Ann-Elizabeth Ostrager, Co-Head of S&C’s Employment Law Group, and associate J. Sam Bonafede co-authored an article for New York Law Journal examining a growing split among federal courts of appeals over the availability of certain compensatory damages under the Defend Trade Secrets Act. The authors highlight the increased uncertainty this divide creates for companies litigating trade secret disputes, particularly in New York, where federal and state law take different approaches to compensatory damages.
“Courts confronting avoided costs theories in 2026 and perhaps beyond will increasingly be asked to choose between competing conceptions of unjust enrichment—one centered on a plaintiff’s injury and another focused on a defendant’s benefit,” they write. “In cases involving New York state law, that choice is further complicated by the need to reconcile those federal restitutionary theories with state-law principles that categorically reject avoided cost damages.”
Read: “Avoided Costs, Avoided Certainty: A Growing Circuit Split Over Defend Trade Secrets Act’s Damages?”