An educational blog devoted to Florida contruction law topics by Florida Bar Board Certified Construction Lawyer, Trenton "Trent" Cotney. Please visit www.trentcotney.com for more information. Disclaimer below.
Safeguarding trade secrets can help put roofers in a better position to secure and retain skilled workers.
The lack of skilled labor is the number one threat to the roofing industry. To hire skilled supervisors, sales staff and management, roofers often have to look to competitors rather than hire employees new to the market. Given the competitive nature and demand for skilled labor, roofers have employed a variety of tactics to not only secure “loyalty,” but protect trade secrets and proprietary information.
The primary tool to enforce confidentiality is a detailed employment agreement. However, most roofing contractors have had access to The Uniform Trade Secrets Act (UTSA). Adopted by 48 states, the USTA provides states with remedies for the misappropriation of trade secrets for companies operating in multiple states.
The Defend Trade Secrets Act of 2016 (DTSA), effective May 12, now provides federal jurisdiction for trade secret misappropration. The DTSA doesn’t preempt state laws, such as the UTSA, but merely provides plaintiffs with the option to file a claim in federal or state court. This is a very important distinction as state laws may require more from a plaintiff. For example, California requires plaintiffs to describe its trade secrets with particularity, while federal law doesn’t. Therefore, the DTSA provides employers with the possibility of an easier route to prosecuting trade secret violations.
The Potential Impact
Why should roofers care? The DTSA can be used as a weapon by roofers against former employees that seek to use proprietary information and trade secrets. This could include misappropriation of specialized marketing information, customer lists, proprietary software and almost anything that isn’t reasonably ascertainable by a competitor.
What to Do?
There are certain things that should be done to take advantage of possible claims with the DTSA, since it allows roofers to aggressively pursue former workers that have misappropriated proprietary information for either their own use or use by a competitor.
Make sure you have detailed and enforceable employment agreements that contain confidentiality and non-compete language.
Identify and protect your company’s trade secrets.
Add the new whistleblower language to your employee agreements. Failure to add the language can result in an employer’s inability to get attorney fees and punitive damages.
By remaining vigilant and safeguarding trade secrets, roofers will be in a better position to secure and retain skilled workers.
The elements necessary to state a cause of action for fraud in the inducement are 1) a false statement concerning a material fact, 2) knowledge by the person making the statement that the representation is false, 3) intent by the person making the statement that the representation will induce another to act upon it, and 4) reliance on the representation to the injury of the other party. Mettler, Inc. v. Ellen Tracy, Inc., 648 So.2d 253 (Fla. 2d DCA 1994). Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com
A claim for unjust enrichment may be brought against a contractor or owner as an equitable claim to address unexecuted change orders. As the Court stated in Della Ratta v. Della Ratta, 927 So.2d 1055 (Fla. 4th DCA 2006), "to state a claim for unjust enrichment, a plaintiff must plead the following elements:1) the plaintiff has conferred a benefit on the defendant;2) the defendant has knowledge of the benefit;3) the defendant has accepted or retained the benefit conferred;and 4) the circumstances are such that it would be inequitable for the defendant to retain the benefit without paying fair value for it." Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333http://www.glennrasmussen.com
Butler v. Yusem, 44 So.3d 102 (Fla. 2010): "there are four elements to fraudulent misrepresentation: (1) a false statement concerning a material fact; (2) the representor's knowledge that the representation is false; (3) an intention that the representation induce another to act on it; and (4) consequent injury by the party acting in reliance on the representation."
Trenton H. Cotney Board Certified in Construction LawTrent Cotney, P.A.1207 N Franklin St, Ste 222Tampa, FL 33602(813) 579-3278www.trentcotney.com