Pelican Bay v. Western Timber

To constitute a trade secret under ORS 646.461(4), information must both (1) gain value because it is not generally known and (2) be the subject of reasonable efforts to maintain that secrecy. Kaib’s Roving R.PH. Agency, Inc. v. Smith, 237 Or App 96, 103, 239 P3d 247 (2010).

Pelican Bay Forest Products, Inc. (Pelican) appealed from the trial court’s summary judgment in favor of Western Timber Products, Inc. (Western Timber) dismissing Pelican's claim for misappropriation of trade secrets under ORS 646.461. Pelican Bay assigned error to the trial court’s finding that Pelican Bay failed to produce sufficient evidence to create an issue of fact as to whether Western Timber improperly used Pelican's trade secrets, a customer list. On appeal, Pelican argued Western Timber used Pelican’s customer list knowing, or had reason to know, the list was received from a person who was obligated to Pelican to keep the customer list secret. In response, Western Timber argued they were unaware the list was a trade secret at the time of its disclosure and the list does not qualify as a trade secret. “To constitute a trade secret under ORS 646.461(4), information…must both (1) gain value because it is not generally known and (2) be the subject of reasonable efforts to maintain that secrecy.” Kaib’s Roving R.PH. Agency, Inc. v. Smith, 237 Or App 96, 103, 239 P3d 247 (2010). The Court found there existed a material question of fact related to whether the customer list was a trade secret because (1) Western Timber only hired a new employee because of his access to that list and (2) Pelican took steps to protect the lists’ secrecy by requiring employees to agree to a confidentiality policy. Additionally, the Court also held knowledgeable use of a trade secret constitutes misappropriation even if the user was not aware of its status as a trade secret when it was disclosed to them.

Reversed and remanded.