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Keywords

lawsuitdamagestrade secretconfidentiality agreement
contractwillcircumstantial evidenceconfidentiality agreement

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Retiree, Inc. v. Anspach, 660 Fed.Appx. 582, 62 Employee Benefits Cas. 2418

Facts

Retiree, Inc., a retirement-planning firm, developed a unique methodology for decumulation, which included a complex Excel model. Anspach, a financial planner, signed a confidentiality agreement with Retiree after considering a merger but later formed her own company, Sensible Money. Retiree alleged that Anspach used its confidential information to create her own financial planning tools after leaving the firm, leading to the lawsuit.

Retiree, Inc., a retirement-planning firm specializing in decumulation—the process of efficiently drawing down retirement assets.

Issue

Did Anspach breach the confidentiality agreement by using and disclosing Retiree's confidential information?

Did Anspach breach the confidentiality agreement by using and disclosing Retiree's confidential information?

Rule

In Kansas, confidentiality agreements are enforceable to protect legitimate business interests, including trade secrets and confidential information, as long as the restrictions are reasonable under the circumstances.

In Kansas, it is well recognized that a restrictive covenant in an employment contract will only be applied to the extent it is reasonably necessary under the facts and circumstances of the particular case.

Analysis

The court found that Anspach appropriated the processes and methodology underlying Retiree's software, despite her claims that her methods were industry standards. The evidence showed that Anspach's post-Retiree spreadsheets were significantly more sophisticated than her pre-Retiree models, suggesting she used Retiree's confidential information. However, the court found insufficient evidence to support the claim that Anspach disclosed this information to third parties.

The court further found that Anspach was able to develop a spreadsheet far more sophisticated that the one she used prior to her affiliation with Retiree in only six months, and concluded this was strong circumstantial evidence that she used Retiree's methods.

Conclusion

The court affirmed the district court's ruling regarding the breach of confidentiality but reversed the damages awarded for disclosure, concluding that the evidence did not support that claim.

We reach the opposite conclusion as to Retiree's disclosure claim.

Who won?

Retiree, Inc. prevailed in part because the court upheld the finding that Anspach breached the confidentiality agreement by using Retiree's proprietary processes.

Retiree, Inc. prevailed in part because the court upheld the finding that Anspach breached the confidentiality agreement by using Retiree's proprietary processes.

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