After an eight week jury trial in Waterbury Superior Court, an East Hartford based flooring solutions company,Dur-A-Flex, has been awarded 50.5 million dollars in damages for the misuse of its trade secrets by Laticrete International, a Bethany based multinational corporation. Laticrete was a former purchaser of Dur-A-Flex's colored sand products. The jury found that the Laticrete misappropriated Dur-A-Flex's trade secrets for the colored sand and awarded 43.7 million dollars in damages. After the jury verdict, Judge Dennis Eveleigh awarded Dur-A-Flex more than 5 million dollars for attorney's fees in a written decision (download here). He also conditioned Laticrete's future use of Dur-A-Flex's technology on payment of royalty fees.
The case was brought back in 2006 on the Complex Litigation Docket in Waterbury (Access court docket here). Dur-A-Flex was represented by Lawrence Rosenthal and Fletcher Thomson from Rogin Nassau's Hartford office. Laticrete was represented by Elizabeth Stewart from Murtha Cullina's New Haven office.
Dur-A-Flex supplied color sand to Laticrete for use in Laticrete's grout products. Laticrete was the only customer of Dur-A-Flex for the sand product. Laticrete at some point stopped buying the colored sand from Dur-A-Flex and started making an identical sand product. Dur-A-Flex claimed that Laticrete was, if fact, using Dur-A-Flex's manufacturing process to make the sand. The jury agreed with Dur-A-Flex and found that Laticrete violated Connecticut's Uniform Trade Secrets Act.
Attorney Rosenthal commented on the verdict and stated he was "certain that Dur-A-Flex had been significantly damaged by Laticrete's improper and unauthorized use of its technology." He believed the verdict was the largest ever for a trade secret case in Connecticut.
I also believe this is the largest jury verdict in Connecticut history for a trade secret case. Additionally, Connecticut case law is fairly sparse when it comes to significant trade secret cases. I expect that the Dur-A-Flex case will impact trade secret law in Connecticut for years to come. In particular, not only the amount of the award, but Judge Eveleigh's written decision on awarding future royalties and attorney's fees, which included a 10% contingency success fee. Judge Eveleigh also issued a post-judgment order permitting Dur-A-Flex to attach the assets of Laticrete. It should be noted that Judge Eveleigh will become a justice of the Connecticut Supreme Court on June 1, 2010. As such, I expect that his decision will carry more weight on these issues.
