Cerro Fabricated Prods. LLC v. Solanick
300 F. Supp. 3d 632
M.D. Penn.2018Background
- Cerro Fabricated Products sued former employee George Solanick for misappropriation of trade secrets (PUTSA) and breach of a confidentiality agreement after Solanick left Cerro and immediately began working for competitor Brass Aluminum; Cerro moved for a TRO and preliminary injunction.
- Solanick had senior roles at Cerro (including president and technical sales manager) and had access to pricing, margins, pipeline, customer relationships, and some manufacturing knowledge; he signed a Confidentiality Agreement but no non-compete.
- Cerro identified broad categories of alleged trade secrets (pricing, margins, pipeline, internal financials, manufacturing methods, single-source customers, etc.); testimony showed limited security measures and that only a few senior employees knew full cost/margin details.
- There was no direct evidence Solanick copied or disclosed documents or that he had already misused Cerro’s trade secrets at Brass Aluminum, but Cerro showed circumstantial market effects (loss of a customer, overlapping bids).
- After an evidentiary hearing, the court found some of Cerro’s categories overly broad but identified specific trade secrets (pricing, margins, certain internal financials, non-public pipeline/customer lists, non-common manufacturing methods) and concluded limited preliminary injunctive relief was warranted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Cerro has likely proven trade secrets under PUTSA | Cerro: pricing, margins, internal financials, pipeline, manufacturing methods, single-source customers, marketing/strategic plans are trade secrets and Solanick acquired them under a duty of confidentiality | Solanick: information is general industry knowledge; Brass Aluminum has different processes and cost structures; no evidence he took or disclosed confidential documents | Court: Found several specific categories qualify as trade secrets (pricing, margins, internal financials, certain non-public manufacturing methods, pipeline, single-source customers, internal plans), but Cerro’s overall list was overly broad and required greater specificity |
| Whether Solanick has misappropriated or likely will misappropriate the trade secrets | Cerro: Solanick’s role at competitor and market overlap make disclosure/use likely; market changes after his departure suggest misuse | Solanick: denies taking or using any confidential information; returned laptop/phone; no proof of disclosure; different plant/cost structure limits usefulness | Court: No direct evidence of past misappropriation, but substantial likelihood of future disclosure because of overlapping roles and narrow market; granted limited injunctive relief to prevent threatened misuse |
| Whether breach of the Confidentiality Agreement merits injunctive relief | Cerro: Agreement imposed confidentiality duties and defendant violated them by working for a competitor and allegedly using Cerro info | Solanick: disputed misuse and said he returned materials; contested applicability/choice-of-law issues | Court: Cerro failed to adequately brief or prove likelihood of success on the contract claim; declined to grant relief specifically on breach theory but noted overlap with trade-secret protections |
| Scope of injunctive relief (including employment restriction) | Cerro: sought broad injunction prohibiting use/disclosure of confidential info, working for Brass Aluminum or any competitor, and contacting Cerro customers | Solanick: a ban on working for Brass Aluminum would irreparably harm his livelihood; no reason to bar employment absent proof it's necessary to prevent disclosure | Court: Enjoined disclosure/use of the identified trade secrets but denied any injunction barring Solanick from working at Brass Aluminum or other competitors (employment ban would unduly restrict livelihood); relief must be specific and narrowly tailored |
Key Cases Cited
- McNeil Nutritionals, LLC v. Heartland Sweeteners, LLC, 511 F.3d 350 (3d Cir. 2007) (preliminary injunction factors)
- Shire U.S. Inc. v. Barr Labs. Inc., 329 F.3d 348 (3d Cir. 2003) (preliminary injunction factors)
- Reilly v. City of Harrisburg, 858 F.3d 173 (3d Cir. 2017) (gateway factors for preliminary injunction)
- Bimbo Bakeries USA, Inc. v. Botticella, 613 F.3d 102 (3d Cir. 2010) (trade-secret preliminary injunction guidance and flexible equitable relief)
- Iron Age Corp. v. Dvorak, 880 A.2d 657 (Pa. Super. Ct. 2005) (burden to prove trade secret)
- Rohm & Haas Co. v. Lin, 992 A.2d 132 (Pa. Super. Ct. 2010) (definition of trade secret beyond technical information)
- Air Prods. & Chems., Inc. v. Johnson, 442 A.2d 1114 (Pa. Super. Ct. 1982) (former employee injunctive restrictions when disclosure likely)
- Campbell Soup Co. v. ConAgra, Inc., 977 F.2d 86 (3d Cir. 1992) (disclosure of trade secrets causes irreparable harm)
- Opticians Ass'n of Am. v. Indep. Opticians of Am., 920 F.2d 187 (3d Cir. 1990) (irreparable harm standard)
- SI Handling Sys., Inc. v. Heisley, 753 F.2d 1244 (3d Cir. 1985) (public interest and trade-secret injunctive relief)
- Den-Tal-Ez, Inc. v. Siemens Capital Corp., 566 A.2d 1214 (Pa. Super. Ct. 1989) (likelihood of disclosure warrants injunction)