Stout’s Intellectual Property Disputes team recently supported counsel in achieving a successful outcome for Recycle Track Systems (RTS). RTS provides waste management brokerage services for large corporations and municipalities. RTS offers a product, Pello, to optimize trash collection schedules, reduce waste, and enhance the redirection of waste from landfills using artificial intelligence and machine learning technology.

RoadRunner Recycling, a former component supplier and partner of RTS, filed a trade secret lawsuit against RTS concerning its Pello sensor technology. RoadRunner alleged trade secret misappropriation under the California Uniform Trade Secret Act and the Defend Trade Secrets Act. The lawsuit, filed in the Northern District of California, also included several breach-of-contract allegations.

During expert discovery, we prepared a rebuttal damages report to evaluate the reasonableness of the plaintiff’s lost profits and unjust enrichment damages claims and defended our rebuttal opinions in a deposition. Leading up to trial, we supported counsel in addressing all of RoadRunner’s trade secret allegations and damages claims. This effort resulted in the exclusion of the plaintiff’s expert’s damages opinion related to RoadRunner’s trade secret claims.

Ultimately, RTS achieved a complete defense verdict on all trade secret allegations at the summary judgment stage. With only a breach-of-contract allegation remaining, the dispute settled, allowing RTS’s Pello device to remain on the market.