3 minute read | October.24.2016
To qualify as a trade secret under either the UTSA or the DTSA, the information in question must not be “readily ascertainable” through “proper means.” But what does “readily ascertainable” mean? If information is ascertainable by the public, but it would take some work to compile it, does that qualify as “readily ascertainable”?
A federal district court in Nebraska recently addressed this question, holding in McDonald Apiary, LLC v. Starrh Bees, Inc., that a database of beehive locations was a trade secret. Specifically, the court concluded that although the beehive locations “realistically” could be ascertainable through means that were not improper, the locations were not “readily” ascertainable given the purported effort necessary to do so. This decision begs the question how fine we can draw the line between “readily” and “realistically” ascertainable.
The case arose from an agreement between the plaintiff McDonald Apiary, LLC and the defendant Starrh Bees, Inc. to bring about 6,000 beehives to Oklahoma and Nebraska. Among other things, McDonald and Starrh had agreed: (1) to place the beehives in locations of McDonald’s choosing; (2) to share transportation costs; (3) that McDonald would extract any resulting honey at its facilities; and (4) that the parties would split the proceeds. McDonald and Starrh’s relationship eventually deteriorated, resulting in McDonald filing suit in 2014. McDonald asserted claims for trade secret misappropriation, breach of contract, and several intentional torts. As to its claim for trade secret misappropriation, McDonald alleged that Starrh misappropriated McDonald’s database of beehive foraging locations in Nebraska.
Starrh filed a motion for summary judgment, arguing that the locations of McDonald’s beehives were not trade secrets because they were ascertainable through proper means. Starrh argued that it could obtain the same information contained in the database by: (1) looking for beehive locations from public roads; (2) observing the area; and (3) using the Internet to obtain information about landowners and crops in the area. The court rejected Starrh’s argument, reasoning that although it may have been possible to ascertain the information through non-improper means, such information was not “readily” ascertainable:
It might have been possible to reconnoiter every highway, country road, and deer path in western Nebraska looking for every one of the approximately 23,000 [McDonald] beehives.... But the Court is not convinced that such a theoretical possibility is enough to make the location database “ascertainable.... ”