Financial Information Technologies, LLC v. iControl Systems, USA, LLC

USCA11 Case: 20-13368 Date Filed: 12/22/2021 Page: 1 of 28

[PUBLISH]

In the

United States Court of Appeals

For the Eleventh Circuit

____________________

No. 20-13368

____________________

FINANCIAL INFORMATION TECHNOLOGIES, LLC,

Plaintiff-Appellee -

Cross-Appellant,

versus

ICONTROL SYSTEMS, USA, LLC,

Defendant-Appellant -

Cross-Appellee.

____________________

Appeals from the United States District Court

for the Middle District of Florida

D.C. Docket No. 8:17-cv-00190-SDM-SPF

____________________

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2 Opinion of the Court 20-13368

Before JORDAN, NEWSOM, Circuit Judges, and BURKE, District

Judge.

NEWSOM, Circuit Judge:

Financial Information Technologies (“Fintech”) and iCon-

trol Systems are competitors. Both companies sell software that

processes alcohol-sales invoices within 24 hours. Fintech operated

in that space alone for several years until iControl entered the mar-

ket and began selling a very similar product at a lower price point.

After losing a number of customers to iControl, Fintech initiated

this lawsuit alleging misappropriation of trade secrets. The jury

found in Fintech’s favor and awarded both compensatory and pu-

nitive damages.

iControl sought a new trial on liability and judgment as a

matter of law on damages, contending with respect to the former

that Fintech’s alleged trade secrets were readily ascertainable—and

thus not “secret”—and with respect to the latter that Fintech hadn’t

proved lost profits because it hadn’t deducted fixed and marginal

costs from its revenue calculations. For its part, Fintech sought a

permanent injunction broadly prohibiting iControl from using ei-

ther company’s software. The district court denied all three mo-

tions, and both parties appealed.

After careful review, we affirm in part, reverse in part, and

remand for further proceedings. In particular, we conclude that

the district court (1) correctly denied iControl’s new-trial motion

on liability, (2) erred in denying iControl’s JMOL motion on

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20-13368 Opinion of the Court 3

damages because Fintech didn’t deduct marginal costs in calculat-

ing lost profits, and (3) correctly refused Fintech’s requested injunc-

tion.

I

Fintech and iControl sell niche computer software that rap-

idly processes electronic payments between retailers and wholesale

distributors of alcoholic beverages. Such software is useful because

many states require retailers to pay cash on delivery (i.e., forbid

payment by credit) for alcohol shipments. Processing and paying

invoices within 24 hours requires specialized technology. Fintech

spent about 15 years developing software that quickly processes

electronic fund transfers between alcohol retailers and distributors.

For a while, Fintech was the only game in town and charged a cor-

respondingly high price for its software.

In 2013, iControl began selling software similar to Fintech’s

at a lower price. For years before, iControl had been in the busi-

ness of processing invoices and facilitating electronic bank transfers

for other products. As it began servicing the alcohol industry,

iControl hired both (1) Mark Lopez, Fintech’s former VP of Oper-

ations, who had been heavily involved in designing Fintech’s soft-

ware, and (2) Andrew Sanderson, a former Fintech sales repre-

sentative. Both Lopez and Sanderson were bound by nondisclo-

sure agreements with Fintech. Not long after hiring Lopez and

Sanderson, iControl managed to lure away several Fintech custom-

ers.

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4 Opinion of the Court 20-13368

Having lost several customers, Fintech filed this lawsuit in

2017, alleging that iControl violated the Florida Uniform Trade Se-

crets Act by misappropriating seven Fintech trade secrets. 1 Fintech

sought both damages and injunctive relief. The district court held

a jury trial on the FUTSA claim, and the jury returned a general

verdict in Fintech’s favor, finding that it had proved by a prepon-

derance of the evidence that iControl misappropriated its trade se-

crets and, further, that iControl acted willfully and maliciously in

doing so. The jury awarded Fintech $2.7 million in actual damages

and $3 million in exemplary damages, and the district court entered

judgment on the jury’s verdict.

iControl filed a motion for a new trial on liability and a re-

newed JMOL motion on damages. For its part, Fintech moved for

a permanent injunction “prohibiting iControl from doing business

in the regulated commerce industry.” The district court denied all

three motions. With respect to iControl’s liability-based new-trial

motion, the court reasoned that “[a] reasonable juror could find

that iControl misappropriated Fintech’s trade secrets”:

Fintech (1) presented evidence showing that iControl

hired Fintech’s former software engineer and rapidly

developed a competing suite of software features that

perform substantially the same function as Fintech’s

1 Fintech initially also alleged violation of the Defend Trade Secrets Act of

2016, tortious interference, violation of the Florida Deceptive & Unfair Trade

Practices Act, misleading advertising, injurious falsehood, and unfair competi-

tion, but only the FUTSA claim went to trial.

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20-13368 Opinion of the Court 5

software features, (2) presented both direct and cir-

cumstantial evidence supporting the inference that

Fintech’s former software engineer divulged the

methods by which Fintech developed the software

features, and (3) presented expert testimony identify-

ing with reasonable particularity the features misap-

propriated by Fintech’s former software engineers.

The court sustained the jury’s willful-and-malicious finding, con-

cluding that the jury reasonably could have inferred that iControl

schemed to hire Lopez to misappropriate Fintech’s software fea-

tures. With respect to damages, the court concluded that Fintech

carried its burden by presenting evidence that its “fixed-cost savings

were trivial due to the relatively few clients lost to iControl . . . and

that [its] marginal costs per lost client were between zero and three

percent of revenues.”

Fintech renewed its motion for a permanent injunction,

which the district court again denied, reasoning that the proposed

injunction was overbroad. Both parties appealed.

Before us, iControl argues that the district court should have

granted a new trial on liability because Fintech’s seven alleged

trade secrets were never actually secret. At minimum, iControl

contends that the jury’s willful-and-malicious finding cannot stand.

iControl further contends that the district court should have

awarded it JMOL on damages because Fintech proved only lost

revenues—not lost profits, as required—and failed to properly de-

duct its fixed and marginal costs. On cross-appeal, Fintech asserts

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6 Opinion of the Court 20-13368

that the district court should have awarded it a permanent injunc-

tion because, it says, its proposed remedy was reasonably tailored

to restrain iControl’s misappropriation.

We will take up each of the three issues—liability, damages,

and the injunction—in turn.

II

A

Overturning a jury’s liability finding is a difficult task under

any circumstances. iControl faces an especially steep climb for two

reasons.

First, the jury rendered a general verdict—it didn’t specify

which of the seven alleged trade secrets iControl misappropriated.

Accordingly, Fintech needs to show evidence of misappropriation

only as to one. See Composite Marine Propellers, Inc. v. Van Der

Woude, 962 F.2d 1263, 1265 (7th Cir. 1992) (holding that a general

jury verdict in a trade-secrets case must be affirmed when the evi-

dence supports misappropriation of at least one secret); cf. also

Griffin v. United States, 502 U.S. 46, 56–57 (1991) (holding that a

general guilty verdict on a multiple-object conspiracy need not be

set aside if the evidence is adequate to support conviction as to one

of the objects).

Second, for whatever reason, iControl didn’t move for

JMOL on liability in the district court. Had it done so, we would

have reviewed the district court’s denial de novo. See St. Louis

Condo. Ass’n, Inc. v. Rockhill Ins. Co., 5 F.4th 1235, 1242 (11th Cir.

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20-13368 Opinion of the Court 7

2021). As matters stand, iControl is stuck with the more deferential

abuse-of-discretion standard applicable to new-trial motions. Ac-

cordingly, the only question before us is whether the district court

abused its discretion in concluding that “the verdict [was] against

the great weight of the evidence.” Hercaire Int’l, Inc. v. Argentina,

821 F.2d 559, 562 (11th Cir. 1987). Ordinarily, given that standard,

we “will reverse a decision denying a motion for new trial only

where there is an absolute absence of evidence to support the ver-

dict.” Id.

1

To prove liability under FUTSA, a plaintiff must show that

“(1) it possessed a ‘trade secret’ and (2) the secret was misappropri-

ated.” Yellowfin Yachts, Inc. v. Barker Boatworks, LLC, 898 F.3d

1279, 1297 (11th Cir. 2018) (quotation omitted). A “trade secret” is

defined as follows:

information, including a formula, pattern, compila-

tion, program, device, method, technique, or process

that:

(a) Derives independent economic value, actual or

potential, from not being generally known to, and not

being readily ascertainable by proper means by, other

persons who can obtain economic value from its dis-

closure or use; and

(b) Is the subject of efforts that are reasonable under

the circumstances to maintain its secrecy.

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8 Opinion of the Court 20-13368

Fla. Stat. § 688.002(4) (emphasis added). Misappropriation occurs

when a trade secret is acquired “by someone who knows or has

reason to know that the secret was improperly obtained or who

used improper means to obtain it.” Yellowfin, 898 F.3d at 1297

(quotation omitted).

By definition, something that is already readily ascertainable

can’t be misappropriated. As a general matter, software source

code is not readily ascertainable and, accordingly, qualifies for

trade-secret protection. See Warehouse Sols., Inc. v. Integrated Lo-

gistics, LLC, 2014 WL 12647878, at *6 (N.D. Ga. July 7, 2014), aff’d,

610 F. App’x 881 (11th Cir. 2015). But aspects of computer software

that are readily ascertainable don’t qualify. See IDX Sys. Corp. v.

Epic Sys. Corp., 285 F.3d 581, 584 (7th Cir. 2002) (“[T]hings that

any user or passer-by sees at a glance are ‘readily ascertainable by

proper means’ . . . and a trade-secret claim based on readily observ-

able material is a bust.”). iControl contends that each of Fintech’s

seven alleged trade secrets was readily ascertainable. Before we

delve into the secrets’ ascertainability, we will briefly explain

Fintech’s software and the seven trade secrets at issue. 2

2 In its briefs to us, iControl asserts that Fintech has consistently failed to allege

its trade secrets with “reasonable particularity.” To be sure, it is important for

a plaintiff to allege trade secrets with particularity at the pleading stage in order

to give the defendant adequate notice of the material that is allegedly subject

to trade-secret protection. But those concerns dissipate when, as here, the al-

leged trade secrets have been litigated and adjudicated in a full-blown trial. Cf.

Ortiz v. Jordan, 562 U.S. 180, 184 (2011) (holding that a party may not appeal

an order denying summary judgment after a full trial on the merits because

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20-13368 Opinion of the Court 9

The essence of Fintech’s software is what it calls “database

architecture.” Database architecture involves both designing a da-

tabase that can “take alcohol invoices from dozens of different dis-

tributors in different formats and normalize them into a central da-

tabase” and configuring a “hierarchy of data within an invoice” that

enables such normalization. Trial Transcript (Day 3) at 52–54. For

example, many alcohol-sale invoices must make adjustments for

discounts, surcharges, etc. Fintech’s software treats these “SAC”

codes (for service promotions, adjustments, and charges) as line

items rather than header adjustments. Then, to further accelerate

the invoicing process, Fintech’s software utilizes certain “exception

rules,” which investigate each field of every invoice to check for

potential errors or missing information. An in-system editor called

the “invoice fixer” allows distributors to enter the database and

make corrections without delaying the payment cycle.

Fintech’s software groups corrected invoices based on the

originating and receiving banks, aggregates them, and calculates a

single ACH transaction using proprietary rounding calculations. 3

To ensure timely payments, Fintech maintains a series of “white

filters” with banks to minimize the risk that any transaction will get

“[o]nce the case proceeds to trial, the full record developed in court super-

sedes” the prior record); Nolfi v. Ohio Kentucky Oil Corp., 675 F.3d 538, 545

(6th Cir. 2012) (“Though Ortiz applies specifically to summary judgment, its

logic applies with equal force to questions involving pleadings.”).

3 ACH (Automated Clearing House) is a network used for electronically mov-

ing money between bank accounts across the United States.

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10 Opinion of the Court 20-13368

blocked at the last minute. Finally, Fintech develops and maintains

several system interfaces based on its clients’ particular accounting

needs to convey payment information between distributors and re-

tailers.

In addition to providing invoice-payment services, Fintech

uses invoice data collected over time to conduct business-intelli-

gence analysis, which it makes available to its clients through a

“user portal.” The portal is unique in the industry in that it allows

each client to control which of its employees can access what infor-

mation.

Based on this invoice-payment process, Fintech’s expert wit-

ness identified the following seven “trade secrets”:

(1) database architecture;

(2) the exception rules and the invoice fixer;

(3) calculations for ACH transactions;

(4) methods for maintaining and using white filters;

(5) payment-reconciliation interfaces;

(6) analysis, normalization, and reports generated for

the user portal; and

(7) user-portal design that allowed clients to adminis-

ter their own users within Fintech’s online system.

In light of the governing standard—pursuant to which we

ask only whether “there is an absolute absence of evidence to sup-

port the verdict,” Hercaire, 821 F.2d at 562—we hold that the proof

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20-13368 Opinion of the Court 11

presented at trial permitted a reasonable jury to find that at least

one of Fintech’s alleged trade secrets was not readily ascertainable

and was instead misappropriated. Fintech showed the jury emails

and iControl documents indicating that Lopez had helped iControl

discover Fintech’s internal processes to aid its software develop-

ment. For instance, when iControl was initially having problems

with SAC adjustments in its invoices, its chief technology officer

asked for Lopez’s help—after which iControl, like Fintech, began

treating the adjustments as line items. Similarly, Fintech submitted

emails in which Lopez advised iControl management about cor-

recting rounding issues that iControl was confronting when calcu-

lating ACH transactions.

So too, with respect to white filters, Fintech submitted a se-

ries of emails between iControl employees and Fifth Third Bank in

which the bank reported that it couldn’t navigate the ACH pay-

ment process despite “doing business for Fintech”—which, in turn,

caused iControl to seek Lopez’s assistance. Those emails suggest—

or certainly could to a reasonable jury—that Fintech had some spe-

cialized method of white-filter maintenance that was not readily

ascertainable to iControl or the bank. Finally, Fintech submitted

an iControl document authored by Lopez and Sanderson that con-

tained screenshots of Fintech’s user portal—which a Fintech wit-

ness testified was password-protected and accessible only to

Fintech customers and employees—and details about how to build

something similar. That evidence could suggest to a reasonable

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12 Opinion of the Court 20-13368

jury that iControl misappropriated information about Fintech’s

user portal rather than develop it independently.

Because the jury returned a general verdict, we needn’t as-

sess each secret individually to determine whether each one was

readily ascertainable. Fintech’s trial evidence suggests that at least

some of its seven alleged trade secrets were not readily ascertaina-

ble to iControl and were instead improperly obtained through

Lopez’s and Sanderson’s aid. Because there is no “absolute absence

of evidence” of misappropriation, the district court was within its

discretion to deny iControl’s new-trial motion.

2

iControl contends that even if the jury’s baseline liability

finding stands, its exemplary-damages award cannot. FUTSA per-

mits exemplary damages if “willful and malicious misappropriation

exists.” Fla. Stat. § 688.004(2). In Perdue Farms Inc. v. Hook, a

Florida court concluded that exemplary damages are permissible

under FUTSA when “the defendant acts willfully, or with such

gross negligence as to indicate a wanton disregard of the rights of

others.” 777 So. 2d 1047, 1053 (Fla. 2d DCA 2001) (quotation omit-

ted). It is for the jury to determine whether a misappropriation was

willful and malicious. Id. at 1052.

Given the standard of review applicable to new-trial mo-

tions, we conclude that the jury here reasonably could have in-

ferred from the evidence presented that iControl schemed to hire

Lopez and Sanderson to misappropriate Fintech’s software

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features. Indeed, iControl acknowledged (internally) the possibil-

ity that Fintech might sue when it hired Sanderson. And testimony

at trial indicated that iControl hired Lopez to help with “strategy,

marketing, product development, product roadmapping, as well as

the delivery of specific technologies, mainly writing code to sup-

port our regulated commerce.” Trial Transcript (Day 2) at 114

(emphasis added). Again, we simply can’t say that there is an “ab-

solute absence of evidence” that would justify setting aside the

jury’s findings.

B

The damages calculation here presents thornier issues.

iControl filed a JMOL motion on damages, and we review the de-

nial of that motion de novo, viewing the evidence in the light most

favorable to Fintech. St. Louis Condo. Ass’n, 5 F.4th at 1242. A

JMOL motion should be granted only when there is no legally suf-

ficient evidentiary basis from which a reasonable jury could render

the verdict that this one did. Id.

In relevant part, FUTSA’s damages provision provides as fol-

lows:

Damages can include both the actual loss caused by

misappropriation and the unjust enrichment caused

by misappropriation that is not taken into account in

computing actual loss. In lieu of damages measured

by any other methods, the damages caused by misap-

propriation may be measured by imposition of

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14 Opinion of the Court 20-13368

liability for a reasonable royalty for a misappropria-

tor’s unauthorized disclosure or use of a trade secret.

Fla. Stat. § 688.004(1) (emphasis added). The dispute in this case is

about what constitutes “actual loss.” iControl contends that

Fintech can recover only lost profits—that is, the revenue it would

have received from its lost customers less the costs it would have

incurred servicing those customers. iControl further contends that

Florida law requires that Fintech subtract both fixed and marginal

costs from its revenues to calculate lost profits. 4

We understand Fintech to agree that it can recover only lost

profits. Even so, it argues (1) that Florida law doesn’t require de-

duction of fixed costs in trade-secret cases, (2) that its marginal

costs were negligible, and (3) that it can therefore, in essence, re-

cover lost revenue. 5 We will address iControl’s fixed- and mar-

ginal-cost arguments in turn.

4 We reject Fintech’s argument that iControl failed to preserve its fixed-cost

argument for appeal. iControl has consistently maintained that Fintech must

deduct all costs in order to prove lost profits. Even in its initial JMOL motion,

iControl complained that Fintech’s damages witness didn’t calculate “over-

head” (i.e., fixed) costs.

5 In its pleadings and initial disclosures in the district court, Fintech stated that

its damages were based on “lost revenue.” Fintech belatedly offered a “rebut-

tal” expert report purporting to perform an actual lost-profits analysis, but the

magistrate judge disallowed the late report. Accordingly, Fintech was forced

to go to trial without a proper damages expert who could explain its costs.

When, at trial, Fintech sought to put on a traditional lost-profits analysis, the

district court disallowed it, but permitted Fintech to proceed on a pseudo-lost-

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As a preliminary matter, though, a bit of definitional house-

keeping: It’s important to be clear at the outset about what we

mean by “fixed” and “marginal” costs. The most basic way to dis-

tinguish these concepts—as economists do—is this: Fixed costs

don’t (at least directly) vary based on output volume, while mar-

ginal costs measure the change in cost associated with a change in

output. See N. Gregory Mankiw, PRINCIPLES OF MICROECONOMICS

266–68 (6th ed. 2011).

Fixed costs, that is, are those that remain essentially the

same regardless of the number of a company’s customers or prod-

ucts. These may include rent, utilities, salaries, depreciation, insur-

ance, property taxes, R&D, etc. Of course, a dramatic change in

the volume of business will likely cause some change in fixed-cost

spending. A thriving company, for instance, may need to expand

(or even move) offices and thereby incur higher rent. Even so, rent

remains a “fixed” cost because it is not directly influenced by the

company’s sales or production volume.

Marginal costs, on the other hand, are tied directly to output

volume. They are often defined as the costs associated with pro-

ducing one more unit of output or servicing one more customer,

and they are calculated by dividing the change in total cost by the

change in output. Id. at 268. When calculating marginal costs over

profits theory under the caveat that Fintech’s damages witness would testify

that its costs were “trivial.” The district court characterized this narrow the-

ory as “sort of a crevasse in [the] law.”

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16 Opinion of the Court 20-13368

a change in output volume during which fixed costs remain con-

stant, marginal costs will depend only on the change in variable

costs.

1

First, fixed costs. iControl contends that Florida law re-

quires plaintiffs to apportion their fixed costs across all customers

and deduct these costs from revenues in a lost-profits analysis. For

the following reasons, we disagree.

We start with the text of FUTSA’s damages provision—

which, again, permits damages for “the actual loss caused by mis-

appropriation.” Fla. Stat. § 688.004(1). Here, Fintech lost a num-

ber of customers when iControl entered the market. Although

Fintech lost the revenues associated with those customers, some of

its losses were offset by the elimination of marginal costs that it no

longer had to incur to service those customers. So its “actual loss”

was lower than its lost revenue. (More on marginal costs shortly.)

Importantly, though, the evidence doesn’t clearly show that

Fintech incurred any reduction in its total fixed costs. Accordingly,

no fixed-cost savings offset its misappropriation-based losses.

Given that, it’s not clear to us why Fintech should have to deduct

fixed costs that it would have incurred anyway—and that, there-

fore, weren’t at all related to iControl’s conduct or Fintech’s re-

sponse. Accord Kutner Buick, Inc. v. Am. Motors Corp., 868 F.2d

614, 618 (3d Cir. 1989) (“The effect on net income must be meas-

ured by revenue lost less costs avoided. This translates into lost

revenue less the variable cost of producing this lost revenue. Fixed

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20-13368 Opinion of the Court 17

or unavoidable costs are by definition unrelated to the individual

income producing activity and thus are not relevant . . . .” (footnote

omitted)).

Additionally, FUTSA permits recovery only of those losses

that are “caused by” misappropriation. See Premier Lab Supply,

Inc. v. Chemplex Indus., Inc., 94 So.3d 640, 644–46 (Fla. 4th DCA

2012) (per curiam). Here, there is no clear causal link because

Fintech’s fixed costs remained unaffected by iControl’s misappro-

priation. See DXS, Inc. v. Siemens Med. Sys., Inc., 100 F.3d 462,

474 (6th Cir. 1996) (reasoning that deducting fixed costs would im-

permissibly base the lost-profits calculation on “overall economic

performance instead of on the basis of the transactions lost” and

wouldn’t place the plaintiff “in as good a position as it would have

been if the alleged tort had not occurred”). If, as iControl urges,

we were to require Fintech to deduct fixed costs from lost revenues

anyway, we would underestimate the magnitude of Fintech’s loss

“caused by” iControl’s misappropriation.6 That outcome seems

6 To illustrate this point, consider a hypothetical company that services 10 cus-

tomers. The company earns $100 in revenues per customer, and it costs the

company $10 to sign up and service each customer. Thus, the company makes

a profit of $90 per customer, for a total of $900. Separately, the company in-

curs $500 in fixed operating expenses, bringing its net profit to $400. Now,

suppose the company loses two customers but that this loss doesn’t cause any

change in the company’s fixed expenses. The company’s net profit will de-

crease to $220. The change in profits ($180) equals the revenues less marginal

costs per lost customer (($100 - $10) x 2 = $180). If we required the company

to deduct a pro rata share of its fixed costs from its per-customer profit for

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18 Opinion of the Court 20-13368

contrary not only to common sense but also, and more im-

portantly, to FUTSA’s plain text.

iControl resists that conclusion by citing several contract

cases. In the end, though, we think that those cases, properly un-

derstood, only bolster our holding. iControl is correct that in

breach-of-contract situations, Florida law typically requires that

both fixed and marginal costs be deducted from revenues to calcu-

late lost profits. In RKR Motors, Inc. v. Associated Uniform Rental

& Linen Supply, Inc., 995 So.2d 588 (Fla. 3d DCA 2008), a Florida

court explained the rationale for fixed-cost deductions, and its de-

cision is worth exploring in some detail.

In that case, Associated Uniform agreed to rent and launder

RKR’s employees’ uniforms. Id. at 590. RKR terminated the agree-

ment, and Associated Uniform sued for breach of contract, seek-

ing—among other remedies—“lost profits.” Id. At trial, Associated

Uniform’s damages expert “based his calculation,” in part, “on the

actual costs that Associated Uniform did not incur due to RKR Mo-

tors’ termination of the contracts.” Id. at 592 (emphasis added). By

contrast, “RKR Motors’ expert concluded that all of Associated

Uniform’s fixed costs related to the contract must be considered

and RKR Motors’ relative portion must be included in the compu-

tation.” Id. (emphasis added). In comparing the two experts’ testi-

mony, the court evidently differentiated between a calculation of

damages purposes, instead of recovering its actual loss of $180, it would only

recover $80. The company would thus be undercompensated for its losses.

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“actual costs” and a damages methodology that requires deduction

of “fixed costs.” Id.

To determine which damages methodology applied, the

court went on to distinguish two Florida cases—Knight Energy

Services, Inc. v. C.R. International Enterprises, Inc., 616 So.2d 1079

(Fla. 4th DCA 1993) (per curiam), and Boca Developers, Inc. v. Fine

Decorators, Inc., 862 So.2d 803 (Fla. 4th DCA 2003). See RKR, 995

So.2d at 592. In Knight, the court noted that a contracting party

seeking lost profits is entitled to “the contract price less any deduc-

tion for costs and expenses necessary to fully perform.” 616 So.2d

at 1080 (emphasis added). Ultimately, the court there didn’t re-

quire any cost deduction because the plaintiff unequivocally stated

that “no deductible costs or expenses [were] necessary to fully per-

form this contract.” Id. In Boca, however, the court found that

fixed costs had to be allocated across the board because there was

no evidence to suggest that the fixed costs were not involved in the

performance of the contract in question. 862 So.2d at 805–06. Im-

portantly, the breaching party in that case ordinarily apportioned

its fixed costs across other contracts but hadn’t apportioned any to

the contract at issue. Id. at 804–05. The court thus required deduc-

tion of “fixed costs such as rent and insurance related to those em-

ployees” who worked on the contract. Id.

Ultimately, the RKR court concluded that the intuition un-

derlying Florida’s contract cases is that all costs involved in per-

forming a contract must be deducted from the contract price to en-

sure that the nonbreaching party doesn’t get a windfall: “Requiring

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20 Opinion of the Court 20-13368

a deduction of a share of fixed costs related to the performance of

a contract allows for a true measurement of the amount the non-

breaching party would have earned on the contract had there been

no breach, which is the proper measure of damages.” 995 So.2d at

593; see also, e.g., Indian River Colony Club, Inc. v. Schopke Con-

str. & Eng’g, Inc., 592 So.2d 1185, 1187 (Fla. 5th DCA 1992) (requir-

ing deduction of reasonable value of supervisory services attribut-

able to performing the contract and non-reimbursable operating

expenses); Fu Sheng Indus. Co. v. T/F Sys., Inc., 690 So.2d 617, 623

(Fla. 4th DCA 1997) (requiring accounting of all costs associated

with the selling of the product for which lost profits were claimed);

Ballard v. Krause, 248 So.2d 233, 234 (Fla. 4th DCA 1971) (requiring

deduction of all costs and expenses necessary to perform the con-

tract); Physicians Reference Lab., Inc. v. Daniel Seckinger, M.D. &

Assocs., PA., 501 So.2d 107, 109 (Fla. 3d DCA 1987) (requiring de-

duction of fixed and variable costs of performance from the con-

tract price); James Crystal Licenses, LLC v. Infinity Radio Inc., 43

So.3d 68, 75 (Fla. 4th DCA 2010) (“A percentage of overhead ex-

penses should have been deducted from the projected lost prof-

its.”).

But Florida courts recognize that this contract-based dam-

ages methodology is different from a calculation of “actual costs.”

See RKR, 995 So.2d at 592. As already explained, by its terms,

FUTSA permits damages only for “the actual loss caused by misap-

propriation.” Fla. Stat. § 688.004(1). Accordingly, Florida’s method

of calculating damages in breach-of-contract disputes does not

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20-13368 Opinion of the Court 21

necessarily carry over into FUTSA cases. See HCA Health Servs.

of Fla., Inc. v. CyberKnife Ctr. of Treasure Coast, LLC, 204 So.3d

469, 472 (Fla. 4th DCA 2016) (suggesting that the fixed-cost-deduc-

tion method of calculating damages is specific to the contracts con-

text because it best approximates “the benefit of the bargain” or

“expectation interest” (quotation omitted)).

This conclusion is strengthened by Murray v. Department

of Transportation, 687 So.2d 825 (Fla. 1997). In this non-contract

business-damages case under another Florida statute, the Florida

Supreme Court held that the calculation of business damages does

not require “one mechanically applied, one-size-fits-all formula

which would not produce proper results.” Id. at 827. Because

“business damages are inherently fact-intensive” and some costs

“such as insurance . . . will continue to be the same regardless of

the loss” of some customers, the court permitted a damages calcu-

lation that didn’t deduct fixed costs. Id. Murray demonstrates

(1) that statutory damages needn’t be determined by the same

method used in contract law and (2) that deduction of business

costs that remain the same regardless of the loss of some customers

isn’t required.

In short, therefore, we agree with the district court that the

jury was not required to deduct Fintech’s fixed costs from its reve-

nues to arrive at a proper “actual loss” measure.

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22 Opinion of the Court 20-13368

2

Marginal-cost deduction presents a different challenge. Both

iControl and Fintech agree that, in theory, a plaintiff must subtract

the costs that it would have had to incur to service its lost custom-

ers from the revenues that it would have received from those cus-

tomers. But Fintech argues that its “business loss was at the mar-

gins” and that it would have incurred only “trivial costs” in servic-

ing the customers it lost to iControl. Br. of Appellee at 73 (quota-

tion marks omitted). Accordingly, Fintech says, it was “up to the

jury” to disregard those costs and award its full lost revenues. Id.

Alternatively, Fintech argues that because its lost revenues were

$2,721,925, and the jury awarded only $2,700,000, we can infer that

the jury deducted some costs.

We begin with the evidence presented to the jury. At trial,

Fintech’s damages witness testified that adding customers to

Fintech’s platform entails “[m]inimal” costs. He claimed that

Fintech’s “cost of goods sold” 7 for all customers is “less than ten

percent” and that “hard costs” 8 are “like three percent or less.”

Fintech incurs low marginal costs in adding additional customers

to its platform, he explained, because it is a technology business

and adding new customers to an already-written program doesn’t

7 “Cost of goods sold” encompasses the costs directly involved in producing

the goods sold or the services delivered.

8 The witness defined these as including “banking costs” and payments for

“communication systems to send data back and forth.”

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20-13368 Opinion of the Court 23

translate into many more costs. Importantly, though, Fintech’s

witness provided no accounting of any costs to corroborate his tes-

timony approximating them. He placed Fintech’s lost revenues at

“$2,721,925.” In his closing statement, Fintech’s lawyer stated—

slightly differently—that “FinTech’s total damage to date [is] $2.7

million in lost revenue.” Trial Transcript (Day 6) at 40 (emphasis

added). “This is the amount of money,” he said, “that FinTech lost

because iControl misappropriated its trade secrets and that’s the

amount of money that FinTech asks you, this jury, to award against

iControl.” Id. (emphasis added). Following that statement, the

jury returned a verdict of $2.7 million.

Missing from the trial record is any evidence that Fintech’s

marginal costs were actually zero. Had Fintech clearly presented

that evidence, it might have been entitled to an award that didn’t

account for those costs. See Knight, 616 So.2d at 1080 (permitting

award without cost deduction when the plaintiff unequivocally

stated that no costs were incurred); DXS, 100 F.3d at 474 (same).

But Fintech presented only evidence that its marginal costs were

“minimal”—and “minimal” doesn’t equal zero. Likewise, “three

percent” and “ten percent” don’t equal zero. Fintech requested

$2.7 million in damages from the jury, and that is what it received.

Although there was a small difference between, on the one hand,

the revenue figure that Fintech presented at trial and, on the other,

the amount that it sought in its closing statement and that the jury

ultimately awarded, we can’t speculate whether the jury deducted

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24 Opinion of the Court 20-13368

any costs from revenues because Fintech never produced any hard-

cost calculations.

Because Fintech didn’t provide any evidence from which a

reasonable jury could conclude that its marginal costs were zero,

the district court erred in denying iControl’s JMOL motion on

damages. See Crain Auto. Grp., Inc. v. J&M Graphics, Inc., 427

So.2d 300, 301–02 (Fla. 3d DCA 1983) (rejecting damages evidence

that “did not explain what calculations and deductions” went into

its estimate as “too speculative”). Even reading the evidence in the

light most favorable to Fintech, it would be a bridge too far to con-

clude that the jury could have reasonably found its marginal costs

to be zero when the only benchmark amounts offered at trial were

“minimal,” “three percent,” and “ten percent.”

* * *

The damages calculation in this case presents difficult legal

and factual questions. Although FUTSA’s damages provision

doesn’t require fixed-cost deduction, Fintech was required to de-

duct its marginal costs. Because it didn’t conclusively prove that

its marginal costs were zero, it wasn’t entitled to its full amount of

lost revenues. On remand, the district court should require an ac-

counting of marginal costs to enable a proper lost-profits calcula-

tion.

C

Finally, Fintech’s requested injunction. We review denials

of injunctive relief for abuse of discretion. Common

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20-13368 Opinion of the Court 25

Cause/Georgia v. Billups, 554 F.3d 1340, 1349 (11th Cir. 2009). As

we have explained before, an injunction must be narrowly tailored

to the proven legal violations and restrain no more conduct than

reasonably necessary. Keener v. Convergys Corp., 342 F.3d 1264,

1269 (11th Cir. 2003). It must also describe the restrained acts in

reasonable detail such that there is no uncertainty or confusion as

to the conduct proscribed. LabMD, Inc. v. FTC, 894 F.3d 1221,

1235 (11th Cir. 2018); Fed. R. Civ. P. 65(d)(1)(C).

FUTSA permits injunctive relief in the following terms:

Actual or threatened misappropriation may be en-

joined. Upon application to the court, an injunction

shall be terminated when the trade secret has ceased

to exist, but the injunction may be continued for an

additional reasonable period of time in order to elim-

inate commercial advantage that otherwise would be

derived from the misappropriation.

Fla. Stat. § 688.003(1). As the statute indicates, an injunction under

FUTSA should ordinarily be for a specified period of time, which

may be extended under certain circumstances. See Premier Lab

Supply, 94 So.3d at 645 (noting that injunctive relief under FUTSA

is time-limited); Restatement (Third) of Unfair Competition § 44,

cmt. f (Am. Law. Inst. 1995) (noting that in the trade-secret context,

an injunction must be time-limited and last “only until the defend-

ant could have acquired the information by proper means”). An

unlimited injunction runs the risk of restraining legitimate compe-

tition.

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26 Opinion of the Court 20-13368

In its first motion, Fintech sought a blanket injunction “pro-

hibiting iControl from doing business in the regulated commerce

industry.” The district court correctly denied the motion on the

ground that FUTSA only “authorizes the injunction of specific,

identifiable trade secrets,” not “blanket restraint of competition.”

See Norton v. Am. LED Tech., Inc., 245 So. 3d 968, 969 (Fla. 1st

DCA 2018) (“[F]UTSA may not be used as a vehicle to restrict com-

petition.”). In its renewed motion, Fintech claimed to narrow the

scope of its requested injunction as follows:

iControl’s misappropriation . . . included aspects of

every part of Fintech’s regulated commerce software

system. . . . Accordingly, Fintech seeks a permanent

injunction prohibiting iControl from using Fintech’s

proprietary regulated commerce software[.] . . . Be-

cause Fintech’s trade secrets were incorporated into

iControl’s Harmony software, Fintech further seeks

an injunction prohibiting iControl from using its Har-

mony software[.] . . . Fintech also seeks a permanent

injunction prohibiting iControl from using its Next

Gen Reconciliation software, which misappropriated

Fintech’s method and process for developing and in-

cluding information in its broken case and price dis-

crepancy reports.

The district court denied the revised injunction as well, concluding

that it “sweeps too broadly and promotes confusion about the na-

ture of Fintech’s trade secrets.”

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20-13368 Opinion of the Court 27

As a practical matter, Fintech’s second motion just used

more words to seek fundamentally the same result—namely, to

eliminate iControl from “the regulated commerce industry.”

Fintech’s revised proposal continued to resemble a blanket re-

straint on competition prohibited under FUTSA. Moreover,

Fintech’s proposed injunction wasn’t narrowly tailored and didn’t

identify specific acts to be restrained. 9 For one, Fintech sought to

enjoin iControl not only from using Fintech’s software, but also

from using its own software. A blanket prohibition on using both

software packages fails the requirement that only “specific, identi-

fiable trade secrets” be enjoined and leads to the impermissible con-

clusion that the entirety of Fintech’s software is a trade secret. And

Fintech wanted the injunction to last forever, which violates

FUTSA’s plain terms indicating that an injunction must be termi-

nated when the trade secret has ceased to exist. Indeed, Fintech’s

own expert admitted that iControl “certainly” could have devel-

oped the “specific functionality” he described as Fintech’s trade se-

crets “[g]iven time.” So there are no circumstances in which

9 Fintech claims that its “trade secrets sufficiently identify the conduct [to be]

restrained.” But remember, the jury returned a general verdict, so we don’t

know which trade secrets in particular the jury found iControl had misappro-

priated. Fintech ignores the fact that even if the district court were to issue an

injunction, the court must make its own factual determinations as to which

alleged trade secrets were misappropriated. See McCarthy v. Fuller, 810 F.3d

456, 460 (7th Cir. 2015). The jury verdict alone does not automatically entitle

Fintech to an injunction.

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28 Opinion of the Court 20-13368

Fintech should be awarded a permanent injunction of unlimited

duration.10

Fintech’s revised proposed injunction swept as broadly as its

first. The district court did not abuse its discretion in denying in-

junctive relief.

III

The district court’s judgment with respect to iControl’s lia-

bility and Fintech’s request for a permanent injunction is affirmed.

We reverse the district court's judgement on damages and remand

for a proper calculation and deduction of marginal costs.

AFFIRMED in part, REVERSED and REMANDED in part.

10 We find unavailing Fintech’s argument that the district court was mistaken

in concluding that “[a]ny misappropriation by iControl occurred more than

five years ago . . . , and nothing offered by Fintech establishes . . . that iControl

could not independently have developed between then and now any trade se-

cret then acquired from Fintech.” Whether the “five years” figure was sup-

ported by the evidence at trial is irrelevant because, in any event, Fintech did

not establish that it should be awarded an injunction of unlimited duration.

And it was Fintech’s—not the district court’s—responsibility to properly time

limit the injunction based on the evidence at trial. See United States v. W. T.

Grant Co., 345 U.S. 629, 633 (1953) (“[T]he moving party must satisfy the court

that [injunctive] relief is needed. The necessary determination is that there

exists some cognizable danger of recurrent violation . . . .”).