FlexWage Solutions LLC v. Ceridian HCM Holding Inc., C.A. No. N23C-04-086 EMD CCLD (Del. Super. May 13, 2024) The plaintiff had developed a payroll solution and pitched this technology to the defendants, whose business lines included payroll services. The two sides entered into non-disclosure agreements, first in 2013 and again in 2018, pursuant to which the plaintiff disclosed confidential information. In October 2018, months after signing the second NDA, the defendants announced a product identical to the plaintiff’s solution. Despite renewed business discussions and the defendants' further product announcements in June 2019, the sides did not finalize an acquisition or license agreement. In 2020, the defendants announced a rebranded product, and by the Fall of 2020, at least one of the plaintiff’s clients had shifted business to the defendants. In April 2023, the plaintiff initiated this litigation, alleging misappropriation of trade secrets and breach of both NDAs.
The Superior Court determined that the plaintiff had filed its 2023 complaint outside the three-year statute of limitations for both the trade secrets claim and the claim for breach of the 2013 NDA. By its terms, the 2013 NDA expired in 2018. For trade secrets, the Court determined the claim likely accrued in October 2018, when the defendants first announced a competing product, but in any event, no later than June 2019. In October 2018, the plaintiff had sufficient reason to suspect that the defendants’ actions likely would result in injury to the plaintiff and enrichment to the defendants; through June 2019, the defendants’ announcements relied on near-verbatim content from the plaintiff’s trade secrets. The Court noted that subsequent business negotiations among the parties were not proper grounds for tolling the statute of limitations.
