An Eastern District of Texas jury sided with a client of Dallas-based Lynn Pinker Hurst & Schwegmann Thursday in a trade secrets case involving mats used at construction sites before Chief Judge Amos L. Mazzant III.
The lawsuit was filed in July 2024 by Spartan Composites against Signature Systems Group, claiming the group misappropriated trade secrets and committed breach of contract.
Spartan Composites created an outdoor mat that helped remove dirt, rocks and other debris from the tires of vehicles on construction sites. Signature Systems became interested in the technology and sought to acquire the company. During the pending sale, Spartan provided information on how it creates the mats to Signature Systems, which involved a nondisclosure agreement.
The sale ended up not going through. However, after some time passed, Signature Systems began producing a mat of its own similar to Spartan’s.
Lynn Pinker Hurst & Schwegmann partner Chris Schwegmann said came out during the four-day trial that Signature Systems didn’t destroy Spartan Composites’ information like they were supposed to when they walked from the deal.
Schwegmann said the jurors who sided with his client “have a clear sense of what’s right and what’s wrong.”
The jury awarded exactly what Spartan asked for in damages: $2.3 million for disgorgement of Signature System’s profits, $570,000 for development costs Signature Systems avoided incurring, $5.5 million for reasonable royalty, $8 million in punitive damages and $1.2 million for loss of profits due to breach of contract.
Schwegmann explained that they will have to elect which trade secret claim they want damages awarded on and calculate attorney fees. He said the total of the final judgment will be around $13 million.
His client teared up when the verdict was read.
“It’s kind of the American dream. I mean, he built a better mousetrap, and then some bigger company swoops in and tries to take it from him. … I think it was an emotional moment for him when the jury came back like that with some kind of validation that sometimes the system works,” Schwegmann said.
He added that from Lynn Pinker’s team of three, it was associate Kristopher Ruiz’s first trial. Ruiz and senior associate Jessie Cox were able to call witnesses during the trial. Cox also gave the opening statement.
Signature Systems Group was represented by Shook Hardy & Bacon partners Robert Reckers, Basil Webb, Brenna Kingyon, Evan Weidner and Kimberly Priest-Johnson. They did not immediately respond to a request for comment.
The case is Spartan Composites LLC, d/b/a FODS, and Spartan Mat LLC v. Signature Systems Group LLC, 4:24-cv-609.