Facebook Loses Bid in AI Dispute to Make Trade Secrets Claims All or Nothing
A federal judge ruled that Massachusetts' Uniform Trade Secrets Act does not preclude an AI startup from bringing separate claims of unfair competition and tortious interference based on the same alleged misappropriation underlying its trade secret claims.
November 02, 2020 at 06:50 PM
4 minute read
The original version of this story was published on The Recorder
Quinn Emanuel Urquhart & Sullivan and a startup founded by researchers at the Massachusetts Institute of Technology have won a skirmish in a trade secret dispute with Facebook over artificial intelligence algorithms.
U.S. District Judge Denise Casper of the District of Massachusetts ruled last week that Massachusetts' version of the Uniform Trade Secrets Act does not preempt Somerville-based Neural Magic's additional claims for unfair competition, unjust enrichment and tortious interference.
The ruling in Neural Magic v. Facebook means that Neural Magic can still pursue unfair competition claims—and treble damages—under Massachusetts Chapter 93A, even if it's ultimately unable to prove that confidential information its chief technology officer allegedly took to Facebook does not meet the definition of a trade secret.
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