CMI Roadbuilding, Inc. v. Iowa Parts, Inc.
920 F.3d 560
8th Cir.2019Background
- CMI Roadbuilding owns engineering documents and other intellectual property for asphalt plant components inherited from predecessor companies (Terex, Cedarapids, Standard Havens).
- Iowa Parts was formed in ~2002 by a former parts manager and hired several ex-employees of CMI Roadbuilding predecessors; it sold replacement parts advertised as meeting OEM specs.
- Iowa Parts obtained parts drawings from vendors who had received CMI engineering documents and also reverse-engineered some parts; Terex warned a former employee in 2002 about disclosing trade secrets.
- Iowa Parts marketed, exhibited, and sold parts publicly from 2002 onward; CMI later discovered Iowa Parts was supplying larger, high-value components (~$300k–$400k).
- CMI sued in 2016 under the DTSA, Iowa UTSA, conversion (common law), and unjust enrichment; both sides moved for summary judgment.
- The district court granted summary judgment to Iowa Parts, finding the statutory claims and conversion barred by the statute of limitations (plaintiff was on inquiry notice well before the limitations cutoffs) and unjust enrichment unavailable because an adequate legal remedy existed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether DTSA/UTSA claims are time‑barred | Discovery rule tolls limitations until CMI learned Iowa Parts made large components (2016) | CMI was on inquiry notice by 2002–2003 given advertising, hires, and Terex letter | Claims time‑barred; discovery rule does not save claims |
| Whether conversion of trade secrets is actionable and timely | Conversion claim available because trade secrets were taken; five‑year limitations not triggered before 2011 | Conversion (if available) is time‑barred and CMI retained control of documents so no conversion | Summary judgment for defendant; conversion barred and not shown to have deprived CMI of its documents |
| Whether unjust enrichment provides relief despite statutory bar | Equitable relief necessary because statutory remedies are time‑barred | Existence of an adequate legal remedy (statutory claims) bars equitable relief | Unjust enrichment barred; cannot pursue equity where adequate legal remedy existed |
| Whether material facts preclude summary judgment | CMI: factual disputes about when misappropriation was discoverable | Iowa Parts: public conduct put CMI on inquiry notice as a matter of law | No genuine dispute sufficient to avoid summary judgment for Iowa Parts |
Key Cases Cited
- Torgerson v. City of Rochester, 643 F.3d 1031 (8th Cir.) (en banc) (summary judgment standard)
- John Q. Hammons Hotels, Inc. v. Acorn Window Sys., Inc., 394 F.3d 607 (8th Cir.) (burden on plaintiff to prove discovery rule tolls limitations)
- Woodroffe v. Hasenclever, 540 N.W.2d 45 (Iowa 1995) (discovery/inquiry notice rule explanation)
- Estate of Montag v. T H Agric. & Nutrition Co., 509 N.W.2d 469 (Iowa 1993) (when discovery rule tolls statute)
- Franzen v. Deere & Co., 377 N.W.2d 660 (Iowa 1985) (focus on plaintiff's awareness of problem)
- Kendall/Hunt Publ'g Co. v. Rowe, 424 N.W.2d 235 (Iowa) (limits on conversion protecting intellectual property)
- United States v. Bame, 721 F.3d 1025 (8th Cir.) (equitable relief barred where adequate legal remedy exists)
- Mosebach v. Blythe, 282 N.W.2d 755 (Iowa Ct. App.) (equity unavailable where adequate legal remedy existed)