Understanding the Meaning of “Valuable Confidential Business Information” Under Florida’s Non-Competition Statute
Florida’s non-struggle statute, located as section 542.335, Florida Statutes, requires that an enforceable non-struggle contract be supported by a “legitimate business interest.” The statute identifies several, specific legitimate business interests, including “valuable confidential business information” that does not if not qualify as a trade secret.
Even if “[v]aluable confidential business … information” is not defined in the non-struggle statute, courts have interpreted this wording to require in effect the same showing as a trade secret, i.e., proof that the fan of the ban possesses information that is both unique in the industry and confidential.
Colucci v. Kar Kare Automotive Group, Inc., 918 So.2d 431, 439 (Fla. 4th DCA 2006) (“[p]rotectable information includes that which is unique in the industry and confidential”); Autonation, Inc. v. O’Brien, 347 F.Supp.2d 1299, 1304 (S.D. Fla. 2004) (“information that is commonly known in the industry and not unique to the allegedly injured party is not confidential and not free to safeguard”). A “trade secret,” is “information … that …. [d]erives independent economic value … from not being commonly known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.” F.S. 688.002(4). A leading treatise clarifies in significant part that:
As a logical matter, if a plaintiff, assumed owner of a trade secret, is vital to prove that the alleged secret is known only to him, to the exclusion of all other significant persons (i.e., persons outside the plaintiff’s enterprise but within the same trade), he must set up the nothingness of similar knowledge.
(Emphasis in the original.) Milgram on Trade Secrets, Volume I, 107[2] at p. 1-468.57 (September 2011Edition). See also, Inhabitant Tile Board Corp. v. Panelboard Mfg. Co., 27 N.J. Super. 348, 357, 99 A.2d 440, 444 (Ch. Div. 1953):
The record is bare of credible proof that plaintiff’s apparatus are secret or that their possession gives plaintiff an benefit over its competitors ….Neither [of plaintiff's testifying executives] … had ever been in a plant of a competitor. They knew nothing of the methods used by others. For all we know, all other manufacturers may be using apparatus identical with those possessed by the plaintiff.
Attorney Peter Maverick represents management and business owners in employment and labor law. Mr. Maverick has successfully represented many businesses in court as well as in responding to threatened legal action.
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