McClain v. State

• Decision Date: 17 October 2008
• Docket Number: No. 06-07-00057-CR.,06-07-00057-CR.
• Citation: McClain v. State, 269 S.W.3d 191 (Tex. App. 2008)
• Parties: Frank Herbert McCLAIN, Jr., Appellant, v. The STATE of Texas, Appellee.
• Court: Texas Court of Appeals

269 S.W.3d 191

Frank Herbert McCLAIN, Jr., Appellant, v.The STATE of Texas, Appellee.

No. 06-07-00057-CR.

Court of Appeals of Texas, Texarkana.

Submitted September 10, 2008.

Decided October 17, 2008.

Albert J. Charanza, Jr., Lufkin, for Appellant.

Art Bauereiss, Asst. Dist. Atty., Clyde M. Herrington, Dist. Atty., Lufkin, for appellee.

Before MORRISS, C.J., CARTER and MOSELEY, JJ.

OPINION

Opinion by Justice MOSELEY.

Frank Herbert McClain, Jr., appeals his conviction for theft of trade secrets.¹McClain was employed for several years by Didrickson Associates, Inc., to repair circuit boards which formed part of the control mechanism for General Electric (GE) gas turbines.When McClain left Didrickson Associates to form his own business, McClain removed approximately 100 backsheets, or circuit diagrams, from the files of Didrickson Associates.McClain later returned the files to Didrickson Associates.Approximately four years later, the State charged McClain with theft of trade secrets.A jury found McClain guilty, and the trial court assessed punishment at seven years' imprisonment.McClain argues 1) the evidence is legally insufficient, 2) the evidence is factually insufficient, 3) the trial court erred in revoking McClain's bond, and 4) the trial court erred in instructing the jury concerning the definition of "owner."

I.Factual Background

At the time of the alleged offense, Rhonel Didrickson, an engineer, was the primary owner of Didrickson Associates, which, among other things, provided technical engineering support for "aero-derivative packages"² and for GE gas turbines.The GE gas turbines on which Didrickson Associates worked are used for a variety of purposes, such as the generation of electricity, driving pumps or compressors, and driving ships.GE began to phase out the older turbines and ceased the manufacture of the cards which controlled them so, in the early nineties, Didrickson Associates hired Ed Watson to start an electronics laboratory to repair existing circuit boards (the trade refers to these circuit boards as "cards") which formed a necessary part of the control panels for the GE turbines.The control panel introduced as an exhibit at trial contained over 100 such cards, although some of the cards were duplicates.Prior to starting the electronics laboratory, Didrickson Associates had merely repaired the controls or replaced the circuit boards.In order to repair the cards, it is necessary to first obtain a diagram of the circuit.That diagram is referred to as a "backsheet."Didrickson Associates assembled its large inventory of these backsheets through four primary means.Most of the backsheets accompanied the cards or panels which had been purchased; others were obtained from training schools which were attended by Didrickson Associates employees, from customers who had hired Didrickson Associates to repair a card, and from prior competitors when they retired.

During the course of operating the electronics laboratory, Didrickson Associates had three electronic technicians in succession: Watson, McClain, and Scott Fiester.Didrickson Associates hired McClain to replace Watson, and Fiester succeeded McClain.During his three-year tenure with Didrickson Associates, McClain was the only electronics technician employed by the company.During his employment, McClain expressed an interest in purchasing the electronic card repair portion of the business, but the parties were not able to agree on a price.

While an employee of Didrickson Associates, McClain decided to generate and keep as work-saving devices typewritten set-up sheets which summarized some of the information on the backsheets, and continued to do so during his employment.In some circumstances, summaries of information were written on the backsheets themselves.Didrickson admitted that most of his competitors will write an operating procedure based on the backsheet and that the backsheet usually has all of the information needed to repair a defective or inoperable card.All of the information on the set-up sheets, though in different form, was contained on the backsheets.In other words, the set-up sheet was a "map" and was "an index to kind of cut through the chase."

McClain was on vacation from July 2-11, 2001.During McClain's absence from work, Didrickson determined that some 100-150 backsheets were missing from the electronics laboratory, but these were subsequently returned.Shortly thereafter, McClain (who had no formal employment contract containing a covenant not to compete) started his own business repairing cards and sent letters to customers of Didrickson Associates announcing his resignation from his former employer.

II.We Lack Jurisdiction Over the Revocation of McClain's Appeal Bond

As a preliminary matter, we will address McClain's third point of error.McClain claims that the trial court erred in revoking his appeal bond.For the reasons heretofore stated in our order issued April 23, 2008, on McClain's motion for preference, we reaffirm that we lack jurisdiction over this complaint.The right to appeal from a ruling on bail pending appeal is governed by Article 44.04(g).SeeTEX.CODE CRIM. PROC. ANN. art. 44.04(g)(Vernon 2006).Such an appeal "is separate from the appeal of the conviction and punishment, and it must be perfected by a separate notice of appeal."Davis v. State,71 S.W.3d 844, 845(Tex.App.-Texarkana 2002, no pet.);see alsoFaerman v. State,966 S.W.2d 843, 848(Tex.App.-Houston[14th Dist.]1998, no pet.).McClain has not filed a separate notice of appeal as required by Rule 31 of the Texas Rules of Appellate Procedure.SeeTEX.R.APP. P. 31;Faerman,966 S.W.2d at 848.McClain's third point of error is overruled.

III.The Sufficiency of the Evidence

Intellectual property protections in the United States exist for the primary purpose of providing incentives to invest and create.Robert P. Merges, et al., INTELLECTUAL PROPERTY IN THE NEW TECHNOLOGICAL AGE, 12 (2d ed.2000).Such protections, though, will impose certain social costs on the public, such as decreasing the free exchange of ideas.The extent that intellectual property is protected seeks to balance "the social benefit of providing economic incentives for creation" against "the social costs of limiting the diffusion of knowledge."Id. at 15.

The principal modes for protection of intellectual property rights include patent, copyright, trademark or trade dress, and trade secrets.Id. at 1-2.Unlike the other principal modes of intellectual property protection, trade secret protection only protects an owner from misappropriation of or the unlawful discovery of an idea.In order for there to be a violation of the right to protect a trade secret, the actor must have wrongfully acquired the information.Id. at 35.

Under the Texas Penal Code, a person commits theft of a trade secret if he or she, without the owner's effective consent, knowingly: "(1) steals a trade secret; (2) makes a copy of an article representing a trade secret; or (3) communicates or transmits a trade secret."TEX. PENAL CODE ANN. § 31.05(b)(Vernon 2003).Section 31.05. of the Texas Penal Code defines trade secret as being "the whole or any part of any scientific or technical information, design, process, procedure, formula, or improvement that has value and that the owner has taken measures to prevent from becoming available to persons other than those selected by the owner to have access for limited purposes."TEX. PENAL CODE ANN. § 31.05(a)(4)(Vernon 2003).Unlike the general theft statute, theft of trade secrets does not require the State to prove intent to deprive the owner of the trade secret.³CompareTEX. PENAL CODE ANN. § 31.05(Vernon 2003)withTEX. PENAL CODE ANN. § 31.03(Vernon Supp.2008).

Texas caselaw has clarified the above definition of trade secrets in a number of ways.Most relevant to this case, the Dallas Court of Appeals has held that a trade secret cannot be something within public knowledge.SeeLeonard v. State,767 S.W.2d 171, 175(Tex.App.-Dallas1988), aff'd sub. nom.Schalk v. State,823 S.W.2d 633(Tex.Crim.App.1991).In two opinions focusing on whether security measures were sufficient to secure secrecy, the Texas Court of Criminal Appeals has refined the secrecy element of trade secrets.SeeWeightman v. State,975 S.W.2d 621, 624(Tex.Crim.App.1998);Schalk,823 S.W.2d at 640."It is axiomatic that the core element of a trade secret must be that it remain a secret."Schalk,823 S.W.2d at 640.However, "absolute secrecy is not required"; rather, a substantial element of secrecy must exist.Id.(citingQ-Co Indus., Inc. v. Hoffman,625 F.Supp. 608(S.D.N.Y.1985)).A substantial element of secrecy exists when "`except by use of improper means, there would be difficulty in acquiring the information.'"Hoffman,625 F.Supp. at 617(quotingA.H. Emery Co. v. Marcan Prods. Corp.,389 F.2d 11, 16(2d Cir.1968)).

In reviewing the legal sufficiency of the evidence in a case before us, we view all of the evidence in the light most favorable to the verdict and determine whether any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.Johnson v. State,23 S.W.3d 1, 7(Tex.Crim.App.2000).

In a factual sufficiency review, we review all the evidence, but do so in a neutral light and determine whether the evidence supporting the verdict is so weak or is so outweighed by the great weight and preponderance of the evidence that the jury's verdict is clearly wrong or manifestly unjust.Lancon v. State,253 S.W.3d 699, 705(Tex.Crim.App.2008);seeRoberts v. State,220 S.W.3d 521, 524(Tex.Crim.App.2007);Watson v. State,204 S.W.3d 404, 414-15(Tex.Crim.App.2006);see alsoClewis v. State,922 S.W.2d 126, 134(Tex.Crim.App.1996)."Although an appellate court reviewing factual sufficiency has the ability to second-guess the jury to a limited degree, the review should still be...