Trade Secrets. William Redmond, as the general manager for PepsiCo, Inc, in California, had access to the company's inside information and trade secrets. In 1994, Redmond resigned to become chief operating officer for the Gatorade and Snapple Co, which
makes and markets Gatorade and Snapple and is a subsidiary of the Quaker Oats Co PepsiCo brought an action in a federal district court against Redmond and Quaker Oats, seeking to prevent Redmond from disclosing PepsiCo's secrets. The court ordered Redmond not to assume new duties that were likely to trigger disclosure of those secrets. The central issue on appeal was whether a plaintiff can obtain relief for trade secret misappropriation on showing that a former employee's new employment will inevitably lead him or her to rely on the plaintiff's trade secrets. How should the court rule on this issue? Discuss fully.
Trade secrets
The U.S. Court of Appeals for the Seventh Circuit affirmed the order of the district court. The appellate court acknowledged that this was not a "traditional trade secret case." Under the applicable state statute, however, relief was available for the "actual or threatened" misappropriation of a trade secret. The court determined that Redmond inevitably would disclose PepsiCo's secrets if he accepted the job with Quaker Oats. The court noted that Redmond had "extensive and intimate knowledge" of PepsiCo's goals for its sports and new age drinks. Redmond and Quaker conceded that the information Redmond obtained at PepsiCo could influence him. The court explained that "PepsiCo finds itself in the position of a coach, one of whose players has left, playbook in hand, to join the opposing team before the big game."
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