Did Groupon’s Former Sales Managers Take Trade Secrets to Google?

Groupon Inc. has filed a trade secret lawsuit against two former sales managers, accusing them of taking confidential trade secrets with them when they left to join a competing venture run by Google Inc. Lawsuits like these are extremely common in the technology industry, where the competition to roll out innovative products is intense.

According to the complaint filed in an Illinois court, Michael Nolan, who worked for Groupon for two years, and Brian Hanna, who joined the company in January, each left last month to join Google Offers. Google, based in Mountain View, California, isn’t named in the suit.

The hiring of Hanna and Nolan by Google breaches their employment agreement with Groupon, which bars them from working with a direct competitor for 24 months after leaving the company, Groupon said.

“In their new positions with Google Offers and/or Google, Hanna and Nolan will provide the same or similar services as they provided at Groupon,” requiring them “to employ confidential and proprietary information that they learned while employed at Groupon,” according to the complaint.

Groupon seeks a court order to prevent the former employees from disclosing confidential information to Google, which would continue to “irreparably” harm it.

As this case highlights, employment and contractual confidentiality agreements are critical tools in guarding valuable trade secrets. Without these agreements in place, Groupon would be unable to provide the necessary documentation under the trade secret laws to assert that its sensitive information has been stolen.

How To Protect Your Company

To ensure your company is protected, anyone granted access to proprietary company trade secret information should be required to sign a confidentiality agreement prior to any such disclosure, whether it be an employee, consultant, partner, distributer, or any other third party. Of course, this is only one way to protect your proprietary information. To create a comprehensive strategy, it is best to consult with an experienced intellectual property attorney. Please contact me for further information.


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