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Olson v. Nieman's5/28/1998
et. Nieman's final contention is that Olson failed to present sufficient evidence to support a verdict against Nieman for misappropriation of a trade secret. For that reason, Nieman argues, the district court erred in not sustaining its motions for directed verdict and judgment notwithstanding the verdict.
Our review is for correction of errors at law. Iowa R. App. P. 4.
In considering the grounds for these motions, we view the evidence in accordance with the same principles that guide the district court in its review. Smith, 464 N.W.2d at 684. The standard is whether there is sufficient evidence to submit a party's claim to the jury. Id.
In making this determination, we, like the district court, must view the evidence in the light most favorable to the party against whom the motions were made. Id. If substantial evidence supports each of the elements of the plaintiff's claim, the district court should deny the motions. Id. Conversely, if there is no such substantial evidence, a directed verdict or judgment notwithstanding the verdict in the defendant's favor is appropriate. Id. "Evidence is substantial if reasonable minds could accept it as adequate to reach the same findings." Tim O'Neill Chevrolet, Inc. v. Forristal, 551 N.W.2d 611, 614 (Iowa 1996).
1. Trade secret. Olson's action for misappropriation of a trade secret arose under Iowa Code chapter 550, which defines a trade secret as:
nformation, including but not limited to a formula, pattern, compilation, program, device, method, technique, or process that is both of the following: a. Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by a person able to obtain economic value from its disclosure or use. b. Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
Iowa Code ยง 550.2(4) (emphasis added).
Nieman argues that Olson's device was generally known and readily ascertainable by proper means and was not economically valuable from not being generally known. Nieman argues further that Olson did not make reasonable efforts to maintain secrecy.
a. Not being generally known and readily ascertainable by proper means. To show that Olson's device was generally known, Nieman relies upon prior art in the form of the patents previously referred to in our discussion of Harms' testimony. As mentioned, the district court did not abuse its discretion in allowing Harms' testimony regarding the patentability of Olson's device. Harms testified Olson's device would not have been obvious to one of ordinary skill in the art-the necessary elements for patentability. He opined that Olson's device was patentable. In reaching that Conclusion, Harms found none of the patents in evidence destroyed the novelty of Olson's device. This testimony was substantial evidence that Olson's device was not generally known and readily ascertainable by proper means.
b. Economic value from not being generally known. Nieman also contends that Olson's device did not obtain economic value from not being generally known. In support of its contention, Nieman argues that the device could have been reverse engineered by competitors as soon as it was produced, and therefore it would not have remained secret.
"Economic value" in section 550.2(4)(a) means "value of the information to either the owner or a competitor; any information which protects the owner's competitive edge or advantage." U.S. West Communications, Inc. v. Office of Consumer Advocate, 498 N.W.2d 711, 714 (Iowa 1993). Although Olson's device could be reverse engineered once place
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