Introduction: An engineering services contractor alleged that an employee had unlawfully obtained confidential information and trade secrets to his benefit when he established a competing company. Baker & O’Brien addressed the allegations by reviewing the documents allegedly taken and classifying them according to common industry knowledge or company proprietary. We estimated their value, if any, for allegedly unauthorized use and gave testimony in mediation, deposition, and a court trial.

According to the World Trade Organization, intellectual property rights are the rights given to persons over the creations of their minds. They usually give the creator an exclusive right to use their creation for a specified time. Copyrights and industrial property are two main areas of intellectual property. Industrial property can be divided into two main areas. One type protects distinctive signs such as trademarks and geographical indications (e.g., Champagne). A second type of industrial property is protected to stimulate innovation, design, and the creation of technology.

We worked on a dispute that involved the latter form of intellectual property, namely corporate documents. An engineering services contractor made an allegation claiming that an employee had unlawfully obtained confidential information and trade secrets to his benefit when he established a competing company. The employee claimed the information was common industry knowledge or had been created in his mind. Baker & O’Brien was engaged to address these allegations. Our experts, with engineering service industry experience, diligently reviewed the documents allegedly taken and classified them into either common industry knowledge or proprietary/confidential files. We developed a detailed information breakdown covering financial and business operations, service procedures, and scientific and technical issues.

Additionally, if Baker & O’Brien was to have determined that any information was not common industry knowledge, we were requested to assess its value. Baker & O’Brien consultants have experience appraising various assets across the energy industry. Typically, our asset valuation process entails estimating the fair market value of income-producing assets involving the physical condition of the assets, as well as their capacity to generate income in the future.

That approach works reasonably well when considering the value of a tangible asset by comparing its value to the known value of the same or similar tangible asset. In this case, Baker & O’Brien applied a cost-based valuation method that considered the time an engineering service provider would have typically spent developing that information. We prepared a model to estimate the value, if any, for the allegedly unauthorized use. We gave testimony in mediation, deposition, and a court trial.