Checkr: Dismissing trade secret litigation after discovering that alleged secrets were public
Munger, Tolles & Olson defended Checkr, Inc., the leading tech company in the background check industry, and Checkr’s subsidiary, Hone Data LLC, against allegations of trade secrets theft, unfair competition, breach of contract and other claims.
Checkr and Hone were sued by vendor Safety Holdings, Inc., doing business as SambaSafety, and American Driving Records, Inc. The plaintiffs alleged that Checkr and Hone breached their subscriber agreements and used alleged SambaSafety trade secrets to develop a competing platform for pulling motor vehicle records.
After discovering that the only sufficiently identified purported trade secret in the complaint – a compilation of codes – was publicly available on the internet, we filed a motion to dismiss. The parties reached a confidential settlement that resulted in dismissal of the case in February 2021.
Snap: Fighting a claim of stolen trade secrets from a defunct startup
Munger, Tolles & Olson is lead counsel for Snap and its French subsidiary Zenly in defending against trade secret and patent litigation brought in federal court in Delaware in January 2020 by now-defunct social mapping application You Map. You Map alleges that Snap misappropriated the trade secrets in You Map’s social mapping application through Zenly S.A.S., by signing up to beta test the application prior to launch and then allegedly incorporating You Map’s so-called “trade secret” zooming, heat map, MapMoji and other purported trade secrets into Snap’s highly successful SnapMap application. You Map also added patent infringement allegations in an amended complaint.
In February 2021, partner Carolyn Hoecker Luedtke led a Munger, Tolles & Olson team in winning a motion to dismiss the original complaint, after which You Map amended the complaint. Snap filed a second motion to dismiss. In July 2021, Magistrate Judge Hall recommended dismissing the suit against the French Zenly defendants but recommended against dismissing the trade secret claims against Snap, a recommendation adopted in September 2022 by Chief US. District Judge Connolly.
Upon reading the Munger team’s 2021 second motion to dismiss, You Map agreed its newly added patent claims were flawed and conceded the motion to dismiss on those claims, agreeing to amend them to try to cure the defects upon the resolution of the motion to dismiss on all other issues. You Map will ultimately amend its patent claims after a decision on Snap’s inter partes review (IPR) petition that was instituted in September 2022 on the patents at issue in the litigation.
Carolyn Hoecker Luedtke
Laura D. Smolowe