In what Connecticut lawyers say is perhaps the largest trade secrets verdict in state history, a Waterbury judge has ordered a Bethany manufacturer to pay $50.5 million to Dur-A-Flex Inc. in East Hartford for copying its process in developing colored sand.
After an eight-week trial, a jury ruled May 18 that Laticrete International Inc., a producer of installation systems for stone and ceramic tile, had violated the Connecticut Uniform Trade Secrets Act and breached a confidentiality agreement with Dur-A-Flex Inc., over the production of a type of colored sand.
Waterbury Judge Dennis Eveleigh, in one of his final rulings on his way to becoming Connecticut Supreme Court justice on June 1, then ruled on Thursday that Dur-A-Flex should be awarded additional money for the continued use of its process and to pay its lawyers.
According to court documents, Dur-A-Flex had been a supplier of colored sand to Laticrete for many years, and Laticrete signed an agreement to maintain the confidentiality of Dur-A-Flex’s trade secrets and manufacturing process, court documents said.
Laticrete employee Rosi Rooshenas had worked hand-in-hand with Dur-A-Flex employees to develop specific colors of sand that matched the color Laticrete wanted to create for its tile grout, according to court documents.
But Laticrete eventually ceased doing business with Dur-A-Flex., and immediately began manufacturing an identical product, said Lawrence G. Rosenthal, a Hartford lawyer who represented Dur-A-Flex.
Last week, a jury ruled that Laticrete had violated the Connecticut Uniform Trade Secrets Act and breached its confidentiality agreement with Dur-A-Flex, awarding a $43.7 million verdict.
The award was bumped up to $50.5 million Thursday to include $5.8 million attorney’s fees and $395,000 in court costs. The judge also awarded a $600,000 royalty payment made to Dur-A-Flex for the conditioned future use of Dur-A-Flex’s technology on payment of royalty fees.
David A. Rothberg, chairman and CEO of Laticrete, in a written statement told HBJ Today that the company is “extremely disappointed,” with the verdict and will appeal the decision “vigorously.”
“We think the finding that Laticrete is liable is absolutely baseless,” Rothberg said in his statement. “Further, the award is grossly excessive and without foundation in either the facts or the law. We are particularly dismayed because, during its 53 years in operation, the company has always acted in accordance with the highest ethical standards.”
