Wellogix, Inc. v. Accenture, L.L.P.
716 F.3d 867
| 5th Cir. | 2013Background
- Wellogix alleged Accenture misappropriated its trade secrets after a nine-day trial resulting in a unanimous verdict for Wellogix with compensatory and punitive damages.
- Wellogix’s software targeted planning, procurement, and payment for complex oilfield services and relied on confidential source code and six-point security measures.
- Wellogix entered 2005 agreements with SAP to integrate its software with SAP’s accounting, sharing source code with SAP.
- Wellogix shared source code with Accenture under confidentiality obligations during six marketing agreements and pilot projects with BP and others.
- During BP’s global Purchase-to-Pay pilot, Accenture and SAP allegedly accessed Wellogix trade secrets uploaded to a confidential online portal and developed competing templates.
- On appeal, Accenture challenged the verdict and damages; the district court denied motions for judgment as a matter of law and for a new trial, after a remittitur of punitive damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of a trade secret | Wellogix’s technology met the six Bass factors and remained secret. | Secrecy was destroyed by public patent disclosures and portal access. | Trade secrets existed; jury could infer secrecy despite some disclosures. |
| Acquisition of trade secrets through improper means | Accenture improperly acquired secrets via confidential agreements, eTrans portal access, and bringing confidential materials into BP’s P2P project. | Insufficient direct proof of portal access; expert testimony alone insufficient. | Sufficient evidence supported improper acquisition by Accenture. |
| Use of trade secrets | Accenture used Wellogix’s templates and content to develop its own complex services work for BP. | Templates were not identical and relied on own efforts; use not proven. | Evidence supported use of Wellogix trade secrets in Accenture’s P2P work. |
| Damages | Flexible damages approach allowed recovery of compensatory damages based on Wellogix’s value and lost opportunities. | Valuation was speculative and lacked objective data; damages were unreliable. | Sufficient evidence supported $26.2 million compensatory damages. |
| Punitive damages due process | Malice supported by evidence of deliberate misappropriation and interference with SAP relationship. | Punitive award excessive or unwarranted given the evidence. | Punitive award upheld as not grossly excessive; ratio and reprehensibility within due process limits. |
Key Cases Cited
- Lavender v. Kurn, 327 U.S. 645 (Supreme Court (1946)) (reversible error requires complete absence of probative facts)
- Morissette v. United States, 342 U.S. 246 (Supreme Court (1952)) (judges should defer to jury conclusions)
- Taco Cabana Int’l, Inc. v. Two Pesos, Inc., 932 F.2d 1113 (5th Cir. 1991) (trade secret existence factors and secrecy considerations)
- In re Bass, 113 S.W.3d 735 (Tex. 2003) (Bass factors for determining trade secret existence)
- Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133 (Supreme Court (2000)) (credibility and inference in evaluating evidence for verdicts)