Integral Dev. Corp. v. Viral Tolat, 675 F. App'x 700 (9th Cir. 2017). · Go Syfert
Integral Dev. Corp. v. Viral Tolat, 675 F. App'x 700 (9th Cir. 2017). Cases Citing This Book View Copy Cite
“if a breach of fiduciary duty is not 'based on the same nucleus of facts as trade secret 24 misappropriation,' cutsa will not preempt the claim.”
25 citation events (25 in the last 25 years) across 7 distinct courts.
Strongest positive: Skye Orthobiologics, LLC v. CTM Biomedical, LLC (cacd, 2024-04-17)
Treatment trajectory · 2017 → 2026 · click a year to view as-of
2017 2021 2026
Top citers, strongest first. 14 distinct citers. How cited ↗
discussed Cited as authority (verbatim quote) Skye Orthobiologics, LLC v. CTM Biomedical, LLC
C.D. Cal. · 2024 · quote attribution · 1 verbatim quote · confidence high
if a breach of fiduciary duty is not 'based on the same nucleus of facts as trade secret 24 misappropriation,' cutsa will not preempt the claim.
examined Cited as authority (quoted) WeRide Corp. v. Kun Huang (3×) also: Cited "see, e.g."
N.D. Cal. · 2019 · quote attribution · 1 verbatim quote · confidence low
tolat ii
cited Cited as authority (rule) Support Community, Inc. v. MPH International LLC
N.D. Cal. · 2024 · confidence medium
Corp. v. Tolat, 675 Fed.
cited Cited as authority (rule) Broidy v. Global Risk Advisors LLC
S.D.N.Y. · 2023 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 704 (9th Cir. 2017).
discussed Cited as authority (rule) Beluca Ventures LLC v. Einride Aktiebolag
N.D. Cal. · 2023 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 704 (9th Cir. 8 2017) (internal quotation marks and quotation omitted); see also Angelica Textile Servs., Inc. v. 9 Park, 220 Cal. App. 4th 495, 508 (2013), as modified on denial of reh’g (Nov. 7, 2013) 10 (“[B]reach of contract claims, even when they are based on misappropriation or misuse of a trade 11 secret, are not displaced by [C]UTSA.”).
discussed Cited as authority (rule) RoadSync, Inc. v. Relay Payments, Inc.
N.D. Ga. · 2022 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 703 (9th Cir. 2017) (a jury could find Tolat misappropriated Integral’s source code because “Tolat copied the source code shortly before he planned to leave Integral and join EBS” and “EBS [later] released a product . . . that competed directly with some of Integral’s products”); Verbena, 2022 WL 910666 , at *4 (“Given that [plaintiff] . . . started his own competitive ecommerce business—selling the same products [his former employer] sold—mere months after [the former employer] investigated him for stealing inventory, it is plausible to in…
discussed Cited as authority (rule) Ever.Ag, LLC v. Milk Moovement, Inc.
E.D. Cal. · 2022 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 704 (9th Cir. 8 2017) (determining supersession did not apply). 9 Interpreting the California Court of Appeal and Ninth 10 Circuit decisions, this court determines it is plausible for 11 defendants to have interfered with the contract between CDI and 12 plaintiff without it involving the “misappropriation of trade 13 secrets” as the claim is focused on “non-trade secret” 14 information.
cited Cited as authority (rule) VibrantCare Rehabilitation, Inc. v. Deol
E.D. Cal. · 2021 · confidence medium
Corp. v. Tolat, 675 Fed.
cited Cited as authority (rule) Broidy Capital Management LLC v. Muzin
D.D.C. · 2020 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 704 (9th Cir. 2017); see, e.g., Javo Bev.
cited Cited as authority (rule) Hill Phoenix, Inc. v. Classic Refrigeration SoCal, Inc.
C.D. Cal. · 2020 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 702 (9th Cir. 2017) (citing Silvaco Data Sys. v. Intel 12 Corp., 184 Cal. App. 4th 210, 220 (2010)).
cited Cited as authority (rule) First Foundation Inc. v.Thomas Munson Giddings
C.D. Cal. · 2020 · confidence medium
Corp. v. Tolat, 675 F. App’x 700, 702 (9th Cir. 2017) (citing Silvaco Data Sys. v. Intel 18 Corp., 184 Cal. App. 4th 210, 220 (2010)).
cited Cited "see, e.g." Luminate Home Loans, Inc. v. Better Mortgage Co., et al.
S.D. Cal. · 2025 · signal: see also · confidence medium
Cal. Aug. 7, 2018); see also 21 Integral Development Corp. v. Tolat, 675 F. App'x 700, 704 (9th Cir. Jan. 11, 2017) (citing 22 Cal. Civ.
cited Cited "see, e.g." Luminate Home Loans, Inc. v. Better Mortgage Co., et al.
S.D. Cal. · 2025 · signal: see also · confidence medium
Cal. May 28, 2020) (citing § 3426.1(b)); see also Integral Dev. 21 Corp. v. Tolat, 675 F. App'x 700, 703 (9th Cir. 2017) (citing Whyte v. Schlage Lock Co., 22 125 Cal. Rptr. 2d 277, 289 (2002)).
discussed Cited "see, e.g." Proofpoint, Inc. v. Vade Secure, Incorporated
N.D. Cal. · 2020 · signal: see also · confidence medium
Cal. October 11, 2008) (finding plaintiff's description of 23 "source code for the SLAM algorithm" as "fundamental to [plaintiff's] augmented and 24 virtual reality products," did "not adequately identif[y]" its trade secrets); see also Integral 25 Development Corp. v. Tolat, 675 Fed.
Retrieving the full opinion text from the archive…
INTEGRAL DEVELOPMENT CORPORATION, a California Corporation, Plaintiff-Appellant,
v.
Viral TOLAT, an Individual, Defendant-Appellee
14-16629.
Court of Appeals for the Ninth Circuit.
Jan 11, 2017.
675 F. App'x 700
Myron Moskovitz, Myron Moskovitz, Piedmont, CA, Jack Russo, Esquire, Managing Senior Counsel, Christopher J. Sargent, Attorney, Computerlaw Group LLP, Palo Alto, CA, for Plaintiff-Appellant, John Lee Cooper, Esquire, Partner, Anthony P. Schoenberg, Esquire, Stephanie Skaff, Attorney, Kelly A. Woodruff, Farel-la Braun + Martel LLP, San Francisco, CA, for Defendant-Appellee
Berzon, Smith, Christensen.
Cited by 17 opinions  |  Unpublished  |  Civil
1 passage pin-cited by 1 case
Pinpoint authority: bottom 90%
Citer courts: N.D. California (1)

MEMORANDUM **

Integral Development Corporation (“Integral”) appeals the district court’s grant of summary judgment in favor of Viral Tolat, Integral’s former Chief Technology Officer. We review de novo the district court’s grant of summary judgment. Szajer v. City of Los Angeles, 632 F.3d 607, 610 (9th Cir. 2011). We affirm in part, reverse in part, vacate in part, and rémand.

1. To succeed on a claim for misappropriation of trade secrets under the California Uniform Trade Secret Act (“CUTSA”), Integral must show three things: (1) it possessed a trade secret; (2) Tolat misappropriated the trade secret; and (3) Tolat’s misappropriation caused or threatened damage to Integral. See Silvaco Data Sys. v. Intel Corp., 184 Cal.App.4th 210, 109 Cal.Rptr.3d 27, 38 (2010), disapproved of on other grounds by Kwikset Corp. v. Superior Court, 51 Cal.4th 310, 120 Cal.Rptr.3d 741, 246 P.3d 877 (2011). In establishing that certain information qualifies as a trade secret, a plaintiff first must clearly identify the information. See id. The plaintiff must also show that the information communicates ideas or facts to another. [1] Id. Finally, a plaintiff must show that it[*703] took reasonable steps to maintain the secrecy of that information, and that the information obtained value from being kept secret. Whyte v. Schlage Lock Co., 101 Cal.App.4th 1443, 125 Cal.Rptr.2d 277, 286-87 (2002).

Integral has identified three sets of information that it claims are trade secrets that Tolat misappropriated: (1) facts about Integral’s business that Tolat included in a resume he sent to EBS, one of Integral’s competitors; (2) Integral’s source codp for its products; and (3) business documents containing, inter alia, customer lists and details about ongoing projects. Integral has faded to present any evidence that it suffered damages as a result of Tolat disclosing facts about Integral in his resume or as a result of Tolat copying and retaining Integral’s business files. There is no evidence in the record that Integral suffered actual losses from these actions, or that any of Integral’s competitors were unjustly enriched as a result of these actions. See Cal. Civ. Code § 3426.3(a). Therefore, the district court properly granted summary judgment in favor of Tolat on Integral’s CUTSA claim, to the extent it is based on the information contained in Tolat’s resume or the business files Tolat allegedly copied and retained.

However, Integral’s CUTSA claim based on the misappropriation of its source code should have survived summary judgment. First, Integral met its burden on the question of whether the source code is a trade secret under CUTSA. There is evidence in the record that Tolat copied at least a portion of Integral’s source code on to an external hard drive, in violation of Integral’s policies, on November 5, 2012, shortly before he planned to retire from Integral. There is also evidence thaj;, on this date, Tolat copied only the recent updates in the source code to the external hard drive and that he tried to cover up the evidence that he had transferred the files to his personal device. Based on this evidence, a fact finder could conclude that Tolat had previously copied all of Integral’s source code, and that he periodically copied the updates to the code. Thus, Integral has raised a question of material fact as to whether Tolat copied all of its source code. Integral has also identified specific key aspects of its source code that it claims Tolat misappropriated. Thus, Integral sufficiently identified the information it alleges is a trade secret.

Source code, which conveys facts or ideas, qualifies for trade secret protection. See Altavion, Inc. v. Konica Minolta Sys. Lab. Inc., 226 Cal.App.4th 26, 171 Cal.Rptr.3d 714, 741 (2014) (“[S]ource code is undoubtedly a trade secret.”) (citing Agency Solutions.com, LLC v. TriZetto Grp., Inc., 819 F.Supp.2d 1001, 1017 (E.D. Cal. 2011)). Finally, the parties do not dispute that Integral took steps to maintain the secrecy of the source code or that the code obtains value from being kept secret.

Second, there is enough evidence in the record to raise a question of material fact as to whether Tolat misappropriated those portions of Integral’s source code that qualify for trade secret protection. See Whyte, 125 Cal.Rptr.2d at 289 (“ ‘Misappropriation’ is, generally speaking, improper acquisition of a trade secret or its non-consensual use or disclosure.”) (citing Cal. Civ. Code § 3426.1(b)). There is evidence that Tolat copied the source code shortly before he planned to leave Integral and join EBS. There is also evidence that, after Tolat joined EBS, EBS released a product—EBS Direct—that competed directly with some of Integral’s products. A fact finder must determine whether Tolat actually gave Integral’s source code to EBS and whether EBS used the source code to develop EBS Direct.

[*704] Lastly, there is evidence that EBS Direct cut into Integral’s sales and that the resulting loss of revenue also caused Integral’s equity value to decrease, satisfying Integral’s burden as to damages. Because Integral has at least raised a question of material fact as to all necessary elements of a CUTSA claim (based on the alleged misappropriation of its source code), we reverse the district court’s summary judgment ruling on this claim and remand.

2. CUTSA does preempt some claims, but it “does not affect ... civil remedies that are not based upon misappropriation of a trade secret.” Cal. Civ. Code § 3426.7(b). If a breach of fiduciary duty is not “based on the same nucleus of facts as [the] trade secret misappropriation,” CUTSA will not preempt the claim. See Silvaco, 109 Cal.Rptr.3d at 48 (quoting K.C. Multimedia, Inc. v. Bank of Am. Tech. & Operations, Inc., 171 Cal.App.4th 939, 90 Cal.Rptr.3d 247, 264 (2009)). Inte gral asserts that Tolat owed a fiduciary duty to Integral, which he breached when he shared confidential information with a competitor. This claim does not require that the confidential information qualify as a “trade secret.” Thus, Integral’s breach of fiduciary duty claim “ha[s] a basis independent of any misappropriation of a trade secret,” and therefore, is not preempted by CUTSA. Angelica Textile Servs., Inc. v. Park, 220 Cal.App.4th 495, 163 Cal.Rptr.3d 192, 202-03 (2013) (finding claim for breach of fiduciary duty was independent of trade secret claim). Accordingly, we vacate the district court’s ruling on this claim and remand the case so the district court can consider the merits.

3. The plain language of CUTSA also provides that it does not preempt “contractual remedies, whether or not based upon misappropriation of a trade secret.” Cal. Civ. Code § 3426.7(b)(1); see also Angelica Textile Servs., 163 Cal. Rptr.3d at 203 (“[B]reach of contract claims, even when they are based on misappropriation or misuse of a trade secret, are not displaced by [C] UTSA.”). Thus, the district court erroneously found Integral’s breach of contract claim was preempted by CUTSA. Accordingly, we vacate the district court’s ruling on this claim, and remand the case so the district court can consider the merits.

4. “Plaintiffs must satisfy two requirements to present a prima facie case of direct [copyright] infringement: (1) they must show ownership of the allegedly infringed material and (2) they must demonstrate that the alleged infringers violate[d] at least one exclusive right granted to copyright holders under 17 U.S.C. § 106.” Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146, 1159 (9th Cir. 2007) (quoting A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013 (9th Cir. 2001)). Integral alleges that Tolat infringed on its copyright in its source code. Integral acquired a copyright in its source code as the source code was written; it did not need to register the source code with the copyright office before a copyright existed. See 17 U.S.C. §§ 101, 302(a). As employer of the various individuals writing source code, Integral was the author of the source code and the owner. Id. § 201(a)-(b). Thus, Integral has satisfied the first requirement of a direct infringement claim.

As copyright owner, Integral has the exclusive right to “reproduce the copyrighted work in copies”; “prepare derivative works based on the copyrighted work”; and “distribute copies ... of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending.” Id. § 106(1)—(3). Integral contends that Tolat violated its exclusive rights in its source code by copying the source code onto personal devices[*705] without authority and later distributing the copies (which Integral contends were not all deleted or returned to Integral) to EBS. The undisputed facts show that Tolat copied at least some of Integral’s source code while still employed by Integral. Whether Tolat had the authority to copy the code and whether Tolat distributed the code to EBS are disputed questions of material fact that must be decided by a fact finder. Therefore, we reverse the district court’s ruling on Integral’s copyright claim and remand.

Each party shall bear its own costs on appeal.

AFFIRMED IN PART, REVERSED IN PART, VACATED IN PART, and REMANDED.

**

This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3.

1

. CUTSA does not protect "ideas,” Rather it protects the information that "communicate[s] ... the idea or fact to another.” Silvaco, 109 Cal.Rptr.3d at 38. That information may take the form of "a formula, pattern, compilation, program, device, method, technique, or process.” Id. (quoting Cal. Civ. Code § 3426.1(d)).