Twitter’s accusation that Meta Platforms stole trade secrets to develop its new microblogging site, Threads, may signal a potential legal battle between the two social media giants. However, legal experts suggest that Twitter faces significant challenges if it decides to sue.
In a letter sent last week, Twitter claimed that Meta had hired several former Twitter employees who had improperly retained devices and documents from the company, which were allegedly used in the development of Threads. Twitter demanded that Meta cease using the information. It remains unclear whether Twitter will proceed with a lawsuit.
Proving such allegations is complex, as many companies have accused competitors of stealing trade secrets through the employment of former staff and the development of similar products. To succeed in court, a company needs to demonstrate that the information taken by the competitor was economically valuable and that it had made reasonable efforts to keep it secret. Defining what constitutes “reasonable effort” can be challenging.
Experts note that courts consider whether a company explicitly informed employees that specific information was confidential and a trade secret. Broad agreements designating all company information as confidential can be problematic, as employees may struggle to determine what is truly confidential.
Trade-secret cases often reveal weaker claims than initially believed. For instance, the legal battle between Waymo (Alphabet’s self-driving vehicle unit) and Uber began with allegations of thousands of stolen documents but ultimately revolved around a small number of disputed items. The case was settled before trial, with Uber paying $245 million in its own shares.
While trials in trade-secret cases are rare, settlements are common due to the strong incentive to avoid unnecessary disclosure of secrets during legal proceedings.
