In all trade secrets cases, plaintiffs must prove that they took reasonable efforts to protect the confidentiality of their claimed trade secrets.

What’s reasonable efforts?

Courts usually say that depends. What’s reasonable for the local organic grocer will differ from what’s reasonable for Raytheon.

In any event, questions of reasonableness are usually questions for trial. Whenever an issue involves any type of balancing or weighing, it’ll be tough to get a motion for summary judgment granted on it.

A new case out of the Ninth Circuit falls into that bucket: VBS Distribution, Inc. v. Nutrivita Laboratories, Inc., __ Fed. App’x __, 2020 WL 2086557 (9th Cir. Apr. 30, 2020) (mem.).

The case involves trade secrets claims over the plaintiff’s customer lists.

The defendant won in the district court on a motion for summary judgment, earning a ruling that there was no evidence that the customer lists were confidential because the plaintiff shared the identity of its customers with its vendors.

The Ninth Circuit reversed.

It found a disputed factual issue on whether the plaintiff took reasonable efforts to protect its claimed trade secrets. It pointed to the facts that:

• the plaintiff stored the customer lists on password-protected computers;

• the plaintiffs’ employees signed confidentiality agreements obligating them to keep customer lists confidential; and

• the customers’ identities were provided to vendors on an oral “understanding of confidentiality” (even though the plaintiff’s written contracts with vendors had no confidentiality obligations).

Note the narrowness of the court’s ruling.

The Ninth Circuit didn’t say that these customer lists are trade secrets. It didn’t say that the plaintiff should prevail on its misappropriation claim.

All it said was that this issue must be decided by a jury.