TransPerfect Global, Inc. v. Lionbridge Technologies, Inc.

Background

TransPerfect sued Lionbridge Technologies, Inc. and H.I.G. Middle Market, LLC. It alleged that the defendants breached a confidentiality agreement and misappropriated information about TransPerfect’s operations to compete unfairly. The claims addressed in this opinion were trade-secret misappropriation under the federal Defend Trade Secrets Act and New York law, unfair competition, fraud, unjust enrichment, and breach of contract.

H.I.G. entered a confidentiality agreement with TransPerfect while considering a potential acquisition during a court-supervised auction. The agreement allowed H.I.G. and certain representatives to use TransPerfect’s evaluation materials only to assess the potential transaction. Credit Suisse mistakenly placed some unredacted TransPerfect documents in an online data room, including customer names and revenue information. H.I.G. and its advisers used some of that information in their auction-related evaluation. The court found no evidence that the information was shared with Lionbridge personnel responsible for pricing or sales.

TransPerfect later identified 92 documents that it said contained trade secrets. The court found that TransPerfect established that two categories of information—average payments to freelance linguists and revenue by customer—were trade secrets. But it found that TransPerfect did not provide sufficient evidence that the defendants acquired those trade secrets through improper means, used or disclosed them outside the permitted auction-related purpose, or caused the alleged damages. TransPerfect argued that the defendants used the information to compete for Merck and IQVIA business, but the court found those arguments rested on speculation rather than evidence connecting the information to the relevant bids or proposals.

Ruling

Summary judgment is a decision entered without a trial when the evidence shows that no reasonable jury could find for the opposing party on a material issue. Judge Denise Cote granted the defendants’ motion for summary judgment. The court held that TransPerfect had not shown trade-secret misappropriation under the federal or New York claims. The confidentiality agreement permitted the defendants’ documented use of the evaluation materials for the auction, and TransPerfect did not identify evidence that the materials reached the Lionbridge sales team or employees who prepared the Merck and IQVIA bids.

The court also held that the unfair-competition claim failed because it depended on the unsuccessful trade-secret claims. It deemed the fraud claim abandoned because TransPerfect did not oppose summary judgment on that claim. It dismissed the unjust-enrichment claim as duplicative of the breach-of-contract claim. The court held that TransPerfect had not shown a breach of the confidentiality agreement and deemed the contract claim abandoned as pleaded because TransPerfect attempted to rely on theories not stated in the operative complaint.

Damages

The court separately held that the defendants were entitled to summary judgment because TransPerfect had not shown recoverable damages caused by misappropriation. Its proposed unjust-enrichment damages relied on a report estimating hypothetical merger synergies, without identifying which trade secrets produced which benefits or connecting the estimates to actual changes in Lionbridge’s operations. Its lost-profit theory concerning Merck and IQVIA likewise lacked evidence that the defendants used TransPerfect’s information or that such use caused TransPerfect’s losses.

Disposition

The court granted the defendants’ July 16, 2021 motion for summary judgment. It directed the Clerk of Court to enter judgment for Lionbridge Technologies, Inc. and H.I.G. Middle Market, LLC and to close the case.