On December 22, 2022, the First Department issued a decision in Continental Indus. Group, Inc. v. Ustuntas, 2022 NY Slip Op. 07294, holding that a theft of trade secrets claim accrues when a plaintiff is damaged, not when the theft occurs, explaining:
A claim for misappropriation of trade secrets is governed by a three-year statute of limitations. Similarly, the statute of limitations for misappropriation of confidential and proprietary business information is three years. The claim accrues when the plaintiff first suffers damages.
Ustuntas solicited one of plaintiff’s suppliers in December 2008 and plaintiff became aware of this on June 30, 2009 but did not sue until September 13, 2012. However, defendants did not establish that plaintiff suffered damages in December 2008 or June 2009. For example, there is no evidence that this particular supplier switched from plaintiff to Plasmar.
Questions of fact also exist as to whether defendants committed independent and distinct acts in 2010 — 2012 that constituted misappropriation of trade secrets and fell within the three-year limitations period, thereby tolling the statute of limitations pursuant to the continuous wrong doctrine. Specifically, plaintiffs submitted purchase order summaries showing that in 2010 — 2012 plaintiff’s former suppliers were using defendant as a distributor.
(Internal citations omitted).