No. 23-1822

ANALOG TECHNOLOGIES, INC.; DR. GANG LIU,

Plaintiffs, Appellants,

v.

ANALOG DEVICES, INC.,

Defendant, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS

[Hon. George A. O'Toole, Jr., U.S. District Judge]

Before

Montecalvo, Lynch, and Rikelman, Circuit Judges.

Howard B. D'Amico, with whom Howard B. D'Amico, P.C. was on brief, for appellants. Alexander Paul Ott, with whom McDermott Will & Emery LLP and Annabel Rodriguez were on brief, for appellee.

June 18, 2024 LYNCH, CIRCUIT JUDGE. Appellants Analog Technologies, Inc. ("ATI") and its CEO Dr. Gang Liu brought this federal action alleging that appellee Analog Devices, Inc. ("ADI") is liable for trade secret misappropriation under federal and Massachusetts law because appellants took "reasonable measures" to maintain the secrecy of development materials ATI had shared with ADI, and ADI violated its obligation to limit its use of those materials. 18 U.S.C. § 1839(3)(A), (5)(B); Mass. Gen. Laws ch. 93, § 42(2)(ii), (4)(ii).

The district court granted ADI's motion to dismiss the claim, holding that, under the clear terms of a written agreement among the parties, any restrictions on ADI's use of the materials had expired. See Analog Techs., Inc. v. Analog Devices, Inc., No. 21-cv-11334, 2023 WL 5833122, at *1, *4 (D. Mass. Sept. 8, 2023). We affirm.

I.

"When reviewing a motion to dismiss, we recount the underlying facts as alleged in the complaint," Shash v. Biogen, Inc., 84 F.4th 1, 6 (1st Cir. 2023), but "disregard any conclusory allegations," Ponsa-Rabell v. Santander Sec. LLC, 35 F.4th 26, 30 n.2 (1st Cir. 2022).

On November 18, 2000, ATI and ADI entered into a "License and Development Agreement" ("2000 agreement"). Under this agreement, ATI agreed to share technological developments related

- 2 - to thermo-electric cooler controllers ("TEC controllers") with ADI so that ADI could manufacture and sell products using that technology. ATI agreed not to license use of these developments to other parties. The agreement required ADI to pay ATI $240,000, as well as royalty payments based on the total sales amount of products sold.

The 2000 agreement, in a section titled "Intellectual Property," included a provision stating:

The parties agree that any information, technical data or know-how which is furnished to the other in written or tangible form by either party in connection with this Agreement and which is clearly marked as "Proprietary Information" or "Confidential" will be maintained by the receiving party in confidence. The obligations of confidentiality and/or non-disclosure set forth in this Section shall survive the expiration or termination of this Agreement for a period of five (5) years from the date of expiry or termination. Confidential information will not be used by the receiving party except to fulfill the receiving party's rights and obligations under this Agreement. (Emphasis added.) The 2000 agreement also included a sunset clause stating that "[t]he term of this Agreement, unless sooner terminated, shall be for a period of five (5) years from the Product silicon release date," which the agreement specified to be on December 20, 2001.

Starting in late 2000, and continuing through 2004,