When most business owners hear the term “intellectual property,” what comes to mind are patents, trademarks, and copyrights. However, trade secrets are part of IP and just as valuable and vulnerable. A recent court decision awarded $800 million in damages over confidential business information that was stolen. As a business sharing sensitive data during negotiations, partnerships, or due diligence, this case is a stark reminder that confidentiality obligations do not disappear when talks fall apart, and misusing inside information can have severe consequences.

A Deal That Turned Into a Lawsuit

The dispute arose when Propel Fuels and Phillips 66 entered negotiations in 2017 to explore a possible acquisition or joint venture. During this process, the parties signed a non-disclosure agreement (NDA) allowing confidential business information to be shared safely.

However, according to the lawsuit, negotiations abruptly ended in 2018. Then, soon after that, the defendant launched its own competing renewable fuel product. Propel Fuels, the plaintiff, alleged that the new venture relied on proprietary data disclosed during negotiations, including business models, pricing, and technical information. In 2024, a jury agreed with this, finding willful trade secret misappropriation and awarded over $600 million in compensatory damages. In July 2025, a court later affirmed this and awarded exemplary damages of $195 million, citing the conduct as egregious.

What Counts as a Trade Secret?

Trade secrets generally protect valuable business information that’s not publicly known. They give a company a competitive edge, provided the firm takes reasonable steps to keep that information confidential. You don’t have to register a trade secret. The protection exists as long as secrecy is maintained.

A trade secret may include pricing strategies, customer data, supply chain details, expansion plans, financial projections, algorithms, and internal processes. In the dispute between Propel Fuels and Phillips 66, internal documents referencing Propel Fuels’ confidential information became key evidence.

Why This Verdict Matters to Your Business

This ruling reinforces several legal principles. First, it reminds business owners that NDAs are not mere formalities. Courts will closely examine how confidential information was actually used. Secondly, ending negotiations doesn’t imply that confidentiality duties end as well. Information shared for evaluation cannot later be used to compete when talks fall through. Finally, the ruling demonstrates how the financial consequences of trade secret violations can spiral quickly. In this case, the court awarded punitive damages, which go beyond compensating the injured company, as they are meant to punish wrongdoing.

Practical Steps To Reduce Risk

As a business owner, you can take several steps to protect yourself during and after the transactions:

Identify and Label Confidential Information

Clearly mark proprietary materials as confidential and restrict access to only individuals who genuinely need it.

Limit Access Through Clean Teams

Use designated review teams, preferably not part of product development or strategic decision-making, to evaluate data during due diligence.

Review Internal Materials Before Launching Similar Initiatives

Conduct internal audits to ensure new products or strategies are independently developed and not influenced by prior confidential disclosures.

Implement Exit Procedures When Talks End

To reduce the risk of future misappropriation claims, consider returning, destroying, or certifying the deletion of shared materials and revoking system access to demonstrate good faith compliance.

Contact the Business Attorneys at Revision Legal

For more information, contact the experienced Business lawyers at Revision Legal. You can contact us through the form on this page or call (855) 473-8474.