SILVACO DATA SYSTEMS, Plaintiff and Appellant,
v.
CIRRUS LOGIC, INC., Defendant and Appellant.
H032802
California Court of Appeal, Sixth District
April 29, 2010
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. CV031950
RUSHING, P.J.
This is one of three cases filed today arising from attempts by Silvaco Data Systems (Silvaco) to secure damages from various participants in the electronic design automation (EDA) industry for their use of a computer program that was based, according to Silvaco, on proprietary source code stolen from it. (See Silvaco Data Systems v. Intel (Apr. 29, 2010, H032895) ___ Cal.App.4th ___; Silvaco Data Systems v. Agilent Technologies, Inc. (April 29, 2010) [nonpub. opn.].) This case differs from the other two in that it includes a cross-appeal raising the question whether Silvaco’s claims were shown, on motion for summary judgment, to be barred by the statute of limitations. Because we will affirm the judgment in the course of the main appeal, the cross-appeal appears to be moot.
Background
Silvaco filed this action in December 2004, charging defendant Cirrus Logic, Inc. (Cirrus) with misappropriation of trade secrets, conversion, unfair business practices, civil conspiracy, and “common count.” Cirrus initially answered the complaint but, some two and half years later, moved for judgment on the pleadings on all but the cause of action for misappropriation of trade secrets. In support of the motion it argued, among other things, that the California Uniform Trade Secrets Act (CUTSA), Civil Code sections 3426.1 et sequitur, provided the exclusive civil remedy for trade secret claims not sounding in contract, and superseded all other theories of recovery. The trial court granted this motion without leave to amend.
All further statutory references are to the Civil Code.
Cirrus then moved for summary judgment on the cause of action for misappropriation of trade secrets. It argued, as here material, that (1) Silvaco sought to predicate liability only on Cirrus’s use of a computer program alleged to have been compiled by its seller from source code purloined from Silvaco; and (2) such an act can supply neither the conduct element (“misappropriation”) nor the required mental state (“knowledge of the trade secret”) to establish a cause of action under CUTSA. (See § 3426.1, subd. (b).) The trial court granted this motion as well. Having thus disposed of the entire controversy, the court entered judgment for Cirrus. Silvaco filed this timely appeal.
Discussion
I. Supersession of Non-CUTSA Claims
With respect to the order granting judgment on the pleadings, the operative facts here do not differ materially from those in Silvaco v. Intel, supra, ___ Cal.App.4th ___. We therefore follow our treatment in that case. All of the non-CUTSA claims depend on a misappropriation of trade secrets for a necessary element. Each count incorporates by reference all preceding allegations, including the allegation of a misappropriation of trade secrets. One of the counts-for unfair business practices-explicitly echoes those allegations, asserting that Cirrus engaged in unlawful practices “including, but not limited to... [the] misappropriation and use of SILVACO trade secrets.” Since no other basis for any finding of wrongdoing is suggested, that count rests unmistakably on misappropriation of trade secrets. That leaves the counts for conversion and “common count.” These do not expressly repeat the trade secret language, but they incorporate it-and more importantly, they implicitly rest upon it. Thus, after incorporating the previous allegations by reference, the conversion count alleges that Silvaco has been damaged “[a]s a proximate result of the conversion and use of SILVACO’s property as described herein.” The “common count” alleges that Cirrus has “obtained certain property of SILVACO as alleged herein.” The only “property” identified anywhere in the complaint is the trade secrets supposedly “contained” in the software used by Cirrus. These counts therefore depend on a misappropriation of trade secrets, or they plead no legal wrong at all.
This contrasts somewhat with the Intel matter, where one of the non-CUTSA claims had eventually been amended to a point where it did not depend on a misappropriation of trade secrets. (Silvaco v. Intel, supra, ___ Cal.App.4th ___ [pp. 36-37].) We held it fatally deficient, however, in other respects. (Id. [p. 41].)
Silvaco eventually withdrew a cause of action for conspiracy because, it wrote, that claim was “redundant” of the trade secrets cause of action.
As we hold today in Silvaco v. Intel, supra, ___ Cal.App.4th ___ [pp. 24-29], CUTSA supersedes other theories of civil liability not sounding in contract. Accordingly none of Silvaco’s non-CUTSA claims asserts a cause of action independent of or apart from its claim for misappropriation of trade secrets. The trial court therefore did not err in granting judgment on the pleadings.
II. Misappropriation of Trade Secrets
Nor did the court err in granting summary judgment on the ground that Silvaco was unable to raise a triable issue of fact with respect to Cirrus’s supposed misappropriation of trade secrets. As we hold in Silvaco v. Intel, supra, ___ Cal.App.4th ___ [pp. 10], CUTSA requires that the defendant be shown to have acquired, disclosed, or used the trade secrets identified by the plaintiff. (§ 3426.1, subd. (b).) Silvaco has never coherently suggested that Cirrus acquired or disclosed any trade secrets belonging to it. The only question is whether, by running software supposedly “contain[ing]” those secrets, Cirrus made an actionable “use” of them. We see no basis on which to reach a different answer than the “no” we gave in the Intel matter. The only trade secrets effectively claimed by Silvaco consist of source code-programming instructions that are written in a high-level programming language by humans, readily understood by them, and easily incorporated in another program. The only “use” attributed to Cirrus was to run a program compiled from such source code, i.e., reduced to executable machine language which is not readily understood by human beings cannot be readily incorporated into another program. As we hold in Silvaco v. Intel, supra, ___ Cal.App.4th ___ [pp. 12-13], it is doubtful that such conduct can ever be deemed a “use” of the underlying source code, and in any event it cannot constitute use-at least not in any sense potentially applicable here-unless it is accompanied by “knowledge of the trade secret” (§ 3426.1, subd. (b)), which is something the compiled code simply could not convey.
It follows that the court did not err by granting summary judgment or, having thereby disposed of the last remaining cause of action, by entering judgment for Cirrus.
This conclusion makes it unnecessary to reach the question whether the court erred by failing to sustain Cirrus’s limitations defense. We will dismiss the cross-appeal on that basis, thereby also mooting any unresolved vestige of Silvaco’s motion to dismiss the cross-appeal.
DISPOSITION
The judgment is affirmed. The cross-appeal is dismissed. Costs to respondent.
WE CONCUR: PREMO, J. ELIA, J.