Court Overturns $64 Million Trade Secret Verdict for Failure to Define the Secrets

A jury once awarded Coda Development $64 million after finding that Goodyear misappropriated its self-inflating tire technology. But the trial court threw out that verdict entirely, and in early 2025, the Federal Circuit affirmed the reversal. The reason had nothing to do with whether Goodyear actually stole the technology. Instead, the case collapsed because Coda failed to define its trade secrets with enough specificity for the court to evaluate them. For any business owner who relies on proprietary information, this case offers a critical lesson about the importance of clearly identifying what you are protecting.

What Went Wrong in Coda's Case

Coda Development, a Czech technology company, developed a self-inflating tire system and shared confidential details with Goodyear during early business discussions. When Goodyear later developed its own self-inflating tire product, Coda sued for trade secret misappropriation under Ohio law. At trial, the jury sided with Coda and awarded $2.8 million in compensatory damages and $61.2 million in punitive damages.

The victory was short-lived. When the court examined whether Coda had properly identified its trade secrets, the answer was no. One claimed trade secret was described only as a list of general functions, with no detail about how those functions were accomplished. Others were dismissed as nothing more than "undifferentiated components" with no explanation of what proprietary knowledge they actually contained. A fourth failed because Coda could not distinguish the claimed secret from information already publicly available through a patent application and a journal article.

Why Defining Your Trade Secrets Matters

Under most trade secret laws, including the federal Defend Trade Secrets Act, a company seeking protection must identify the specific information it considers secret. Vague or overbroad descriptions are not enough. Courts require this specificity so they can determine whether the information qualifies as a trade secret and whether the alleged misappropriation actually occurred.

This requirement exists for good reason. A trade secret is not simply a general area of expertise or a broad category of knowledge. It must be a specific piece of information, such as a formula, process, design, technique, or compilation of data, that derives independent economic value from being kept confidential. Businesses that fail to document and define their proprietary information with precision risk losing their ability to enforce their rights, even when misappropriation may have genuinely occurred.

Key Takeaway for Business Owners

The Goodyear case is a powerful reminder that protecting trade secrets begins long before any dispute arises. Business owners should take the time to create and maintain a detailed inventory of their trade secrets. Each item on that list should describe the secret with enough specificity that an outsider could understand what it is and why it is valuable. Simply labeling something as "our proprietary process" or "our unique technology" will not hold up in court.

Equally important is distinguishing your trade secrets from publicly available information. If elements of your technology have been disclosed in patent applications, published research, or marketing materials, those elements may no longer qualify for trade secret protection. A regular audit of what remains confidential and what has entered the public domain can prevent costly surprises down the road.

Want to learn more about protecting your trade secrets? Schedule a free consultation with Diorio IP Law Group to discuss your options.