42 Cal.App.5th 352
Cal. Ct. App.2019Background
- GPP developed a proprietary formula and process (a shelf-life extender) for treating field-cored iceberg lettuce and treated the identity of a particular organic acid and its application process as a trade secret.
- Kevin Le, a former GPP scientist who signed a confidentiality agreement, left to form West Coast AG (WCA) and competed with GPP; GPP sued in 2005 for trade-secret misappropriation and obtained TRO and preliminary injunction.
- In 2006 the parties entered a stipulated permanent injunction permanently enjoining Le/WCA from acquiring, disclosing, or using GPP’s trade-secret product or soliciting GPP customers using that information.
- Later events (VPS/Inn Foods dealings, intervenor VPS, and discovery) produced contested admissions about the identity of the organic acid (initially citric acid admission, later amended to denial, and ultimately an admission that it was sodium benzoate) and citation to prior patents/patent application describing related PPC compositions and mentioning benzoic acid.
- Le/WCA moved under Code Civ. Proc. § 533 to dissolve or modify the injunction, arguing newly discovered evidence (patents, publications, and identification of sodium benzoate) destroyed GPP’s trade secret; after denial they filed a renewed motion under CCP § 1008(b).
- The trial court denied the renewed motion; the Court of Appeal treated the appeal as a writ petition and denied relief, holding appellants failed to meet § 533 and that the injunction could stand.
Issues
| Issue | GPP's Argument | Le/WCA's Argument | Held |
|---|---|---|---|
| Appealability of order denying renewed motion under CCP §1008(b) | Orders denying renewed §1008(b) motions are not appealable; treat as writ only in unusual cases | Denial is appealable; split in authority | Denial of §1008(b) renewed motion is not appealable; court exercised discretion to treat appeal as writ and reach merits. |
| Whether injunction must be dissolved under CCP §533 because trade secret no longer exists | Trade secret still exists (encompasses formula + process) and patents/public disclosures did not fully disclose GPP’s proprietary formula/process | Identification of sodium benzoate and patent disclosures destroyed the secrecy/commercial advantage; thus injunction should be dissolved | Trial court did not abuse discretion: substantial evidence supports implied finding GPP retained a valid trade secret and §533 relief not warranted. |
| Does prior patent/publication (and identification of sodium benzoate) extinguish trade secret | Prior patents and bare mention of acids do not reveal GPP’s specific proprietary formula/process or application method | Publication of sodium benzoate in patents and literature places components in public domain and permits reverse engineering, negating secrecy | Court held patents and references did not, as a matter of law or fact, clearly extinguish GPP’s trade secret; publication alone did not prove loss of commercial advantage here. |
| Vagueness/enforceability of the stipulated permanent injunction | Injunction terms were stipulated; description of claimed trade secret (proprietary formula and process for field-cored lettuce) was sufficiently definite | Injunction is too vague to enforce; GPP cannot define its own trade secret; injunction may be void and unenforceable | Court rejected vagueness claim: appellants had agreed to stipulation, §2019.210 does not require minute detail, and injunction was not shown void for want of jurisdiction. |
Key Cases Cited
- Tate v. Wilburn, 184 Cal.App.4th 150 (Cal. Ct. App. 2010) (held orders denying renewed motions under §1008(b) are not appealable)
- Chango Coffee, Inc. v. Applied Underwriters, Inc., 11 Cal.App.5th 1247 (Cal. Ct. App. 2017) (followed Tate; legislative silence on §1008(b) supports nonappealability)
- Olson v. Cory, 35 Cal.3d 390 (Cal. 1983) (framework for treating an appeal as a writ petition in unusual circumstances)
- Wanke v. Keck, 209 Cal.App.4th 1151 (Cal. Ct. App. 2012) (injunctions can only be opposed as void for lack of jurisdiction in narrow circumstances)
- DVD Copy Control Assn., Inc. v. Bunner, 116 Cal.App.4th 241 (Cal. Ct. App. 2004) (widespread publication can destroy a trade secret)
- Forcier v. Microsoft Corp., 123 F. Supp. 2d 520 (N.D. Cal. 2000) (once a trade secret is publicly disclosed in a patent, it is placed in the public domain)