Bondpro Corp. v. Siemens Power Generation, Inc.

United States Court of Appeals for the Seventh Circuit

463 F.3d 702 (7th Cir. 2006)

A trade secret is information that (1) is not generally known by the public or by an industry and (2) is information with which the owner has taken reasonable efforts to keep confidential.

Relevant Facts

Siemens Power Generation, Inc. (the defendant) manufactured electrical generators that utilized insulated copper coils placed within a bowl-shaped mold. When heat was applied, sometimes wrinkles would appear in the finished form. BondPro Corp. (the plaintiff) developed a process for shaping insulation that utilized a vacuum, heat, and air pressure rather than the bowl mold, which led to fewer wrinkles. Specifically, the plaintiff’s process used an autoclave, which was a container that provided air pressure and heat. At least one other company, Torr Technologies, also developed a method of using air pressure and heat to mold the insulation into the necessary shape. Torr Technologies described its process in advertising materials that it circulated at a trade show.

The plaintiff approached the defendant about licensing its insulation-molding technique, and the parties signed two confidentiality agreements. The confidentiality agreements expressly excluded information that was generally known or was already known to the defendant before the plaintiff disclosed its process. Under the agreements, the plaintiff disclosed and demonstrated its insulation-molding process to the defendant. The defendant did not ultimately license the plaintiff’s technique. Instead, the defendant filed a patent application for its own insulation-molding process similar to the plaintiff’s process except that it did not include the final step of using an autoclave. The patent application was rejected, and the defendant did not use the plaintiff’s process for any manufacturing. The plaintiff sued the defendant, alleging theft of trade secret, claiming that the defendant had publicly disclosed the plaintiff’s trade secret in its patent application. A jury found that the defendant had misappropriated the plaintiff’s trade secret. However, the district court granted judgment as a matter of law for the defendant and the plaintiff appealed.

Issue

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Holding & Reasoning

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Concurrence

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Dissent

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Last updated:

December 29, 2020

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Procedural History

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Citations

463 F.3d 702 (7th Cir. 2006)