutions and insurance companies dominated the list of most active claimants in the three years from 2021 to 2023.

The LexisNexis report examines trends in trade secret litigation in the federal district and appellate courts. Focusing on the three-year period from 2021 to 2023, it analyzed emerging trends in filings, venues, judges, law firms, attorneys, parties, time measurements, case settlements, findings and damages.

The report often focuses on different data sets, for example, case filtering to provide analysis of general trade secret cases, trade secret cases excluding DTSA cases and DTSA cases filed in federal district courts, and trade secret cases filed in federal appeals courts.

“The ability to use Lex Machina to track changing patterns and trends in litigation is exemplified in a practice area like trade secret litigation,” said Elaine Chow, Lex Machina’s trade secret legal data expert and editor of the report. “We can use Lex Machina’s multitude of filters to slice through the data and analysis to see, for example, that trade secret filings rebounded in 2023 and that the proportion of trade secret cases involving DTSA claims continued to grow. Legal practitioners can use this information to derive valuable data-driven insights most relevant to their own practice.”

In 2023, there were a reported 1,203 trade secret cases filed in federal district courts.

In the three-year period from 2021 to 2023, the largest number of trade secret cases were filed in the Central District of California, while Judge Yeakel in the Western District of Texas was the most active judge in trade secret cases commercial.

In the three-year period from 2021 to 2023, Gordon Rees Scully Mansukhani was the most active law firm representing plaintiffs in trade secret cases.

Littler Mendelson defended clients in the largest number of trade secret cases in the period of three between 2021 and 2023.

For trade secret cases that were appealed to a federal appeals court and ended with a decision on the merits between 2021 and 2023, 45 percent were ultimately overturned, the report found.

Over $511 million in punitive/willful damages awarded between 2021 and 2023.

Report metrics can help readers decide who to pursue as clients, whether to file a particular motion, or when to settle (and for how much).

TOPICS
Trends in Processes