9-4 ATTORNEYS' FEES—CPRC § 134A.005

• Jurisdiction: United States

9-4 Attorneys' Fees—CPRC § 134A.005

Prior to TUTSA's enactment, the Texas Theft Liability Act was the primary avenue for the trade secret plaintiff to recover attorneys' fees.⁸⁵ Now, under TUTSA, a court has discretion to award "reasonable" attorneys' fees to the prevailing party if "(1) a claim of misappropriation is made in bad faith; (2) a motion to terminate an injunction is made or resisted in bad faith; or (3) willful and malicious misappropriation exists."⁸⁶ Neither TUTSA nor UTSA defines "bad faith," and, as discussed above, "willful and malicious misappropriation" has only recently been clarified. Courts seeking to apply this provision, however, typically look to comparable statutes to supply definitions in the trade secret context.⁸⁷ For example, in a separate context, Texas courts have established that "[b]ad faith is not simply bad judgment or negligence; rather, it is the conscious doing of wrong for dishonest, discriminatory, or malicious purposes."⁸⁸

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Notes:

^[85] Although TUTSA now preempts TTLA claims, the new statute makes clear that it has no effect on contract remedies relating to trade secret misappropriation. This means that attorneys' fees may be available based on contractual remedies regardless of TUTSA's application.

^[86] Tex. Civ. Prac. & Rem. Code Ann. § 134A.005.

^[87] See, e.g., Bradbury Co. v. Teissier-Ducros, No. 03-1391-WEB, 2005 U.S. Dist. 387 F.Supp.2d 1167 (D. Kan. Nov. 3, 2005) (finding other states' interpretations of the UTSA persuasive in defining bad faith); Russo v. Baxter Healthcare Corp., 51 F.Supp. 2d 70, 76 (D.R.I. 1999) (applying bad faith standard under the Rhode Island rules of civil procedure).

^[88] Parker v....