Conxall Corporation v. Iconn Systems, LLC
2016 IL App (1st) 140158
| Ill. App. Ct. | 2016Background
- Conxall sued iCONN and several former Conxall employees alleging misappropriation of trade secrets related to cable assemblies and panel mounts sold to MSA; MSA was a third‑party defendant.
- iCONN obtained from MSA samples, 2D drawings, 3D models, and QC specs while bidding to supply MSA; Conxall later learned iCONN also supplied MSA and sued.
- Conxall alleged four categories of trade‑secret information (overall Firehawk design, component designs, Conxall’s manufacturing process, and designs for Hach/Skybitz/KSI products).
- After a four‑week jury trial, the jury returned a general verdict for defendants and answered a special interrogatory (MSA owned the information in the files) “yes.”
- Posttrial, Conxall moved for judgment n.o.v. / new trial (denied); iCONN moved for attorneys’ fees under the Illinois Trade Secrets Act §5 (denied); appeals and cross‑appeal followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether instruction No. 18 (warning against asserting only broad areas of technology) misstated law/prejudiced Conxall | Instruction misstated trade‑secret law and misled jury | Instruction was appropriate and read in context of other instructions that tracked the Act | Affirmed: instructions taken as a whole were adequate; No.18 not an abuse of discretion |
| Whether Conxall preserved objection to MSA’s special interrogatory No.4 (did MSA own the info) and whether its consideration should have been limited to iCONN’s cross‑claim against MSA | Interrogatory improperly considered as to the general verdict and should have been limited | Conxall failed to specifically object to interrogatory No.4, forfeiting the issue | Affirmed: Conxall forfeited specific objection by making only a general objection |
| Whether the jury’s affirmative answer to special interrogatory No.4 was against the manifest weight of the evidence | Evidence showed 3D files contained internal dimensions and MSA disclaimed ownership of internal design structure, so verdict was unsupported | Flaherty (MSA) testified the files were MSA property and MSA did not tell iCONN any part belonged to Conxall; evidence supported verdict | Affirmed: jury verdict not against manifest weight; appellate court will not reweigh evidence |
| Whether trial court erred denying iCONN’s request for attorneys’ fees under 765 ILCS 1065/5 (bad faith) and what standard defines “bad faith” | Conxall’s claims were objectively specious and brought in subjective bad faith, warranting fees; adopt California two‑prong test (objective speciousness + subjective bad faith) | Trial court found no bad faith; Presiding and another justice favored Illinois/Krautsack/Rule 137‑based standard; dispute over appropriate standard and whether remand required | Majority: vacate denial of fees and remand for reconsideration under Illinois standard as explained by the concurring opinion (court split: differing views on adopting SASCO test). Trial court’s denial vacated and remanded for further proceedings |
Key Cases Cited
- People v. Lovejoy, 235 Ill. 2d 97 (Ill. 2009) (purpose of jury instructions is to provide correct legal rules)
- Dillon v. Evanston Hosp., 199 Ill. 2d 483 (Ill. 2002) (instruction must state law fairly and not mislead)
- Maple v. Gustafson, 151 Ill. 2d 445 (Ill. 1992) (standard for manifest‑weight review and appellate deference to jury)
- Krautsack v. Anderson, 223 Ill. 2d 541 (Ill. 2006) (defining bad faith standard for fee awards and discussion of Rule 137 guidance)
- SASCO v. Rosendin Elec., 143 Cal. Rptr. 3d 828 (Cal. Ct. App. 2012) (California two‑prong test for bad faith under trade‑secrets fee provision: objective speciousness + subjective bad faith)
- FLIR Sys., Inc. v. Parrish, 95 Cal. Rptr. 3d 307 (Cal. Ct. App. 2009) (application of SASCO/analysis of fee shifting for specious trade‑secret claims)
- Gemini Aluminum Corp. v. Cal. Custom Shapes, Inc., 116 Cal. Rptr. 2d 358 (Cal. Ct. App. 2002) (early articulation of objective/specious + subjective bad‑faith framework)
- Trandes Corp. v. Guy F. Atkinson Co., 996 F.2d 655 (4th Cir. 1993) (misappropriation focuses on improper means of procurement)