Rockwell Graphic Systems Inc. v. DEV Industries Inc., 925 F.2d 174 (7 Cir. 1991)
Feb 03, 2015 by Vahid Dejwakh

Facts and Procedural History

a. Rockwell manufactures printing presses that cannot be reverse engineered. You need the piece part drawings in order to build them, so these drawings are kept as a trade secret in a locked vault
i. Procedures are in place to protect the drawings
b. DEV president Fleck had been a Rockwell employee; now he and Peloso are accused of having stolen some Rockwell piece part drawings → DEV argues that Rockwell didn’t take enough efforts to protect the drawings because they had 200 engineers making copies, vendors keeping copies, and did not enforce the secrecy rules

Issue(s)

Did Rockwell take enough precautions to keep their drawings secret?

Holding and Dissent(s)

Reversed in favor of Rockwell
i. Rockwell took reasonable precautions by hiring security guards to protect the vault, confidentiality agreements, etc
ii. If we impose too high costs to protect a trade secret, these may deter people from inventing them in the first place

Analysis and Discussion

i. Two reasons why it's important to protect T.S.:
1. To show that the more likely explanation for why competitor knows your T.S. is misappropriation (Tort/signaling stealing)
2. To show the T.S. had more economic value than the costs to protect (Property/incentive)
ii. Notice: have a stamp on documents saying T.S. so that everyone who sees it has been on notice

   < Back