Affirming dismissal of an unjust enrichment claim, the U.S. Court of Appeals for the Second Circuit upheld a summary judgment for the defendant concluding that plaintiffs-appellants had failed to state a claim for misappropriation of a trade secret when they pleaded a claim for relief for unjust enrichment based on the alleged misappropriation. The 2d Circuit agreed with the district court that a basic element of an unjust enrichment claim indicates a showing of a relationship between the parties, not merely a claim “predicated on misappropriation of a trade secret.”  Grynberg v. Eni S.p.A., Case No. 11-3846 (2d Cir., Nov. 20, 2012) (summary order).

Jack J. Grynberg and his family-owned companies sued Eni S.pA. in the United States District Court for the Southern District of New York for unjust enrichment alleging Eni used Grynberg’s estimate of oil reserves in a Kazakhstan oil field to successfully bid (jointly with British Gas, in 1992) for the development of the oil field. Earlier, Grynberg had told British Gas that they estimated the recoverable oil in the field to be about 12 billion barrels, while Eni had estimated the oil reserves at around 2 billion barrels. Eni and British Gas used an estimate of more than 15 billion barrels in their winning bid. Grynberg did not make a bid for the oil field. Grynberg had sued British Gas on the same issue in 1992 and reached a settlement in 1995, but then filed this suit against Eni in 2006. 

The district court concluded that Grynberg had to prove the basic elements of an unjust enrichment claim under New York law, i.e., that “(1) defendant was enriched, (2) at plaintiff’s expense, and (3) equity and good conscience militate against permitting  defendant to retain what plaintiff is seeking to recover.” Also as a threshold matter, Grynberg was required to show that an actual or substantive relationship existed between the parties. Given the quasi contract nature of an unjust enrichment claim, direct contractual privity is not required, but the connection between the parties cannot be too attenuated. The district court found that there had been no communication between Grynberg and Eni, and that Grynberg had failed to provide any evidence that Eni had received the contentious information from British Gas. Therefore, since Grynberg had not met the threshold for an unjust enrichment claim, the district court dismissed his claim.  Grynberg appealed.

The 2d Circuit agreed with the district court that Grynberg had failed to claim misappropriation of a trade secret. Moreover, the court found that the defendant Eni would have still prevailed on summary judgment even had the district court considered the merits of the alleged trade secret claim, because Grynberg had failed to show that Eni had any notice that the information it purportedly received from the joint venture with British Gas was in breach of a confidential relationship.