Preliminary Injunction – Trade Secret Misappropriation

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7^th Circuit Court of Appeals

Case Name: Life Spine, Inc., v. Aegis Spine, Inc.,

Case No.: 21-1649

Officials: SCUDDER, ST. EVE, and KIRSCH, Circuit Judges.

Focus: Preliminary Injunction – Trade Secret Misappropriation

This trade secret case arises from a short‐lived business relationship between two companies that sell spinal implant devices. Life Spine, Inc. makes and sells a spinal implant device called the ProLift Expandable Spacer System. Aegis Spine, Inc. contracted with Life Spine to distribute the ProLift to hospitals and surgeons. In the distribution agreement, Aegis promised to protect Life Spine’s confidential information, act as a fiduciary for Life Spine’s property, and refrain from reverse engineering the ProLift. Despite these promises, Aegis funneled information about the ProLift to its parent company, L&K Biomed, Inc., to help L&K develop a competing spinal implant device. Shortly after L&K’s competing product hit the market, Life Spine sued Aegis for trade secret misappropriation and breach of the distribution agreement. Following a nine‐day evidentiary hearing, the district court granted Life Spine’s motion for a preliminary injunction barring Aegis and its business partners from marketing the competing product.

Aegis now appeals. It submits that the district court’s injunction rests on a flawed legal conclusion—namely, that a company can have trade secret protection in a device that it publicly discloses through patents, displays, and sales. We see the issue differently, however. As a legal matter, we do not dispute—nor does Life Spine—that information in the public domain cannot be a trade secret. But the issue here is factual: Did Life Spine publicly disclose the specific information that it seeks to protect by patenting, displaying, and selling the ProLift? The district court found that the answer was no, and Aegis must show that its finding was clear error. It has not done so. Finding no basis to upset the district court’s meticulous analysis, we affirm.

Affirmed

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Derek A Hawkins is Corporate Counsel, at Salesforce.