When a group of key employees walks out the door and lands at a direct competitor, an employer’s instinct is to act fast and act broadly—filing suit and casting a wide net for evidence of wrongdoing. On July 7, 2026, the Eighth Circuit served a stark warning in Wilbur-Ellis Company v. Gompert: this instinct to act fast and act broadly, without careful preparation and specificity, can lead to costly failure in court. The case offers a roadmap of the pitfalls employers must avoid when pursuing trade secret and breach of loyalty claims against departing employees.
The Facts
On August 13, 2021, four former Wilbur-Ellis employees told the company they were resigning. The company then placed the employees on an “inactive employment status.” Regardless, the employees were paid until August 27, 2021, at which time their resignation was formalized. Around August 16—the same time period they were still paid by Wilbur-Ellis—the employees had started working for competitor J.R. Simplot Co. For roughly two weeks they remained on Wilbur-Ellis’s payroll while simultaneously receiving income from Simplot. At least 11 employees in total moved from Wilbur-Ellis to Simplot around that time, but Wilbur-Ellis chose to sue only these four. It alleged breach of the duty of loyalty, misappropriation of trade secrets under both the federal Defend Trade Secrets Act (“DTSA”) and the Nebraska Trade Secrets Act (“NTSA”), and tortious interference with its business relationships. The company pointed to customer information allegedly taken, documents downloaded from company devices, and the coordinated nature of the departures as evidence of wrongdoing. The district court rejected the allegations, granting summary judgment to the employees on nearly all claims, and the Eighth Circuit affirmed. Notably, because the NTSA “similarly defines trade secrets and misappropriation” as the DTSA, the Eighth Circuit analyzed Wilbur Ellis’s state and federal trade secret claims together. The lesson for employers is not merely that Wilbur-Ellis lost—it is why it lost.
Lesson 1: Vague Trade Secret Definitions Will Sink Your Case
The most important takeaway from the decision is that generality is fatal to a trade secret claim. The district court found that Wilbur-Ellis “paint[ed] with a broad brush, never clearly and adequately identifying the ‘trade secrets’ at issue, let alone how they were used or misused or the damages reasonably attributable to each defendant.” When pressed to describe what had been stolen, Wilbur-Ellis pointed to categories like “documents and information regarding Wilbur-Ellis’s business and market strategy,” “documents and information relating to Wilbur-Ellis’s customers,” and “nonpublic customer proposals, pricing and rebate data.” The courts found these descriptions far too broad. Wilbur-Ellis never explained what specific documents relating to customer information were misappropriated, which defendant allegedly misappropriated them, or how the information was misappropriated.
The Eighth Circuit pointedly observed that because it is not hard to imagine that most documents at Wilbur-Ellis would be related to its “customers, financial information, [or] strategy,” Wilbur-Ellis failed to rebut the concern that it “apparently claim[s] that everything [the employees] encountered in their positions at Wilbur-Ellis was a trade secret.” The message to employers is clear: before litigation—and ideally long before any key employee departs—you must be able to identify your trade secrets with precision. A trade secret audit, well-crafted confidentiality agreements, and documented information-security protocols are essential tools for building a credible claim.
Lesson 2: Suspicious Circumstances Alone Are Not Enough
Wilbur-Ellis had several facts that, on the surface, looked damning: employees resetting company devices before returning them, a coordinated mass departure to a competitor, and at least some employees downloading files in their final weeks. Yet none of it was enough.
When Wilbur-Ellis argued that the employees “tried to hide their misconduct by wiping six of eight company-issued devices,” the record contradicted this characterization—in depositions, the employees stated they reset their devices to avoid leaving personal information on them, and Wilbur-Ellis did not cite any other evidence showing the devices were wiped to conceal misconduct. Critically, under Nebraska law, disloyal conduct must be “so harmful as to substantially hinder the employer in the continuation of his business” to give rise to liability. Wilbur-Ellis did not explain how the wiping of the devices “substantially hindered” its operations—it did not allege, for example, that the wiping caused Wilbur-Ellis to permanently lose valuable data.
On the duty of loyalty claims, the court found that facts showing employees simultaneously provided resignation notices and met with a key business partner showed nothing more than the employees’ “plan to go into competition with the employer . . . while still employed,” which they had “no general duty to disclose.” Employers must understand that courts require admissible, specific evidence—not just suspicion—to prevail.
The court’s treatment of Wilbur-Ellis’s tortious interference claims followed a similar pattern. To prevail on such a claim under Nebraska law, a plaintiff must prove, among other things, an unjustified intentional act of interference and that the interference caused the harm sustained. The Eighth Circuit agreed with the district court that Wilbur-Ellis did not point to any specific act by any specific defendant as the basis for its tortious interference claims—defeating the company’s claims.
Lesson 3: Discovery Missteps Can Be Irreversible
Wilbur-Ellis compounded its substantive problems with serious procedural missteps during discovery. Wilbur-Ellis began discovery in a “backwards” manner by first seeking discovery from Simplot, a third party, rather than from the employees themselves. When the court instructed Wilbur-Ellis to seek discovery from the employees first, it eventually did file a motion to compel—but the magistrate judge had issued an order requiring parties to first contact the court to set a conference before filing any motion to compel, and Wilbur-Ellis did not comply with that order. As a result, its motion to compel was denied on procedural grounds, leaving it without critical discovery when it needed it most. The summary judgment record confirmed the damage: the defendants averred—and Wilbur-Ellis did not dispute—that Wilbur-Ellis never produced any documents in discovery when asked to produce evidence showing a breach of any duty owed to it.
For employers, this underscores the need to engage experienced litigation counsel at the outset who will navigate discovery strategically, follow court protocols precisely, and prioritize securing evidence from the departing employees before pursuing third parties.
The Bottom Line for Employers
The Wilbur-Ellis decision is a cautionary tale about the gap between what an employer believes happened and what it can actually prove in court. As the district court put it, “Wilbur-Ellis has a lot of suspicions about what it thinks happened behind the scenes but has not submitted sufficient evidence to permit a reasonable jury to find in its favor.” The key to avoiding Wilbur-Ellis’s fate is preparation that starts well before any lawsuit is filed:
- conduct regular trade secret audits;
- label and restrict access to genuinely confidential information;
- require employees to sign tailored and specific confidentiality agreements; and
- establish clear policies around the return of company devices and data.
Thereafter, when departures do happen, move quickly and methodically—document what is missing, preserve electronic evidence, and partner with counsel who will build a targeted, evidence-based case from day one.
In trade secret litigation, precision is not just an advantage. It is a prerequisite.