Willenken’s Trade Secrets Team Achieves Settlement and Stipulated Injunction on the Eve of Trial

Willenken’s battle-ready team got to the proverbial eve of trial before obtaining a hard-fought settlement and stipulated injunction to protect the trade secrets of its client, Takeya USA, a manufacturer of popular stainless steel water bottles. 

The case was about deception, betrayal, and the theft of valuable trade secrets by a former senior executive of Takeya USA. This former executive was hired as a potential successor to take over Takeya USA on the retirement of its CEO. Instead, while serving as Takeya’s COO and having fiduciary duties to the company, he formed a secret competing company, LHC, and began to sell nearly the exact same water bottles as Takeya, produced at the same manufacturer as Takeya, to Takeya’s same clients—but for a much lower price. 

For over four months, this executive and a co-conspirator emailed out to a third former Takeya sales rep confidential and trade secret business information on Takeya’s pricing, bid proposals, and deals. The sales rep then used that information to target Takeya’s customers on behalf of LHC. 

The former executive finally resigned just in time to try to divert a company-make-or-break deal he was working on for Takeya over to LHC—with Takeya’s largest customer. The loyal customer alerted Takeya to its former executive’s double dealing, but, now aware of Takeya’s internal bottom-line pricing, told Takeya it had to rebid. Takeya had to match LHC’s inferior pricing for all its products, losing the company millions. 

When the scheme was revealed, Takeya filed suit—but prior counsel got mired in years of baseless counter-claims and discovery stonewalling. After two years, and with a trial date fast approaching, Willenken was brought in to sharpen the case and prepare for trial. 

Willenken’s trade-secret savvy team, Jason Wilson, Amelia Sargent, and Sherin Varghese, answered the call to regain momentum in the case and prepare it for trial. Amelia immediately noted the dearth of forensic evidence due to defendants’ discovery tactics and served key requests to obtain the all-important forensic information needed to tell Takeya’s story. This ended up being the linchpin to turn the case around: Defendants’ counsel again attempted to stonewall, but in deposition, defendants revealed that they had been engaging in email spoliation and had destroyed a responsive computer. 

Armed with these admissions, the team brought two successful motions to compel, and Takeya was awarded monetary sanctions and a forensic investigation of Defendants’ remaining media overseen by a third-party neutral.  The forensic investigation, managed on Takeya’s side by staff attorney and e-discovery specialist Sherin, opened the floodgates: Defendants’ scheme had left a huge paper trail demonstrating their misdeeds. The third-party neutral had even uncovered forensic artifacts indicating Takeya information still in use on defendants’ remaining computers.

Through COVID, several more trial continuances, and more tactical interference by Defendants, the case was finally set for a jury trial in Orange County for Valentine’s Day, February 14, 2022. The Willenken team by that time had grown to include senior counsel Mayra de Aguiar, who deftly re-deposed the co-conspirator defendants and by the time of trial had flipped a fourth co-conspirator to give damaging testimony in a “Mary Carter” agreement, and associate Kirby Hsu, who kept pace with defendants’ many discovery antics, and briefed and argued a motion for summary judgment on defendants’ improperly resurrected counter-claims. 

As trial approached, Willenken did what Willenken does best: stand up yet another 100% diverse trial team with a deep bench of experience to divide and conquer the opposition. Amelia mooted her devastating opening statement and began to prepare opening witnesses on key HR and forensics issues, while Jason planned the direct of Takeya’s betrayed CEO and the ultimate cross-examination of the former executive. Mayra prepared crosses of the co-conspirators while Kirby prepared the damages expert, and both drafted motions in limine. Sherin gathered key documents while senior trial paralegal Susan Hardman coolly handled pretrial exhibit and witness lists and jury instructions. The team was further assisted by senior paralegal Dea Collins and assistants Lily Tom, Lisa Gibbons, and Julie Contreras.

Meanwhile, cracks in the defendants’ side were starting to show: They failed to designate any opposing experts (belatedly proffering the former executive to offer a lay opinion about damages), and failed a last minute hail-mary attempt to keep the third-party neutral from testifying at trial about the forensic investigation’s results. With mere days to go before trial, the parties reached a deal. Willenken obtained a confidential monetary settlement from the defendants and—importantly for Takeya—a stipulated injunction. This injunction prohibits defendants from ever using Takeya’s trade secret and confidential information, and forbids its former executive and co-conspirator from contacting or soliciting Takeya’s two most important customers to sell stainless steel water bottles for a period of five years—a huge win to protect Takeya’s business from unlawful interference and misuse of its trade secrets going forward.