Arnold Porter Wins Significant Jury Verdict in Noncompete and Corporate Raid Case
After a month-long jury trial, on Friday, September 27, Arnold & Porter achieved a resounding victory for client Cynosure from a unanimous Boston jury in the United States District Court, District of Massachusetts, resulting in an award of over $25 million in compensatory and punitive damages.
Cynosure, a leading provider of aesthetic and medical treatment devices, had filed a lawsuit against industry competitor Reveal Lasers and 28 employees for breaching contracts and duties of loyalty, as well as engaging in tortious interference with contractual relations, trade secret misappropriation, unfair and deceptive trade practices, and conspiracy. The firm achieved victories at several key stages — including obtaining a temporary restraining order within days of the cases being filed and then a preliminary injunction, with the court (Judge Patti Saris) enforcing a number of the noncompetes.
The trial was bifurcated and proceeded only against Reveal and the two individuals who spearheaded the corporate raid, Cynosure’s former heads of sales in North America, Chris Chambers and the head of the Northeast, Robert Daley. These defendants engaged in a brazen conspiracy to recruit high-performing Cynosure employees to join Reveal in advance of Reveal’s U.S. launch. As a result of these actions, around two dozen Cynosure employees — more than a quarter of its North American sales force — resigned within two months in May and June 2022, taking with them trade secrets and critical company information that would be highly advantageous to a new entrant like Reveal.
Arnold & Porter proved that Chambers and Daley breached numerous provisions in their respective contracts, including the non-competition, employee non-solicitation, and non-disclosure provisions, the implied covenant of good faith and fair dealing, and their fiduciary duties of loyalty (while aided and abetted by Reveal). The jury also found that the defendants interfered with the contracts of other employees and conspired to engage in these unlawful activities, and that Reveal Lasers and Daley misappropriated Cynosure’s trade secrets.
As a result of this unlawful conduct, the jury awarded Cynosure a total of over $25 million in compensatory and punitive damages.
The Arnold & Porter team was led by partners Dipanwita Deb Amar and Joe Farris, with trial team members partner Joshua Barlow and senior associate Matthew Diton.
