First District Appeals Court orders dismissal of trade secrets claims filed by WSP USA

By Carrie Salls | Jan 1, 2019

HOUSTON – A state appellate court has affirmed in part and reversed in part a company's suit against three former employees over allegations of misappropriation of trade secrets.

The Court of Appeals for the 1st District of Texas ordered the dismissal of misappropriation of trade secrets and confidential claims filed by WSP USA Inc. against the three former employees but upheld the 270th District Court for Harris County’s decision to deny dismissal of claims filed by WSP USA Buildings Inc. and WSP USA Administration Inc., according to an opinion issued on Dec. 20.

The Appeals Court opinion said the WSP entities, which operate an engineering firm, filed a complaint against former employees Derek Gaskamp, Jonathan Miller and Andrew Hunter “for conduct related to their alleged misappropriation of WSP’s trade secrets and confidential information.”

The District Court denied the defendants’ Texas Citizen Participation Act (TCPA) motion for dismissal of the WSP lawsuit, which they appealed.

In the original lawsuit, which also named former Houston office manager David Sinz and his new firm, Infinity MEP, as defendants, WSP alleged that Sinz opened Infinity MEP to conduct “the very same services provided by WSP” soon after he quit the company. The opinion said Gaskamp, Miller and Hunter also left WSP to work for Infinity MEP.

“After the employees resigned, WSP learned that Infinity MEP’s website identified 14 different ‘featured projects,’ which Infinity MEP represented were ‘from Infinity MEP staffs’ previous career at WSP and other firms,’” the Appeals Court opinion said. “By posting the information on its website, WSP alleged that Infinity MEP was ‘attempting to leverage WSP’s successful projects and WSP’s association with high-profile clients – without WSP’s consent – into business opportunities, relationships and contracts of its own.’”

As a result, the opinion said WSP found through a subsequent “internal investigation and a forensic analysis” that “seven USB devices were plugged into Sinz’s WSP-issued computer between January and April 2017, none of which were WSP-issued devices.”

Although the Appeals Court agreed with the District Court’s decision to deny dismissal of the claims filed by WSP USA Buildings and WSP USA Administration, Justice Laura Carter Higley wrote in her opinion that “WSP USA Inc.’s claims related to appellants’ exercise of their rights of association and free speech,” so those claims should be dismissed.

Justice Terry Jennings wrote a concurring opinion, saying that he agreed with the majority opinion written by Higley, but that he wanted to stress his view that the Texas Supreme Court recently issued an overly broad interpretation of the Texas Citizen Participation Act (TCPA), on which the Appeals Court ruling was based.

“Although applying the court’s strictly textual interpretation of the pertinent definitions here, without regard for the expressly stated purpose of the TCPA, necessarily leads to a manifestly unjust and absurd result against appellee, WSP USA Inc., we must apply them as instructed by our higher court,” Jennings wrote in his concurring opinion.

"I again urge the Texas Legislature to amend or repeal the TCPA to correct the overly-broad misinterpretations of the statute by Texas courts,” Jennings wrote.

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