An Oregon livestock nutrition company has prevailed in a lawsuit over trade secrets against a former employee who was found to have intentionally destroyed evidence.
A federal judge has entered a default judgment against Yongqiang Wang, the former employee, as punishment for deleting emails and giving away a computer likely containing information related to trade secrets owned by Omnigen Research.
U.S. District Judge Michael McShane said the “extreme measure” of a default ruling against Wang was justified because he severely interfered with the orderly administration of justice in the case.
“These actions have deprived the plaintiffs of evidence central to their case and undermined the court’s ability to enter a judgment based on the evidence,” McShane said.
Roger Hennagin, the attorney representing Wang, said he could not comment on the ruling because he hasn’t yet been able to discuss it with his client, who works in China.
The complaint against Wang was initially filed last year by Omnigen, a company founded by former Oregon State University professor Neil Forsberg and later sold to Phibro Animal Health for $23 million.
The lawsuit accused Wang of planning to sell feed additives in China that were based on trade secrets stolen from Omnigen, a company that employed him between 2005 and 2013.
Omnigen’s feed additives, which counteract hemorrhagic bowel syndrome in cattle, are used by roughly 20 percent of the U.S. dairy cow herd and the company hoped to expand its reach to China.
Wang obtained “sham” patents in China from confidential information he accessed while working for Omnigen and secretly launched two companies, Mirigen and Bioshen, to sell the additives in that country, the complaint alleged.
In a counterclaim against Omnigen, Wang denied relying on his former employer’s trade secrets and claimed Forsberg unjustly enriched himself by failing to share profits with Wang, as earlier promised.
According to McShane, the case was “plagued” by evidence problems “from its inception,” with Wang deleting more than 4,000 files from his computer despite a preliminary injunction requiring him to preserve evidence.
While many of the files were recovered, some documents that were probably relevant to the case were permanently destroyed, the judge said.
Both Wang and his wife also deleted emails detailing their involvement in the formation of Mirigen and Bioshen and donated a desktop computer to Goodwill shortly after the preliminary injunction was issued, McShane said.
While the default judgment means that Wang has lost the case, the judge still intends to hold a hearing to establish damages owed to Omnigen.