Neither Snow nor Rain nor Heat nor Gloom of Night . . . Will Stop the U.S. Postal Service from Stealing Its Contractor’s Trade Secrets?
According to a 42-page complaint it filed in the U.S. District Court in Utah, Express One was the first reseller to contract with the USPS in 2009, and “[o]ver the last 13 years, Express One has invested a massive amount of time, effort and resources establishing relationships with its platform partners and building its reseller business, to the exclusion of other business opportunities.” In 2019, however, Express One alleges that the USPS decided to steal its trade secrets and use them to set up a competing e-commerce platform:
[T]he USPS devised a plan by which it would convince Express One to share its confidential customer, pricing and business information with the USPS so that the USPS could develop its own competing platform. The ultimate goal was to implement a competing USPS platform, terminate the reseller program, including Express One’s reseller contract, and take control of Express One’s business and profit margin. In order to execute that plan, the USPS made numerous promises and misrepresentations to Express One to induce Express One to trust the USPS, continue investing in and building its reseller network, agree to a new contract, and share its confidential customer, pricing and business information with the USPS.
In May 2022, the USPS announced the launch of a new e-commerce platform called “USPS Connect eCommerce” and promptly terminated its relationship with Express One. According to Express One, the USPS’s conduct, “if allowed to stand, will not only cost Express One hundreds of millions of dollars in damages, but will force the company out of business altogether.”
Express One asserts claims for breach of contract, fraudulent inducement, and trade secret misappropriation under the Defend Trade Secrets Act and the Utah Uniform Trade Secrets Act, among other things. Interestingly, it also asserts a claim for “Misappropriation of Trade Secrets – Constitutional Takings,” which, of course, could only be brought against the government and implicates the takings clause of the Fifth Amendment of the U.S. Constitution (“nor shall private property be taken for public use, without just compensation”).