A $40 Million Jury Instruction Error Sends Trade Secret Dispute Back to Trial

Short summary

The Ninth Circuit reversed a $40 million jury verdict, permanent injunction, and $17M attorneys' fee award in a trade secret misappropriation case between Comet Technologies and XP Power. The court found the district court improperly placed the burden of proving 'ready ascertainability' on the defendant rather than the plaintiff under the Defend Trade Secrets Act. Because conflicting expert testimony on reverse-engineering was central to the case, the error was not harmless, sending the dispute back for retrial.

• •Ninth Circuit reversed $40M damages award and permanent injunction in trade secret case
• •Court held plaintiff bore burden of proving trade secrets were not readily ascertainable under DTSA
• •Erroneous jury instruction was not harmless due to conflicting expert testimony on reverse-engineering

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