A former employee's move to a competitor is not, by itself, trade-secret theft. But when the employee allegedly downloads internal files before resigning and the new employer subsequently pursues an opportunity described in those files, the timing and surrounding facts may support a lawsuit. A September 29, 2026 federal court order involving two competing air-taxi companies offers a particularly useful example of how courts separate plausible trade-secret allegations from speculation.
The decision is Joby Aero, Inc. v. Archer Aviation Inc., No. 5:25-cv-10703-SVK (N.D. Cal. Sept. 29, 2026), ECF No. 106. It is an order on motions to dismiss amended pleadings, not an appellate opinion or a final determination that anyone stole trade secrets. The case remains pending. Its practical significance lies in the court's claim-by-claim treatment of the same employee departure.
The Departure and the Alleged Downloads
Joby and Archer develop electric vertical takeoff and landing aircraft. Joby alleged that George Kivork, who worked on its state and local policy matters, downloaded dozens of files from its Microsoft SharePoint system on July 18, 2025, two days before announcing his resignation. Joby further alleged that he sent some files to a personal email account and changed access permissions on numerous documents so he could reach them after leaving. Kivork joined Archer in August 2025.
The documents allegedly included business contacts, infrastructure plans, regulatory strategies, sponsorship information, and technical materials. Joby sued Kivork and Archer, asserting, among other things, a federal Defend Trade Secrets Act claim and contract-based claims. The defendants contested the sufficiency of the allegations. At this stage, the judge was required to test whether the pleaded facts plausibly stated a claim, not decide whose account was true.
Why the Hawthorne Airport Allegations Survived
The strongest new allegations concerned Hawthorne Airport in Los Angeles County. Joby alleged that it had cultivated airport contacts and considered Hawthorne for aircraft maintenance and operations. Its pleading identified two particular files allegedly taken by Kivork: a contact list and a strategy document addressing Hawthorne. According to the pleading, Archer's earlier public map of proposed Los Angeles facilities did not include Hawthorne. After Kivork joined Archer, Archer acquired a long-term lease at Hawthorne and announced plans for an aviation facility there.
The court found this sequence sufficient at the pleading stage to support an inference that Kivork and Archer had used Joby's alleged trade secrets. The important point was the combination of a specifically identified internal strategy, an employee's alleged removal of relevant documents, a competitor's earlier plans, and its subsequent conduct. The judge did not rule that the airport opportunity belonged exclusively to Joby or that Archer's lease proved theft. The allegations simply crossed the threshold from speculation to a plausible claim. (Sept. 29 Order at pp. 10-11.)
Why the Dodgers, Asian Markets, and Hydrogen Claims Did Not
The same order reached a different result on three other categories of alleged past misuse.
Joby alleged that Kivork had taken a contact list containing information about a Los Angeles Dodgers executive and that Archer later pursued a Dodgers sponsorship. The court accepted that a carefully developed, nonpublic contact compilation could potentially qualify as a trade secret. But Joby did not allege facts showing that Archer actually used the particular contact information in making its bid. Having a contact in a file and later competing for a sponsorship were not enough. (Id. at pp. 12-13.)
Joby also pointed to regulatory plans for demonstrations in Japan and South Korea. The court noted that Archer had publicly expressed interest in those markets before hiring Kivork. Its later announcements about partnerships did not plausibly establish that it had used Joby's specific regulatory blueprint. (Id. at pp. 13-15.)
The hydrogen-technology allegations had a similar defect. Joby alleged that Kivork downloaded material concerning a hydrogen-electric prototype and that Archer later explored hydrogen aircraft. But merely considering a new technological direction did not establish use of Joby's particular technical information. The court dismissed the past-misappropriation theories for these three categories, with leave to amend. (Id. at pp. 15-17.)
The distinction matters in ordinary business disputes. An employee's new company may win a customer, enter a geographic market, or explore a product that the former employer also considered. Competitive overlap is not proof that confidential information caused the result. The pleading needs facts connecting a particular protected item to particular alleged use or disclosure.
A Different Question: Threatened Misappropriation
Although several theories of completed misuse were insufficient, the court allowed Joby's allegations of threatened misappropriation to proceed for all identified categories of trade secrets.
That ruling rested on more than the employee's knowledge of sensitive information. The court considered allegations that Kivork continued to possess materials after Joby requested their return, the previously sustained allegations concerning the developer agreement, and the circumstances suggesting that Archer possessed or could access additional material. The court also noted a dispute over counsel's alleged offer to delete files, which could not be resolved on a motion to dismiss. (Id. at pp. 17-19.)
A surviving threatened-misappropriation claim is not the same as an injunction. The party seeking an injunction still must establish the applicable evidentiary and equitable requirements. The federal trade-secret statute also restricts injunctions that would prevent a person from entering an employment relationship based merely on information the person knows. See 18 U.S.C. § 1836(b)(3)(A)(i).
The Employment Agreement: Two Very Different Clauses
Joby relied on an employee agreement addressing proprietary information, return of company materials, and competitive activity during employment.
In an earlier June 5, 2026 order, the same court held that the agreement's broadly worded confidentiality restriction functioned as an unenforceable restraint under California Business and Professions Code section 16600. In September, the court therefore required Joby to remove allegations premised on that invalid confidentiality clause. Yet the court continued to permit a claim based on the separate obligation to return company materials. (June 5 Order, ECF No. 69, at pp. 19-22; Sept. 29 Order at pp. 3-4.)
The court also allowed a claim under a separate provision prohibiting assistance to competitors during the employee's actual employment. That clause was expressly limited to conduct while employed. It could not be extended into an unlimited post-employment restriction. Joby's allegations that Kivork changed file-access permissions before resigning, allegedly to assist Archer, were sufficient to keep this narrower contract theory in the case. (Sept. 29 Order at pp. 4-6.)
As for Archer, the court allowed a claim that it induced breach of the document-return obligation, based on the pleaded circumstances, including Archer's onboarding communications and the surviving trade-secret allegations. But it dismissed, with leave to amend, the claim that Archer induced a breach of the during-employment restriction because Joby had not alleged conduct by Archer preceding that particular breach. (Id. at pp. 6-9.)
What California's Court of Appeal Has Said About Employee Loyalty
The federal order is consistent with an important published California appellate decision, Techno Lite, Inc. v. Emcod, LLC (2020) 44 Cal.App.5th 462.
In Techno Lite, employees operated their own company while working for a lighting-transformer business. Their employer allowed that arrangement after they promised not to compete with it. The evidence showed they nevertheless diverted business to their own enterprise. The Court of Appeal rejected the argument that section 16600 made their promise unenforceable. California protects employees' freedom to seek new work and, within limits, prepare to compete. It does not require an employer to tolerate employees secretly competing against it while collecting its pay. The appellate court affirmed the fraud finding based on the false promise. (Id. at pp. 471-474.)
Another California appellate case, Angelica Textile Services, Inc. v. Park (2013) 220 Cal.App.4th 495, 509-510, likewise distinguishes legitimate preparations for future competition from disloyal acts during employment. These authorities do not create a general post-employment noncompete exception. The timing and character of the employee's conduct remain central.
What Businesses Should Learn From the Case
For a former employer, the first task is to preserve the actual record. File-access logs, downloads, personal-email transfers, permissions changes, return-of-property certifications, and the chronology of a competitor's conduct can be more useful than a broad accusation that an employee knew the company's secrets. The business should identify the specific information it contends is secret, how it protected that information, and what facts indicate improper acquisition, use, disclosure, or a genuine threat of misuse.
For a business hiring from a competitor, onboarding should include careful treatment of the candidate's prior obligations and a clear instruction not to bring or use the former employer's materials. A hiring company should not assume that the invalidity of a post-employment noncompete permits it to retain the former employer's documents or induce a breach of a valid return-of-property obligation.
For the departing employee, the legal right to join a competitor does not carry a right to copy or retain the former employer's files. Conversely, the former employer cannot turn an overbroad confidentiality agreement into a substitute for a prohibited noncompete simply by labeling all business knowledge confidential.
The Joby order demonstrates why employee-departure disputes are fact intensive. One set of alleged conduct supported a plausible inference of misuse, several others did not, and the threat-based claims survived under a different analysis. None of those rulings established ultimate liability. For companies facing a sensitive employee departure, the strength of the case will depend on the evidence tying identifiable protected information to specific conduct, and on the enforceability of the particular contractual obligations involved.
Legal Authorities
- Joby Aero, Inc. v. Archer Aviation Inc., No. 5:25-cv-10703-SVK, ECF No. 106 (N.D. Cal. Sept. 29, 2026) — official order
- Joby Aero, Inc. v. Archer Aviation Inc., ECF No. 69 (N.D. Cal. June 5, 2026) (earlier order) — order
- Techno Lite, Inc. v. Emcod, LLC (2020) 44 Cal.App.5th 462
- Angelica Textile Services, Inc. v. Park (2013) 220 Cal.App.4th 495
- Defend Trade Secrets Act, 18 U.S.C. §§ 1836, 1839
- California Business and Professions Code § 16600 — official text
Related practice areas: Trade Secrets and Unfair Competition · Executive-Related Disputes