Fishkin v. Susquehanna Partners, GP

Susquehanna International Group, LLP (SIG) (plaintiff) employed Cal Fishkin and Igor Chernomzav (defendants) as securities traders subject to employment contracts containing noncompetition clauses. The clauses restricted Fishkin and Chernomzav from trading any products that the employees traded in their final three months prior to their terminations with SIG for a limited period. It also prohibited them from disclosing confidential information. The agreement provided for liquidated damages or injunctive relief in the event of a breach. In 1999, SIG assigned Francis Wisniewski to trade Dow Futures. Wisniewski discovered that he could earn a profit on trading Dow Futures by closely monitoring the S&P 500 Index with a formula that he developed. In 2001, SIG again assigned Wisniewski to trade Dow Futures, this time with Fishkin. During 2002, Wisniewski and Fishkin earned SIG profits of approximately $30 million. Fishkin sought to renegotiate his employment contract, but SIG refused. Later, Fishkin was approached by a representative for a group that would become NT Prop Trading, LLC (NT Prop) (defendant) to trade Dow Futures. Fishkin indicated he would be interested once his SIG employment contract expired. The NT Prop representative inquired as to profitability of SIG’s Dow Futures trading, but Fishkin declined to provide details though he did imply that SIG’s trading method was profitable. When Fishkin and Chernomzav left SIG in March 2003, they formed TABFG, LLC (defendant) and entered a joint venture with NT Prop to trade securities. Fishkin, Chernomzav, and Wisniewski sued SIG seeking a declaration that the noncompetition agreements in their employment contracts were unenforceable. SIG counterclaimed, seeking an injunction against Fishkin and Chernomzav as well as damages for breach of contract and misappropriation of trade secrets, among other counterclaims. The district court found that SIG was entitled only to nominal damages because it could not establish lost profits and that the fact that SIG’s Dow Futures trading was profitable was not a trade secret. SIG appealed.