The revived trade secrets award could greatly exceed the contract claim because that claim wasn’t treated as having cost AAI the contract, just time and money wasted on the partnership, Jackson said. The appeals court also rejected Boeing’s pushback on a sanction of $375,000 for intentionally destroying evidence.
The Eleventh Circuit’s ruling drove that home, finding Missouri’s five-year statute of limitations should have applied rather than Alabama’s two-year time bar, because the claim arose from the exchange of proprietary information in connection with the parties’ teaming agreement. The construction of partnering agreements is critical, she said, from deciding on sharing and nondisclosure rules to choice of law for settling disputes. Nor are disputes over trade secrets or large contracts.īut the “nefarious allegations, kickbacks, behind the scenes effort to drive the contract to Boeing, and the effort to dispatch AAI as a competitor” make the case stand out, Jackson said. “You’ve created a beast whose only objective is to litigate against you.” ‘Bad Faith’Ĭompetitors partnering on a contract isn’t uncommon in defense contracting, trade secrets attorney Linda M. “You’re not really killing them, you’re transforming them,” he said. Pooley noted the threat of a bankrupt company with only one asset-a legal claim. The case provides an example of large companies’ occasional “failure of risk appreciation” when using leverage against weaker vendors or partners, trade secrets attorney James Pooley of James Pooley PLC said.ĪAI filed for bankruptcy in 2011. “Also it’s David and Goliath, with a small contractor driven to bankruptcy by big bad Boeing.” Especially now, with today’s conspiratorial mindset, people assume the worst,” Marsh said. “The conventional wisdom is that juries are susceptible to stolen trade secrets claims. He added that they also generally involve factual disputes relatively likely to make it to a jury.
Such claims can lead to more negotiating leverage for plaintiffs because “the downside suddenly becomes exponentially larger,” trade secrets attorney John F. Trade secrets law provides an easier path to the punitive damages and attorneys’ fees that AAI also seeks, attorneys said. AAI says it’s entitled to collect as Boeing only won it because of the theft. Air Force aircraft maintenance contract plagued by scandal that led to jail time for a Boeing executive and a Pentagon contract official.ĪAI’s chapter in the saga netted it a $2.1 million jury verdict against Boeing for breach of contract.ĪAI said the revived trade secrets claims reach $100 million from Boeing’s profits on the contract. The fight is part of a broader history of a U.S. Successful trade secrets claims generally offer greater opportunity for hefty windfalls, because they arise from tort rather than contract law, attorneys say.
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Trade secrets claims could greatly increase what AIA already won in a jury trial for breach of contract, with a chance of even more in punitive damages. 14, saying the lower court applied the wrong state’s statute of limitations. Court of Appeals for the Eleventh Circuit revived the suit’s trade secrets claim Feb. Boeing’s $1.16 billion bid in 2008 beat AAI’s by 1.28%, spawning a 2011 lawsuit. claimed Boeing broke off a partnership under false pretenses, then used its trade secrets to win a contract AAI had held for decades. bankrupted an ex-partner by using its secrets to win a billion-dollar contract reopens a rancorous feud and highlights the reach of trade secrets penalties.Īlabama Aircraft Industries Inc. The revival of allegations that the Boeing Co.