Trade Secret Protection | Former Employees Get Sued by Honeywell

Trade Secret Laws Blog: Honeywell Sues Akebono and Two Former Employees for Trade Secrets Theft

On July 24, 2008, Honeywell International sued Akebono Corporation, Akebono Brake Industry Co., Ltd. and Sunil Kesavan and Ximming Shao for misappropriating trade secrets that relate to the making of fiction materials for automotive brake pads.

Honeywell claims that a secret process one of its employees designed for the making of automotive brake pad materials has been maintained as a trade secret from 1996 until the present. Honeywell further claims that Kesavan and Shao, who left employment with Honeywell in 2002 and 1999 respectively, began work with Akebono and used information Honeywell maintained to research and develop, and ultimately received a US patent for, brake systems that utilize Honeywell's confidential and trade secret information.

Under trade secret protection law, Honeywell is now trying to get the genie back in the bottle. Their first two claims for relief are to have the Akebono patent declared the property of Honeywell and correct the "named inventor" for the patent to be exclusively their employee (see http://uspto.gov/web/offices/pac/mpep/documents/appxl_35_U_S_C_256.htm) and not Kesavan and Shao and, ultimately, Akebono.

The case is filed in the United States District Court for the Eastern District of Michigan and is case number 2:08-CV-13197.

Most employees fail to realize that trade secrets, ideas and inventions often belong to the employer. Non-compete agreements are often overlooked when seeking new employment. In Michigan, non-compete agreements are often enforceable for trade secret protection.

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Employees need to be more cautious about starting a business which competes against a former employer. Even if there is no non-compete agreement, confidential information and trade secrets are still protected under Michigan law.

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