The inevitable disclosure doctrine has been applied in some jurisdictions to enjoin a former employee from working for a competitor where a court finds that the employee will inevitably disclose or use his former employer\u2019s trade secrets in a new position with a competitor.\u00a0 There has been considerable disagreement among courts as to the viability of this doctrine.\u00a0 Until recently, no Georgia appellate court had adopted or rejected the doctrine.\u00a0 However, in an opinion issued on May 6, 2013, the Georgia Supreme Court seems to have rejected the inevitable disclosure doctrine, though it has left the door open for the doctrine to be adopted at some point in the future under different circumstances.<\/p>\n
In Holton v. Physician Oncology Services, LP<\/em> (Case No. S13A0012), the Georgia Supreme Court held \u201c[b]ecause a stand-alone claim for the inevitable disclosure doctrine of trade secrets \u2013 untethered from the provisions of our state trade secrets statute \u2013 is not cognizable in Georgia, we reverse the part of the Order enjoining Holton from the inevitable disclosure and use of trade secrets.\u201d<\/p>\n Holton was a former executive of Physician Oncology Services (\u201cPOS\u201d), which provides radiation therapy services to cancer patients.\u00a0 After leaving POS, Holton accepted a position as Chief Executive Officer of a competitor.\u00a0 POS sought and obtained an injunction against his continuing as CEO of the competitor on various grounds, including that he would inevitably disclose trade secrets of POS.<\/p>\n In support of its conclusion that Holton \u201cwould inevitably disclose the confidential and trade secrets\u201d of POS, the trial court cited the Georgia Trade Secrets Act, as well as Essex Group Inc. v. Southwire Co.<\/em>, 269 Ga. 553, 501 S.E.2d 501 (1998).\u00a0 In Essex<\/em>, the Georgia Supreme Court had upheld a five-year injunction prohibiting an employee who headed a 3 year, $2 million dollar development project from working for a competitor\u2019s logistics department. However, in that decision, the Georgia Supreme Court never used the words \u201cinevitable disclosure\u201d or referred to that doctrine.\u00a0 Therefore, in Holton<\/em>, the Supreme Court held that Essex<\/em> did not expressly address or adopt the doctrine.<\/p>\n \u00a0In Holton<\/em>, the Supreme Court held that the inevitable disclosure doctrine is not an independent claim under which a trial court may enjoin an employee from working for an employer or disclosing trade secrets.\u00a0 Therefore, it reversed the part of the trial court\u2019s order relying on the inevitable disclosure doctrine to enjoin Holton from working for the competitor or disclosing trade secrets and other confidential information.<\/p>\n In a section of the opinion which leaves some possibility of adopting the inevitable disclosure doctrine in the future, the Supreme Court held \u201cbecause it appears that the trial court did not reach [POS\u2019s] claim for actual or threatened misappropriation of trade secrets and the case returns to the trial court for a final adjudication on the merits, we decline to address today whether the inevitable disclosure doctrine may be applied to support a claim for the threatened misappropriation of trade secrets.\u201d<\/p>\n Thus, while the Supreme Court rejected the inevitable disclosure doctrine under the circumstances present in Holton<\/em>, it does not appear the court rejected it for all purposes.<\/p>\n","protected":false},"excerpt":{"rendered":" The inevitable disclosure doctrine has been applied in some jurisdictions to enjoin a former employee from working for a competitor where a court finds that the employee will inevitably disclose or use his former employer\u2019s trade secrets in a new position with a competitor.\u00a0 There has been considerable disagreement among courts as to the viability […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_mo_disable_npp":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[4,9],"tags":[65,16,29],"acf":[],"yoast_head":"\n