ACI Worldwide Corp. v. Baldwin Hackett & Meeks
896 N.W.2d 156
| Neb. | 2017Background
- ACI Worldwide sued BHMI in 2012 alleging BHMI misappropriated ACI’s middleware trade secrets (XPNET vs. BHMI’s TMS); most of ACI’s claims were dismissed pretrial except the trade-secret claim. Two trials followed: a 2014 trial where the jury found for BHMI on ACI’s misappropriation claim, and a 2015 trial where a jury awarded BHMI $43.8 million on counterclaims (breach of an NDA and violation of Nebraska’s Junkin Act).
- Pretrial, ACI repeatedly sought BHMI’s source code and manuals; the district court refused broad trade-secret disclosure until ACI pursued additional non-trade-secret discovery and identified alleged trade secrets with particularity. ACI did limited non-trade-secret discovery before the first trial.
- After the first trial ACI obtained email attachments from MasterCard in separate federal litigation and sought to use them to reopen discovery and vacate the 2014 verdict; the district court sealed the documents but did not admit them at the second trial.
- At the second trial BHMI proved (1) ACI violated the NDA by using BHMI confidential information in its lawsuit and (2) anticompetitive injury under the Junkin Act (TMS would have offered lower-cost, multi-platform competition to XPNET). BHMI’s damages and attorney fee petitions were granted by the district court.
- ACI appealed, arguing (inter alia) discovery abuse (denial of source code), that the Noerr–Pennington immunity barred BHMI’s claims, insufficiency of evidence on antitrust and breach claims and damages, and that attorney fees were excessive.
Issues
| Issue | ACI's Argument | BHMI's Argument | Held |
|---|---|---|---|
| 1) Denial of trade-secret discovery / motion to vacate 2014 judgment | ACI: district court wrongly denied source code/manuals, so ACI was deprived of evidence and the 2014 verdict should be vacated | BHMI: ACI failed to pursue non-trade-secret discovery and thus had not shown the particularized need to justify disclosure | Court: no abuse of discretion — trial court permissibly required ACI to exhaust non-trade-secret discovery and show particularity before exposing BHMI’s trade secrets |
| 2) Noerr–Pennington immunity to BHMI’s antitrust/tort claims | ACI: pleadings and First Amendment petitioning immunity bar BHMI’s counterclaims | BHMI: Noerr–Pennington is an affirmative defense that ACI waived by not pleading it timely | Court: Noerr–Pennington is an affirmative defense; ACI waived it by failing to plead timely, so immunity unavailable |
| 3) Sufficiency of evidence for Junkin Act, breach of NDA, and damages | ACI: BHMI failed to show antitrust injury, breached contract, or admissible, non-speculative damages | BHMI: presented competent evidence of market power/effects (TMS reduced price/improved quality), use of BHMI confidential info in ACI’s suit, and a damages model (company principal’s lost-profits testimony supported by contracts and market testimony) | Court: evidence was sufficient; jury verdict not clearly wrong — antitrust injury, breach of NDA, and damages presented competent evidence; expert/lay testimony admissible |
| 4) Attorney-fee award amount | ACI: BHMI failed to submit invoices and court erred applying a multiplier | BHMI: submitted affidavit summarizing hours/rates; complexity, novelty, hours, and results justify fee and enhancement | Court: affidavit provided sufficient basis; district court did not abuse discretion in applying multiplier and awarding fees |
Key Cases Cited
- Eastern R.R. Conference v. Noerr Motor Freight, 365 U.S. 127 (1961) (establishing petitioning immunity from antitrust liability)
- United Mine Workers v. Pennington, 381 U.S. 657 (1965) (extending Noerr immunity principles)
- Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49 (1993) (defining the “sham” litigation exception to Noerr–Pennington)
- Eastman Kodak Co. v. Image Technical Servs., 504 U.S. 451 (1992) (monopolization standard and monopoly power inference from market share)
- Jacobs v. Tempur-Pedic Int’l, Inc., 626 F.3d 1327 (11th Cir.) (examples of anticompetitive effects that can prove antitrust injury)
- In re Remington Arms Co., 952 F.2d 1029 (8th Cir.) (trade-secret discovery framework regarding need vs. harm)