This Fight Isn’t About Who Keeps the Billy Joel Albums: Maryland Divorce Firm Served With Trade Secret Misappropriation Suit Alleging $350 Million in Damages

By April 8, 2015Trade Secrets

90063Now THIIS is one we’ve never seen before at Sullivan’s Trade Secrets.  Law360 is reporting that a Maryland-based divorce firm has been sued in federal court in Maryland for allegedly stealing and copying a computer program designed and owned by a couple of companies owned and operated by Donald Bailey Sr. Who is Donald Bailey Sr.?!?  Apparently the soon-to-be-ex-husband of Mrs. Bailey and Mrs. Bailey is represented in the divorce action by Joseph, Greenwald and Laake’s Stephen Friedman.

What is Mr. Friedman allegedly doing with this computer program?  Well, according to Donald Bailey Sr., Mr. Friedman “allegedly uploaded and copied more than 800 pages of client information and copyrighted code that belonged to Bailey’s companies. Other government contractors will now be able to edge out his product in bidding because the security of his program was compromised when his wife stole it and handed it off to the divorce attorney.”

The computer program in question is owned by plaintiffs Zegato Solutions Inc. and Aldmyr Systems Inc., both Bailey’s companies, according to the complaint.  Bailey apparently alleges that the fact that Mr. Friedman and soon-to-be-ex Mrs. Bailey possess the program and won’t return it to Bailey’s companies depletes and depreciates the value of the program in his/their hands because the code’s security now has to be identified to all potential purchasers as compromised.  Bailey Sr. also apparently claims that Mr. Friedman and Mrs. Bailey are using their possession of the code as a “bargaining chip” and are trying to extract $1.5 million for its safe return.

Well – that’s a new twist in the world of trade secrets.  We’ll keep an eye on this one for you.



Author Todd Sullivan

Todd has a niche practice focusing on employee departures and defections, including the litigation of injunctions and trials in cases involving noncompete and nonsolicitation covenants, trade secret misappropriation, allegations of unfair competition, duty of loyalty breaches, inevitable disclosure, and employee raiding. His clients are companies and key employees who seek his advice regarding the retention and separation process; he routinely drafts, reviews, and negotiates employment retention and separation agreements. As lead counsel, Todd has litigated more than 100 employee defection matters in federal and state trial and appellate courts and has arbitrated others throughout the United States. His clients span every industry sector — banking, insurance, biotechnology, manufacturing, life sciences, computer services, computer software, personnel placement, securities brokerage, advertising, radio and television broadcasting, legal medical and architectural professional services, government contracting, and even NASCAR. Todd recently served as lead defense counsel in one of the most significant broker defection cases ever tried before FINRA and also as lead plaintiff’s counsel in the largest-ever case of trade secrets theft in North Carolina.

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