Parchem Trading, LTD. v. DePersia

Background

Parchem Trading, Ltd. sued Kristen DePersia, one of its former employees, for misappropriation of trade secrets. Parchem alleged that DePersia, after leaving Parchem and joining its competitor Charkit, used trade-secret information to help sell chemical products to Bristol-Myers Squibb Company, which did business with Parchem. Parchem also alleged that DePersia kept or used proprietary business information on her personal cellphone.

DePersia worked for Parchem from October 2011 until her resignation on April 28, 2016. She began working for Charkit on May 9, 2016. Before leaving Parchem, she asked for a report showing the historical sales of products to Bristol-Myers Squibb. DePersia said she used the report at a March 2016 industry meeting to discuss Bristol-Myers Squibb’s purchase history with a Bristol-Myers Squibb representative and did not keep a copy. That representative submitted a declaration stating that he took the report and later destroyed it after leaving Bristol-Myers Squibb.

Parchem and DePersia disputed the circumstances of DePersia’s business contacts and use of her cellphone. DePersia said she generally searched her work email for business contacts instead of saving them on her personal phone. During Parchem’s inspection of the cellphone when she left, Parchem’s compliance officer did not see anything suspicious and testified that he had no evidence that the phone contained proprietary business contact information.

Legal standard and claims

The court applied New York law because both parties assumed that New York law governed the dispute. Under that law, a trade-secret claim required Parchem to show that it possessed a trade secret and that DePersia used it in violation of a duty, agreement, confidential relationship, or through improper means. The court noted that a former employee could generally compete with a former employer when no restrictive agreement existed, unless trade secrets or fraudulent methods were involved.

DePersia had not signed a non-compete or non-solicitation agreement. The court therefore explained that merely reconnecting with a former customer or soliciting that customer would not by itself establish trade-secret misappropriation. The relevant question was whether DePersia used Parchem’s trade secrets or engaged in other wrongful conduct when she obtained business from Bristol-Myers Squibb while working for Charkit.

Court’s analysis

The court granted summary judgment on the claim concerning Bristol-Myers Squibb’s business relationship. Summary judgment is a decision without a trial when the evidence shows that no genuine dispute over an important fact requires a jury and the moving party is entitled to judgment under the law.

The court assumed, for purposes of its analysis, that the Bristol-Myers Squibb purchase-history list might qualify as a trade secret, or that a factual dispute might exist on that issue. Even with that assumption, the court found no evidence that DePersia later misappropriated the list to obtain Bristol-Myers Squibb’s business for Charkit. The evidence indicated that DePersia used the list while still working for Parchem at the industry meeting, gave it to a Bristol-Myers Squibb representative, and did not retain it. Parchem did not provide evidence showing how DePersia later obtained or used the list.

The court also found no evidence that DePersia used confidential information to reconnect with Bristol-Myers Squibb. A Bristol-Myers Squibb representative contacted her through LinkedIn, a public social-media platform, and the record did not show that she used a confidential contact list or other trade secret to arrange a meeting. The court further noted evidence that Bristol-Myers Squibb initiated purchases from DePersia at Charkit and that Charkit primarily sold different types of chemicals to Bristol-Myers Squibb. Parchem’s assertions about overlapping products and lost profits were not supported by evidence tying those losses to the alleged misuse of trade secrets.

As to the cellphone theory, the court found that Parchem offered no evidence showing what confidential information was on the phone, how or when DePersia used it, or what event would allow a reasonable jury to infer misappropriation. The compliance officer’s inspection did not reveal anything suspicious, and DePersia stated under oath that she generally avoided saving business contacts on the phone and deleted any minimal, outdated business information before the inspection. The court concluded that Parchem relied on speculation and conclusory allegations rather than evidence sufficient to create a genuine factual dispute.

Disposition

Judge Kenneth M. Karas granted DePersia’s Motion for Summary Judgment. The court directed the clerk to terminate the motion, enter judgment for DePersia, and close the case.