USA Power, LLC v. PacifiCorp
372 P.3d 629
Utah2016Background
- USA Power developed a two-year, ~$1M preliminary design and business plan for a Spring Canyon combined-cycle gas plant in Mona, Utah; some configuration details were publicly filed but supporting economic/feasibility "backup studies" remained confidential.
- USA Power and PacifiCorp entered negotiations; PacifiCorp signed a Confidentiality and Non-Disclosure Agreement and received USA Power’s confidential Volumes I–III, then walked away from purchase negotiations and issued an RFP to which both parties bid.
- PacifiCorp submitted its own Mona proposal (Currant Creek), retained USA Power’s former water attorney Jody L. Williams to obtain water rights, and ultimately awarded the project to itself; PacifiCorp later built Currant Creek.
- USA Power sued, alleging trade-secret misappropriation and breach of the confidentiality agreement by PacifiCorp, and breach of fiduciary duty by Williams; a jury found misappropriation and awarded ~ $133M (later reduced), and found breach by Williams; the trial court granted JNOV for Williams on causation.
- On appeal the Utah Supreme Court affirmed: it upheld denial of PacifiCorp’s JNOV on the trade-secret existence issue; affirmed remittitur and other discretionary rulings on damages and attorney fees; and affirmed JNOV for Williams for lack of competent evidence of causation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of trade secret / sufficiency to survive JNOV | USA Power: its Spring Canyon "vision" (compilation + nonpublic backup studies and business/financial analyses) constituted trade secrets; sufficiently defined for jury. | PacifiCorp: USA Power failed to define secrets with specificity and its compilation was generally known or readily ascertainable (SS&W reverse-engineered analyses). | Court: Affirmed denial of JNOV — USA Power sufficiently defined secrets and presented evidence that some nonpublic components were not generally known or readily ascertainable and had independent economic value. |
| Unjust enrichment damages / remittitur | USA Power: jury properly calculated unjust enrichment; remittitur was improper. | PacifiCorp: award improperly gave USA Power 100% of Currant Creek profits despite PacifiCorp’s independent contributions. | Court: Affirmed remittitur denial — trial court reasonably found jury could infer only one Mona plant and that misappropriation produced PacifiCorp’s profits; trial court acted within discretion. |
| Head-start limitation jury instruction | USA Power: n/a (plaintiff sought full recovery). | PacifiCorp: requested head-start instruction limiting damages to period of competitive advantage. | Court: Refused proposed wording but held given instructions permitted PacifiCorp’s argument; refusal not an abuse of discretion. |
| Exemplary damages under UUTSA | USA Power: willful misappropriation warranted exemplary damages. | PacifiCorp: jury verdict and circumstances did not justify exemplary damages. | Court: Affirmed denial — trial court properly applied totality-of-circumstances (Read factors) and reasonably declined exemplary damages. |
| Attorney fees: lodestar vs contingency | USA Power: fee award should follow its contingency agreement (make-whole). | PacifiCorp: lodestar is correct method; contingency-only awards are exceptional. | Court: Affirmed lodestar use; contingency-fee-only awards are permissible only when fees are sought as foreseeable consequential damages and the contingency arrangement was foreseeable (Campbell rule). |
| Prejudgment / post-verdict interest and statutory 10% rate | USA Power: entitled to prejudgment interest and statutory 10% post-judgment rate. | PacifiCorp: lost-profit awards are speculative (bar prejudgment interest); §15-1-1 10% rate does not apply to all contract judgments. | Court: Denied prejudgment interest (lost profits are not sufficiently liquidated); rejected automatic post-verdict prejudgment interest under old rule 54(e); held §15-1-1 applies only to loans/forbearances of money/goods/chose in action, not broadly to all contract judgments. |
| Causation for Williams (JNOV) | USA Power: Williams’ work for PacifiCorp (securing water) caused PacifiCorp to win RFP and/or caused PacifiCorp to back out of purchase — so Williams‘ breach caused USA Power’s losses. | Williams: no competent evidence that her actions were unique or that absence of her involvement would have changed outcome; other lawyers could have obtained water; PacifiCorp bid/succeeded without firm water at bid time. | Court: Affirmed JNOV for Williams — USA Power failed to prove that but-for Williams’ conduct it would have benefitted (no competent evidence another lawyer couldn’t have secured water or that water was outcome-determinative). |
Key Cases Cited
- USA Power, LLC v. PacifiCorp, 235 P.3d 749 (Utah 2010) (earlier appeal clarifying compilation trade-secret principles)
- ASC Utah, Inc. v. Wolf Mountain Resorts, L.C., 309 P.3d 201 (Utah 2013) (standard for reviewing denial of JNOV)
- Read Corp. v. Portec, Inc., 970 F.2d 816 (Fed. Cir. 1992) (factors relevant to awarding exemplary damages in trade-secret context)
- Campbell v. State Farm Mut. Auto. Ins. Co., 65 P.3d 1134 (Utah 2001) (contingency-fee awards as consequential damages and foreseeability test)
- Odetics, Inc. v. Storage Tech. Corp., 185 F.3d 1259 (Fed. Cir. 1999) (discretionary nature of enhanced damages review)
- Harline v. Barker, 912 P.2d 433 (Utah 1996) (legal-malpractice causation requires showing client would have benefitted)