## Facts

- Life Spine, Inc., an Illinois medical-device company, developed and sold the ProLift Expandable Spacer System, a complex spinal implant with precisely engineered components and tolerances.
- Life Spine treated as confidential certain nonpublic information related to the ProLift, including engineering specifications, dimensions and tolerances, testing data, and certain pricing and customer/business information.
- Life Spine used confidentiality agreements and access controls to limit dissemination of this information.
- Life Spine and Aegis Spine, Inc. entered a distribution agreement under which Aegis would market ProLift and agreed to protect confidential information, act as a fiduciary for Life Spine’s property, and refrain from reverse engineering.
- Life Spine alleged that Aegis provided ProLift devices and nonpublic technical information to its parent company, L&K Biomed, Inc., to assist in developing a competing device, AccelFix-XT.
- After AccelFix-XT entered the market, Life Spine sued Aegis for trade secret misappropriation and breach of the distribution agreement.
- Following a nine-day evidentiary hearing, the district court granted a preliminary injunction barring Aegis and business partners from marketing the competing product.

## Issues

1. Whether trade secret protection can apply to specific engineering and business information associated with a product that has been patented, displayed, and sold, where the alleged secrets themselves were not publicly disclosed.
2. Whether the district court clearly erred in finding Life Spine likely to succeed on trade secret misappropriation and contract-breach claims.
3. Whether the district court erred in finding irreparable harm not adequately compensable by money damages.
4. Whether the balance of harms and the public interest supported a preliminary injunction.
5. Whether federal patent law preempted enforcement of the agreement’s anticopying provisions or rendered the injunction overbroad.

## Decision

- The Seventh Circuit affirmed the preliminary injunction.
- The court held that the controlling question was factual: whether the specific information claimed as trade secrets had been publicly disclosed by patenting, displaying, or selling the ProLift.
- The court found no clear error in the district court’s determination that the asserted trade secrets were not in the public domain and were subject to reasonable secrecy measures.
- The court upheld the district court’s findings of likely success on misappropriation and breach of the distribution agreement.
- The court agreed that evidence supported irreparable harm through loss of customers, market share, and goodwill that would be difficult to quantify.
- The court rejected arguments that patent law preempted the relevant contractual restrictions and concluded the injunction was adequately tailored to the alleged misconduct.

## Legal Principles

- Information in the public domain cannot be a trade secret, but public availability of a product (including patenting, displaying, and sales) does not negate trade secret protection for specific nonpublic technical or business information not disclosed by those activities.
- Whether asserted trade secret information was publicly disclosed is a fact-intensive inquiry; on interlocutory review of a preliminary injunction, factual findings are reviewed for clear error.
- Reasonable measures to maintain secrecy can include contractual confidentiality obligations and controlled access to sensitive engineering and testing materials.
- A preliminary injunction may issue in trade secret and related contract cases when the plaintiff shows likelihood of success, irreparable competitive injury not readily remedied by damages, and that the balance of harms and public interest favor enforcement of confidentiality and protection of investment in product development.
- Patent law generally does not preempt private contractual restrictions on copying or use of nonpublic information, and injunctive relief may bar marketing of a competing product when supported by findings tied to misappropriation and contract breach.

## Conclusion

The Seventh Circuit upheld a preliminary injunction preventing marketing of a competing spinal implant where the record supported findings that Aegis likely misappropriated Life Spine’s nonpublic engineering and business information and breached confidentiality and non-reverse-engineering obligations, and that Life Spine faced irreparable competitive harm despite the ProLift’s patents and public sales.


Life Spine, Inc. v. Aegis Spine, Inc., 8 F.4th 531 (7th Cir. 2021)