Sedona Finalizes DTSA Model Jury Instructions: Key Changes from the Draft

Background 

The Sedona Conference has published its Defend Trade Secrets Act Model Jury Instructions: DTSA 10th Anniversary Commemorative Edition, the product of Working Group 12’s consensus process. Earlier this year, we alerted clients to the draft instructions. The final publication cautions that the instructions are a starting point only, not binding law, and must be tailored to the facts, claims, and governing law of each case. 

Key Changes from the Draft 

Trade Secret Identification. The final instructions clarify that the sufficiency of a plaintiff’s trade secret identification may be submitted to the jury when it remains a disputed factual issue, a point confirmed by recent Ninth Circuit authority holding that whether a plaintiff has identified its alleged trade secrets with “sufficient particularity” is a question of fact. The instructions retain the requirement of reasonable precision and specificity to distinguish the alleged secret from generally known information, while cautioning that the precise contours of the particularity standard remain unsettled and are highly fact specific. 

Ownership and Harm. Ownership may be submitted to the jury when disputed and the court has not resolved it as a threshold matter, and the instructions acknowledge a circuit split over whether a nonexclusive licensee can satisfy the DTSA’s ownership requirement.  Actual harm is not generally required to establish liability, although harm or unjust enrichment may be included where monetary relief is sought. 

Misappropriation and Retention. The final version retains the draft’s three core misappropriation theories—improper acquisition, unauthorized disclosure, and unauthorized use—and confirms that inevitable disclosure or use alone is insufficient for a damages claim, although threatened misappropriation may support injunctive relief. The instructions note a circuit split on inevitable disclosure: several jurisdictions, including California and Oregon, have treated it as impermissible under the DTSA, while courts in Illinois have allowed inevitable disclosure claims to survive a motion to dismiss. The final version also adds an optional instruction for former employees’ failure to return lawfully acquired information, reflecting the absence of consensus on whether retention alone constitutes improper acquisition. 

Combination Trade Secrets. Rather than expressing a preference for the “substantial portion” approach seen in the draft, the final instructions acknowledge a continuing split of authority and leave the choice to controlling precedent by offering competing alternatives of “all elements” and “substantial portion” tests for proving unauthorized use of a combination trade secret. 

Damages. The damages instructions may permit worldwide recovery where a domestic act occurs “in furtherance” of the misappropriation, require proximate causation, and recognize actual loss, unjust enrichment, and reasonable royalty theories, with an emphasis on avoiding double recovery. They generally call for apportionment by individual trade secret or appropriate group, particularly where products contain both protected and unprotected elements. Exemplary damages require a threshold finding of willful and malicious misappropriation, remain within the court’s discretion, and are capped at twice compensatory damages.  

The final instructions also engage with several additional damages issues, including some that the law has not yet fully resolved. First, whether unjust enrichment damages are a legal remedy for the jury or an equitable remedy for the court remains unsettled. The instructions propose submitting the issue to the jury with the option of treating the verdict as advisory. Second, the instructions address the “head-start” doctrine, which limits the period of unjust enrichment recovery to the time during which the defendant retained an unfair competitive advantage derived from the misappropriation. Third, on reasonable royalty, while the model instruction itself addresses only unauthorized use, the accompanying comments note that the DTSA expressly authorizes royalties for unauthorized disclosure as well, and that the instruction should be modified to include references to disclosure where a plaintiff has properly preserved and presented such a claim. This differs from some state UTSA counterparts. The instructions further note that several states treat reasonable royalty as a fallback measure available only when other damages cannot be proven (California, Colorado, Illinois, and Oregon), and others do not expressly authorize reasonable royalties at all (Alaska, Arkansas, Connecticut, Louisiana, and Washington). Where DTSA and state claims are combined, these limitations should be accounted for when developing damages models. 

Takeaway 

The final instructions are a practical litigation tool, not a substitute for controlling authority. Parties should identify which optional provisions apply to their case, address trade secret identification and damages apportionment early in litigation, and verify each instruction against current circuit law before submitting proposed jury instructions.