New York's high court has the chance to clarify damages in trade secret cases, following a U.S. Court of Appeals for the Second Circuit ruling Monday asking the state Court of Appeals to certify two questions.

New York is only one of a few states that doesn't have a version of the Uniform Trade Secrets Act, which provides a codified way to handle trade secret cases similar to the federal version—the Defend Trade Secrets Act—signed into law in May 2016. The common law interpretations in its absence have led to a lack of case law clarity, according to observers.

In the case before the circuit, E.J. Brooks v. Cambridge Security Seals, 16-207-cv, Judges Amalya Kearse, Raymond Lohier Jr. and Christopher Droney noted that state precedent was silent on two core issues in the case: first, whether the defendant's avoided costs are a permissible measure of damages for these claims of misappropriation of a trade secret, unfair competition and unjust enrichment; and whether under New York statute prejudgment interest is mandatory where a plaintiff recovers damages through the “avoided costs” theory.