ACI Worldwide Corp. v. Baldwin Hackett & Meeks
296 Neb. 818
| Neb. | 2017Background
- ACI Worldwide (ACI) sued Baldwin Hackett & Meeks, Inc. (BHMI) asserting trade secret misappropriation concerning middleware (XPNET v. TMS); BHMI counterclaimed for breach of a nondisclosure agreement (NDA), tortious interference, and violations of Nebraska's Junkin Act.
- The district court limited ACI's access to BHMI's source code and manuals, requiring ACI to pursue non‑trade‑secret discovery first and identify trade secrets with particularity. ACI proceeded largely with circumstantial evidence.
- In a 2014 trial the jury found for BHMI on threshold issues (ACI failed to prove misappropriation). ACI later obtained email attachments from MasterCard in federal litigation that it claimed supported its claims. ACI moved to vacate the 2014 judgment and reopen discovery; the court denied relief.
- In a 2015 second trial on BHMI’s counterclaims, the jury found for BHMI on the NDA and Junkin Act claims and awarded $43,806,362.70; the court awarded BHMI attorney fees and costs.
- On appeal ACI argued (inter alia) that the court abused its discretion by denying trade‑secret discovery, erred in denying Noerr‑Pennington immunity, and that BHMI’s proofs (liability and damages) were insufficient. The Nebraska Supreme Court affirmed.
Issues
| Issue | ACI's Argument | BHMI's Argument | Held |
|---|---|---|---|
| Denial of trade‑secret discovery / motion to compel source code | ACI: district court wrongly withheld BHMI source code and manuals, depriving ACI of evidence; vacate 2014/2015 judgments | BHMI: ACI had not done non‑trade‑secret discovery or identified trade secrets with particularity; disclosure would risk competitive harm | Court: No abuse of discretion — trial court permissibly required non‑trade‑secret discovery first and particularized identification before ordering disclosure |
| Noerr‑Pennington immunity (preclusion of antitrust/tort claims) | ACI: litigation activity is immune under Noerr‑Pennington; therefore BHMI’s claims (Junkin Act, tortious interference) barred | BHMI: Noerr‑Pennington is an affirmative defense that must be pleaded; ACI waived it by not timely pleading; also not applicable to sham exception facts | Court: ACI waived Noerr‑Pennington by failing to plead it as an affirmative defense and raised it too late; no relief granted |
| Sufficiency of evidence for Junkin Act antitrust claim | ACI: BHMI failed to prove antitrust injury (no market‑wide harm: price, output, or quality effects) | BHMI: Evidence showed TMS would have been lower‑priced and multi‑platform (quality); ACI’s suit prevented TMS entering market (reduced output, increased price) | Court: Competent evidence supported antitrust injury (reduced output, price/quality effects); verdict upheld |
| Breach of NDA | ACI: Allegations were public; NDA covered only non‑public information; ACI did not use confidential info in suit | BHMI: NDA explicitly barred using BHMI confidential information in any legal action; ACI used material learned under NDA to form lawsuit | Court: NDA language clear — prohibited use of BHMI confidential info in legal actions; jury reasonably found breach |
| Damages proof (lost profits) and expert qualification | ACI: BHMI’s financial witness (company principal Jack) was not qualified and damages were speculative/failed to deduct overhead | BHMI: Jack had practical, superior knowledge of finances and contracts; overheads were fixed and need not be deducted; supporting contracts and testimony corroborated projections | Court: Trial court did not abuse discretion — Jack qualified; damages evidence sufficiently reliable for jury to estimate lost profits; award upheld |
| Attorney fees award and multiplier | ACI: BHMI failed to introduce invoices; multiplier unjustified | BHMI: Submitted a detailed affidavit summarizing hours and rates; case was complex, novel, and required extensive work warranting enhancement | Court: Affidavit provided sufficient detail; district court properly applied factors and did not abuse discretion in awarding fees and multiplier |
Key Cases Cited
- Eastern R. Conf. v. Noerr Motors, 365 U.S. 127 (U.S. 1961) (establishes petitioning immunity from antitrust and related tort liability)
- United Mine Workers v. Pennington, 381 U.S. 657 (U.S. 1965) (extends Noerr immunity principles)
- Professional Real Estate Investors, Inc. v. Columbia Pictures Indus., 508 U.S. 49 (U.S. 1993) (defines the "sham" exception to Noerr immunity)
- Eastman Kodak Co. v. Image Technical Servs., 504 U.S. 451 (U.S. 1992) (monopolization framework used in antitrust analysis)