Boeing Ducks $72 Million Verdict as Judge Finds No Trade Secrets

The Boeing Co. convinced a Washington state federal judge to scrap a $72 million jury verdict because a startup failed to adequately define allegedly stolen alternative fuel airplane trade secrets or establish their worth.

Zunum Areo Inc. provided “only vague and amorphous descriptions” at trial, falling “well short of providing the specific concrete examples” required to establish trade secrets, Judge James L. Robart ruled Wednesday in the US District Court for the Western District of Washington. Zunum also failed to provide sufficient evidence for a reasonable jury to determine the alleged secrets had economic value from not being generally known, he said.

The judgment as a matter of law Robart issued represented total victory for Boeing, also finding for the aerospace giant on breach of contract and other claims. The judge said a reasonable jury couldn’t have determined from trial with any specificity what Zunum claimed to be trade secrets, negating the need to analyze whether Boeing improperly acquired and used them.

“Clarity does not require a tome,” Robart wrote. “It does, however, require the plaintiff to take the time to ‘separate [its] trade secrets from the other information’ known to or ascertainable by the industry.”

Zunum’s 2020 complaint accused Boeing of gaining access to business plans, market and technical analyses, and other trade secrets “through due diligence under the pretext of a strategic investment in Zunum.” The suit also said Boeing copied the innovations and used them to help develop its own aircraft.

Boeing had falsely assured Zunum that it merely wanted to determine whether it could supply aerostructures for Zunum—not compete with it—before creating its own aircraft using confidential information, the lawsuit said. Zunum also said Boeing kept it beholden to the aeronautics giant through debt financing, and colluded with other companies to block Zunum from entering the hybrid-electric propulsion market, the complaint said.

A jury found Boeing willfully misappropriated 11 of 20 allegedly stolen trade secrets and interfered with Zunum’s business. It awarded $81.2 million for trade secrets theft, $11.5 million for business interference, then deducted $20.8 million because Zenum could have mitigated the damage. A willfulness multiplier on the trade secrets award was to be litigated and could have brought the award to as much as $254 million.

Robart’s order said the trial didn’t present enough evidence for a reasonable jury to reach its conclusions. Aside from failing to demonstrate critical elements of a trade secrets claim, Zunum also failed to provide evidence Boeing breached an investment rights letter, he said.

Hueston Hennigan LLP and Perkins Coie represent Boeing. Holwell Shuster & Goldberg LLP and Corr Cronin LLP represent Zunum Aero Inc.

The case is Zunum Aero Inc. v. The Boeing Co., W.D. Wash., No. 2:21-cv-00896, judgment as a matter of law filed 8/14/24.