Home Depot prevails in dumpster case
A dumpster rental company that made several business proposals to Home Depot and then sued the company for trade secret infringement lost its appeal in a U.S. Circuit Court in Massachusetts, according to a synopsis published in Leagle, an online legal journal.
The Massachusetts appeals court, which handed down its decision on April 15, upheld a lower court’s decision that Take It Away, a waste hauling firm, could not reasonably expect that its business pitches to Home Depot bound the retailer to a confidential nondisclosure clause. Take It Away approached Home Depot several times from 1996 to 2002 with a dumpster rental proposal. Under the agreement, Home Depot would rent dumpsters to its customers and keep 10% of the revenues; Take It Away would keep the remainder of the fees and provide all the dumpsters, services and customer support.
Only one of eight Home Depot officers or employees approached by Take It Away agreed to sign a confidentiality agreement, according to court papers. The others either refused or were never asked in the first place.
Home Depot never entered into a partnership with Take It Away, preferring instead an arrangement where it leased space to dumpster rental firms that handle all customers relations. In 2003 Home Depot entered into contracts with four different lessors who rented dumpsters from store sites.
In November 2005, Take It Away sued Home Depot for trade secret misappropriation, unfair and deceptive business practices, and breach of their nondisclosure agreement.
A Massachusetts federal judge ruled in favor of Home Depot in a 2009 summary judgment motion, which Take it Away appealed to the higher court. The appellate panel upheld the summary judgment, noting in its ruling that the trade secret was originally “[an] idea [that] struck one of Take It Away's principals in a flash as he was driving by a Home Depot store.”
“In sum, it is hard to see what concept or plan Home Depot gained from the disclosure that it could not have thought up readily for itself if it had found any reason to expand its rental activity: a dumpster is a big tool for removing debris, and renting tools and establishing reliable supply networks are not the stuff of novel concepts.”