Can readily ascertainable pricing information qualify as trade secrets? CDC Restoration & Construction v. Tradesmen Contractors Explained

In CDC Restoration & Construction v. Tradesmen Contractors, the Utah Court of Appeals addressed whether pricing information readily available through public sources can qualify for trade secret protection under the Utah Uniform Trade Secrets Act (UTSA).

Background and Facts

CDC Restoration performed concrete repair work for Kennecott Utah Copper Corporation under a preferred provider agreement (PPA) containing labor and equipment pricing rates marked as confidential. When former CDC foreman Paul Carsey and project manager Kenneth Allen formed competing company Tradesmen Contractors, CDC alleged they misappropriated CDC’s pricing information and bid details to win a Kennecott contract. The trial court granted summary judgment for defendants, ruling CDC’s information did not qualify as trade secrets and finding insufficient evidence of misappropriation.

Key Legal Issues

The court addressed whether CDC’s labor and equipment rates met the UTSA’s two-pronged test requiring information to (1) derive independent economic value from not being generally known or readily ascertainable, and (2) be subject to reasonable efforts to maintain secrecy. The court also examined whether circumstantial evidence could support claims of bid information misappropriation.

Court’s Analysis and Holding

Regarding pricing information, the court found CDC failed to demonstrate the information was not readily ascertainable. Equipment rates could be obtained simply by calling rental companies, and both defendants had substantial industry experience enabling them to develop similar pricing independently. The court rejected CDC’s argument that defendants’ use of the information proved its trade secret status, noting this would improperly collapse separate elements of the legal test.

However, the court reversed on CDC’s bid information claims. Circumstantial evidence showed Carsey helped formulate CDC’s bid then worked on Tradesmen’s competing bid the night before submission. This created genuine issues of material fact sufficient to survive summary judgment.

Practice Implications

This decision clarifies that Utah courts will rigorously examine whether alleged trade secrets are truly not readily ascertainable by proper means. Companies cannot simply label information “confidential” and expect trade secret protection. The ruling also confirms that the UTSA preempts common law claims based on misappropriation of information, regardless of whether that information ultimately qualifies as a trade secret. However, circumstantial evidence can still create triable issues on misappropriation claims when direct evidence is unavailable.