Can a compilation qualify as a trade secret when some components are public? USA Power v. PacifiCorp Explained

In a significant trade secrets decision, the Utah Supreme Court addressed whether a compilation of information can qualify for trade secret protection when some components have been publicly disclosed while others remain confidential.

Background and Facts

USAPower spent two years and nearly $1 million developing its “Spring Canyon vision” for a power plant in Mona, Utah. The company made several public disclosures to regulatory bodies regarding the plant’s location, technology, and specifications. However, other information including economic studies, feasibility analyses, and business plans remained confidential. When PacifiCorp entered acquisition negotiations, USAPower required a confidentiality agreement before sharing the complete vision. After negotiations failed, PacifiCorp issued an RFP and selected its own competing Currant Creek proposal.

Key Legal Issues

The central question was whether USAPower’s compilation could constitute a trade secret under Utah’s Uniform Trade Secrets Act when portions were publicly available. PacifiCorp argued that reverse-engineering made the confidential information readily ascertainable. The court also addressed the scope of unjust enrichment damages and causation requirements in legal malpractice claims involving breach of fiduciary duties.

Court’s Analysis and Holding

The Utah Supreme Court held that a compilation may qualify as a trade secret when specific components derive independent economic value from not being generally known or readily ascertainable. The court emphasized that not all elements need to be confidential—protection extends to identifiable portions meeting the statutory requirements. Regarding readily ascertainable information, the court found that PacifiCorp’s seven-week, $250,000 reverse-engineering effort did not encompass all of USAPower’s confidential economic analyses and business plans.

Practice Implications

This decision provides important guidance for protecting compilation trade secrets in Utah. Practitioners should carefully document which specific components of a compilation remain confidential and demonstrate their economic value. The ruling clarifies that partial public disclosure does not automatically destroy trade secret status for the entire compilation. However, companies must still prove that confidential portions were not readily ascertainable through proper means, requiring detailed analysis of what competitors could reasonably discover independently.