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The successful plaintiff was awarded partial and substantial indemnity costs following a bifurcated trial on liability for misappropriation of trade secrets.
The plaintiff, Shaver-Kudell Manufacturing Inc., sought costs on a substantial indemnity basis for an abandoned summary judgment motion and partial indemnity costs for a 13-day trial, following its complete success on liability where it was found that the defendants misappropriated its trade secret and confidential customer information.
The defendants argued for deferral of costs, challenged the scale of costs for the summary judgment motion, and disputed the quantum of costs and disbursements.
The court determined that costs should not be deferred, found the plaintiff's Rule 49 offer to settle the summary judgment motion valid, and awarded partial indemnity costs for the summary motion to the date of the offer and substantial indemnity thereafter.
The court also fixed the trial costs, making adjustments for certain claimed amounts and expert fees, ultimately ordering the defendants to pay specific amounts for both the summary motion and the trial.
The court held that the defendants misappropriated trade secrets and a former employee breached her duty of confidence by soliciting customers from memory.
The plaintiff, Shaver-Kudell Manufacturing Inc. (SK), sued the defendants, Knight Manufacturing Inc. (KM), Lucy Shaver (a former long-term employee of SK), Dusko Ballmer (Lucy's common-law spouse and KM's consultant), and Alexander Knecht (KM's founder), for misappropriation of trade secrets related to its metal sleeve manufacturing process and tooling, and for breach of confidence regarding its customer list.
The court found that SK's manufacturing process and tooling were trade secrets, and that the defendants breached confidence and misappropriated these secrets.
Additionally, the court found that Lucy Shaver breached her duty of confidence and good faith by using her memorized knowledge of SK's customer list to solicit clients for KM shortly after leaving SK's employment.
