Trade Secret Claims and Ownership Limits in the Tenth Circuit

The Chip Law Group’s Pramod Chintalapoodi writes that the Tenth Circuit’s ruling in Snyder v. Beam Technologies, Inc. concerns the unusual trade secret claims between a former employee, acting as plaintiff and suing his prior employer. He alleged misappropriation of trade secrets and several state law claims against his employer.

The case stems from John Snyder’s employment with Guardian Life Insurance Company, then later with Beam Technologies. While still at Guardian, Snyder downloaded a national list of insurance brokers from internal systems and emailed it to his personal account.

After his termination, Snyder joined Beam and created broker spreadsheets using the Guardian list as a template. He inadvertently included the complete list as an additional tab when emailing the materials to Beam employees, without confidentiality markings or access restrictions. After learning of his mistake, he took no steps to retrieve the list or limit its use.

The opinion centers on ownership of the asserted trade secret and whether the plaintiff’s conduct met the legal standard for maintaining secrecy. On affirming summary judgment in part, the court concluded that the plaintiff failed to satisfy the essential elements required for trade secret protection.

On appeal, the Tenth Circuit reiterated that a trade secret plaintiff must identify the alleged trade secret and prove its existence, including reasonable efforts to maintain secrecy. Even viewing the facts favorably to Snyder, the court held his actions insufficient as a matter of law.

Storing the list on personal devices or a work laptop, without password protection or confidentiality designations, did not meet the required diligence. The court also rejected his contention that disclosure was limited, emphasizing the absence of restrictions and the breadth of distribution.

For lawyers, the decision reinforces the importance of concrete secrecy measures. Courts will scrutinize the initial handling of information and responses to inadvertent disclosure. Failure to label materials, restrict access, or mitigate dissemination can defeat protection claims.

The case also demonstrates challenges of asserting trade secret rights over information from a prior employer, particularly where ownership and safeguarding efforts cannot be established.