Ams-Osram USA Inc. v. Renesas Elecs. Am., Inc
Authored by: Jeremy J. Gustrowsky
In the recent case of Ams-Osram USA Inc. v. Renesas Electronics America, Inc., the Federal Circuit addressed several important issues in trade secret and contract law, especially as they relate to the technology industry. The dispute began when TAOS (now Ams-Osram USA Inc.) shared confidential information about its ambient light sensor technology with Intersil (now Renesas) during merger talks in 2004. After the talks ended, Intersil used that information to develop competing products, leading to a lawsuit for trade secret misappropriation and breach of a confidentiality agreement.
A key question was when TAOS’s trade secret stopped being a secret. The court clarified that the critical date is not when Intersil actually reverse-engineered TAOS’s product, but when it could have done so using proper, legitimate means. Since TAOS’s product containing the secret was publicly available by February 2005, the court held that the trade secret was “properly accessible” from that point—even if Intersil didn’t reverse-engineer it until later. This sets an important precedent for how courts determine the lifespan of a trade secret in the context of publicly released products.
The court also upheld awards for both trade secret misappropriation and breach of contract, finding that the damages were based on separate sets of product sales and did not constitute double recovery. Notably, the court affirmed that exemplary (punitive) damages could be awarded on top of disgorgement of profits, rejecting arguments that such damages were barred. Additionally, the court interpreted the confidentiality agreement’s indemnity clause to allow recovery of attorneys’ fees for direct disputes between the parties, not just third-party claims.
However, the court found that the district court erred in how it calculated prejudgment interest, which compensates for the time between the injury and the final judgment. The case was sent back to the lower court to recalculate interest based on when each infringing sale actually occurred, rather than simply starting from the date the lawsuit was filed. This decision highlights the importance of carefully considering when and how products are released that contain valuable know-how, and the need for precision in quantifying damages and interest in intellectual property disputes.