So you’ve sued someone for stealing your trade secrets. Or you’re about to sue.

Either way, you need to investigate what happened. Did she download gigabytes of corporate documents? Or mass email secret customers? 

There’s a bunch of reasons why you want to do this. And an example of one comes via a recent decision in Insight Global, LLC v. Beacon Hill Staffing Group, LLC.

What happened

Insight Global is a staffing services company. It fired an employee. And that employee got a new job at another staffing company, Beacon Hill Staffing. 

Beacon Hill then hired more Insight Global employees, who supposedly brought Insight Global's confidential information with them.

Insight Global then sued Beacon Hill for stealing its employees and stealing its trade secrets. Which eventually resulted in a dispute over what discovery Insight Global could get from Beacon Hill.

Investigating broadens your right to discovery

In ruling on the discovery dispute, the court summarized the state of affairs:

1. Insight Global provided two lists: one of 17 customers and another of 49 hiring managers (who presumably worked for these customers). Insight Global asserted that a former employee accessed the customer data before leaving for Beacon Hill. 

2. There was no evidence that the former Insight employee downloaded or printed out the customer information.

3. There was no evidence that Insight lost any customers or revenue following the former employee's departure.

4. Insight Global admitted that, generally, its customers are not always exclusive to a single staffing company and sometimes work with multiple staffing agencies for filling the same position.

From this, the court found that Insight Global's showing of trade secret theft was “not weighty.” There was no actual evidence of misappropriation of the 17 customers. Just allegations that they could possibly have been misappropriated.

Plus, there was the whole problem that customers sometimes work with multiple staffing agencies. This undercuts their secretness and thus their protectability as trade secrets.

(Note to defendants: you need to investigate whether those 17 customers work with other staffing companies, whether to fill the same positions (preferably) or to fill other ones.)

The court then used this minimal trade secret showing to significantly narrow Insight Global's discovery. Insight Global had sought basically all documents related to the 17 customers (and the revenues derived from them) and all communications with the 49 hiring managers.

But what the court allowed was discovery into the specific dates when Beacon Hill first contacted those customers or hiring managers or received money or work from the customers.

The court contrasted this with a prior discovery ruling on requests that “sought reams of customer information without naming any customer. The court denied that discovery because Insight had not (could not) identify any actual, affected customer.”