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ARTICLE · 28 NOVEMBER 2018

A Dismissal Without Prejudice May Not Support Fee Award Under The DTSA

In a case of first impression, Judge Gregg Costa of the Fifth Circuit, affirming a lower court decision, held that a dismissal without prejudice of a Defend Trade Secrets Act (DTSA) case does not support a prevailing-party fee award.

United StatesIntellectual Property

Dawn Rudenko Albert is a Partner in our Stamford office.

In a case of first impression, Judge Gregg Costa of the Fifth Circuit, affirming a lower court decision, held that a dismissal without prejudice of a Defend Trade Secrets Act (DTSA) case does not support a prevailing-party fee award. Dunster Live, LLC v. Lonestar Logos Management Company, (5th Cir.-- F.3d -- (2018)) 2018 WL 5916486.

The plaintiff and defendants are former members of a limited liability company that previously had the contract with Texas to construct and install highway signs at approaching exits. Prior to the expiration of that contract, the defendants formed a new company without the plaintiffs. The defendants' new company won the new contract. The plaintiff sued in the Western District of Texas claiming that the defendants stole proprietary software and a database in violation of the DTSA.

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