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Coin Dealers Says Customer Lists and Marketing Strategies are Trade Secrets Stolen By Former Employee

The suits filed by or against rare coin dealers in recent years could fill up even the largest of penny jars. The newest suit, The American Eagle Reserve LLC vs. Justin A. O'Neal, was filed Sept. 4 in Jefferson County District Court. Dozens of suits involving coin companies have been filed in the county the last year alone.

In its suit, TAER alleges one of its former employees stole company trade secrets in hopes of making a pretty penny. TAER is petitioning the court for an injunction to restrain O'Neal from contacting its customers. Court documents show that TAER and O'Neal entered into a confidential services, trade secrets and employment agreement on March 24, 2008.

"In part consideration for entering into an agreement, Plaintiff agreed to? train, employ and give the Defendant access to confidential and secret customer lists and information concerning rare and collectible coins," the suit says.

"Additionally, Defendant agreed to maintain confidentiality and use his best efforts to promote sales in the interest of Plaintiff, devoting full time to his employer's business and following the written and oral directives of the plaintiff? for a term of at least three years."

In August, six months after he was hired, O'Neal, who was now armed with the company's customer list and "techniques gleaned from" TAER training, quit and began contacting TAER customers, the suit states. "Defendant ? agreed not to enter into any business which was in direct or indirect competition with the plaintiff," the suit states. "Plaintiff would further show unto the Court that the nature of the rare and collectible coin business is such that the market is nationwide, supported and promoted by nationwide advertising and commerce by regular mail, electronic mail, telephone and other methods of electronic communication so that it is reasonable to prohibit competition on a nationwide basis.

"TAER is suing O'Neal for tortuous interference, disclosure and conversion of trade secrets, including the customer list and trade infringement."The Defendant continues to solicit to customers of the Plaintiff to the detriment of the Plaintiff; and unless enjoined, such conduct will cause irreparable harm to the Plaintiff, the full extent of which is indeterminable.

A hearing was set for the month of September but Hurricane Ike has delayed court proceedings.

Full post as published by Womble Trade Secrets Blog on October 01, 2008 (boomark / email).