Hill Holliday Connors Cosmopulos v. Greenfield ( 2011 )


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  •                              CORRECTED OPINION
    UNPUBLISHED
    UNITED STATES COURT OF APPEALS
    FOR THE FOURTH CIRCUIT
    No. 10-1435
    HILL HOLLIDAY      CONNORS     COSMOPULOS,    INCORPORATED,    d/b/a
    Erwin-Penland,
    Plaintiff - Appellee,
    v.
    JEFFREY GREENFIELD; 1ST APPROACH LLC,
    Defendants and Third-Party Plaintiffs -
    Appellants,
    v.
    CELLCO PARTNERSHIP, d/b/a Verizon Wireless; JOSEPH A. ERWIN,
    Third-Party Defendants - Appellees.
    Appeal from the United States District Court for the District of
    South Carolina, at Greenville.    G. Ross Anderson, Jr., Senior
    District Judge. (6:08-cv-03980-GRA)
    Argued:   March 23, 2011                          Decided:    June 2, 2011
    Corrected Opinion Filed:      July 27, 2011
    Before GREGORY, AGEE, and KEENAN, Circuit Judges.
    Affirmed by unpublished opinion. Judge Agee wrote the majority
    opinion, in which Judge Keenan joined.  Judge Gregory wrote an
    opinion dissenting in part.
    ARGUED: Jay Stanley Horowitz, HOROWITZ & FORBES, LLP, Denver,
    Colorado, for Appellants.    Brenda R. Sharton, GOODWIN│PROCTER,
    Boston, Massachusetts, for Appellees. ON BRIEF: Phillip Jeffrey
    North, THE LAW OFFICE OF P. JEFFREY NORTH LLC, Hilton Head
    Island, South Carolina, for Appellants. Stacey B. Ardini, Kunal
    Pasricha, GOODWIN│PROCTER, Boston, Massachusetts, William F.
    Sheehan, GOODWIN│PROCTER, Washington, D.C., Bernie W. Ellis,
    Rita M. McKinney, MCNAIR LAW FIRM, P.A., Greenville, South
    Carolina, for Appellees Hill Holliday Connors Cosmopulos,
    Incorporated, d/b/a Erwin-Penland, and Joseph A. Erwin; Robert
    A. Muckenfuss, David M. Chromy, Elizabeth M. Z. Timmermans,
    MCGUIREWOODS LLP, Charlotte, North Carolina, for Appellee Cellco
    Partnership, d/b/a Verizon Wireless.
    Unpublished opinions are not binding precedent in this circuit.
    2
    AGEE, Circuit Judge:
    Jeffrey Greenfield collaborated with Erwin-Penland, a South
    Carolina   advertising          agency,     on     a    marketing     plan   aimed   at
    securing   a    contract      with    the       Captain    D’s   restaurant    chain.
    Captain D’s declined to implement the proposal, which centered
    on the general concept of a gospel choir competition entitled
    “How Sweet the Sound.”            Erwin-Penland, however, later convinced
    another client, Verizon Wireless, to fund a modified version of
    the project, but without the participation of Greenfield or his
    company,       1st     Approach       LLC         (collectively        “Greenfield”).
    Greenfield      subsequently         demanded          compensation     from    Erwin-
    Penland, who responded by filing a declaratory judgment action
    in South Carolina state court, seeking a ruling that Greenfield
    had no ownership interest in the “How Sweet the Sound” concept.
    Greenfield removed the case to the United States District
    Court for the District of South Carolina and instituted various
    counterclaims, including a third-party complaint against Verizon
    Wireless   and       Joseph   Erwin   —     the    president     of    Erwin-Penland.
    The district court concluded that Greenfield had no protected
    interest   in    the     “How    Sweet    the      Sound”    project     and   granted
    summary judgment in favor of Erwin-Penland and the third-party
    3
    defendants. 1         Greenfield now challenges that ruling on appeal.
    For the reasons stated herein, we affirm the judgment of the
    district court.
    I.
    Joseph    Erwin      heard   Greenfield         speak      on    the    subject     of
    “branded entertainment” at a conference.                     Subsequently, he asked
    Greenfield       to    collaborate       with       Erwin-Penland        on    a   marketing
    proposal    aimed       at   securing      an    account     with       the    Captain     D’s
    restaurant       chain.       Greenfield        accepted     Erwin’s       offer     without
    entering into a written agreement establishing the terms of his
    relationship with Erwin-Penland.
    After a series of collaborative phone calls and emails,
    Greenfield       sent     Erwin-Penland         a    marketing      deck       outlining    a
    concept he labeled “‘Amazing Grace’ Captain D’s Branded Reality
    Show.”       Joint        Appendix       (“J.A.”)      at    1375.            Erwin-Penland
    subsequently changed the name of the proposal to “How Sweet the
    Sound.”     Id. at 712, 896.              The “How Sweet the Sound” concept
    involved “[t]he top 20 church choirs in the US competing for
    over $250,000 in prizes and the title of the Best Choir in the
    USA.”      Id.     at    1376.       A    production        team    of     producers       and
    1
    We refer to Verizon Wireless and Joseph Erwin collectively
    as the “third-party defendants.”
    4
    cameramen,       along       with    a    host     “[s]imilar          to   Ryan    Seacrest     on
    American Idol,” would “cross the country in [a] 6 week trek of
    visiting      EVERY      Captain         D’s    location,”         using      local    media     to
    publicize the event.                Id. at 1377.            Once there, the team would
    interview local choir members about their “choir and why they
    think they are the best in the US.”                        Id.
    Competitions           would       then    take      place       in   Atlanta,      Georgia;
    Jackson, Mississippi; Birmingham, Alabama; and Charleston, South
    Carolina between the best twenty-five choirs in each region.
    Each contest would be featured in a television episode, take
    place “in large arenas,” and “have a large panel of celebrity
    judges who [would] vote on the best overall performance.”                                        Id.
    The winners of the regional competitions would then “be invited
    to   attend      [a]   National           competition        in    Nashville,”         Tennessee
    featuring      “the      4    best       church       choirs      in    the      country    in    an
    authentic     inspirational              contest      to   find    the      #1    Choir    in    the
    USA.”      Id.     Winning the national competition would entitle a
    choir to “the title of the Best Choir in the USA” and “over
    $250,000 in prizes.”            Id. at 1376.
    In   conjunction          with      the     “entertainment”             provided     by    the
    gospel choir competition, Greenfield proposed marketing Captain
    D’s through three different mediums:                         product placement, radio,
    and the internet.              The parties intended that Greenfield would
    serve as producer and talent broker for Captain D’s “How Sweet
    5
    the     Sound”      project.            Although        Captain    D’s    expressed     some
    interest in the proposal, it ultimately declined to adopt the
    plan.
    Subsequently,          Greenfield         and     Erwin-Penland        presented   a
    similar “How Sweet the Sound” concept to Verizon Wireless, one
    of Erwin-Penland’s existing clients.                       Modifications were made to
    this proposal to better suit Verizon Wireless’ business model.
    For     example,         Greenfield       and     Erwin-Penland         suggested    signing
    choirs up for the competition at Verizon Wireless stores and
    creating “a CD of the winning choirs” that would be distributed
    “through stores and agents.”                    Id. at 1587.
    Although Verizon Wireless also expressed interest in the
    “How Sweet the Sound” concept, it had concerns about the plan’s
    projected        cost.         Greenfield         and     Erwin-Penland        subsequently
    worked to scale back the television component of the project to
    a   one-hour        special       or    documentary.         When       Verizon     Wireless’
    response       to       this   less-expensive           model     was    not    immediately
    forthcoming, Greenfield inquired as to whether Verizon Wireless
    was still interested in the concept or whether he was free to
    present    it       to    other    clients.           Erwin-Penland        responded    that
    Verizon was still considering the scaled-back plan.
    Over    a       year   later,      Erwin-Penland          and    Verizon    Wireless
    implemented a limited “How Sweet the Sound” marketing concept by
    organizing          a    single        gospel     choir    competition         in   Memphis,
    6
    Tennessee.          The project later evolved into a series of gospel
    choir competitions orchestrated throughout the nation.                                  In 2009,
    the final contest was televised on the Gospel Music Channel and
    a     documentary         about       the     series           appeared     on     the      Black
    Entertainment           Television          Network      (“BET”).           Although        other
    agencies       aided          Erwin-Penland             and      Verizon         Wireless     in
    implementing the “How Sweet the Sound” concept, Greenfield was
    not asked to assist, and had no part, in executing the plan.
    II.
    Greenfield demanded compensation from Erwin-Penland for its
    use    of    the       “How   Sweet    the     Sound”         marketing    plan,     which    he
    claimed to have originated.                   In response, Erwin-Penland filed a
    declaratory         judgment         suit     in       South     Carolina       state     court,
    requesting         a     ruling      that     Greenfield          had     “no     co-ownership
    interest      or       rights   in    the     marketing         project     ‘How    Sweet    the
    Sound.’”      J.A. at 28.            Greenfield removed the case to the United
    States District Court for the District of South Carolina based
    on the parties’ diverse citizenship.                           See 
    28 U.S.C. § 1332
    (a).
    He    then    filed       a   first    amended          counterclaim       and     third-party
    complaint against Erwin-Penland and the third-party defendants,
    which stated numerous claims for, inter alia, fraud, breach of
    contract,          misappropriation           of       trade      secrets,        and     unjust
    enrichment.
    7
    Erwin-Penland and the third-party defendants subsequently
    filed motions for summary judgment as to all of Greenfield’s
    claims.      In turn, Greenfield filed a motion for summary judgment
    on his unjust enrichment and breach of fiduciary duty claims.
    The district court concluded that no genuine issue of material
    fact precluded granting judgment as a matter of law to Erwin-
    Penland and the third-party defendants.                  Accordingly, the court
    granted summary judgment in their favor on all claims and denied
    Greenfield’s competing motion for summary judgment.
    First,      the    district     court      concluded     that   “Greenfield’s
    purported trade secrets fail[ed] to meet [the] criterion” for
    protection      under   the   South      Carolina     Trade   Secrets    Act      (“the
    Act”), see 
    S.C. Code Ann. § 39-8-20
    (5), because his “claimed
    trade    secrets   [were]     not    novel      or   protectable,    and,    if   they
    were,      Greenfield   failed      to   take    reasonable    steps    to   protect
    them.” 2     J.A. at 183.        Thus, “even assuming the existence of
    . . . trade secret[s],” 
    id.
     at 183 n.3, summary judgment was
    appropriate “for the independent reason that Greenfield failed
    to take reasonable efforts to protect” them.                  
    Id. at 187
    .
    Second, the district court rejected Greenfield’s argument
    that he had “an oral or implied-in-fact contract” with Erwin-
    2
    Our summary of the district court’s summary judgment
    orders focuses solely on the portions relevant to the four
    issues Greenfield raises on appeal.
    8
    Penland that was subject to breach.                     
    Id. at 189
    .      Because “[t]he
    parties did not discuss, let alone come to an agreement on, the
    essential terms of a contract,” the district court concluded “no
    reasonable trier of fact could find mutual assent as to any
    essential     terms”    of    an   agreement,           given    “either     orally,    in
    writing, or implied” in fact.            
    Id. at 189
    .
    Indeed,    the    district       court       concluded      that    “[a]   careful
    review   of     the    documentary      record          and    deposition    testimony”
    established, “at best, that Erwin-Penland and Greenfield . . .
    discuss[ed] potential or speculative options for the [“How Sweet
    the   Sound”]    concept[].”           
    Id.
             It    was    “undisputed      that   no
    proposed options made by Greenfield were ever accepted by Erwin-
    Penland.”       
    Id. at 189-90
    .         The    district      court     consequently
    determined that Greenfield was unable to “point to any objective
    manifestations and expressions by Erwin-Penland that would be
    sufficient to establish the existence of a contract.”                             
    Id. at 190
    ; see also 
    id.
     (“Mere expectations and one-sided hopes of a
    party do not make a contract . . . .”).
    Third, the district court held that Greenfield “failed to
    satisfy the elements necessary to support” an unjust enrichment
    claim.      
    Id. at 199
    .        Greenfield’s “only contribution to” the
    “How Sweet the Sound” project “was in conjunction with . . .
    speculative pitches . . . to Verizon Wireless and Captain D’s.”
    
    Id. at 200
    .       As he had no “role in executing and implementing
    9
    the    . . .       project       . . .    eventually        undertaken     by     Verizon
    Wireless”      and      “did     not   contribute    any    trade   secret      or   other
    protectable information” to the marketing scheme, the district
    court held that Greenfield was unable to “prove as a matter of
    law    that    a   non-gratuitous         ‘benefit’    was     conferred      for    which
    compensation [was] required.”               
    Id.
    Fourth, the district court ruled that Greenfield’s attempt
    to cancel Erwin-Penland’s “How Sweet the Sound” trademark based
    on fraudulent representations to the United States Patent and
    Trademark Office failed as a matter of law.                         The court stated
    that    even       if      Greenfield’s     factual        allegations     were      true,
    “[t]rademark rights are not based on creativity, but on use in
    commerce.”           
    Id. at 201
    .     Because     it    was    “undisputed       that
    Greenfield ha[d] not used the [“How Sweet the Sound”] mark in
    commerce,” he could not “claim trademark rights in the term” or
    demonstrate        “that       Erwin-Penland      committed    fraud     in     procuring
    th[e] trademark registration.”               
    Id.
    Greenfield noted a timely appeal of the district court’s
    order granting summary judgment.                   We have jurisdiction under 
    28 U.S.C. § 1291
    .
    III.
    On appeal, Greenfield generally argues the district court
    misapplied the summary judgment standard in failing to view the
    10
    record evidence and all inferences drawn therefrom in the light
    most       favorable      to   him,   as   the   non-moving     party.        He   more
    specifically avers the district court erred in concluding the
    “How Sweet the Sound” concept failed to meet the criteria for
    protection under the Act.               For example, Greenfield contends the
    district court applied “a non-existent novelty requirement” for
    trade secret protection and ignored a genuine issue of material
    fact as to whether he took reasonable efforts to preserve the
    secrecy of the “How Sweet the Sound” marketing scheme.                        Opening
    Br. at 23.
    Greenfield also challenges the district court’s “failure to
    discern in the” relationship between himself and Erwin-Penland
    “the       basis    for    imposing     contractual     and     equitable     duties”
    predicated         on   Erwin-Penland’s      and    Verizon     Wireless’     “unjust
    enrichment at [his] expense.”                
    Id. at 24
    .        Finally, Greenfield
    claims the district court erred in refusing to cancel Erwin-
    Penland’s      “How       Sweet   the   Sound”     trademark    based    on   various
    fraudulent assertions made throughout the trademark registration
    process. 3     See id.; see also 
    15 U.S.C. § 1064
    (3).
    3
    Greenfield raised various fiduciary-duty claims in                          his
    Opening Brief but informed the Court at oral argument he                            no
    longer asserted those issues on appeal.  As Greenfield has                         now
    conceded there was no error as to those claims, we do                              not
    address them here.
    11
    In response, Erwin-Penland and the third-party defendants
    argue the Act offers no protection as to any of Greenfield’s
    claims concerning the “How Sweet the Sound” marketing scheme.
    They contend the concept was “‘readily ascertainable by proper
    means by the public,’” Response Br. at 19, and that Greenfield
    “knowingly shared [the plan] with multiple third parties (some
    of whom were Greenfield’s competitors)” without the protection
    offered     by     a    confidentiality         agreement.                
    Id. at 20
    .
    Accordingly,       Erwin      Penland     and    the       third-party          defendants
    maintain that “Greenfield cannot prove . . . he took reasonable
    efforts     to    maintain       the    confidentiality            of     his    supposed
    secrets.”    
    Id.
    Based on Greenfield’s admissions that the parties “engaged
    only in preliminary proposals in advance of a speculative pitch
    for new business and never even discussed the essential terms of
    a   . . .   contract,”        Erwin-Penland      and       Verizon      Wireless       also
    dispute     Greenfield’s         claim       that      a     binding        contractual
    relationship was established.              
    Id. at 20-21
    .           They further argue
    that   Greenfield       is    unable    to   make      out   a     claim    for    unjust
    enrichment,      as    he    contributed     neither       labor    nor    a    protected
    piece of intellectual property to the marketing scheme Verizon
    Wireless eventually implemented.                Lastly, Erwin-Penland and the
    third-party      defendants       would      have      us    reject        Greenfield’s
    trademark-cancellation claim because “he makes no claim to ever
    12
    having used the [“How Sweet the Sound”] mark in commerce.”                              
    Id. at 34
    .
    IV.
    “We    review      de    novo   a    district   court’s         award    of    summary
    judgment,      viewing       the   facts    and    inferences         reasonably      drawn
    therefrom in the light most favorable to the nonmoving party.”
    Fraternal      Order    of    Police      Lodge    No.     89   v.    Prince       George’s
    County, 
    608 F.3d 183
    , 188 (4th Cir. 2010).                       Under Federal Rule
    of Civil Procedure 56(a), summary judgment is appropriate “if
    the movant shows that there is no genuine dispute as to any
    material fact and the movant is entitled to judgment as a matter
    of law.”       In this case, the record demonstrates that no genuine
    dispute as to a material fact precluded granting judgment as a
    matter    of   law     in    favor   of    Erwin-Penland        and    the   third-party
    defendants.      See Estate of Kimmell v. Seven Up Bottling Co. of
    Elkton, Inc., 
    993 F.2d 410
    , 412 (4th Cir. 1993) (“[I]n a case
    where ‘the record taken as a whole could not lead a rational
    trier of fact to find for the non-moving party, there is no
    genuine     issue      for    trial’      and    summary    judgment         is    proper.”
    (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 
    475 U.S. 574
    , 587 (1986))).
    13
    A.    Trade Secret
    The    South       Carolina      Trade    Secrets     Act     protects      “trade
    secrets” that meet two separate criteria. 4                         First, the trade
    secret       must    “derive[]      independent      economic       value,    actual   or
    potential,        from     not   being    generally     known     to,   and   not   being
    readily ascertainably by proper means by the public or any other
    person      who     can    obtain   economic      value    from   its   disclosure      or
    use.”         
    S.C. Code Ann. § 39-8-20
    (5)(a)(i).                    Second, the trade
    secret must be “the subject of efforts that are reasonable under
    the     circumstances         to    maintain      its     secrecy.”       
    Id.
        § 39-8-
    20(5)(a)(ii).             As the plain language of the statute provides,
    4
    The Act defines a “‘[t]rade secret’” as
    information including but not limited to, a formula,
    pattern,   compilation,    program, device,  method,
    technique,   product,  system,   or process, design,
    prototype, procedure, or code that:
    (i) derives independent economic value, actual
    or potential, from not being generally known to,
    and not being readily ascertainable by proper
    means by the public or any other person who can
    obtain economic value from its disclosure or use,
    and
    (ii) is the subject of efforts that are
    reasonable under the circumstances to maintain
    its secrecy.
    
    S.C. Code Ann. § 39-8-20
    (5)(a) (emphasis added).
    14
    information must satisfy both criteria in order to be deemed a
    “trade secret” under the Act. 5              
    Id.
     § 39-8-20(5)(a).
    For purposes of this opinion, we assume, without deciding,
    that the “How Sweet the Sound” concept satisfies the Act’s first
    criterion. 6       A reasonable finder of fact, however, could not
    conclude that Greenfield took reasonable efforts to maintain the
    secrecy    of    the    “How      Sweet    the   Sound”    marketing      scheme,      the
    second    criterion         for   protection     under    the    Act.      In    Lowndes
    Products,       Inc.   v.     Brower,     
    191 S.E.2d 761
        (S.C.   1972),       the
    Supreme     Court      of    South    Carolina      construed      the    reasonable-
    efforts-to-maintain-secrecy               requirement     as    setting   a     high   bar
    5
    See also Restatement (Third) of Unfair Competition § 39
    (1995) (defining a “trade secret” as “any information that can
    be used in the operation of a business or other enterprise and
    that is sufficiently valuable and secret to afford an actual or
    potential economic advantage over others”); Restatement (First)
    of Torts § 757 cmt. b (1939) (“The subject matter of a trade
    secret must be secret.     Matters of public knowledge or of
    general knowledge in an industry cannot be appropriated by one
    as his secret.”).
    6
    See 
    S.C. Code Ann. § 39-8-20
    (5)(b) (“A trade secret may
    consist of a simple fact, item, or procedure, or a series or
    sequence of items or procedures which, although individually
    could be perceived as relatively minor or simple, collectively
    can make a substantial difference in the efficiency of a process
    or the production of a product, or may be the basis of a
    marketing or commercial strategy. The collective effect of the
    items and procedures must be considered in any analysis of
    whether a trade secret exists and not the general knowledge of
    each individual item or procedure.”).
    15
    for trade secret protection. 7             See 
    id. at 766
    ; see also Woven
    Elecs. Corp. v. Advance Grp., Inc., 
    930 F.2d 913
    , Nos. 89-1580 &
    89-1588, 
    1991 WL 54118
    , at *3 (4th Cir. Apr. 15, 1991), as
    amended May 6, 1991 (unpublished) (characterizing “a consistent
    effort . . . to keep” a “wire weaving process” secret, rather
    than       “isolated    attempts     to        protect    [that     information’s]
    confidentiality,” as sufficient to meet the reasonable-efforts-
    to-maintain-secrecy       requirement)          (citing   Lowndes    Prods.,     191
    S.E.2d at 765)).
    Individuals “entitled to a trade secret” and desiring “to
    have its exclusive use in [their] own business” are barred from
    “lightly      or   voluntarily     hazard[ing]      its   leakage     or   escape.”
    Lowndes      Prods.,    191      S.E.2d     at     766    (quotation       omitted).
    Revealing a trade secret to others is consequently fatal to its
    protected      status   unless    one     “exercise[s]     eternal    vigilance.” 8
    Id. (quotation omitted).            The exercise of “eternal vigilance”
    imposes a heavy burden on the owner of a trade secret, as it
    “calls for constant warnings to all persons to whom the trade
    7
    See also 20 S.C. Jur. Intellectual Prop. § 75 (2011)
    (engaging in an extensive discussion of the reasonable-efforts-
    to-maintain-secrecy requirement based on Lowndes Products).
    8
    Although the dissent is correct that “[d]isclosure . . .
    does not necessarily vitiate secrecy,” Dis. Op. at 28, it fails
    to account for South Carolina case law conditioning further
    trade secret protection on the exercise of “eternal vigilance.”
    Lowndes Prods., 191 S.E.2d at 766.
    16
    secret has become known and obtaining from each an agreement,
    preferably in writing, acknowledging its secrecy and promising
    to respect it.” 9     Id. (quotation omitted).
    The    undisputed       evidence    in   this     case   demonstrates      that
    Greenfield did not exercise “eternal vigilance” in sharing the
    details    of   the   “How    Sweet     the   Sound”    marketing     scheme    with
    others.    To the contrary, Greenfield transmitted the “How Sweet
    the Sound” concept to Erwin-Penland, J.A. at 775, and presented
    the plan to Verizon Wireless in the presence of multiple third
    parties — including members of “other ad agenc[ies]” — without
    the benefit of any type of nondisclosure agreement.                   Id. at 791.
    The record, without contradiction, also supports the district
    court’s finding that “[t]he alleged ‘trade secrets’ in question
    had . . . been previously shared with a different third-party,
    the restaurant chain Captain D’s, with whom Greenfield . . . had
    no confidentiality or other agreement.”                Id. at 186.
    It would thus be unreasonable, if not impossible, for a
    finder of fact to conclude that Greenfield took “efforts that
    [were]    reasonable    under    the     circumstances        to   maintain    [the]
    9
    See also 20 S.C. Jur. Intellectual Prop. § 75 (2011)
    (“‘[E]ternal vigilance’ in the form of ‘constant warnings to all
    persons to whom the trade secret has become known and obtaining
    from each an agreement, preferably in writing, acknowledging its
    secrecy and promising to respect it’ is required.” (quoting
    Lowndes Prods., 191 S.E.2d at 761)).
    17
    secrecy”   of     his    marketing       strategy.     
    S.C. Code Ann. § 39-8
    -
    20(5)(a)(ii).          And such efforts are mandatory under the plain
    language     of    the     Act    if    a    trade   secret       is     to   merit    its
    protection.       See id.; Lowndes Prods., 191 S.E.2d at 765 (“[A]ll
    trade secrets are not entitled to . . . protection . . . .”); 20
    S.C. Jur. Intellectual Prop. § 76 (2011) (“A third party who
    receives information without any express or implied assurance of
    confidence may do what it likes with the information.”).
    Although         Greenfield       unilaterally       placed      confidentiality
    notices    on     some    of     his    materials,   these     notations         are   not
    sufficient to create a genuine issue of material fact as to the
    reasonableness of his conduct. 10                 South Carolina courts do, of
    course, require such “warnings to all persons to whom the trade
    secret has become known.”                   Lowndes Prods., 191 S.E.2d at 766
    (quotation      omitted).         But    South    Carolina    law      is     clear    that
    warnings alone are insufficient to place a trade secret within
    the   sphere      of     protection      provided     by    the     Act.         See   id.
    (characterizing          “isolated       steps     . . .     taken       to    implement
    secrecy” as insufficient to merit trade secret protection).
    10
    In his Opening Brief, Greenfield also notes that he
    registered the “How Sweet the Sound” concept as a “Gospel Music
    Contest” with the Writers’ Guild of America, listing himself and
    Joseph Erwin as co-owners.   See Opening Br. at 18.   Greenfield
    does not contend, however, that this registration constituted
    reasonable measures to maintain the secrecy of the “How Sweet
    the Sound” marketing plan.
    18
    A trade secret owner who knowingly discloses proprietary
    information      to   others   should     also    “obtain[]      from    each   an
    agreement    . . .     acknowledging     its     secrecy   and    promising     to
    respect it.” 11       Id. (quotation omitted).         Greenfield points to
    nothing in the record suggesting he obtained, or attempted to
    obtain, a confidentiality agreement from the multiple entities
    to   whom   he    presented    the   “How    Sweet   the   Sound”       concept. 12
    Accordingly, the district court correctly determined no material
    facts were in dispute and correctly held that (1) Greenfield
    failed to take reasonable efforts to maintain the secrecy of his
    marketing plan, see 20 S.C. Jur. Intellectual Prop. § 76 (2011)
    11
    We respect the dissent’s viewpoint but are compelled to
    adhere to the principle that “federal courts sitting in
    diversity must apply state substantive law, decisional as well
    as statutory, in the adjudication of state-created rights.”
    Hottle v. Beech Aircraft Corp., 
    47 F.3d 106
    , 109 (4th Cir.
    1995).    While obtaining a non-disclosure agreement is not a
    mandatory requirement under South Carolina law, we emphasize
    that Greenfield’s failure to even attempt to obtain any such
    agreement from any of the parties to whom he disclosed his trade
    secrets bears substantial weight under the precedent of South
    Carolina’s highest court. See Liberty Mut. Ins. Co. v. Triangle
    Indus., Inc., 
    957 F.2d 1153
    , 1156 (4th Cir. 1992) (“[A] federal
    court sitting in diversity has a duty to apply the operative
    state law as would the highest court of the state in which the
    suit was brought.”).
    12
    See Estate of Kimmell, 
    993 F.2d at 412
     (acknowledging
    that “the non-moving party may not rest on its pleadings, but
    must come forward with specific facts showing that evidence
    exists to support its claims and that there is a genuine issue
    for trial” (citing Celotex Corp v. Catrett, 
    477 U.S. 317
    , 324
    (1986)).
    19
    (“If no understanding of confidentiality exists, there can be no
    secrecy regarding information disclosed.”), and (2) this failure
    precluded   Greenfield     from       relying     on     the     protection     of
    intellectual property afforded by the Act.               See 
    id.
     § 73 (“South
    Carolina’s statutory definition of a trade secret requires that
    the secret be ‘the subject of efforts that are reasonable under
    the circumstances to maintain its secrecy.’” (quoting 
    S.C. Code Ann. § 39-8-20
    (5)(a)(ii))).
    B.    Contract
    A contract, under South Carolina case law, is defined as
    an obligation which arises from actual agreement of
    the parties manifested by words, oral or written, or
    by conduct. If agreement is manifested by words, the
    contract is said to be express.   If it is manifested
    by conduct, it is said to be implied. In either case
    the parties must manifest a mutual intent to be bound.
    Without the actual agreement of the parties, there is
    no contract.
    Stanley Smith & Sons v. Limestone Coll., 
    322 S.E.2d 474
    , 477
    (S.C. Ct. App. 1984) (internal citations omitted).
    “The essentials of a contract [thus] include an offer and
    acceptance.”      Benya v. Gamble, 
    321 S.E.2d 57
    , 60 (S.C. Ct. App.
    1984); see also Hodge v. Nat’l Fid. Ins. Co., 
    68 S.E.2d 636
    , 639
    (S.C.   1952)   (“Regardless    of    which     party    makes   the   offer   or
    proposal,   its    acceptance    by    the    other     is   necessary   to    the
    creation of the contract.”).          In this case, Greenfield points to
    20
    four    pieces       of    evidence,         which   he     believes      demonstrate       the
    formulation of a binding agreement with Erwin-Penland.
    First,        Greenfield         cites a      March       28,    2006    email      that
    demonstrates the parties discussed forming an LLC with Verizon
    Wireless if it agreed to fund the “How Sweet the Sound” project,
    50% of which would be owned by Verizon Wireless and 50% of which
    would    be    owned       by    1st    Approach      and    Erwin-Penland.           Second,
    Greenfield          relies      on     two   slides       from    the    April     26,     2006
    presentation to Verizon Wireless indicating the “How Sweet the
    Sound” concept was created jointly by 1st Approach and Erwin-
    Penland       and    that       they    offered      Verizon      Wireless      40%   of    net
    revenues       if    it     would      agree    to    fund       the    project.         Third,
    Greenfield generally points to evidence that he was responsible
    for creating at least 50% of the “How Sweet the Sound” marketing
    scheme.       Fourth, Greenfield references his work scaling back the
    “How    Sweet       the   Sound”       proposal      to   address       Verizon    Wireless’
    budgetary      concerns,         resulting      in    a   new    plan    similar      to   that
    which     Verizon         Wireless       and    Erwin-Penland           later    implemented
    without his assistance.
    Greenfield’s first two pieces of evidence do indicate that
    he and Erwin-Penland reached an agreement concerning the concept
    they would initially pitch to Verizon Wireless.                           What is lacking
    from the record, however, is any evidence demonstrating that
    Verizon Wireless ever accepted their proposed terms.                               And it is
    21
    clear      that    Verizon    Wireless’       acceptance     of    the    offer    was   a
    condition precedent to the formation of the LLC which Greenfield
    and Erwin-Penland had discussed. 13                See Rickborn v. Liberty Life
    Ins. Co., 
    468 S.E.2d 292
    , 300 (S.C. 1996) (“A meeting of minds
    is   based    upon    the     intent    and    purposes    as     shown    by   all    the
    circumstances.”).            Because the necessary condition precedent of
    acceptance was never satisfied, no reasonable finder of fact
    would conclude the parties reached a binding agreement.                                See
    McGill v. Moore, 
    672 S.E.2d 571
    , 575 (S.C. 2009) (“If a contract
    contains a condition precedent, that condition must either occur
    or   it     must    be   excused       before    a   party’s       duty    to     perform
    arises.”); Allstate Ins. Co. v. Estate of Hancock, 
    545 S.E.2d 845
    , 847 (S.C. Ct. App. 2001) (“[N]o contract arises until the
    offer is accepted and all conditions precedent are met.”).
    Greenfield’s          other      evidence,     which        indicates       he   was
    responsible for developing portions of the “How Sweet the Sound”
    project later implemented by Verizon Wireless and Erwin-Penland,
    is insufficient to change our analysis.                    The relevant question
    on Greenfield’s contract claim is not whether Erwin-Penland and
    Greenfield collaborated in formulating the “How Sweet the Sound”
    13
    See Alexander’s Land Co. v. M & M & K Corp., 
    703 S.E.2d 207
    , 214 (S.C. 2010) (“A condition precedent is an act which
    must occur before performance by the other party is due.”
    (quotation omitted)).
    22
    proposal submitted to Verizon Wireless — record evidence makes
    clear they did.          Rather, it is whether Greenfield and Erwin-
    Penland    ever    reached          a   binding          agreement    concerning        the
    implementation of that scheme.                      On this record, the district
    court did not err in concluding there is insufficient evidence
    for a reasonable finder of fact to conclude that an agreement as
    to the “How Sweet the Sound” plan’s execution was ever reached.
    C.    Unjust Enrichment
    Under South Carolina law, “quantum meruit, quasi-contract,
    and   implied     by    law        contract        are   equivalent       terms   for    an
    equitable remedy.”           Myrtle Beach Hosp., Inc. v. City of Myrtle
    Beach, 
    532 S.E.2d 868
    , 872 (S.C. 2000).                       Obtaining this remedy
    requires   Greenfield         to    show   (1) he        conferred    a     benefit     upon
    Erwin-Penland and the third-party defendants, (2) they realized
    some value from the benefit, and (3) it would be inequitable for
    Erwin-Penland     and        the    third-party          defendants    to    retain     the
    benefit without paying Greenfield its value.                         See Gignilliat v.
    Gignilliat, Savitz & Bettis, L.L.P., 
    684 S.E.2d 756
    , 764 (S.C.
    2009); Sauner v. Pub. Serv. Auth. of S.C., 
    581 S.E.2d 161
    , 167
    (S.C. 2003).
    The list of benefits Greenfield alleges he conferred on
    Erwin-Penland          and     the      third-party           defendants          includes
    23
    (1) trademark          rights,     (2) an       Effie      Award, 14        (3) the   BET
    television       special,      (4) various       financial     benefits        resulting
    from     the    “How   Sweet     the   Sound”     series,    and   (5) intellectual
    property       related   to    the     competitions.         As    explained      below,
    Greenfield possessed no trademark related to the “How Sweet the
    Sound” concept; he was therefore unable to confer such a benefit
    on Erwin-Penland and the third-party defendants.                       See infra Part
    IV.D.        We further conclude that Greenfield cannot equitably take
    credit for “conferring” critical and financial success on the
    “How Sweet the Sound” project when he played no role in the
    execution and production of the work. 15
    That    leaves    Greenfield’s          argument    that       he    contributed
    valuable intellectual property to the project in conceptualizing
    14
    In 1968, the American Marketing Association established
    an annual awards program known as the “Effie Awards” to
    recognize the most effective advertising efforts in the United
    States.
    15
    The district court correctly found that
    [b]y his own admission, Greenfield has not expended
    ‘any time or effort having the concerts go forward,’
    had no involvement in the ‘day-to-day’ operations of
    the concerts, has not worked on any concert logistics,
    has not lined up any churches, booked any venues, and
    has not traveled for the project. By contrast, Erwin-
    Penland, which has worked on the [“How Sweet the
    Sound”] project [from] 2007 through the present, has
    been compensated for the actual work it performed on
    the . . . project.       Such compensation for work
    performed does not constitute unjust enrichment.
    J.A. at 200.
    24
    the general marketing scheme Erwin-Penland and Verizon Wireless
    later utilized.        Given the fact that (1) Greenfield’s only claim
    to a protected intellectual property right arises under the Act,
    and (2) we     have    already   concluded     the   “How    Sweet     the     Sound”
    concept fails to meet the Act’s definition of a “trade secret,”
    see    supra   Part    IV.A,   Greenfield     is   unable    to    show      that   he
    conferred any intellectual property benefit on Erwin-Penland and
    the    third-party     defendants.      See   Sauner,   581       S.E.2d      at    167
    (requiring a plaintiff “confer[] a non-gratuitous benefit on the
    defendant”).
    We   consequently       agree   with    the    district         court       that
    Greenfield failed to demonstrate he conferred a benefit upon the
    defendants that would be inequitable for them to keep without
    paying its value.        Summary judgment in favor of the defendants
    on     Greenfield’s       unjust-enrichment          claim        is        therefore
    appropriate.      See Othentec Ltd. v. Phelan, 
    526 F.3d 135
    , 140
    (4th    Cir.   2008)    (requiring     “a   nonmoving       party”     on    summary
    judgment “produce some evidence (more than a ‘scintilla’) upon
    which a jury could properly proceed to find a verdict for the
    party . . . upon whom the onus of proof is imposed” (quoting
    Anderson v. Liberty Lobby, Inc., 
    477 U.S. 242
    , 251 (1986))).
    25
    D.   Trademark Cancellation
    Greenfield   also      contends    the   district    court    erred   in
    refusing to cancel Erwin-Penland’s “How Sweet the Sound” mark.
    See 
    15 U.S.C. § 1064
    (3).       This argument is based on Greenfield’s
    contention that Erwin-Penland fraudulently failed to reveal in
    trademark registration paperwork, filed with the United States
    Patent and Trademark Office, that he too had “a credible right
    to use the mark.”        Opening Br. at 41.          We find no merit to
    Greenfield’s trademark-cancellation claim.
    As this Court has previously explained, “[t]here is no such
    thing as property in a trade-mark except as a right appurtenant
    to an established business or trade in connection with which the
    mark is employed. . . . [T]he right to a particular mark grows
    out of its use, not its mere adoption.”             Int’l Bancorp, LLC v.
    Societe des Bains de Mer et du Cercle des Etrangers a Monaco,
    
    329 F.3d 359
    , 364 (4th Cir. 2003) (quoting United Drug Co. v
    Theodore   Rectanus,    Co.,   
    248 U.S. 90
    ,   97   (1918))   (emphasis
    added); see also Sengoku Works Ltd. v. RMC Int’l, Ltd., 
    96 F.3d 1217
    , 1219 (9th Cir. 1996) (“To acquire ownership of a trademark
    it is not enough to have invented the mark first or even to have
    registered it first; the party claiming ownership must have been
    the first to actually use the mark in the sale of goods or
    services.”) (emphasis added).
    26
    Nothing        in   Greenfield’s        Opening      Brief,       or    the   record,
    suggests       he   ever    used      the   “How       Sweet    the    Sound”      mark    in
    commerce. 16        See Opening Br. at 42-42.                   Therefore, Greenfield
    failed    to     establish    the     necessary        factual     predicate       for    his
    trademark-cancellation           claim.          See     Gen.    Healthcare        Ltd.    v.
    Qashat, 
    364 F.3d 332
    , 335 (1st Cir. 2004) (“Trademark rights may
    arise under either the Lanham Act or under common law, but in
    either     circumstance,        the    right      is    conditioned         upon   use     in
    commerce.”)         (emphasis      added).         We     accordingly        uphold       the
    district court’s grant of summary judgment in favor of Erwin-
    Penland.        See Celotex Corp., 
    477 U.S. at 323
     (“[A] complete
    failure     of      proof    concerning       an       essential      element      of     the
    nonmoving       party’s     case    necessarily         renders       all    other      facts
    immaterial.”).
    V.
    For all of the foregoing reasons, we affirm the judgment of
    the district court.
    AFFIRMED
    16
    We decline to address the additional arguments raised in
    Greenfield’s Reply Brief, as “arguments not specifically raised
    and addressed in opening brief, but raised for the first time in
    reply, are deemed waived.”    Moseley v. Branker, 
    550 F.3d 312
    ,
    325 n.7 (4th Cir. 2008).
    27
    GREGORY, Circuit Judge, dissenting in part:
    This case is about just compensation for an inventor of a
    marketing    scheme         who     was   later      cut   out    of     the   deal        by   two
    entities that had a long-standing relationship with each other:
    Verizon    and    its        advertising       agency      of    record,       Erwin-Penland
    (“EP”).      The       majority        takes     the     case     away    from       the    jury,
    concluding       that       no    rational       trier     of    fact     could      find       the
    inventor,    Greenfield,            had   taken      efforts      reasonable         under      the
    circumstances          to     protect      the      scheme’s       secrecy.            Such      a
    conclusion is premature.                  There is a rich record with details
    pointing in both directions regarding Greenfield’s efforts to
    protect    his     ideas,         with    both      copyright      and     confidentiality
    notices,    including            one   that    was     specifically        removed         by    EP
    without     Greenfield’s            permission,        that       indicates       while         the
    arguments in his favor may ultimately be overcome, a jury should
    at least have been allowed to view his efforts.
    There       are        three      additional        points     that       the    majority
    overlooks.       First, the majority ignores a proposition advanced
    by the very treatise it cites:                      that disclosure to prospective
    clients in the advertising context does not necessarily vitiate
    secrecy, but rather may, in fact, be reasonable.                                 Second, the
    majority assumes without record support that other advertising
    agencies were competitors.                    These agencies may well have been
    collaborators whose roles were to take over portions of the plan
    28
    that could not be executed by EP and 1st Approach, meaning their
    presence      is    a        fact    the    jury    has        a    right    to     consider     and
    ultimately discount.                 The majority thus skews this fact in the
    light most favorable to the movants.                           Finally, the argument that
    Greenfield disclosed some secrets to Captain D’s is irrelevant
    because these were not the same secrets presented to Verizon, in
    particular they did not include the so-called Pastor Packet,
    which   was    an        idea       unique    to    the        proposal      drafted       for   the
    wireless giant.              For these reasons, I respectfully dissent as to
    the trade secret cause of action.                         I concur in the remainder of
    the majority’s opinion, and do not discuss it here.
    I.
    Unless        otherwise         noted,       all     of       the   following     facts     are
    uncontested.             I    relate       them    here    because          there    are   several
    important points that the majority omits.
    Jeffrey Greenfield is the sole employee of two marketing
    companies,         1st       Approach       and     Buzznations.              These     companies
    specialize in branded entertainment:                           the combination of a brand
    with a live event synthesized with internet strategies, word-of-
    mouth, grassroots “buzz” marketing, and traditional print and
    broadcast media.               In addition to being the principal at both
    companies, he gives lectures around the country.                                    At one of his
    lectures, he met Joseph Erwin, the president and founder of EP,
    29
    a   regional    advertising    agency        located    in   Greenville,     South
    Carolina. 1    After hearing his talk about branded marketing, Erwin
    approached Greenfield and suggested that the two collaborate.
    1st Approach and EP pursued an account with Captain D’s, a
    seafood restaurant chain primarily located in the South, to be
    what is known in the industry as the “agency of record.”                     There
    is hot dispute over who first originated the concept, 2 but the
    two parties agree that the advertising campaign to Captain D’s
    centered around the production of a marketing campaign called
    “Amazing Grace,” after the hymn.              The campaign was designed to
    be a reality television series modeled on the show American Idol
    in a competition for the best church choir in America.
    There was no non-disclosure agreement (“NDA”) between the
    parties.       Nevertheless,     the   two     had     extensive   collaboration
    including     conference   calls,      meetings,       and   materials   sharing.
    The information Greenfield transmitted to EP, in the form of
    PowerPoint slides as part of a presentation “deck,” was under
    explicit       confidentiality      provisions.              Specifically,     the
    1
    EP was purchased by Hill Holliday Connors Cosmopulos,
    Inc., a national advertising agency that is owned by Interpublic
    Group.
    2
    Greenfield testifies that it was his idea to have the
    gospel choir competition.    In contrast, Erwin testifies that
    someone on his team – who used to be a political operative in
    the democratic South – had the idea of using churches and faith-
    based singing to bring the communities together.
    30
    disclaimer on the slides presented to Captain D’s read:                  “[t]he
    ideas and concepts contained within this document are the sole
    and confidential property of 1st Approach, LLC and will not be
    shared with any other agency or utilized without prior written
    consent.”    J.A. 1375.
    After Captain D’s turned down the bid, 1st Approach and EP
    decided to market it elsewhere.            EP was the ad agency of record
    for Verizon.     Verizon was EP’s top revenue-generating client and
    had been for some number of years.             EP had initial discussions
    with Verizon about potentially developing the “Amazing Grace”
    concept,    which   later   became    known   as    “How   Sweet   The   Sound”
    (“HSTS”), after the second line of the song, for the wireless
    company.     Verizon was trailing its competitors in the African
    American community, with only 17% of market-share as opposed to
    25%   overall,   and   needed   a    marketing     strategy   to   reach   this
    demographic.
    When EP initially presented the HSTS idea in December 2005
    to Verizon, it labeled the idea “Confidential and Proprietary
    Material by [EP].”      J.A. 1577.     Like the Captain D’s disclaimer,
    the material read “[u]se, disclosure or distribution of this
    material is not permitted to any unauthorized persons or third
    parties except by written agreement.”            
    Id.
       The regional Verizon
    employees passed on the information to Verizon’s Chief Marketing
    31
    Officer,         Stratton,       without        the    knowledge    or      consent   of
    Greenfield.
    After the December 2005 pitch, in which Greenfield did not
    participate, EP followed up with an April 2006 presentation.
    The contents of this presentation, a 30-plus PowerPoint slide
    deck,      lie       at   the   heart    of     the   dispute,    because    Greenfield
    concedes in his deposition that the trade secrets in question
    were contained therein. 3               As part of the presentation, Greenfield
    came       up    with     numerous      ideas    he   claims     were    trade   secrets
    including tax strategies and the so-called Pastor Packet, which
    was a direct mailing bundle sent to church preachers and choir
    directors that could be used to rope their congregations into
    signing         up    for   Verizon      subscriptions.          Importantly,      these
    secrets differ markedly from the information that was submitted
    to Captain D’s, both in kind and in quantity, with the Pastor
    Packet being the most obvious example.
    In the lead up to the April 2006 presentation, Greenfield
    and EP exchanged many emails and also participated in numerous
    3
    Greenfield’s reply brief alleges that there were trade
    secrets beyond what were contained in the April 2006 pitch at
    which other advertising agencies were present.       (Appellant’s
    Reply Br. at 27.) It is theoretically possible, then, that some
    of the secrets may not have been adequately protected, whereas
    others were. The majority does not consider this point. I need
    not express an opinion on their scope, however, as there are
    enough facts on this record for a jury to be able to consider
    the secrets even if they are limited to the April 2006 deck.
    32
    conference calls with each other.                      On March 13, 2006, Greenfield
    drafted a budget that he sent to EP detailing the projected
    costs of HSTS.       Verizon ultimately did not rely upon this budget
    – it went with a scaled-down version of the idea – but it did
    pick up the HSTS program and execute it in Memphis, Tennessee as
    a test market.       The parties did not discuss what would happen if
    Verizon did not accept the deal, or as here accepted it, but in
    modified form.          Greenfield, however, registered his idea with
    the   Writer’s    Guild        of    America       on        February    15,      2006,   with
    ownership vested in himself and EP.
    At the April 2006 presentation to Verizon, Greenfield spoke
    only briefly, for as short as five minutes, and the people at
    Verizon   do   not      remember      him     independently             of   this    lawsuit.
    Nevertheless, the “deck” identified him and 1st Approach as the
    co-creators of the HSTS idea and included a copyright notice
    from EP and 1st Approach.                  At the meeting, at least one other
    advertising agency was present and possibly more.                              The deck was
    not marked “confidential.”                 The record does not specify whether
    the   advertising         agencies          were        competitors          or     potential
    collaborators     to     1st    Approach          or    what     the    relationship         was
    between Verizon, EP, and the agency or agencies.                             See J.A. 494-
    500   (discussing        the        role     of        the     respective         advertising
    agencies).       None    of    the    people       from       advertising         agencies   or
    33
    other      attendees            at    the     meeting          were     asked     to     sign     a
    confidentiality agreement.
    Greenfield was ultimately cut out of the process after the
    April      2006     pitch.           In     the    two-month          period    following       the
    presentation,           he   worked        with    EP     to   fine     tune    the     proposal,
    scaling it back to reduce the television aspect since Verizon
    determined that aspect was not within its “core competency.”                                     On
    June 9, 2006, Greenfield participated in a conference call with
    EP    in   which        Erwin     affirmed        the   “partnership.”            The     parties
    agreed that Greenfield would have to downsize the proposal to
    fit Verizon’s needs.                 On June 19, 2006, Greenfield submitted his
    final work-product to EP, reducing the cost of the budget to
    $5.4 million.            On November 22, 2006, Greenfield wrote to EP and
    asked whether Verizon had approved or turned down HSTS and said
    that if they had turned it down, he would like to shop around
    the   idea    to        other    potential         clients.           Allen    Bosworth    of    EP
    responded by saying that the idea was “still being looked at” by
    Verizon and that Yahoo! Music was very interested in the deal.
    J.A. 1598.          After that, Greenfield emailed EP on January 26,
    2007,      March    29,      2007,     and    July      26,     2007,    but     EP    failed    to
    respond.
    EP claims that the reason it ceased to do business with
    Greenfield         is    because      he     was    the    “television          man”;    that    if
    Verizon decided it did not want to do that component of the
    34
    advertising     campaign,       then     it       could    simply     eliminate     him.
    However, the record shows that Verizon did adopt a proposal that
    was    strikingly       similar        to        Greenfield’s         original     idea.
    Specifically,      in   conjunction         with     EP    and   other    advertising
    agencies, Verizon in both 2008 and 2009 produced eleven events
    and a final competition, a one-hour documentary film, and a one-
    hour televised finals competition that aired on the Gospel Music
    Channel.      According to Greenfield, the marketing campaign has
    been   a   financial    boon    to     both      Verizon   and   EP,     substantially
    creating    inroads     into    the     African      American       community.       The
    campaign     for    HSTS       ultimately          received      an     Effie     Award,
    essentially the equivalent of an Oscar within the advertising
    community.    EP also received trademark registration for HSTS.
    II.
    There are three important inquiries that must be decided.
    First, as a threshold matter, is there a trade secret?                           Second,
    if there is a trade secret, was it adequately protected?                          Third,
    if it was adequately protected, was it improperly taken?                             The
    first inquiry, one that is assumed though not decided by the
    majority, is whether Greenfield has a protectable interest to
    begin with under South Carolina Code § 39-8-20(5).                        Because the
    answer is not clearly established, I would certify it for the
    South Carolina courts.
    35
    The       Act   defines      trade      secret    to     include      “a      formula,
    pattern,       compilation,       program,         device,      method,          technique,
    product, system, or process, design, prototype, procedure, or
    code.”     
    S.C. Code Ann. § 39-8-20
    (5)(a).                   It goes on to specify
    that:
    [a] trade secret may consist of a simple fact, item,
    or procedure, or a series or sequence of items or
    procedures which, although individually could be
    perceived as relatively minor or simple, collectively
    can make a substantial difference in the efficiency of
    a process or the production of a product, or may be
    the basis of a marketing or commercial strategy. The
    collective effect of the items and procedures must be
    considered in any analysis of whether a trade secret
    exists   and  not   the  general  knowledge   of  each
    individual item or procedure.
    
    Id.
     at (5)(b).          Although there is little to no caselaw on the
    issue,    it    appears    from       the   statute’s       text    that     a   marketing
    strategy that consists of disparate ideas woven together can be
    a trade secret.
    Verizon argues that there is nothing protectable contained
    in the April 2006 slides.                   Specifically, Verizon claims that
    because the individual elements of the trade secret are in the
    public domain there is no trade secret.                            The district court
    seemed    to    agree     with    this      proposition,       holding       that    “[t]he
    concepts themselves are generalized principles that are well-
    known    in    the   advertising         and      marketing    industries         and   are
    readily    ascertainable         by    others.”         J.A.       165-66.        However,
    neither Verizon nor the district court cited any authority to
    36
    support    their       proposition        that       because     some     elements    of     a
    marketing strategy are public, their “collective effect” cannot
    constitute a trade secret.
    Both the text of the statute as well as what little law
    exists on the topic seem to go in the opposite direction.                                 That
    is to say, even if elements of the trade secret are public, if
    the particular alchemy behind the item as a whole is not, then
    it is considered protectable.                  Greenfield uses the analogy of a
    Mrs. Fields cookie; general recipes for chocolate chip treats
    are common, but the recipe specific to Mrs. Fields is still
    considered a trade secret.                    Several cases support his point.
    See, e.g., Lowndes Products, Inc. v. Brower, 
    259 S.C. 322
    , 328
    (1972) (“A trade secret can exist in the unique combination of
    otherwise      known       components;        although      each    of    its    parts,    by
    itself, may be in the public domain, the unified process, design
    and    operation      of    the   combination         may   be     the   essence     of    the
    secret.”); Servo Corp. of Am. v. General Elec. Co., 
    393 F.2d 551
    ,     555   (4th     Cir.      1968)       (a    litigant     may     not    “avoid     the
    consequences of the breach of confidence by piecing together in
    retrospect bits of information which had been disclosed in a
    variety of places and which as a combination were not clearly a
    matter of public knowledge.”); Elizabeth Carpenter, 20 S.C. Jur.
    Intellectual Property § 74 n.3 (2010) (collecting cases); Louis
    Altman     &   Malla       Pollack,       2    Callman      on     Unfair      Competition,
    37
    Trademarks, and Monopolies § 14:22 (2008) (“The internal facts
    of a business . . .     [t]he subject matter is not necessarily
    new, novel or unique; it may be something which, when connected
    with a known factor, may be so valuable to a business that its
    continued concealment from others is of paramount importance.”).
    However, general business know-how is not protected.               Altman &
    Pollack, supra, § 14:22.        Similarly, marketing strategies that
    are commonly employed are not protectable.        Id. 4
    Greenfield alleges that the particular combination of his
    marketing plan, with judges selecting the best choirs after they
    submit   short   segments,     text    message   voting,     and   audience
    participation,   constituted    the    essence   of   his   secret.    Even
    though there are particular elements that are within the public
    domain, there are kernels of ideas that are both original and
    unknown, and as a result not readily ascertainable by proper
    means.   Specifically, the idea of the Pastor Packet – which was
    utilized by Verizon to outreach to ministers and choir directors
    – is an idea original to Greenfield that was ascertainable only
    through his private presentation.          Thus, while in retrospect
    4
    It is also important to note that South Carolina has no
    “novelty” requirement, unlike other jurisdictions such as New
    York and California that require the combination to be new, much
    like a patent, must not be “obvious.” The district court seemed
    to impose just such a requirement, but I find that to be
    unsupported by South Carolina law.
    38
    some of these ideas may be self-evident, at the time they were
    created they were not.
    More importantly, however, even if we were to conclude that
    the April 2006 presentation contained no trade secrets because
    the     individual       elements    were       “readily      ascertainable,”           the
    existence of a trade secret is generally one of fact left to the
    jury, not for the judge, though a few courts consider the issue
    to be a mixed question and a small minority consider it to be an
    issue of law.        Louis Altman & Malla Pollack, 2 Callman on Unfair
    Competition, Trademarks and Monopolies § 14:27 ns.61-63 (Supp.
    2010-2) (collecting cases).               South Carolina has not weighed in
    on the issue and there are no cases that I have uncovered from
    this jurisdiction addressing the point.                      I would thus certify
    the issue to the South Carolina courts.
    III.
    The next question is whether Greenfield took adequate steps
    to protect his trade secret.              The district court granted summary
    judgment    on    the     basis    that    Greenfield        failed     to    adequately
    protect    his    secrets      because    he    disclosed        them   at   a   business
    pitch to Verizon and the business pitch included third-parties:
    other     advertising         agencies    whose    role      in     the      process     is
    unspecified.            The    majority    agrees      and       concludes       that    no
    reasonable       jury    could    find    otherwise.         I    disagree.        It    is
    39
    striking       to     me,   for    instance,      that      Greenfield      did     place
    confidentiality notices on his materials – notices that were
    only subsequently removed by EP.                    I do not believe that EP’s
    unilateral actions should vitiate efforts to protect secrecy nor
    that a reasonable jury should be foreclosed from agreeing.
    Under South Carolina law, the owner of a trade secret must
    show that she or he made “efforts that are reasonable under the
    circumstances to maintain its secrecy.”                     
    S.C. Code Ann. § 39-8
    -
    20(5)(a)(ii).          Thus, “[o]ne may not claim as a trade secret
    information ‘completely disclosed by the goods one markets’” or
    “information that has been disclosed to the public in a way
    which makes ‘the “secret” so obvious as to render meaningless’
    any    claim     of    confidentiality.”          Carpenter,       supra,    at     § 74.
    Nevertheless, “courts have recognized that some disclosure is
    necessary for enjoyment of the benefits of a trade secret and
    that not every disclosure effectively destroys secrecy.”                           Id.    A
    quintessential example of protected disclosure is a pitch to
    potential customers.              Id. at n.7 (citing ILG Indus., Inc. v.
    Scott, 
    49 Ill. 2d 88
    , 94 (1971)).                    Most importantly, like the
    question of whether or not a trade secret exists as a threshold
    matter,     the     question      of   adequate     protective     measures       is,    at
    least under Fourth Circuit caselaw, one of fact.                          Trades Corp.
    v.    Guy   F.    Atkinson     Co..    
    996 F.2d 655
    ,    664   (4th     Cir.    1993)
    (analyzing a Maryland law that, for our purposes, is identical);
    40
    Altman    &     Pollack,     supra,      § 14:26,       n.27   (collecting     cases).
    Indeed,    it    is    a   rare   case    where    summary     judgment    should    be
    granted on this issue because “the answer depends on a balancing
    of costs and benefits that will vary from case to case and so
    require estimation and measurement by persons knowledgeable in
    the particular field of endeavor involved.”                          Rockwell Graphic
    Systems, Inc. v. Dev Industries, Inc., 
    925 F.2d 174
    , 179 (7th
    Cir. 1991).           Factors that should be considered by a jury in
    evaluating      secrecy      include,     according       to   the    Restatement    of
    Torts:
    (1) the extent to which the information is known
    outside of his business; (2) the extent to which it is
    known by employees and others involved in his
    business; (3) the extent of measures taken by him to
    guard the secrecy of the information; (4) the value of
    the information to him and to his competitors; (5) the
    amount of effort or money expended by him in
    developing the information; (6) the ease or difficulty
    with which the information could be properly acquired
    or duplicated by others.
    Restatement (First) of Torts § 757, cmt. b (1939).
    In the instant matter, these factors suggest that there was
    enough of a track record for the jury to be able to hear the
    case.     First and foremost, the pitch was not open to the general
    public; it was a closed setting and the information was thus not
    known outside the business.              While it is true other advertising
    agencies      may     have   been     there,      the    precise      nature   of   the
    relationships is not fleshed out by the record.                       Indeed, it is a
    41
    fact that can be spun in many directions, and, according to
    summary     judgment      standards,       deserves     to        be    construed      in
    Greenfield’s favor.          These agencies may or may not have been
    competitors looking to poach the idea from EP and 1st Approach,
    or they may have been collaborators that would be brought in to
    handle parts of the deal that were beyond the competencies of EP
    and 1st Approach.           They may have been agents of Verizon, and
    they may have had contractual relationships with EP.                           To rest
    the    entire   decision     on    this   point    seems     to    me    a   thin    reed
    indeed.     I think it would be far better to allow the jury to
    weigh and consider this in addition to other evidence at trial.
    The majority also makes much of the disclosure to Captain
    D’s, but there are two responsive points.                         First, as stated
    above,     disclosure       to    potential       customers       is     a    protected
    activity.         Second,    the     content   of     the     secrets        that    were
    disclosed to Captain D’s differs from the content of the trade
    secrets – in particular the Pastor Packet – that made up the
    idea     Greenfield    claims       Verizon    misappropriated.               Thus    the
    majority seems to be comparing apples to oranges.
    Next, even if the other advertising agencies or Captain D’s
    were competitors as the majority simply assumes without support,
    the deck said that it was copyrighted to EP and 1st Approach.
    1st    Approach    also     had    confidentiality     notices          on   materials.
    J.A.     910;   J.A.    941;      J.A.    1061-64;    J.A.        1186;      J.A.    1375
    42
    (including information that was in talks and Captain D’s pitch
    and    confidentiality         notices      from        EP    on    their      own    behalf).
    Indeed, the confidentiality notices that were lacking on the
    final deck were, according to Greenfield, removed without his
    consent.       (Appellant’s Br. at 36-37.)                   I do not believe that it
    is appropriate to hold that EP’s unauthorized and unilateral
    efforts vitiate Greenfield’s protective efforts or render them
    insufficient as a matter of law.
    While    a     business      pitch       may    be    “speculative,”          at    least
    according to Verizon and EP, it arguably does not allow the
    customer to appropriate the ideas in the pitch without paying
    for them.       Any disagreement over the function of business sales,
    and    precisely       how   confidential            they    are    intended     to       be   and
    actually      were,    is    further      justification            for   vacating      summary
    judgment and allowing the matter to go to trial.
    The contractual relationship between Verizon and EP also
    militates against the degree of disclosure necessitated; because
    the    two    companies      had    a    very    close       working     relationship          and
    Verizon was EP’s biggest client, it is within the purview of the
    jury    to     find    that    secrets          might       fall    within     their       legal
    relationship.          More specifically, the jury could determine an
    expectation      of    secrecy      was     part       of    the   overall      relationship
    between the two companies.                See, e.g., Burten v. Milton Bradley
    Co.,    
    763 F.2d 461
    ,       463    (1st        Cir.    1985)      (“A    confidential
    43
    relationship     generally            arises     by        operation      of    law    from    the
    affiliations         of    the     parties       and       the   context       in     which    the
    disclosures      are           offered       . . .     a     confidential           relationship
    typically will be implied where disclosures have been made in
    business       relationships             between           employers       and        employees,
    purchasers      and            suppliers,       or      prospective            licensees       and
    licensors.”) (internal citations omitted).
    Furthermore, the fact that Greenfield himself kept the idea
    for the series a secret is telling.                              He waited after being
    assured that Verizon was still considering the pitch instead of
    taking it to other potential customers, suggesting he viewed the
    matter as both secret and proprietary.
    Finally, Verizon points to the fact that there was no NDA
    as   an   example         of    why   Greenfield           failed    to    take       reasonable
    efforts to protect his material.                           I strongly caution against
    placing too much reliance on the existence of an NDA.                                         While
    indicative of secrecy, it is no talisman.                              Altman & Pollack,
    supra, § 14:26 (noting four factors, of which an NDA is only
    one).     Indeed, according to the treatise on South Carolina law
    cited     by   the     majority,         a    confidential          relationship        may     be
    implied from the circumstances of the disclosure rather than be
    in the form of an express agreement, as mentioned previously.
    Carpenter, supra, at § 76 (“Written agreements are not, however,
    essential to protect secret information disclosed to employees
    44
    or others in every case. The required agreement may be implied
    by the confidential relation itself.”).                       Thus, I believe there
    are enough facts for a jury at least to be able to evaluate this
    issue for itself.
    IV.
    Last, there is the question as to whether the secret was
    indeed misappropriated if it did exist in the first place.                               The
    district court held that it was not; even if the materials were
    confidential, it ruled, it had not been acquired by “improper
    means.”        Under       South    Carolina       law,     “improper      means”    means
    “theft, bribery, misrepresentation, breach or inducement of a
    breach of a duty to maintain secrecy, duties imposed by the
    common    law,      statute,       contract,      license,    protective        order,    or
    other     court       or   administrative          order,     or    espionage       through
    electronic       or    other       means.”         
    S.C. Code Ann. § 39-8-20
    (1)
    (emphasis added).            The district court ruled that because Verizon
    did not consider the material confidential, a fortiori it could
    not   have    been     acquired      through       improper      means.     I   disagree.
    Verizon      knew     that   Greenfield       had    a    role     in   formulating      the
    marketing strategy, as evidenced by 1st Approach’s inclusion in
    the 2006 deck, and a reasonable jury could find that Verizon
    intentionally induced EP to breach its duty of secrecy and cut
    45
    him out from the deal.    This is true regardless of whether or
    not key Verizon officials knew specifically who Greenfield was.
    V.
    For the foregoing reasons, I affirm in part and dissent in
    part.
    46
    

Document Info

Docket Number: 10-1435

Filed Date: 7/27/2011

Precedential Status: Non-Precedential

Modified Date: 4/18/2021

Authorities (20)

Benya v. Gamble , 282 S.C. 624 ( 1984 )

Hubbell, Incorporated v. Entertec Petroleum, Incorporated, ... , 930 F.2d 913 ( 1991 )

the-estate-of-bernard-c-kimmell-through-his-co-representatives-margaret , 993 F.2d 410 ( 1993 )

sengoku-works-ltd-a-corporation-plaintiff-counter-defendant , 96 F.3d 1217 ( 1996 )

ILG Industries, Inc. v. Scott , 49 Ill. 2d 88 ( 1971 )

Celotex Corp. v. Catrett, Administratrix of the Estate of ... , 106 S. Ct. 2548 ( 1986 )

Trandes Corporation v. Guy F. Atkinson Company, and ... , 996 F.2d 655 ( 1993 )

United Drug Co. v. Theodore Rectanus Co. , 39 S. Ct. 48 ( 1918 )

Anderson v. Liberty Lobby, Inc. , 106 S. Ct. 2505 ( 1986 )

sally-s-hottle-personal-representative-of-the-estate-of-douglas-a , 47 F.3d 106 ( 1995 )

General Healthcare Ltd. v. Qashat , 364 F.3d 332 ( 2004 )

Roger Burten D/B/A Rainy Day Games & Toys v. Milton Bradley ... , 763 F.2d 461 ( 1985 )

Allstate Insurance v. Estate of Hancock , 345 S.C. 81 ( 2001 )

Moseley v. Branker , 550 F.3d 312 ( 2008 )

Stanley Smith & Sons v. Limestone College , 283 S.C. 430 ( 1984 )

Othentec Ltd. v. Phelan , 526 F.3d 135 ( 2008 )

Servo Corporation of America v. General Electric Company , 393 F.2d 551 ( 1968 )

Rockwell Graphic Systems, Incorporated v. Dev Industries, ... , 925 F.2d 174 ( 1991 )

international-bancorp-llc-international-services-incorporated , 329 F.3d 359 ( 2003 )

Fraternal Order of Police Lodge No. 89 v. Prince George's ... , 608 F.3d 183 ( 2010 )

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