Financial Firm Cleared of Poaching, Misappropriation of Trade Secrets

On December 17, 2017, the New York County Supreme Court dismissed claims asserted by financial analytics firm First Manhattan Consulting Group that its competitor, Novantas, Inc., poached its employees to steal trade secrets.  The specific claims against Novantas were tortious interference with contract, unfair competition, and misappropriation of trade secrets.  First Manhattan also filed suit against two individuals who were officers at the firm and who were subject to contractual confidentiality and employee non-solicitation obligations.

Ultimately, the jury did not find Novantas to have engaged in a “pattern and practice of poaching” First Manhattan’s employees, and the tortious interference or unfair competition claims against the firm were dismissed.  Most notably, the Court refused to submit the misappropriation claim to the jury on the grounds that the information presented by First Manhattan did not constitute specific trade secrets, and there no testimony concerning the alleged misappropriation.  The case thus affirmed the necessity of detailed, comprehensive information about trade secrets to be presented at trial, including a full account of the nature of the misappropriation, as well as how exactly the plaintiff was damaged.

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