Missouri Law After Alabama Aircraft v. Boeing: Limitation-of-Liability Clauses Reach Trade Secret Torts, But Unjust Enrichment Survives Absent Express Waiver

Missouri Law After Alabama Aircraft v. Boeing: Limitation-of-Liability Clauses Reach Trade Secret Torts, But Unjust Enrichment Survives Absent Express Waiver

Introduction

In a published decision with significant implications for commercial contracting and trade secret litigation, the Eleventh Circuit (applying Missouri law) reversed the dismissal of a trade secret claim brought by Alabama Aircraft Industries, Inc. and related entities (collectively, Pemco) against The Boeing Company and affiliates (collectively, Boeing). The panel held that a bargained-for limitation-of-liability clause in the parties’ 2005 master teaming agreement applies beyond contract claims to restrict damages for Pemco’s statutory trade secret misappropriation claim under the Missouri Uniform Trade Secrets Act. Yet, reading the contract alongside Missouri’s statute, the court carved out a crucial exception: the clause does not bar restitutionary recovery for unjust enrichment because “unjust enrichment” was not among the enumerated categories of disclaimed damages.

The case, involving a failed “teaming arrangement” to bid on a 2008 U.S. Air Force contract, returns to the district court after a prior Eleventh Circuit decision (Pemco I) revived Pemco’s trade secret claim under Missouri’s statute of limitations. On remand, the district court dismissed the revived claim under Rule 12(b)(6) based on the limitation clause. The Eleventh Circuit reversed, holding that while most damages categories (punitive, incidental, consequential, lost profits, and attorneys’ fees/costs) are barred, Pemco may proceed to seek disgorgement of Boeing’s ill-gotten gains to the extent those gains are not duplicative of Pemco’s already-awarded direct, out-of-pocket contract damages.

Parties: Pemco (plaintiffs-appellants) and Boeing (defendants-appellees). Court: U.S. Court of Appeals for the Eleventh Circuit. Law applied: Missouri contract law and the Missouri Trade Secrets Act (Mo. Rev. Stat. § 417.450 et seq.).

Summary of the Opinion

The court addressed whether a limitation-of-liability clause in a master agreement—expressly barring “any incidental damages, punitive and exemplary damages and any consequential damages,” including lost profits and attorneys’ fees—forecloses damages for a statutory trade secret misappropriation claim. The panel held:

  • The master agreement’s merger clause and incorporation-by-reference language bind the NDA and master agreement into a single contract under Missouri law.
  • The limitation-of-liability clause applies not only to breach of contract damages but also to tort claims intertwined with the agreement—here, misappropriation of trade secrets—because otherwise the clause’s explicit bar on punitive/exemplary damages (unavailable in contract) would be rendered superfluous.
  • Enforcement of the clause does not violate Missouri public policy when negotiated at arm’s length by sophisticated commercial parties; Missouri’s Supreme Court in Purcell Tire permits contractual limitation of remedies even as to torts linked to the contract.
  • However, Missouri’s Trade Secrets Act expressly allows damages measured by (a) actual loss and (b) unjust enrichment not accounted for in actual loss. The contract’s limitation clause did not list unjust enrichment among barred categories, and unjust enrichment is not the same as “consequential damages.”
  • Pemco has already recovered direct, out-of-pocket damages for Boeing’s breach of contract. Pemco may pursue only non-duplicative unjust enrichment attributable to the alleged misappropriation (e.g., Boeing’s ill-gotten gains/cost savings on the Air Force “Recompete” contract).
  • The dismissal is reversed and remanded for proceedings limited to unjust enrichment under the Missouri Trade Secrets Act. A request to reassign the case to a different district judge is denied.

Analysis

Precedents Cited and How They Shaped the Decision

  • Bridgecrest Acceptance Corp. v. Donaldson (Mo. 2022) and Intertel, Inc. v. Sedgwick Claims Management Services, Inc. (Mo. Ct. App. 2006): Establish Missouri’s incorporation-by-reference rule. The master agreement’s merger clause, expressly including exhibits and attachments, folded the NDA into the master agreement. Result: one integrated contract governs, including the limitation clause.
  • Dewey v. American Stair Glide Corp. (Mo. Ct. App. 1977) and All Star Awards & Ad Specialties, Inc. v. HALO Branded Solutions, Inc. (Mo. 2022): Punitive damages are unavailable in contract under Missouri law. This matters because the limitation clause explicitly barred punitive/exemplary damages; to give that bar meaning, the clause must reach tort claims.
  • TAP Pharmaceutical Products Inc. v. State Board of Pharmacy (Mo. 2007), Riverside Pipeline (Mo. 2007), and Ringstreet Northcrest, Inc. v. Bisanz (Mo. Ct. App. 1995): The “no superfluity” canon of contract construction. The court used this to refuse an interpretation that would make the punitive-damages exclusion meaningless.
  • Alack v. Vic Tanny International of Missouri, Inc. (Mo. 1996): Consumer exculpatory clause case; Missouri forbids advance exoneration for intentional torts in certain contexts. But Alack expressly reserved the question of limits negotiated between sophisticated commercial entities, and the parties here disclaimed any fiduciary relationship, sidestepping the narrow fiduciary exception.
  • Purcell Tire & Rubber Co. v. Executive Beechcraft, Inc. (Mo. 2001): Controlling Missouri authority that sophisticated parties may contractually limit remedies, even for negligence claims closely tied to the contract, and even where the clause says liability “under this agreement.” The Eleventh Circuit predicted Missouri would permit the parties’ limitation here to apply to Pemco’s tort claim intertwined with the contract.
  • Ryann Spencer Group, Inc. v. Assurance Co. of America (Mo. Ct. App. 2008) and Central Trust & Investment Co. v. Signalpoint Asset Management, LLC (Mo. 2014): A tort must be independent of a mere breach; elements of a Missouri Trade Secrets Act claim. Pemco’s misappropriation claim is an independent statutory tort, but the key element is damages (or equitable relief) not barred or already satisfied.
  • Kforce, Inc. v. Surrex Solutions Corp. (8th Cir. 2006): The district court relied on Kforce’s “full recovery” principle to bar further recovery. The Eleventh Circuit distinguished it because Kforce did not analyze unjust enrichment damages under the Missouri Trade Secrets Act.
  • Russo v. Ballard Medical Products (10th Cir. 2008) and Caudill Seed & Warehouse Co. v. Jarrow Formulas, Inc. (6th Cir. 2022): Applying UTSA analogs, both courts allow recovery of unjust enrichment in addition to actual loss so long as there is no double counting. The Eleventh Circuit aligned with this prevailing UTSA view.
  • Mihlfeld & Associates, Inc. v. Bishop & Bishop, L.L.C. (Mo. Ct. App. 2009) and Norber v. Marcotte (Mo. Ct. App. 2004): No double recovery under Missouri law; separate recoveries must compensate separate injuries.
  • Cason v. King (Mo. Ct. App. 2010): Defines “consequential damages” under Missouri law as plaintiff’s foreseeable losses naturally and proximately caused by the breach. This definition underpins the distinction between consequential damages and restitutionary unjust enrichment.
  • JB Contracting, Inc. v. Bierman (Mo. Ct. App. 2004), American Standard Insurance Co. of Wisconsin v. Bracht (Mo. Ct. App. 2003), and S & J, Inc. v. McLoud & Co. (Mo. Ct. App. 2003): Elements and equity of unjust enrichment in Missouri; the “unjust” component and focus on the defendant’s gain.

Legal Reasoning

1) One Contract, Not Two: The Master Agreement and NDA Function as a Single Instrument

The master agreement’s merger clause made the “Entire Agreement” include exhibits and attachments; the NDA was such an attachment. Under Missouri’s incorporation-by-reference doctrine, the NDA and master agreement must be construed together. Pemco therefore cannot avoid the master agreement’s limitation-of-liability clause by recharacterizing the NDA as a stand-alone contract.

2) The Limitation Clause Reaches Tort Damages Intertwined with the Contract

The clause bars “any incidental damages, punitive and exemplary damages and any consequential damages,” including lost profits and litigation expenses/attorneys’ fees. Because punitive and exemplary damages are unavailable in contract under Missouri law, the only reasonable construction that gives effect to those words is that the parties intended to limit tort damages arising from conduct intertwined with the agreement (such as trade secret misappropriation connected to the NDA and teaming arrangement). Missouri’s “no superfluity” canon compelled the court’s broader reading.

The panel did not define the outer bounds of what torts fall within the clause; it was enough that misappropriation of trade secrets arose from the exchange of proprietary information within the teaming arrangement, placing it squarely in the clause’s ambit.

3) Public Policy: Sophisticated Parties May Limit Remedies, Even for Torts Tethered to the Contract

Pemco argued that enforcing the clause would violate public policy by exonerating intentional torts and “waiving” statutory remedies. The court disagreed:

  • Alack’s anti-exculpation rule arose in a consumer context; the Missouri Supreme Court expressly reserved whether arm’s-length, sophisticated parties could allocate risk differently.
  • Purcell Tire answered that question: sophisticated commercial entities can limit future remedies by contract, even for negligence-related tort exposure intertwined with the contract. That principle fits the present case, where the parties also disclaimed any fiduciary relationship, and where the clause does not completely exonerate Boeing—an unjust enrichment avenue remains.

The court also noted it need not decide whether Missouri would reject a clause that entirely extinguishes all remedies for intentional torts, because here, not all remedies were barred: unjust enrichment remains available.

4) The Trade Secret Tort Is Independent of the Contract Breach, But Damages Must Be Legally Available and Non-Duplicative

A mere failure to perform a contract does not by itself sound in tort. Here, Pemco alleged an independent statutory tort (misappropriation) under the Missouri Trade Secrets Act, which requires that: (1) a trade secret exist, (2) the defendant misappropriated it, and (3) the plaintiff is entitled to damages or injunction. The decision turned on element (3): had Pemco alleged a category of recovery that remained legally available after the parties’ contractual limitations and Pemco’s prior contract verdict?

The court answered yes—but only as to unjust enrichment. Pemco already received a jury award of direct, out-of-pocket damages for Boeing’s breach of the NDA and master agreement. Under Mo. Rev. Stat. § 417.457.1, however, damages may include both “the actual loss caused by misappropriation” and “the unjust enrichment caused by misappropriation that is not taken into account in computing actual loss.” That statutory structure—also widely used across UTSA jurisdictions—permits a plaintiff to pursue disgorgement of a misappropriator’s gains so long as there is no double counting.

5) Unjust Enrichment Is Not “Consequential Damages” and Was Not Disclaimed

Boeing argued that unjust enrichment equates to consequential damages and is therefore barred. The court rejected that argument. Under Missouri law, consequential damages are the plaintiff’s losses naturally and proximately caused by the breach—damages that make the plaintiff whole. Unjust enrichment, by contrast, focuses on the defendant’s gain that it would be unjust to retain; it is a restitutionary measure that strips ill-gotten profits or cost savings from the wrongdoer.

Because the clause did not list “unjust enrichment,” “restitution,” “disgorgement,” or the like, and because unjust enrichment is conceptually distinct from consequential damages, the panel refused to read that remedy into the exclusions. If the parties had intended to bar restitutionary recovery, they could have said so expressly.

6) No Double Recovery

Missouri law forbids duplicate compensation for the same injury. Pemco’s prior contract verdict covered its direct, out-of-pocket losses. On remand, Pemco may pursue only those unjust enrichment amounts (profits or cost savings) causally linked to the misappropriation that were not already embedded in the contract award. This is consistent with the statute’s explicit anti-duplication directive and UTSA caselaw (e.g., Russo, Caudill Seed).

Impact

  • Contract drafting with Missouri law (and UTSA jurisdictions) in mind:
    • Limitation-of-liability clauses negotiated between sophisticated parties will be enforced broadly—even against statutory tort damages intertwined with the contract—if the language and structure otherwise would be superfluous.
    • To bar restitutionary recovery for misappropriation (or other intentional misconduct), drafters should consider adding explicit language disclaiming “restitution, unjust enrichment, disgorgement, accountings of profits, and any restitutionary or equitable monetary remedies,” in addition to “incidental, consequential, special, punitive/exemplary” damages.
    • If parties want fee-shifting or exemplary damages to remain available for willful/malicious misappropriation, they should carve those out. This opinion enforces a clause barring “litigation expenses and attorneys’ fees” and “punitive and exemplary damages,” limiting statutory enhancements that would otherwise be available under the Trade Secrets Act.
  • Litigation strategy in trade secrets cases with limitation clauses:
    • Plead and prove restitutionary unjust enrichment separately from actual loss. Build a causal narrative showing how misappropriation produced specific gains or cost savings for the defendant (e.g., profit on the awarded contract, facility-wide cost efficiencies).
    • Disaggregate ill-gotten gains from other business drivers to avoid duplication with any contract or other compensatory awards.
    • Expect defendants to argue that unjust enrichment is “consequential.” This decision provides a clear Missouri-law answer that it is not.
  • Government contracting and teaming arrangements:
    • Parties often integrate master agreements, work-share agreements, and NDAs. This case treats those as a single contract when a merger clause and incorporation-by-reference exist, extending remedy limitations across the suite of documents.
    • Bidders sharing cost and technical data should assume that, absent targeted drafting, statutory punitive and fee-shifting remedies can be contractually waived—while restitutionary disgorgement likely remains unless expressly disclaimed.
  • Public policy boundaries left open:
    • The court did not decide whether Missouri would enforce a clause that completely exonerates liability for an intentional tort. The presence of a surviving unjust enrichment remedy allowed the court to sidestep that question.
    • The opinion reinforces that consumer exculpatory principles (Alack) do not control sophisticated commercial agreements—Purcell Tire does.
  • Uniform Trade Secrets Act uniformity:
    • The court’s reliance on UTSA-analog decisions (Russo, Caudill Seed) underscores that unjust enrichment is a mainstream remedy, available in addition to actual loss provided there is no double counting. The Eleventh Circuit’s reasoning will be persuasive in other UTSA jurisdictions applying similar limitation clauses under their own contract law.

Complex Concepts Simplified

  • Limitation-of-liability clause: A contract provision that restricts what kinds or amounts of damages a party can recover if the other breaches or commits related wrongs. Here, the clause barred incidental, consequential, punitive/exemplary damages, lost profits, and attorneys’ fees/costs.
  • Merger clause and incorporation by reference: Language stating the written agreement is the complete agreement, and that referenced documents (e.g., an NDA as an “attachment”) are part of the same contract. This binds all documents together and extends limitations across them.
  • Superfluity canon: Courts avoid interpretations that render contractual words meaningless. Because punitive damages don’t exist in contract, the parties’ express bar on “punitive and exemplary” damages would be pointless unless the clause also reached tort damages.
  • Consequential damages vs. unjust enrichment:
    • Consequential damages compensate the plaintiff’s foreseeable losses stemming from the breach (e.g., the buyer’s lost resale profits from a late delivery).
    • Unjust enrichment strips the defendant’s gains (profits or cost savings) obtained through wrongful conduct—here, misappropriation of trade secrets—so that the wrongdoer doesn’t keep ill-gotten benefits.
  • Independent tort: A tort (like statutory misappropriation) that arises from duties imposed by law, not merely from a promise in a contract. It supports relief only if damages or equitable relief are available and not foreclosed by contract.
  • No double recovery: Plaintiffs cannot be paid twice for the same injury. Under the Missouri Trade Secrets Act, a court may award both actual loss and unjust enrichment—but not if the unjust enrichment is already “taken into account” in calculating actual loss.
  • Scope of surviving remedy here: The court expressly limited Pemco’s remaining path to restitutionary unjust enrichment on remand. Punitive/exemplary damages, lost profits, incidental and consequential damages, and attorneys’ fees/costs are off the table under the clause.

Other Appellate Rulings in the Opinion

  • Standard of review: De novo review of the Rule 12(b)(6) dismissal; the court accepted well-pleaded facts and construed them in Pemco’s favor.
  • Party concessions: The court is not bound by a party’s prior legal positions; contract interpretation is a question of law for the court.
  • Reassignment request: Denied. Reassignment on remand is a “severe remedy” and not warranted by the district judge’s scheduling remarks, which reflected a legitimate desire to resolve an aged case “in the interest of fairness to both sides.”

Conclusion

Alabama Aircraft v. Boeing establishes a clear Missouri-law rule for sophisticated commercial parties: a well-drafted limitation-of-liability clause can restrict damages for statutory trade secret misappropriation, not just contract claims, where the clause’s language would otherwise be rendered superfluous. At the same time, courts will not silently read “restitution” out of the law. Because unjust enrichment is not the same as “consequential damages” and was not expressly disclaimed, the Trade Secrets Act’s restitutionary remedy survives.

The decision offers pragmatic guidance for both drafters and litigants. Contract architects who want to foreclose restitutionary exposure must say so explicitly, listing “restitution, unjust enrichment, disgorgement, accounting of profits,” alongside conventional exclusions. Litigants confronted with broad limitation clauses should focus on non-duplicative unjust enrichment, carefully proving the defendant’s ill-gotten gains or cost savings attributable to misappropriation. And everyone should heed the court’s reminder: sophisticated parties enjoy freedom to allocate risk and limit remedies—but courts will enforce those bargains as written, and only as written.

Outcome: The Eleventh Circuit reversed the dismissal and remanded. Pemco may proceed solely on an unjust-enrichment measure of recovery under the Missouri Trade Secrets Act; all other damage categories sought in the complaint are contractually barred.

Case Details

Year: 2025
Court: Court of Appeals for the Eleventh Circuit

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