Palantir Technologies Inc. v. Abramowitz

Background

Palantir Technologies Inc. brought claims against Marc L. Abramowitz for breach of contract and trade-secret misappropriation. Abramowitz moved for summary judgment, which is a request for judgment without a trial because the moving party contends that no genuine dispute of important facts exists. Palantir opposed the motion. The court denied the motion as to both claims.

Breach of contract

The contract claim concerns a nondisclosure agreement that Abramowitz signed on July 12, 2014. Under California law, Palantir must prove a contractual obligation, its own performance or excuse, Abramowitz’s breach, and resulting damages.

Abramowitz argued that the agreement did not apply retroactively to information disclosed before he signed it and that Palantir had no evidence of disclosures after that date. The court agreed that the agreement did not retroactively make earlier disclosures or uses improper. But the court held that the agreement imposed a continuing obligation beginning July 12, 2014, not to use or disclose Palantir’s proprietary information, regardless of whether Abramowitz obtained that information before, on, or after the signing date.

The court found genuine disputes of material fact about whether Palantir disclosed proprietary information during meetings with Abramowitz in February 2013, March 2014, and June 2014; whether the information fit the agreement’s definition of proprietary information; and whether Abramowitz later used it in patent applications. Palantir employees testified that they discussed confidential information with Abramowitz and that he acknowledged its confidentiality. Palantir’s experts also opined that Abramowitz’s patent applications were based on or derived from Palantir’s confidential information. The court concluded that whether Abramowitz used proprietary information in breach of the agreement would be an issue for the jury.

Abramowitz also argued that Palantir had no evidence of damages. Palantir identified costs of monitoring and uncovering the alleged breach, fees paid to the Patent and Trademark Office, and costs of mitigating harm. The court found factual disputes about whether and to what extent Palantir suffered damages. It also stated that California law makes nominal damages available when a contract is breached.

Trade-secret misappropriation

Palantir also brought a claim under the California Uniform Trade Secrets Act. The court described the relevant elements as the existence of a trade secret, disclosure to Abramowitz under circumstances creating an obligation not to use or disclose it to Palantir’s detriment, and Abramowitz’s use or disclosure of it to a third party. Information qualifies as a trade secret if it has economic value because it is not generally known and the owner took reasonable measures to keep it secret.

Abramowitz argued that Palantir had not taken reasonable steps to protect the alleged trade secrets and that there was no evidence he used or disclosed them. The court held that whether Palantir’s efforts were reasonable was a fact-specific question for the jury. Evidence included Abramowitz’s alleged acknowledgments that information shared with him was confidential, Palantir’s physical and network security measures, and mandatory legal training about confidentiality and data security. The court stated that Abramowitz’s contrary arguments could be considered by the jury but did not justify summary judgment.

The court also found factual disputes about whether Abramowitz actually used or disclosed Palantir’s trade secrets. Palantir’s experts opined that his patent applications were based on or substantially derived from the alleged trade secrets. The court therefore denied summary judgment on the trade-secret claim.

Other motion and order

Abramowitz moved to strike an affidavit from Alexander Karp, Palantir’s co-founder and chief executive. The court denied that motion, noting that Palantir had previously identified Karp as someone who had met with Abramowitz and discussed confidential information, and that Abramowitz had an opportunity to examine Karp in a deposition. The court stated that summary judgment would be inappropriate even without considering Karp’s affidavit.

The court denied Abramowitz’s motion for summary judgment. Both Palantir’s breach-of-contract claim and trade-secret misappropriation claim will go forward. The existing case schedule and scheduled hearings on the parties’ expert-evidence motions remained in effect.