Saved Development Costs Available as Measure of Damages

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Judge Phyllis J. Hamilton of the Northern District of California issued an order this week on motions for partial summary judgment in Oracle Corp. v. SAP AG, et al., No. C 07-1658 PJH, 2010 WL 3258603 (N.D. Cal. Aug. 17, 2010) (slip op.).   In considering whether recovery of “saved development costs” is an available measure of damages, the court  distinguished Ajaxo, Inc. v. E*Trade Group, Inc., 135 Cal. App. 4th 21 (2005);

Ajaxo was a case in which defendant E*Trade gave the plaintiff’s trade secrets to one of the plaintiff’s competitors, which used the trade secrets and saved some development costs for E*Trade.

The court, in dictum, stated that “these cases are inapposite because, unlike the contract or tort claims for which plaintiffs’ unjust enrichment claim serves as an alternative here, trade secret law allows recovery of saved development costs.” Id. *14.

By CHARLES H. JUNG

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