Allied Erecting & Dismantling Co. v. Genesis Equipment & Manufacturing, Inc.
805 F.3d 701
6th Cir.2015Background
- Allied (family-owned) developed the multiuse Allied MT attachment; Mark Ramun (son) worked at Allied, left in 2001, and took a laptop with ~15,000 pages of Allied technical documents.
- Mark later joined Genesis and helped develop Genesis’s multiuse tools (LXP, Versi Pro) that Allied claimed relied on Allied MT trade secrets.
- Allied sued Genesis in 2006 under the Ohio Uniform Trade Secrets Act (OUTSA); a 2010 jury found misappropriation and awarded $3,046,800 for unjust enrichment; district court denied injunctive/royalty relief; this court reinstated the unjust-enrichment award but affirmed denial of prospective relief.
- Allied filed a new suit in 2013 alleging continued misappropriation (expanded products, dealer networks, marketing disclosures); Genesis moved to dismiss claiming the OUTSA statute of limitations and claim preclusion barred the suit.
- The district court dismissed under Rule 12(b)(6) as time-barred (single-claim rule); the Sixth Circuit affirmed, concluding claim preclusion was the proper ground and also rejecting Allied’s claim against Genesis’s parent (IES) for failure to plead misappropriation by improper means.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether continued post-judgment use of the same trade secrets gives rise to a new OUTSA claim (statute of limitations) | Post-verdict use triggered a new accrual date (new claim) so 2013 suit is timely | UTSA/OUTSA adopts a single-claim rule: claim accrues at initial misappropriation; later use does not restart limitations | Dismissal affirmed; single-claim approach governs and prior misappropriation (2003; discovered 2005) produced a single claim whose limitations period ran before 2013 |
| Whether prior judgment bars re-litigation (claim preclusion/res judicata) | Allied argued it pursued claims diligently and sought relief for continued misuse | Genesis argued the prior final judgment on the same trade secrets precludes later suit on the same cause of action | Sixth Circuit: claim preclusion applies; the new suit involves issues that were or could have been litigated previously, so barred |
| Whether Allied’s request for prospective relief (injunction/royalties) survived the prior denial | Allied sought ongoing damages/royalties for continued use after the verdict | Genesis noted district court already denied prospective relief and this court affirmed that denial | Prospective relief already denied and affirmed; no reopened avenue for royalties or injunctions in this new suit |
| Whether parent company IES can be held liable for acquiring Genesis after the prior litigation | Allied alleged IES purchased Genesis in 2011 and profited from misappropriation | Genesis/IES argued Allied failed to plead improper acquisition/disclosure by IES or any independent misappropriation | Complaint against IES fails to state an OUTSA claim; dismissal affirmed (no pleading of improper means or vicarious liability sufficiently alleged) |
Key Cases Cited
- Petrella v. Metro-Goldwyn-Mayer, Inc., 134 S. Ct. 1962 (U.S. 2014) (separate-accrual rule for copyright infringement — contrast with UTSA single-claim approach)
- A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020 (Fed. Cir. 1992) (patent law treats each infringement as a separate claim for limitations purposes)
- Cadence Design Sys., Inc. v. Avant! Corp., 29 Cal.4th 215 (Cal. 2002) (trade-secret claim arises once at initial misappropriation; UTSA single-claim principle)
- Manturuk v. Gen. Motors Corp., 2000 Mich. App. LEXIS 1377 (Mich. Ct. App. 2000) (state case cited for single-claim rule — omitted from Key Cases list because not in official reporter)
- Adcor Indus., Inc. v. Bevcorp, LLC, 252 Fed. Appx. 55 (6th Cir. 2007) (noting Ohio OUTSA forecloses multiple-misappropriation argument)
- Federated Dep’t Stores, Inc. v. Moitie, 452 U.S. 394 (U.S. 1981) (res judicata bars relitigation of claims that were or could have been raised)
- Kane v. Magna Mixer Co., 71 F.3d 555 (6th Cir. 1995) (four-part test for claim preclusion)
- Rawe v. Liberty Mut. Fire Ins. Co., 462 F.3d 521 (6th Cir. 2006) (application of res judicata principles in successive federal actions)