Do Lawyers Have Trade Secrets?

That, at least, is the question implicit in a report from Texas Lawyer concerning a dispute between two Houston law firms engaged in a lawsuit in which a TRO was recently entered.

Here’s a short summary of the facts as reported: last year, the former office manager of Schrader & Associates was charged with embezzling more than $200,000 from the firm. This January, Schrader learned that she may also have taken “confidential, proprietary and privileged information,” including trade secrets, and shared it with another firm, Stefanides & Associates.

How Schrader learned of this is strange, to say the least. According to an affidavit he filed, Stefanides’ wife and law partner told him she had seen his confidential work product on their firm’s computers.

Texas Lawyer reports that the former office manager offered to “teach” Stefanides how to do asbestos litigation in return for an agreement to split the proceeds 50-50. When he learned the office manager was not a lawyer, he hired her as “Director of Marketing.”

The trade secrets apparently relate to the firm’s “strategy and method of prosecuting asbestos cases and other mass toxic tort cases.”

Proving that that is a trade secret may be a tough proposition under orthodox trade secrets principles. Allowing former employees to steal stuff, though, is also tough for judges to swallow.

Judge John Donovan, no exception to the rule, issued a TRO on January 30 prohibiting any use of the information.

How this one plays out could be interesting.