The research institute founded and headed by J. Craig Venter
The research institute founded and headed by J. Craig Venter

The research institute founded and headed by J. Craig Venter, Ph.D., yesterday won the dismissal of a federal lawsuit filed against it by the company he co-founded four years ago to develop and apply large-scale computing and machine learning toward making discoveries intended to revolutionize the practice of medicine. Judge William Q. Hayes of U.S. District Court for the Southern District of California sided with the J. Craig Venter Institute (JCVI) by dismissing the lawsuit brought against it by Human Longevity Inc. (HLI), the company Venter co-founded in 2014.

In its lawsuit, Human Longevity asked the Court to bar JCVI from “accessing, using, disclosing or discussing with anyone the contents of any private or confidential fact and/or information acquired by it and/or otherwise known to it, because of and/or through Venter obtaining information from HLI.”

HLI accused JCVI of engaging in misappropriation of HLI’s trade secrets; wrongful retention of the trade secrets and other HLI property, including a laptop; tortious interference with contract; tortious interference with prospective economic advantage against JCVI; and unfair business practices.

HLI sought unspecified damages to be determined at trial, and an injunction to prevent misuse of the company’s intellectual property.

“The Court concludes that Plaintiff HLI fails to allege facts giving rise to a plausible inference of misappropriation within the meaning of the DTSA,” Judge Hayes wrote in his 13-page order dismissing the case.

DTSA is the Defend Trade Secrets Act of 2016, the law that amended the federal criminal code to create a private civil cause of action for trade secret misappropriation. Under DTSA, a trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce.

DTSA establishes remedies including injunctive relief, compensatory damages, and attorney's fees—and sets a three-year statute of limitation from the date of discovery of the misappropriation.

“We are pleased the Court agrees that HLI’s allegations are meritless and fail to state a trade secret claim,” JCVI said in a statement to Clinical OMICs.

In his order, Judge Hayes stated the Court would entertain an amended complaint by HLI within 30 days of his order, filed yesterday, and did not dismiss the case permanently or “with prejudice.”

An HLI spokesperson at deadline had not responded to questions from Clinical OMICs about whether the company planned to file an amended complaint, or planned to appeal the Order.

Health Nucleus Platform at Issue

In its complaint, HLI alleged that its trade secrets “include, but are not limited to” processes and data relating to its development of its Health Nucleus tech platform, which HLI told the Court “combines intelligence platform integrating genomics, advanced clinical imaging and machine learning to provide clients with whole body assessment of potential disease and health risks.”

HLI’s website further describes Health Nucleus as a “premier health intelligence platform integrating genomics, advanced clinical imaging and robust machine learning in a spa-like setting.”

“The Health Nucleus evaluation provides an unprecedented, data-driven quantitative health assessment designed to screen for risk factors and early signals of the most critical diseases to know more about your health than ever before,” HLI added.

HLI described its trade secrets in its Complaint as including “bi-weekly business development updates, leadership updates, executive summaries, and weekly reports of all Health Nucleus activities.”

Judge Hayes, however, sided with JCVI.

“Plaintiff HLI’s allegations of Health Nucleus technology and information are expansive and lack particularity,” Judge Hayes concluded.

In August, Judge Hayes sided on procedural grounds with JCVI in denying a motion by HLI seeking a temporary restraining order and preliminary injunction.

‘High Net-Worth Individuals’

Also according to HLI, the trade secrets included:

  • The identity and contact information of clients and potential clients, including unidentified high net-worth individuals “such as Hollywood actors and actresses, corporate executives, NFL team owners, philanthropists and politicians.”
  • Negotiating terms and strategies for potential transactions.
  • Employee contact and compensation information
  • Research data, studies, imaging, as well as client results and prognoses
  • The Lenovo laptop computer owned by HLI.
  • Internal financial reports on HLI’s business operations and future forecasts.
  • Audits and industry reports, including “analysis of market competitors” and “plans, projections and negotiations regarding the potential expansion of [HLI’s] business operations.

In its complaint filed in July, HLI asserted that JCVI gave competitors of the company access to its trade secrets through Venter’s use of an HLI-owned laptop. Venter relinquished his role as CEO last year but remained executive chairman until May.

Using that laptop, HLI alleged that after leaving the company Venter “immediately began using the HLI computer and server to communicate to the public, solicit HLI investors and employees.” The company maintains it terminated him, while Venter announced at that time that he had retired.

Also using that laptop, HLI alleged, Venter sought to recruit up to nine HLI employees in order to establish a competing company. “Defendants’ actions were part of a deliberate scheme and plan to deprive HLI of the benefits of its industry, effort, and expense and to give Defendants an unfair competitive advantage,” it stated in its complaint.

HLI sought unspecified damages to be determined at trial, and an injunction to prevent misuse of the company’s intellectual property.

JCVI countered by attacking HLI’s contentions as “claims that are baseless, and have no likelihood of success on the merits.” JCVI contended that HLI consented to Venter’s use of the laptop for both organizations, that both JCVI and Venter had preserved data from the laptop, and that their use of the data was not illegal.

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