RRK Holding Co. v. Sears, Roebuck & Co., No. 04 C 3944, 2007 WL 495254 (N.D. Ill. Feb. 14, 2007) (Coar, J.).

Judge Coar denied defendant summary judgment on plaintiff’s trade secret and breach of contract (nondisclosure agreement) claims. The Court also granted defendant summary judgment on plaintiff’s unjust enrichment claim holding that because it was based upon the trade secret misappropriation allegations it was preempted by the Illinois Trade Secret Act (“ITSA”). Plaintiff alleged that, pursuant to a nondisclosure agreement, it disclosed to defendant its plans for its “combination tool” which consisted of a rotary saw, also called a spiral saw, which could be converted into a plunge router. But after negotiations broke down over price, defendant allegedly disclosed the idea to its Canadian subsidiary, which then allegedly disclosed the idea to another party, Choon Nang Electrical Appliance Manufacturing Ltd. (“Choon Nang”), that obtained a British design patent on the combination tool and produced it for defendant. 

The Court held that there was at least a question of fact as to whether the combination tool was maintained as a trade secret because: 1) plaintiff only disclosed the idea to defendant after receiving verbal assurances of confidentiality followed by a nondisclosure agreement; 2) plaintiff marked documents regarding the combination tool confidential; and 3) plaintiff presented evidence that both plaintiff’s and defendant’s combination tools enjoyed substantial sales upon their respective introductions to the market.

The Court also held that there was at least a question of fact as to whether defendant misappropriated the combination tool. The parties put forth conflicting evidence as to whether defendant disclosed the combination tool to Choon Nang, and, if it was disclosed, whether the disclosure occurred before or after Choon Nang filed its British patent application.