A federal court in Massachusetts has granted in part a motion for permanent injunction against defendants found liable for misappropriating trade secrets related to an insulin patch pump, imposing several significant remedies including the reassignment of patent applications that incorporate the intellectual property.
The case centered on Insulet Corporation's Omnipod insulin delivery system, where after a month-long trial, a jury found six defendants liable for misappropriating trade secrets in violation of the Defend Trade Secrets Act (DTSA). The jury awarded Insulet $452 million, consisting of $170 million in unjust-enrichment damages and $282 million in exemplary damages. However, the court ultimately reduced the total damages award to $59.4 million to avoid potential double recovery issues with the injunctive relief.
The court's April 24, 2025 ruling in Insulet Corporation v. EOFlow Co., Ltd. et al. follows a jury verdict that found the defendants liable for misappropriating four trade secrets belonging to Insulet Corporation, including an occlusion-detection-algorithm (ODA). When addressing Insulet's request for reassignment of patent applications incorporating aspects of the misappropriated trade secrets, the court explained:
“[T]he victim of trade secret misappropriation may be entitled to ownership of any patents obtained by the wrongdoer on the misappropriated trade secret.” The court further noted that plaintiff's expert testified that the patent application at issue “describes proprietary aspects of plaintiff's occlusion-detection-algorithm (‘ODA') trade secret—a trade secret that the jury found to have been misappropriated by defendants.”
The court rejected defendants' opposition to the patent reassignment, explaining that “[e]quitable reassignment of defendants' patent applications derived from the trade secrets is appropriate to prevent continued use of those trade secrets.” Citing Ethicon Endo-Surgery, Inc. v. Crescendo Techs., LLC, the court emphasized that such reassignment helps ensure “that ‘the wrongdoer is not improperly rewarded for its misappropriation.'”
This case highlights an often-overlooked remedy in trade secret litigation—the ability to obtain ownership of patents derived from misappropriated trade secrets. This remedy can be particularly valuable when the trade secrets have been incorporated into patent applications, as it provides a more complete remedy than damages and merely enjoining the defendant from using the technology.
Insulet Corporation v. EOFlow Co., Ltd., Civil Action No. 23-11780-FDS (D. Mass. Apr. 24, 2025).
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