We are seeing more and more lawsuits against an employee after s/he leaves an employer. Some of these suits have basis, some do not. In Schlumberger v. Rutherford, we see a lawsuit that lacked basis. Charlotte Rutherford was employed by Schlumberger as an in-house lawyer. She was privy to confidential, proprietary information in that capacity. She was the Chief of Intellectual Property Counsel when she left. Schlumberger is one of the largest companies providing technical services to the oil and gas industry. It holds numerous patents on a variety of devices. Ms. Rutherford left with positive performance evaluations.
She went to work for Acacia Research Corporation in May, 2013. Acacia, said Schlumberger, was a patent troll. It created nothing, but instead tried to make a claim for various patents so as to garner an easy settlement. Ms. Rutherford countered that Acacia was a patent licensing firm. Ms. Rutherford left on good terms. The Schlumberger General Counsel even referred one client to Ms. Rutherford after she left Schlumberger.
Schlumberger filed its suit against Ms. Rutherford in March, 2014. This was apparently prompted by a lawsuit by Dynamic 3D against Schlumberger in February, 2014. Dynamic 3D is a subsidiary of Acacia.
The court awarded Ms. Rutherford $350,00 in attorney's fees and $250,00 in sanctions.
In its suit, Schlumberger alleged that Ms. Rutherford downloaded confidential information from her work computer. In the Petition, it claimed that she inserted some ten thumb drives into her computer in her last few weeks at the firm. It claimed that she connected a backup external drive to her computer for the first time ever shortly before she left. It accused her of not retriunng the external hard drive and of not returning the thumb drives upon her departure. The firm did not point to any specific information which she allegedly took. It did not even mention in its Petition that she went to work for Acacia. The former employer accused her of breach of fiduciary duty, conversion, misappropriation of trade secrets, breach of contract, and violation of the Texas Theft Liability Act. The company was trying to squeeze in every possible theory of recovery.
The former employer asked for a Temporary Restraining Order. It specifically asked that the TRO be granted ex parte (i.e., without notifying Ms. Rutherford herself). The firm obtained a TRO prohibiting the former Intellectual Property Counsel from using her information. Once, the former counsel learned of the TRO, Schlumberger then voluntarily dissolved the TRO. In effect, the former employer took actions designed to attract attention, so as to scare off other employers or entities based on nothing more than sham affidavits.
Ms. Rutherford moved to dismiss based on Strategic Lawsuits Against Public Participation (SLAPP), known in Texas as Texas Citizens Participation Act, Tex.Civ.Pra. & Rem. Code, §27.001-.011.
The Acacia lawsuit was apparently based on publicly available information, but Schlumberger assumed Acacia used information from Ms. Rutherford. The court granted Ms. Rutherford's motion to dismiss, apparently finding that Schlumberger's investigation of Ms. Rutherford's actions was simply very superficial. The Defednant also presented evidence that Schlumberger fabricated or greatly exaggerated facts regarding her supposed attempt to download confidential information. The ten thumb drives was based on an affidavit by the administrative assistant. But, when the administrative assistant was deposed, she testified she could not remember how many thumb drives Ms. Rutherford asked for.
The alleged change in backing up turned out to not be true. Ms. Rutherford actually started backing up her data on an external had drive two years before she left Schlumberger. The company claimed she left after receiving a poor performance evaluation. But, in fact, her last evaluation received the highest rating possible.
The company pointed to an affidavit by an IT technician claiming that Ms. Rutherford had transferred ten gigabytes of data from her computer to an external hard drive. But, the same IT technician, however, testified in his deposition that nothing was transferred.
Schlumberger claimed the devices were missing. Yet, the IT technician testified that he never looked for the supposed ten thumb drives or the missing external hard drive. he said no one ever asked him to look for the devices. He testified that he found nothing suspicious about Mr. Rutherford's backing up. He considered it to be routine. And, the company could not point to any specific information which allegedly emanated form the former Chief Intellectual property Counsel.
The Defendant also pointed to a prior case in which Schlumberger was sanctioned for another lawsuit against a former employee.
If Ms. Rutherford did not assist Acacia with its lawsuit, what right was being infringed upon by the Schlumberger lawsuit. The Texas version of SLAPP accords protection regarding the freedom to associate and to petition. Ms. Rutherford is free to associate with those who she chooses. And, if she chooses, she is free to petition for a court for redress against those who cause her harm. If such lawsuits could occur, then the future Rutherfords will avoid working for certain employers. The future Rutherfords will find their employment opportunities very constrained.
Schlumberger tried to scare off Acacia and Ms. Rutherford. In the end, they have been scared off. Too many of those TRO lawsuits work their evil with impunity. This time, the former employer lost. The former employer has filed an appeal. But, the facts of the case cannot now be changed.