Destiny Health, Inc. v. Connecticut General Life Insurance Company ( 2015 )

2015 IL App (1st) 142530
SIXTH DIVISION
August 21, 2015
No. 1-14-2530
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
FIRST DISTRICT
______________________________________________________________________________
DESTINY HEALTH, INC., ) Appeal from the
) Circuit Court of
Plaintiff-Appellant, ) Cook County
)
v. ) No. 09 L 4138
)
CONNECTICUT GENERAL LIFE INSURANCE )
COMPANY and CIGNA CORPORATION, ) Honorable
) Raymond Mitchell,
Defendants-Appellees. ) Judge, Presiding.
______________________________________________________________________________
PRESIDING JUSTICE HOFFMAN delivered the judgment of the court, with opinion.
Justices Hall and Lampkin concurred in the judgment and opinion.
OPINION
¶1 The plaintiff, Destiny Health, Inc. (Destiny), filed suit against the defendants,
Connecticut General Life Insurance Company and Cigna Corporation (collectively referred to as
"Cigna"), alleging violations of the Illinois Trade Secrets Act (Trade Secrets Act) (765 ILCS
1065/1 et seq. (West 2008)) and breach of a confidentiality agreement. The circuit court granted
Cigna's motion for summary judgment, finding no genuine issue of material fact on the issue of
whether Cigna used any of Destiny's trade secrets or breached the confidentiality agreement.
No. 1-14-2530
Destiny appeals, arguing the court erred by failing to: (1) construe the evidence in Destiny's
favor; (2) consider circumstantial evidence; and (3) apply the inevitable disclosure doctrine. For
the reasons which follow, we affirm the judgment of the circuit court.
¶2 The following factual recitation is taken from the pleadings, affidavits and depositions of
record.
¶3 Destiny, a wholly-owned subsidiary of Discovery Holdings (a South African company),
is in the business of developing products for the health insurance industry. Among other things,
it pioneered Vitality, a wellness-based healthcare program designed to make people healthier by
balancing and integrating health insurance coverage with incentives that motivate active
participation in healthcare and reward healthy behavior. Wellness programs such as Vitality
have become increasingly popular among employers who offer such programs to their employees
as a means to improve the overall health of their workforce and reduce healthcare and insurance
costs. Under Vitality, an employee earns points for engaging in certain healthy activities (e.g.,
getting a flu shot) and may redeem those points for rewards (e.g., monetary contributions to a
health savings account).
¶4 Cigna provides a suite of products and services, including health insurance, to employers
and organizations around the world. Prior to the events at issue here, Cigna offered health and
wellness programs to employers interested in providing such a program as a benefit to their
employees.
¶5 In 2007, Cigna became interested in combining its existing wellness program with a
points-based program, using a third-party vendor. Richard Gray, an executive at Cigna, and Art
Carlos, president and chief actuarial officer at Destiny, discussed the possibility of entering into a
business relationship enabling Cigna to offer a points-based wellness program to its employer-
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clients. In order to evaluate the potential relationship, Cigna required sensitive business
information from Destiny. In July 2007, the parties executed an amendment to an existing
confidentiality agreement governing the exchange of business information during the parties'
negotiations.
¶6 The preamble to the confidentiality agreement stated that "the parties wish to enter into
discussions regarding the possible formation of a working relationship *** which will require the
disclosure of certain highly confidential information and material nonpublic information by one
party *** to the other party." Section 2 of the confidentiality agreement prohibited the parties
from "using or misappropriating" any confidential information. Section 4 required the parties to
return any confidential information and work product upon termination of the relationship.
Section 6 states that the agreement does not apply to information that "is in or hereafter enters
the public domain[.]" The agreement does not commit Cigna to entering into a relationship with
Destiny, prohibit Cigna from developing its own points-based program, or prevent Cigna from
contracting with another vendor.
¶7 In September 2007, following execution of the amendment to the confidentiality
agreement, Cigna sent several representatives to Destiny's office in Chicago for a full-day
meeting. Elizabeth Horgan, product director at Cigna, testified that the purpose of the meeting
was to gather information and conduct a "deep dive" evaluation of Destiny's Vitality program.
Horgan served as project manager and leader of the deep-dive team. Destiny furnished Cigna
with all of the information it requested, including proof of concept, return on investment,
information technology, and actuarial data. Destiny provided Cigna with historical data and
actuarial studies from South Africa showing that the Vitality program is successful and
profitable. Destiny also provided Cigna with specific information regarding how it determined
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which activities to incentivize, the number of points to award for completing each activity, and
how it determined when an award was due. In his deposition, Carlos testified that Cigna's "deep
dive" evaluation provided a level of insight into the Vitality program that well surpassed
anything that Destiny had previously shared with an outside organization. Indeed, Horgan and
Gray acknowledged that Destiny gave them all of the information that they requested.
¶8 In October 2007, after evaluating Destiny's Vitality program, Gray informed Carlos that
Cigna could not move forward with the project due to "system challenges." According to Gray,
Cigna withdrew from negotiations because: Destiny's Vitality program was inflexible and too
rigid to fit Cigna's needs; Destiny's claimed return on investment for Vitality was not supported
by its underlying data; Destiny was not a proven provider in the United States; Destiny refused to
consider a vendor relationship rather than a joint venture; Destiny's financial results with prior
joint ventures in similar situations were poor; Destiny had high management turnover; and the
cost of the Vitality program was too high.
¶9 In her deposition, Horgan testified that Cigna believed a flexible wellness program was
better than a "fixed" program. That is, Cigna wanted to give each employer the ability to
customize its own program by choosing the activities to incentivize, the point values for each
activity, the rewards offered, and the point levels to earn specific rewards. Lisa Suter, a senior
product specialist at Cigna, stated in her affidavit that "[t]he optimal incentive program depends
upon employer goals, culture, wellness philosophy, demographics, health improvement programs
offered and base participation rates." The Vitality program, on the other hand, offered a fixed
approach and did not allow any customization. As Carlos explained in his deposition, Vitality is
based on actuarial studies and uses a unique formula of programs, activities, and point levels to
yield specific responses and savings. Since the Vitality program is based on actuarial science,
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Destiny believed that customization would lead to different (and potentially worse) results. As
such, employers are not permitted to change the variables.
¶ 10 After negotiations with Destiny ended, Cigna explored the possibility of partnering with
other vendors, including: IncentOne, Virgin Life Care, Carlson Marketing, Tangerine Wellness,
and Incentive Logic. Cigna ultimately selected IncentOne as its vendor.
¶ 11 Scott Young, director of business development at IncentOne, was responsible for
developing and designing Cigna's incentive-points program. Beginning in March 2008, Cigna
and IncentOne worked together on the project. Young testified in his deposition that Cigna had a
list of activities it wanted to incentivize and IncentOne provided Cigna with recommended
milestones, guidelines, and incentive point values based upon IncentOne's experience and data.
Young explained that IncentOne contracted with Health Scan Solutions, a health services
researcher, to conduct a full literature review of publicly available information. Young stated
that IncentOne provided the research findings to Cigna.
¶ 12 Young also testified that IncentOne developed a return on investment (ROI) predictor and
a proprietary budget calculator. He explained that the budget calculator is a tool that employers
can use to demonstrate how adjustments to point levels impacted the level of employee
engagement, program costs, and anticipated savings. IncentOne also developed Empower, a
proprietary methodology which helped determine the point values to award for each activity.
Cigna used this information to set default activities, point levels, and rewards. The default
settings served as a template and employers could change the settings. Young testified that
Cigna accepted nearly all of IncentOne's design recommendations.
¶ 13 Although Cigna had a list of activities it wanted to incentivize, Young testified that there
was nothing unique about those activities as Cigna had already included those activities in its
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preexisting wellness program or they were known in the industry. According to Young, nothing
from the Vitality program was used to develop the IncentOne-Cigna Program, and Cigna
personnel never mentioned the name Vitality, never shared information about Vitality, and never
provided documents referencing Vitality. Young stated that he was not even aware that Cigna
had previously considered a business arrangement with Destiny.
¶ 14 A number of Cigna's employees were deposed and corroborated Young's testimony.
They testified that: Cigna and IncentOne worked together to build a points-based wellness
program; Cigna had a list of activities it wanted to incentivize; Cigna relied upon its own
experience and market research; IncentOne provided Cigna with guidelines and
recommendations; and Cigna did not share any information with IncentOne regarding the
Vitality program. In addition, Horgan testified that some members of the deep-dive team also
worked with IncentOne to develop Cigna's wellness program.
¶ 15 In January 2009, Cigna announced the launch of its wellness-based incentive health
insurance program, known as the "Cigna Incentive Points Program," which Destiny alleged
incorporated many of its proprietary trade secrets, without its consent. Destiny concluded that
Cigna never intended to enter into a business relationship with it, and that Cigna's participation
in their negotiations was simply a ruse to view its confidential information.
¶ 16 In April 2009, Destiny filed a complaint in the circuit court of Cook County against
Connecticut General Life Insurance Company alleging misappropriation of trade secrets (765
ILCS 1065/1 et seq. (West 2008)). Thereafter, Destiny filed a second amended complaint adding
Cigna Corporation as a defendant and adding a claim for breach of contract. In its second
amended complaint, Destiny identified five broad categories of trade secrets: actuarial data,
information technology, operations, disease management, and marketing. Destiny alleged that
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its confidential information constitutes trade secrets under the Trade Secrets Act and that it has
exercised reasonable efforts to maintain the secrecy and confidentiality of its information. It
further alleged that this information is not generally known by its competitors and, if known,
would be an economic benefit to them. According to the second amended complaint, Cigna
knew that Destiny's confidential information constituted trade secrets and it misappropriated
those secrets by having members of the deep-dive team develop Cigna's incentive-points
program. Destiny sought injunctive relief, as well as compensatory damages.
¶ 17 In April 2014, Cigna moved for summary judgment, arguing that Destiny failed to raise a
genuine issue of material fact as to whether Cigna violated the Trade Secrets Act or breached the
confidentiality agreement. Cigna maintained that the confidential information provided to it
during negotiations does not qualify as trade secrets because the specific details of the Vitality
program are publicly available. More specifically, Cigna claimed that Destiny provided
information about Vitality, on a nonconfidential basis, to prospective customers and gave
presentations at trade shows. Cigna also argued that, even if the confidential information
qualifies as a trade secret, the undisputed facts show it did not use or misappropriate Destiny's
trade secrets. Last, Cigna asserted that Destiny cannot prove damages. Cigna supported its
motion with deposition testimony, affidavits, and documents produced in the discovery phase of
litigation.
¶ 18 In opposing the motion, Destiny argued that a question of fact was created based upon
undisputed evidence that Cigna acquired Destiny's actuarial data (e.g., "proof of concept" and
ROI) and it improperly used that data by developing its own points-based wellness program.
Destiny also argued that disclosure of its trade secrets was "inevitable" because the same
employees who conducted the "deep dive" evaluation of Vitality were also tasked with designing
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and developing Cigna's wellness program. Moreover, Destiny disputed Cigna's claim that it
disclosed its trade secrets to the public. Destiny claimed that the level of information it provided
to Cigna was never provided to another entity. Finally, Destiny relied on its expert, Joseph
Gemini, to dispute Cigna's claim that Destiny suffered no damages.
¶ 19 In July 2014, the circuit court granted Cigna's motion for summary judgment on Destiny's
trade-secrets and breach-of-confidentiality agreement claims, concluding that Destiny failed to
present any evidence that Cigna used Destiny's confidential information. This appeal followed.
¶ 20 As this matter comes to us on appeal from the entry of summary judgment, our review is
de novo, applying the same legal standards as did the circuit court. Standard Mutual Insurance
Co. v. Lay, 2013 IL 114617, ¶ 15. Summary judgment is appropriate when "the pleadings,
depositions, and admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party is entitled to a judgment as a
matter of law." 735 ILCS 5/2-1005(c) (West 2012); Purtill v. Hess, 111 Ill. 2d 229, 240 (1986).
In determining whether a genuine issue of material fact exists, we construe the pleadings,
depositions, admissions, and affidavits strictly against the movant and in a light most favorable
to the opponent (Williams v. Manchester, 228 Ill. 2d 404, 417 (2008)), drawing all reasonable
inferences in favor of the nonmovant (Lapidot v. Memorial Medical Center, 144 Ill. App. 3d 141,
147 (1986)). However, the inferences drawn in favor of the nonmovant must be supported by the
evidence. Mere speculation and conjecture is insufficient to defeat a motion for summary
judgment. Benson v. Stafford, 407 Ill. App. 3d 902, 912 (2010). "If the plaintiff fails to establish
any element of the cause of action, summary judgment for the defendant is proper." Williams,
228 Ill. 2d at 417.
¶ 21 We initially address Destiny's argument that the circuit court failed to construe the
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evidentiary material strictly against Cigna as the movant and in the light most favorable to it as
the opponent of the motion. Destiny maintains the court erred when it relied on Young's
deposition testimony to conclude that "IncentOne provided Cigna with *** proof of concept."
Destiny claims that the court ignored a document that was prepared during Cigna's preliminary
review of IncentOne, which states that IncentOne's "proof of concept [is a] work in progress."
Destiny argues the document presents a factual dispute as to whether IncentOne provided Cigna
with "proof of concept." Destiny also argues the court erred by failing to "consider the issue of
Mr. Young's credibility" and "clear bias."
¶ 22 In ruling on a motion for summary judgment, the circuit court does not decide a question
of fact but, rather, determines whether one exists. Coole v. Central Area Recycling, 384 Ill. App.
3d 390, 396 (2008). Thus, a court cannot make credibility determinations or weigh evidence in
deciding a summary judgment motion. Id. Accordingly, Young's credibility is not an issue. The
question is whether there is evidence in the record contradicting his testimony.
¶ 23 As to Destiny's contention that the circuit court failed to construe the evidence in
Destiny's favor by ignoring evidence, we reiterate, our review is de novo (see Williams, 228 Ill.
2d at 417), and, therefore, we examine the depositions and pleadings anew to determine whether
a genuine issue of fact exists. No deference is given to the circuit court's ruling. Interior Crafts,
Inc. v. Leparski, 366 Ill. App. 3d 1148, 1151 (2006).
¶ 24 Based on our review of the record, we find no factual dispute between the contents of
Cigna's preliminary report, which was created in 2007, and Young's testimony, which related to
the work he performed on the Cigna-IncentOne project in March 2008. Young's unrebutted
testimony demonstrates that IncentOne contracted with Health Scan Solutions to conduct
research and that IncentOne provided the research findings, including proof of concept, to Cigna.
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Although Young did not specify when the studies were conducted or when IncentOne gave its
proof-of-concept findings to Cigna, the absence of such evidence does not create a factual
dispute. Gyllin v. College Craft Enterprises, Ltd., 260 Ill. App. 3d 707, 710-11 (1994) (a
plaintiff must present some affirmative evidence to defeat a motion for summary judgment).
Destiny presented no evidence to rebut Young's testimony that it was IncentOne that provided
Cigna with proof-of-concept findings.
¶ 25 In urging reversal of the circuit court's judgment, Destiny's principal argument is that a
genuine issue of fact exists on the question of whether Cigna used its trade secrets in the
development of Cigna's incentive-points program. Based on the following analysis, we reject the
argument.
¶ 26 The Trade Secrets Act provides for injunctive relief as well as actual and punitive
damages for the misappropriation of trade secrets. 765 ILCS 1065/3, 4 (West 2008). In order to
establish improper use of trade secrets, a plaintiff must show: "(1) a trade secret existed; (2) the
secret was misappropriated through improper acquisition, disclosure, or use; and (3) the owner of
the trade secret was damaged by the misappropriation." Liebert Corp. v. Mazur, 357 Ill. App. 3d
265, 281 (2005).
¶ 27 As a preliminary matter, we note that Destiny fails to identify, with any degree of
particularity, the alleged trade secrets or confidential information that Cigna is alleged to have
used in the development of its incentive-points program. See Composite Marine Propellers, Inc.
v. Van Der Woude, 962 F.2d 1263, 1266 (7th Cir. 1992) (noting it is not enough to point to broad
areas of technology and assert that something there must have been secret and misappropriated).
However, as we agree with Cigna that Destiny has presented no evidence to establish the second
essential element, misappropriation, we assume for purposes of our analysis (without deciding)
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that the confidential information conveyed to Cigna qualifies as trade secrets.
¶ 28 Under the Trade Secrets Act, misappropriation can be shown in one of three ways: by
improper acquisition, unauthorized disclosure, or unauthorized use. 765 ILCS 1065/2(b) (West
2008); Liebert, 357 Ill. App. 3d at 281. To satisfy the use requirement, Destiny must show that
Cigna could not have created its incentive-points program without the use of Destiny's trade
secrets. Mangren Research & Development Corp. v. National Chemical Co., 87 F.3d 937, 944
(7th Cir. 1996).
¶ 29 In this case, Cigna offered, as direct evidence, the deposition testimony of Young,
Horgan, and Berger, each of whom stated that Cigna and IncentOne worked together, over the
course of many months, to design and develop Cigna's incentive-points program. They testified
that IncentOne conducted its own market research and provided guidance to Cigna, and that
IncentOne made a number of recommendations to Cigna, many of which were accepted. They
denied relying on any information obtained from the Vitality program.
¶ 30 Cigna also supported its motion for summary judgment with the deposition testimony of
Carlos who was repeatedly asked how Cigna used Destiny's trade secrets. In response to these
questions, Carlos testified that he is "reaching a reasonable conclusion" based upon the fact that
Cigna was interested in Destiny's confidential information and later developed a program similar
to Vitality. Ian Duncan, Destiny's expert witness, admitted in his deposition that he could not
identify any specific Destiny information that Cigna used to develop its incentive-points
program. Duncan testified that he does not know how Cigna chose the point values, the
activities to incentivize, the relative weights of the point values, the rewards Cigna offers, or the
number of points required to earn each reward. When asked whether there was any evidence that
Cigna actually used any of Destiny's trade secrets, Duncan consistently answered, "I don't know"
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or "I can't point to anything."
¶ 31 Although Destiny presented no direct evidence of Cigna's improper use of its confidential
information, it contends that the following circumstantial evidence is sufficient to support an
inference that Cigna misappropriated its trade secrets and thus create a genuine issue of fact on
the issue: (1) Horgan had no experience with incentive-points programs prior to evaluating
Destiny's program; (2) Cigna was impressed with the Vitality program and noted "it is light years
away from anything else on the market"; (3) Cigna's decision not to partner with Destiny was
based on price; (4) Cigna was under pressure to get an incentive-points program to the market;
(5) by partnering with IncentOne, Cigna knew it would have to be involved in the design and
development of the program; and (6) there is no evidence that Cigna destroyed Destiny's
confidential information as required by the confidentiality agreement. Destiny also asks this
court to infer misappropriation based upon the fact that Cigna had access to its trade secrets and
developed an incentive-points program similar to the Vitality program.
¶ 32 Destiny is correct in arguing that circumstantial evidence can satisfy a plaintiff's burden
to prove trade secret misappropriation. See RKI, Inc. v. Grimes, 200 F. Supp. 2d 916, 923 (N.D.
Ill. 2002) (since direct evidence of misappropriation of trade secrets is typically not available, a
plaintiff can rely on circumstantial evidence). However, as Cigna correctly argues, "[s]ufficient
circumstantial evidence of use in trade-secret cases must demonstrate that (1) the
misappropriating party had access to the secret and (2) the secret and the defendant's design
share similar features." Stratienko v. Cordis Corp., 429 F.3d 592, 600 (6th Cir. 2005).
Assuming for the purposes of analysis that the information relating to the Vitality program that
Destiny revealed to Cigna constituted trade secrets, the first element, access, is satisfied.
Therefore, the focus of our analysis is on the second element, the similarity of Cigna's incentive-
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points program and the Vitality program.
¶ 33 Destiny asserts that its expert witness, Duncan, "pointed to similarities between Destiny's
trade secrets and Cigna's incentive-points program." For example, Duncan testified that Cigna
viewed Destiny's historical data and actuarial studies, which demonstrated "the link between
incentives, behavior change and reduction in *** hospital admission rates, and upon the basis of
that, that enabled [Cigna] to go ahead and make the decision to launch a program of this nature."
Duncan also testified that the studies showed the importance of managing chronic illness such as
hypertension and the importance of fitness and exercise. Destiny asserts that its historical data
and actuarial findings "made their way into Cigna's program" and "provided a footprint for Cigna
to work from in creating its own [wellness] program."
¶ 34 Surely, however, Destiny cannot mean to argue that the importance of managing chronic
illness or the concept of a points-based wellness program are themselves trade secrets. See
Composite Marine Propellers, 962 F.2d at 1266 (stating that the idea of making marine
propellers and selling them in the boating industry is not a trade secret). Contrary to Destiny's
assertion, Duncan did not identify any similarities between Cigna's incentive-points program and
Destiny's Vitality program. Rather, Duncan simply discussed the confidential information that
Cigna "viewed" or "had access to," as well as what that information "showed" or "illustrated."
Duncan admitted in his deposition that he never conducted a side-by-side comparison between
Cigna's incentive-points program and the Vitality program and that he could not identify any
specific Destiny information that Cigna used in the development of its incentive-points program.
¶ 35 The evidence of record established that Destiny's Vitality program incentivizes certain
specific healthy activities by offering points to participants which can be redeemed for rewards.
An employer offering the Vitality program cannot change the activities incentivized or the points
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awarded for each activity. It is a fixed program. In contract, Cigna's program allows each
participant employer to customize its program by selecting the activities it chooses to incentivize
and setting the point values for each activity. As Cigna argues, the two programs are both
philosophically and operationally different. Other than the fact that both programs are incentive-
points programs, Destiny produced no evidence, direct or circumstantial, that the programs are
similar.
¶ 36 Alternatively, Destiny argues it established a genuine issue of fact on the question of
Cigna's use of its trade secrets under the inevitable disclosure doctrine. More specifically,
Destiny asserts that "because Horgan and her Cigna team acquired specialized knowledge
regarding the details of [Vitality], and then were subsequently assigned to work on the same task
of developing an [incentive-points program] for Cigna *** disclosure of Destiny's trade secrets
was inevitable." In support of its argument, Destiny cites PepsiCo, Inc. v. Redmond, 54 F.3d
1262 (7th Cir. 1995) and Strata Marketing, Inc. v. Murphy, 317 Ill. App. 3d 1054 (2000)
(Strata).
¶ 37 In PepsiCo, a high-level product manager had access to sensitive information about
PepsiCo's costs, pricing and marketing strategies. The manager resigned to take a position with
one of PepsiCo's competitors, and he was made directly responsible for managing products that
competed with the PepsiCo products he managed in his prior job. Since it was undisputed that
the manager possessed important trade secrets that would be directly relevant to his new
employment, the district court determined that the manager would inevitably use PepsiCo's trade
secrets in his new position and granted a preliminary injunction prohibiting the new employment.
The United States Court of Appeals for the Seventh Circuit affirmed, holding that "a plaintiff
may prove a claim of trade secret misappropriation by demonstrating that defendant's new
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employment will inevitably lead him to rely on the plaintiff's trade secrets." PepsiCo, 54 F.3d at
1269.
¶ 38 In Strata, a sales representative had access to confidential information about Strata's
business plans, product development, formulas, customer lists, and sales and marketing methods.
The sales representative resigned and took a position as a sales representative at MRP, one of
Strata's competitors. Strata filed a complaint alleging that the sales representative could not
operate or function without relying on its trade secrets and sought a preliminary injunction
prohibiting the sales representative from beginning employment at MRP. The trial court
dismissed Strata's complaint and denied its motion for a preliminary injunction. On appeal, this
court reversed and, relying on PepsiCo, held that inevitable disclosure is a theory upon which a
plaintiff can proceed under the Trade Secrets Act. Strata, 317 Ill. App. 3d at 1070.
¶ 39 Cigna responds by arguing that PepsiCo and Strata are distinguishable because they
involve employees leaving one company to work for a competitor. Cigna cites Omnitech
International, Inc. v. Clorox Co., 11 F.3d 1316 (5th Cir. 1994) (Omnitech), and argues that the
inevitable disclosure doctrine should not apply in trade secret cases arising out of failed
commercial transactions.
¶ 40 In Omnitech, the plaintiff and Clorox signed a nondisclosure agreement and a letter of
intent in connection with the possible sale of Omnitech's "Dr. X" line of roach spray. Omnitech
agreed to share certain proprietary information with Clorox while keeping Clorox's interest in the
insecticide market confidential. Clorox was given the right to conduct laboratory and marketing
tests of Dr. X and was granted the right of first refusal to purchase Omnitech's assets. Clorox
later acquired another line of insecticides from a different manufacturer and decided not to go
forward with the Dr. X acquisition. Omnitech filed suit alleging trade secret misappropriation.
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Omnitech sought to rely not on direct evidence, but rather on an inference of misappropriation
from the fact that Clorox had access to its proprietary information. On appeal, the United States
Court of Appeals for the Fifth Circuit held that such evidence was insufficient as a matter of law
to support an inference that Clorox improperly disclosed or used any of Omnitech's confidential
information. The court explained:
"Certainly 'misappropriation' of a trade secret means more than simply using
knowledge gained through a variety of experiences, including analyses of possible
target companies, to evaluate a potential purchase. To hold otherwise would lead
to one of two unacceptable results: (i) every time a company entered into
preliminary negotiations for a possible purchase of another company's assets in
which the acquiring company was given limited access to the target's trade
secrets, the acquiring party would effectively be precluded from evaluating other
potential targets; or (ii) the acquiring company would, as a practical matter, be
forced to make a purchase decision without the benefit of examination of the
target company's most important assets—its trade secrets." Omnitech, 11 F.3d at
1325.
¶ 41 We find that the facts of this case are more akin to the facts in Omnitech than to the facts
in PepsiCo or Strata. Unlike PepsiCo and Strata, this case does not involve an employee who
possessed trade secrets leaving his employer to work for a competitor. Rather, this case involves
two companies that had entered into negotiations and shared confidential information. The fact
that the information provided by Destiny might have made Cigna more informed in evaluating
whether to partner with Destiny or another vendor in the development of an incentive-points
program does not support an inference that Cigna misappropriated Destiny's trade secrets absent
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some showing that Cigna would not have been able to develop its incentive-points program
without the use of Destiny's trade secrets.
¶ 42 Absent some evidence that Cigna could not have developed its incentive-points program
without the use of Destiny's trade secrets, conclusory assertions of misappropriation based solely
upon Cigna's access during the parties' negotiations are not sufficient to make the requisite
showing that Cigna's use of those trade secrets was inevitable. See Rotec Industries, Inc. v.
Mitsubishi Corp., 179 F. Supp. 2d 885, 895 (C.D. Ill. 2002) (where the plaintiff fails to provide
any evidence to substantiate its belief that the defendants used its alleged trade secrets, the
plaintiff's argument "is based, not on circumstantial evidence, but solely on unsupported
speculation"); Glenayre Electronics, Ltd. v. Sandahl, 830 F. Supp. 1149, 1153 (C.D. Ill. 1993)
("Glenayre has not provided any direct evidence of misappropriation, and the circumstantial
evidence provided is too thin a reed to withstand Defendants' motion.").
¶ 43 Cigna produced direct evidence that Horgan's team did not rely upon or use any of the
confidential information Destiny claims was misappropriated. Destiny has produced no evidence
to the contrary. Despite several years of discovery, Destiny has provided no evidence that could
support an inference that Cigna used Destiny's information, no evidence that Cigna's incentive-
points program is similar to the Vitality program, and no evidence that Cigna could not create its
own program without Destiny's information. We decline to assume that Cigna improperly used
confidential information based solely on the fact that it had access to the information. Thus,
Destiny has not provided sufficient evidence to demonstrate that there is a genuine issue of
material fact regarding Cigna's claimed misappropriation.
¶ 44 The foregoing analysis leads us to conclude that the pleadings, depositions, and affidavits
of record establish the absence of a genuine issue of fact on the question of Cigna's use of
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No. 1-14-2530
Destiny's trade secrets in the development of Cigna's incentive-points program. As a
consequence, Cigna is entitled to judgment as a matter of law on Destiny's claim alleging a
violation of the Trade Secrets Act, and we, therefore, affirm the summary judgment entered by
the circuit court on that claim.
¶ 45 Next, Destiny argues that the circuit court erred in granting summary judgment in favor
of Cigna on its breach of contract claim. In support of its contention in this regard, Destiny relies
upon the same arguments that it asserted in urging reversal of the summary judgment entered on
its Trade Secret Act claim. For the reasons stated in our analysis of Destiny's claim brought
pursuant to the Trade Secrets Act, we also reject Destiny's arguments that it raised a genuine
issue of material fact as to whether Cigna used or misappropriated Destiny's confidential
information in breach of the parties confidentiality agreement and, therefore, affirm the summary
judgment in favor of Cigna on the breach of contract claim.
¶ 46 Having determined that there exists no genuine issue of fact on the question of Cigna's
misappropriation of Destiny's confidential information, we need not address Cigna's other
arguments in support of the summary judgment entered by the circuit court.
¶ 47 Affirmed.
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