Lawsuit involves mutual accusations of trade secret theft

Glenn W. Peterson

A highly skilled worker for a technology company leaves to start a new, competing business. The former employer sues the one-time employee, now competitor, for theft of trade secrets. It is an increasingly common scenario in California and elsewhere, one that requires the plaintiff to prove that the knowledge used in the new endeavor represents secret information, to which the one-time worker would only have had access to through his or her work for the company, rather than prior general know-how.

Such a dispute is currently playing out in Texas between Chinese telecommunication company Huawei Technologies and the founder of CNEX Labs, Inc., a one-time engineer for Huawei. Hired in 2011 at a division of Huawei located in California, the engineer worked for the company for two years to improve storage and retrieval of data by developing better chips for the purpose. He formed his company within a week after leaving Huawei, and the lawsuit alleges that he took proprietary information with him.

However, the engineer claims that Huawei hired him under false pretenses, seeking to increase Chinese technological dominance by gaining access to his inventions and stealing intellectual property of American engineers like him. The lawsuit comes at an interesting time for Huawei, which faces allegations from the U.S. government and around the world of stealing trade secrets from competitors.

Though the judge hearing the case is aware of Huawei’s geopolitical legal fight, it has no direct bearing on the current case. Due to the complexity of legal matters involving trade secrets, it may be helpful for those wishing to protect their intellectual property to hire an attorney.