Former Employee Accused Of Spilling Secret Beer Recipe In Furtherance Of Class Action Cannot Strike Claims Under Anti-SLAPP Statute

Author:Ms Anne Dunne and Dawn Mertineit
Profession:Seyfarth Shaw LLP

Last week, the Ninth Circuit finally ruled that a former Anheuser-Busch employee cannot avoid claims filed by the brewer alleging misappropriation of trade secrets and breach of a nondisclosure agreement, the latest in a long running saga that started when Anheuser-Busch filed suit 6 years ago. Former Anheuser-Busch employee James Clark ("Clark") had filed a motion to strike the company's trade secrets claims accusing him of stealing proprietary information under the California Anti-SLAPP statute ("strategic lawsuits against public participation").

California is one of 28 states that have enacted anti-SLAPP statutes, having done so after observing a "disturbing increase in lawsuits brought primarily to chill the valid exercise of the constitutional rights of freedom of speech and petition for the redress of grievances." California's statute contains a two prong test. First, the defendant must establish that suit was filed in response to "any act . . . in furtherance of the person's right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue." Once a defendant has established that the suit was brought to chill petitioning activity, the action will be "be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim."

The district court denied Clark's initial motion, but the Ninth Circuit reversed and remanded in November 2015, holding that Clark's disclosure of the recipe to counsel in...

To continue reading