## Facts

- AUA Private Equity Partners, LLC, a private equity firm, employed Astrid Soto as Vice President of Business Development and Investor Relations beginning in March 2014.
- Soto agreed by offer letter and acknowledgments to confidentiality obligations and IT policies restricting transfer of company files and prohibiting use of unsanctioned cloud storage.
- Shortly before her termination, Soto uploaded files containing AUA’s confidential and alleged trade-secret information from her work laptop to her personal Google Drive account.
- After uploading, Soto deleted the files from the laptop and cleared her browsing history.
- AUA terminated Soto effective immediately the next business day.
- AUA alleged Soto continued to represent herself as an AUA employee after termination and refused to return the files in her possession.

## Issues

1. Whether the complaint plausibly alleged “misappropriation” of a trade secret under the Defend Trade Secrets Act (DTSA) based on acquisition by “improper means” when an employee copied confidential files to a personal cloud account in violation of confidentiality and IT policies and retained them after termination.
2. Whether, if the DTSA claim survived dismissal, the court should retain supplemental jurisdiction over related New York state-law claims.

## Decision

- The court denied Soto’s Rule 12(b)(6) motion to dismiss in full.
- The court held the complaint plausibly alleged DTSA misappropriation because it alleged acquisition of trade secrets by improper means.
- Because the DTSA claim remained, the court retained supplemental jurisdiction over the related state-law claims.

## Legal Principles

- Under the DTSA, “misappropriation” may be established by acquiring a trade secret through “improper means”; use or disclosure is not required if improper acquisition is adequately pleaded.
- “Improper means” includes theft and breach of a duty to maintain secrecy, including through electronic means.
- At the pleading stage, allegations that information has economic value from not being generally known, and that the owner used reasonable secrecy measures (e.g., confidentiality agreements and access/transfer restrictions), can sufficiently allege trade secret status.
- A federal court may exercise supplemental jurisdiction over state-law claims when the related federal claim remains in the case.

## Conclusion

The court allowed AUA’s DTSA and related state-law claims to proceed, ruling that alleged copying and retention of trade-secret materials to a personal cloud account in violation of confidentiality and IT policies plausibly constituted misappropriation by improper acquisition even without specific allegations of later use or disclosure.


AUA Private Equity Partners, LLC v. Soto, No. 17 Civ. 8035 (GHW), 2018 WL 1684339 (S.D.N.Y. Apr. 5, 2018)