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See _T.C.A._ @ 47251701(2001).Forthesereasons,theActisinapplicabletothecaseatbar.(|G2$ !.8tdd8         0  <s-s   R$      5  <  _ThislistcanstillbefoundintheRestatementofLaw,Third,UnfairCompetition39,DefinitionofTrade  Secret,commentd(1995). d  R$      3  <  _Thatconfidentialityagreementprovidesthat confidentialinformationincludes:businessrecordsandplans;  financialstatements;customerlistsandrecords,tradesecrets;technicalinformation;products;inventions;product x designinformation;pricingstructure,discounts;costs;computerprogramsandlistings;copyrightsandotherintellectual @ property;moldfixtureconstructiontechniques;Odysseymoldingtechniques,andotherproprietaryinformation.(|3$ !.8tdd8     VVVV'dxd)!dxdx( $ Figure  1  ^_X`YE<<CLevel 1Level 2Level 3Level 4Level 5(|3$ !.8tdd8     ($$   1  X[Z&OLE 2.0 Box <=8C HKKKK],EAGLEV~1.OP3|xUHP LaserJet 4 Plus,,,,,,03#37=CIQYag1.a.i.(1)(a)(i)1)a)(O$ji) !.8tdd8     _  t8XXdd8  @ tINTHECOURTOFAPPEALSOFTENNESSEE  @%ATJACKSON#t #Ԉ ,   February20,2002Session X XXt #tXX#EAGLEVISION,INC.v.ODYSSEYMEDICAL,INC.,etal.XXt   `  ADirectAppealfromtheChanceryCourtforShelbyCounty  h @@No.1101183TheHonorableD.J._Alissandratos_,Chancellor  X @@*AV) ` dE<` A (  @@TTNo.W200101772_COA_ԄR3CVFiledAugust14,_2002_ '  AV) ` dE<` A      XXXX  Thisisanactionformisappropriationoftradesecretsinwhichthemanufacturerofasurgical  productallegedlymisappropriatedtheproductdesignandmarketedacompetingproductafterthe  developerdiscontinueditsrelationshipwithmanufacturer.Trialcourtgrantedsummaryjudgment  infavorofmanufactureronallclaims.Wereverseandremand. z #XXXX##tXXy#XXt Tenn.R.App.P.3;AppealasofRight;JudgmentoftheChanceryCourtReversedand F Remanded  6   #tX#XX.tW.FrankCrawford,P.J.,W.S.,deliveredtheopinionofthecourt,inwhichAlanE._Highers_, f J.andWilliamB._Acree_,Jr.,_Sp.J._,joined. V RobertE._Craddock_,Jr.;JohnS.Wilson,III,Memphis,ForAppellant,EagleVision,Inc. 6 RandallD.Noel;DanielW.VanHorn,Memphis,forAppellees,OdysseyMedical,Inc.,andGary  _Tatge_    OPINION #tXX#XXt "! #tXX #XXt  8XdXXd8  Thisactionformisappropriationoftradesecrets,breachofcontract,breachoffiduciaryduty, v$# andconversionarisesoutofthemanufactureofasurgicalproduct.Plaintiff/AppellantEagleVision, f% $ Inc.( EagleVision)developsandmarketsproductsforopthamalogicsurgery.M  #  1      ׀In1995,Curtis V&!% Freeman,presidentofEagleVision,approachedGaryTatge,presidentofOdysseyMedical,Inc. F'"& ( Odyssey),aboutthepossibilityofOdysseymanufacturingadevicecalleda _punctum_ԀplugNX  #  2      ׀for 6(#' EagleVision( Plug). &)v$(   Therecordindicatesthat,attheinitialmeetingbetweenFreemanandTatge,theparties  discussedconfidentialityagreements,butthatMr.Freemanwastheonlyonewhosignedsuchan  agreement,apparentlyleavingopenthepossibilityofMr.Tatgesigningasimilaragreementatalater  date. Therewerenootherdiscussionsregardingconfidentialityagreementsbetweenthepartiesuntil  afterthepartieshadbeenworkingtogetherforseveralyears. p   InordertofacilitatethemanufactureofthePlug,EagleVisionprovidedOdysseywith P  detaileddrawingsandinformationregardingthePlugsdesign,aswellasasampleplug.Fromthe @  sampleplug,Odysseymademeasurementswhichitthencomparedtothedrawings,and 0  manufacturedthedevice.BasedupontheirinspectionofthedeviceOdysseyhadmanufactured,  p  EagleVisionandOdysseyenteredintoa feeforservicesvendorarrangement, andsignedaLetter `  ofUnderstandingonAugust23,1995.Neitherthesedocuments,noranyotherdocumentssetting P  outtherelationshipbetweentheparties,containsaconfidentialityclauseornoncompeteprovision @  infavorofEagleVision,orwordssuchas confidentialor tradesecret.However,EagleVisions 0  designspecificationsdrawings,whichOdysseyusedtoenterdataintoitsComputerAssistedDesign   ( CAD)software,wereclearlymarked, Confidential.    AspartofitsrelationshipwithEagleVision,Odysseyprovidedregulatoryconsulting  servicestoEagleVision,whichgaveOdysseyaccesstoEagleVisionsFDAfiles,includingpatient  complaintinformation. TherecordindicatesthatOdysseywasawareofEagleVisionsdesirethat  therelationshipbetweenthepartiesandtheinformationcommunicatedbetweenthembekept p confidential.Inthisregard,therecordestablishesthatOdysseyrequireditsemployeestoexecute ` aconfidentialityagreementwhichprovidedthattheOdysseyemployeemustprotectconfidential P information, regardlessiftheinformationisthedirectpropertyofOdysseyorisprotectedunder @ aseparateagreementwithathirdparty.W  #  3      ׀TherecordalsocontainsevidencetotheeffectthatMr. 0 Tatgemadenotationsto, KeepallEagleConfidential,and lockeverythingup.Whenaskedin  p depositionwhetherMr.Tatgecommunicatedtheneedto keepallEagleconfidential,Odyssey ` employeeRayWallacetestifiedthat, Ourdesireatthispointintimewastomaintaingood P separationbetweenEagleVisionandanythingelseweweredoing. @   AfterOdysseyhadmanufacturedthePlugforEagleVisionforseveralyears,thepartieshad   apartingofthewaysoverapriceincreaseOdysseyrequested.InadditiontorejectingOdysseys ! requestfortheincreaseinpricetoEagleVision,EagleVisionaskedOdysseytoexecuteanon "  competeagreement,whichOdysseyrefusedtosign.Afterthepartiesfailedtoreachanagreement, #! Odysseyclaimsitbegantodevelopitsownpunctumplug,whichitbeganmarketingin1997. $"   OnOctober24,1997,EagleVisionfiledaComplaintagainstOdysseyandTatgeforbreach p&!$ ofcontract,misappropriationoftradesecrets,breachofimplieddutyofconfidentiality,breachof `'"% fiduciaryduty,andconversion.OdysseyandTatgefiledseparateanswers,andOdysseyfileda  counterclaimforanunpaidbalanceonEagleVisionsaccount.OnJanuary11,2000,Odysseyfiled  amotionforpartialsummaryjudgmentonEagleVisionsmisappropriationoftradesecretsclaims  (specifically,theplugsdimensionsandmaterialspecifications).OnMay5,2000,thetrialcourt  grantedpartialsummaryjudgmentonthoseissuesinfavorofOdyssey.Thetrialcourtsorderreads, p inrelevantpart: `  8  8`    ItappearingtotheCourtthatuponDefendantsMotionfor @  PartialSummaryJudgmentandsupportingMemorandum;uponthe 0  Responseoftheplaintiffthereto;upondefendantsReply  p  Memorandum;uponalloftherespectiveexhibitsandstatementsof `  undisputedfactfiledbytheparties;uponthedepositionsfiledherein; P  upontheoralargumentofcounseloccurringinopenCourtonApril @  12,2000;upontheCourtsownresearchoftherelevantcaselaw;and 0  upontheentirerecordherein,themotionofOdysseyMedical,Inc.   andGaryTatgeforPartialSummaryJudgmentiswelltakenand  shouldbegranted...` x` x 8  8`    ITISTHEREFORE,ORDERED,ADJUDGEDAND  DECREEDthat thedimensionsofthemarketedEagleVision  punctumplugs,aswellastheuse,selectionandgradeofsilicone p comprisingtheplugmaterial,andtheuse,selectionandpercentage ` oftitaniumdioxideastheplugtintagentarenottradesecrets.... P` x` x (emphasisadded). 0   OnJune6,2000,Odysseyfiledasecondmotionforsummaryjudgmentonthecounterclaim ` fortheunpaidbalance,whichthetrialcourtgrantedinfavorofOdysseyonAugust1,2000,placing P thefundsinescrowpendingtheresolutionofthecase.And,finally,onNovember6,2000,Odyssey @ fileditsthirdmotionforsummaryjudgmentonEagleVisionsremainingclaims.Inresponsetothis 0 motion,EagleVisionwaivedorabandonedalltheclaimswiththeexceptionofthemisappropriation   oftradesecretsclaimsastotolerancedata,breachofcontract,andbreachoffiduciaryduty.On ! April2,2001,EagleVisionfiledamotiontoreconsiderOdysseysfirstmotionforsummary "  judgment,whichthetrialcourtultimatelydeniedonJuly9,2001. #!   OnMay21,2001,thetrialcourtgrantedsummaryjudgmentonallremainingclaims.Eagle % # Visionappealsthisfinalorder,andpresentsthefollowingissuesforreview:(1)Whetherdisputed p&!$ evidenceofDefendantsabilitytoreverseengineerPlaintiffsproductraisesgenuineissuesof `'"% materialfactthatprecludesummaryjudgment;(2)Whetherthehypotheticalabilitytoreverse P(#& engineeraproductsexcusesthemisappropriationofconfidentialinformation;and(3)Whethera @)$' vendorswrongfulretentionofavendeespropertycreatesarightofsetoffagainstunpaidinvoices 0*%(  submittedbythevendor.  +p&) OXXXX  Amotionforsummaryjudgmentshouldbegrantedwhenthemovantdemonstratesthatthere   arenogenuineissuesofmaterialfactandthatthemovingpartyisentitledtoajudgmentasamatter  oflaw. See Tenn.R.Civ.P.56.04.Thepartymovingforsummaryjudgmentbearstheburdenof  demonstratingthatnogenuineissueofmaterialfactexists. See#XXXOX]-#OXXXXԀ_Bain_Ԁv.Wells ,936S.W.2d618,622  (Tenn.1997).Onamotionforsummaryjudgment,thecourtmusttakethestrongestlegitimateview p oftheevidenceinfavorofthenonmovingparty,allowallreasonableinferencesinfavorofthat `  party,anddiscardallcountervailingevidence. See#XXXOXc/#OXXXXԀid. In Byrdv.Hall ,847S.W.2d208(Tenn. P  1993),ourSupremeCourtstated: @  8  8`   Onceitisshownbythemovingpartythatthereisnogenuineissue  p  ofmaterialfact,thenonmovingpartymustthendemonstrate,by `  affidavitsordiscoverymaterials,thatthereisagenuine,materialfact P  disputetowarrantatrial.Inthisregard,Rule56.05providesthatthe @  nonmovingpartycannotsimplyrelyuponhispleadingsbutmustset 0  forthspecificfactsshowingthatthereisagenuineissueofmaterial   factfortrial.8` x` x  Id. at21011(citationsomitted)(emphasisinoriginal).    Summaryjudgmentisonlyappropriatewhenthefactsandthelegalconclusionsdrawnfrom  thefactsreasonablypermitonlyoneconclusion. See#XXXOX*1#OXXXXԀ_Carvell_Ԁv.Bottoms ,900S.W.2d23,26(Tenn. p 1995).Sinceonlyquestionsoflawareinvolved,thereisnopresumptionofcorrectnessregarding ` atrialcourt'sgrantofsummaryjudgment. See#XXXOX5#OXXXXԀ_Bain_ ,936S.W.2dat622.Therefore,ourreviewof P thetrialcourtsgrantofsummaryjudgmentis denovo ontherecordbeforethisCourt. See#XXXOX6#OXXXXԀWarren @ v.EstateofKirk ,954S.W.2d722,723(Tenn.1997).#XXXOX7#XXXX 0   Wewillconsiderthefirstandsecondissuestogether.Theelementsinanactionfor  \ misappropriationoftradesecretsaresetoutin HickorySpecialties,Inc.v.B&LLaboratories,Inc. , H 592S.W.2d583(Tenn.Ct.App.1979),wheretheCourtsaid: 4 8  8`    Theelementsrequiredinaninjunctivetradesecretssuitare   setforthin Smithv._Dravo_ԀCrop., [203F.2d369(7thCir.1953)],as ! theexistenceofatradesecretwhichiscommunicatedtothe "  defendantwhilethedefendantisinapositionoftrustandconfidence #! anduseofthatinformationbythedefendanttoplaintiffsdetriment. l$" Thefactthatthesecretcouldhavebeendiscoveredbythedefendant, X% # throughhisownskillsandinitiative,isnotdeterminative.Theissue D&!$ iswhethertheinformationwasactuallyprocuredthrougha 0'"% confidentialrelationship.(l#&` x` x  Id. at586. )D%(   *0&)   Inconsideringtheseissues,theseminalquestioniswhetherthespecificationsofEagle   Visions_punctum_Ԁplugconstitutetradesecrets.Q  #  4      ׀Onthisquestion,theCourtin HickorySpecialties,  Inc.v.B&LLaboratories,Inc.,supra, said:  8  8`    Tradesecretsaredefinedin Allis_Chalmers_ԀMfg.Co.v. ` ContinentalAviation&Eng.Corp., 255_F.Supp_.645(E.D.Mich. L  1966):8 ` x` x 8  8`   8 ` x` x[_T]he_Ԁweightofmodernauthority...holdsthat a  ` tradesecretmayconsistofanyformula,process,  L  pattern,deviceorcompilationofinformationthatis  4  usedinonesbusinessandwhichgiveshiman   opportunitytoobtainanadvantageovercompetitors   whodonotuseit. [Citationsomitted.]P.653.    8  8`   Ontheissueofsecrecy,theCourtcontinued:t ` x` x 8  8`   8 ` x` xThesubjectmatterofatradesecretmustbesecret. L  Mattersofpublicknowledgeorgeneralknowledge 8 intheindustryorideaswhicharewellknownor  p easilyascertainable,cannotbetradesecrets.  X Similarly,mattersdisclosedbyamarketedproduct D cannotbesecret.However,theproprietorofthe 0 businessmaycommunicatethesecrettoemployees  involvedinitsuse,ortootherspledgedtosecrecy.  Ibid.   592S.W.2dat58687(emphasisadded). h    Determinationofwhetherinformationconstitutesa tradesecretisaquestionoffact. See @  VentureExpressv._Zilly_ ,973S.W.2d602,606(Tenn.Ct.App.1998); ArkansasDailies,Inc.v. ,!| Dan ,260S.W.2d200,204(Tenn.Ct.App.1953).Indeterminingthisfactualquestion,Tennessee "h  CourtshaveinvokedtheRestatementofTorts757,commentb(1939)U  #  5      ,whichprovides: #T!   #@" 8  8`    Somefactorstobeconsideredindeterminingwhethergiven   informationisone'stradesecretare:(1)theextenttowhichthe  informationisknownoutsideofhisbusiness;(2)theextenttowhich  itisknownbyemployeesandothersinvolvedinhisbusiness;(3)the t extentofmeasurestakenbyhimtoguardthesecrecyofthe ` information;(4)thevalueoftheinformationtohimandtohis L  competitors;(5)theamountofeffortormoneyexpendedbyhimin 8  developingtheinformation;(6)theeaseordifficultywithwhichthe $ t informationcouldbeproperlyacquiredorduplicatedbyothers. `` x` x  See,e.g.,VentureExpress ,973S.W.2dat602.  8    OdysseyhasofferedevidencethatithadtheabilitytotakeEagleVisionsplugand,utilizing   adevicecalledan optical_comparator_inconjunctionwithEagleVisionsdrawings,manufacture   asampleplug,withwhichEagleVisionsrepresentativeswere extremelyimpressed.Itwasthe   qualityofthissampleplugwhichconvincedEagleVisiontoenterintoavendorvendeerelationship   withOdyssey.Baseduponthisevidence,OdysseyarguesthatthespecificationsofEagleVisions p punctumplugare easilyascertainable,and,therefore,nottradesecrets. \   Ontheotherhand,EagleVisionpresentedevidencethatthePlugsdesignspecificationsare 4 not easilyascertainablefromavisualinspectionofitsproduct.EagleVisionclaimsthatthedevice  p capableofmeasuringthePlugsdimensionsis highlysophisticated,andutilizesavery tricky  \ process.EagleVisionexplainsthat,evenwithsuchdifficultmeasurements,thedevices H dimensionaltolerancesarenotdisclosedbyavisualinspectionoftheproduct,andwouldhavebeen 4  impossibleforOdysseytodiscover.     Aswehavenotedabove,oneofthefactualconsiderationsinthedeterminationofwhat  constitutesatradesecretis theeaseordifficultlywithwhichtheinformationcouldbeproperly  acquiredorduplicatedbyothers.RestatementofTorts757,commentb. ThisCourt,in Hickory  Specialties ,notedthat,ifamatteris disclosedbyamarketedproduct[it]cannotbeasecret.592 l S.W.2dat587.However,whethersomethingthatcanonlybedisclosedbyusingsophisticated X  equipmentandacomplexprocessis,nonetheless, easilyascertainable,isnotadetermination D! properlymadeonamotionforsummaryjudgment. 0"    Inthecaseatbar,weholdthatthequestionofwhetherEagleVisions_punctum_Ԁplugdesign $X" constitutesa tradesecretisanissueofmaterialfactwhichprecludessummaryjudgment.The $D # partiesthemselvesdisputeatleastonefactweholdismaterialtotheresolutionofthiscase:whether %0!$ OdysseymisappropriatedtolerancedataitgatheredforusewithCADsoftware. &"%    EagleVisionslastissueforreviewconcerningEagleVisions setoffclaimhaspreviously (#' beendismissedbyOrderofthisCourtfiledJanuary15,2002. )$(   |*%)   TheorderofthetrialcourtgrantingsummaryjudgmenttoDefendantsisreversed.Thecase   isremandedtothetrialcourtforsuchfurtherproceedingsasmaybenecessary.Costsoftheappeal  areassessedagainstAppellees,OdysseyMedical,Inc.andGaryTatge.  #XXXX8##tXX #XXt     `     h   __________________________________________ D     `     h   W.FRANKCRAWFORD,PRESIDINGJUDGE,W.S.