Zunum Aero v. Boeing

People and parties

Trial judge

Trial2024

Plaintiff

v.

Defendant

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An investor with a competing program

Boeing could examine Zunum’s technology as an investor. It could not use that access for every purpose: under the parties’ 2017 investor rights letter, Boeing could use Zunum’s confidential information to manage its investment. The dispute was whether Boeing instead put that information to work on its own hybrid-electric aircraft program. A jury found for Zunum on trade secrets, one contract and interference with a potential investor. The trial judge set the verdict aside. [1, pp. 2, 5–6]

The Ninth Circuit restored the verdict because the trial record permitted the jury’s conclusions. Its 2025 memorandum repeatedly identified the same error: the district court had discounted evidence or drawn inferences against the party that had won at trial. The appellate court also reversed the conditional new-trial order and directed reassignment to another judge. [1, pp. 3–9]

Then came a second dispute: whether the Ninth Circuit had authority to decide the appeal at all. Boeing had brought patent inventorship counterclaims, which can send an appeal to the Federal Circuit when they are compulsory. In a published 2026 order, the panel held these counterclaims were permissive, while still sufficiently connected to support federal jurisdiction over Zunum’s state-law claims. That distinction gives the case significance beyond aircraft technology. [2, pp. 10–25]

What Boeing was allowed to do with the information

Zunum’s project involved hybrid-electric aircraft technology. Its suit named The Boeing Company and Boeing HorizonX Ventures, LLC, which the appellate decisions call “Boeing” collectively. Zunum alleged misuse of information shared under agreements that restricted its use to evaluating or managing an investment or exploring collaboration. Its theories included competitive use of aircraft designs and disclosures to third parties. Those were allegations to be proved, not consequences that followed automatically from Boeing’s access. [1, p. 2] [2, pp. 6–8]

The distinction matters under Washington’s trade-secret statute. Information must have actual or potential economic value from not being generally known or readily ascertainable, and its holder must make reasonable efforts to preserve secrecy. Misappropriation can involve unauthorized use by someone who received the information under a duty to keep it secret or limit its use. Lawful access therefore does not answer whether a later use was lawful. [3, § 19.108.010(2)(b), (4)]

The contract supplied another route to liability. As the appellate court described it, the 2017 letter confined Boeing’s use to managing its investment. The contract claim was governed by Delaware law; the trade-secret and interference claims were governed by Washington law. The restriction gave the jury a concrete question: was Boeing managing its investment, or using the information to advance its own program? [1, pp. 5–7]

A verdict, a reversal, and a fight over the forum

1. 2020

   Zunum sues in Washington state court; its amended complaint advances twelve state-law claims concerning Boeing’s conduct. [2, p. 6]

2. July 2021

   Boeing removes the case to federal court on a patent inventorship counterclaim. It adds a second patent counterclaim that December. [2, p. 8]

3. April–May 2024

   Boeing wins its patent counterclaims on summary judgment. Zunum then wins a mixed verdict after an eight-day jury trial on trade-secret and other state-law claims. [2, pp. 8–9]

4. After trial, 2024

   The district court grants judgment as a matter of law for Boeing and conditionally orders a new trial, setting aside the verdict. [1, pp. 2, 8]

5. August 14, 2025

   The Ninth Circuit reverses both posttrial rulings and remands with instructions to assign a different district judge. [1, pp. 8–9]

6. August 26, 2026

   The panel denies rehearing in a published order rejecting Boeing’s appellate and supplemental-jurisdiction challenges. [2, pp. 10–25]

What the jury could reasonably find

Boeing’s challenge

The posttrial challenge attacked the foundations of Zunum’s case: whether the alleged secrets were identified precisely enough, whether they had value from secrecy, whether Boeing misused them, and whether the asserted breach and interference caused compensable harm. Boeing also argued on appeal that inadequate damages evidence independently justified judgment in its favor. The district court accepted the sufficiency challenge; the appellate panel did not. [1, pp. 2–7]

Zunum’s trial record

Zunum’s witnesses identified secrets by number, explained them and used exhibits and demonstratives to show their contents. Technical experts addressed secrecy, value and similarities between the companies’ work. Other evidence described Zunum’s development effort and the technical and commercial benefits of its information. Internal Boeing communications addressed the difficulty of replicating the technology and incorporating Zunum information into Boeing’s own work. [1, pp. 3–5]

The limit on posttrial review

Judgment as a matter of law tests whether the evidence legally supports the verdict. It does not authorize the court to decide which witnesses it finds more convincing. Applying Reeves and Krechman, the panel held that the judge had to draw reasonable inferences for Zunum and, in this record, credit the testimony of its admitted experts. The court reviewed the JMOL ruling anew; it reviewed the conditional new-trial ruling for abuse of discretion. [1, pp. 2, 4, 7–8]

The appellate question was whether the jury could reasonably reach its verdict on this evidence. Expert explanations, documents and contemporaneous communications supplied that support for protected secrets, competitive misuse and resulting injury. [1, pp. 3–7]

The judge limited the definitions, then found them inadequate

The specificity issue had an unusual feature: the district court had rejected Zunum’s repeated attempts to introduce comprehensive definitions and instead supplied its own exhibit listing the alleged secrets with short descriptions. Witness testimony, examples and exhibits gave those numbered entries substance. The panel held that the combined presentation allowed the jury to evaluate whether the information qualified for protection. [1, pp. 2–3]

This is a record-based conclusion, not permission to claim everything a business knows. Zunum still had to identify its secrets sufficiently for the jury to apply the statute. But it did not have to delineate every boundary with the precision the district court later demanded. The verdict itself distinguished among the claims: the jury found misappropriation of eleven of the nineteen alleged secrets presented at trial. [1, pp. 2–3]

The same attention to the whole record mattered for value and use. Development costs were supported by testimony about commercial and technical benefits and Boeing’s own assessments. Evidence of similarities was supported by expert explanations and internal communications suggesting planned incorporation of Zunum information. The panel treated these as mutually reinforcing evidence, rather than requiring one document to prove the entire claim. [1, pp. 3–5]

The lost opportunity—and what the award measures

The contract and interference claims focused attention on investment opportunities. For the contract claim, the jury could infer that misuse destroyed Zunum’s competitive advantage and cost it future investment or partnerships. For the Safran claim, testimony described a lengthy negotiation that began with Safran approaching Zunum and remained promising until Boeing’s alleged interference. Boeing employees’ contemporaneous communications also acknowledged Safran’s interest. [1, pp. 5–7]

The panel held that this evidence supported a business expectancy with a reasonable prospect of coming to fruition, along with intentional interference for an improper purpose and resulting damage. It also upheld admission of Zunum’s damages expert and found the testimony sufficient to support the damages verdict when credited under the JMOL standard. A signed final investment contract was not the factual premise on which the panel relied. [1, pp. 6–7]

The 2026 order reports the jury’s awards as $67.08 million in actual damages and $14.15 million in unjust enrichment for trade-secret misappropriation, plus $11.56 million for interference with the Safran expectancy. It reports no separate contract damages, to avoid double recovery. These are the jury’s component awards as recounted by the court; they should not be mistaken for a verified final amount payable after all adjustments, fees or further proceedings. [2, p. 9]

Why the panel also rejected a new trial

Reversing JMOL would not by itself dispose of Boeing’s alternative request for a new trial. The panel addressed that ruling separately. The district court had supplied no substantive rationale beyond its flawed JMOL analysis, and the appellate court’s review of the full record did not show a verdict against the great weight of the evidence. It therefore reversed the conditional new-trial order too. [1, p. 8]

The direction to use a different judge involved another concern. During the litigation, a bank managing Judge James L. Robart’s spouse’s IRA twice bought Boeing stock. The panel acknowledged prompt divestment. It emphasized, however, that Robart learned of the transactions in May and June 2023 but disclosed them to the parties only in September 2024, one day before entry of final judgment. [1, pp. 8–9]

Together with the district court’s rulings during and after trial, that delay could cause an objective observer to question impartiality in further proceedings. The panel applied the appearance-of-impartiality principle under 28 U.S.C. § 455(a). Its ruling should not be turned into an accusation that the judge deliberately favored Boeing or personally directed the purchases. [1, pp. 8–9]

Did the appeal belong in a different circuit?

Boeing’s rehearing petition raised a threshold objection: the Federal Circuit has exclusive appellate jurisdiction when a party asserts a compulsory counterclaim arising under federal patent law. Boeing had sought declarations resolving inventorship of its Active Voltage and Thin Haul patents after Zunum alleged that Boeing patents drew on its information. Those counterclaims supplied the route into federal court. [2, pp. 6–12] [4, § 1295(a)(1)]

The statutes ask different questions at different stages. Section 1454(a), the patent-removal provision Boeing invoked, speaks of a patent claim asserted by any party. Section 1295(a)(1), which allocates these appeals, specifies a compulsory patent counterclaim. A counterclaim could therefore help bring this case into federal court without sending its appeal to the Federal Circuit. [2, pp. 8, 11–12] [7, § 1454(a)]

The timing did not dispose of the objection. Federal appellate courts must examine their own jurisdiction and that of the district court, even when the challenge first appears on rehearing and comes from the party that originally invoked federal jurisdiction. The panel therefore addressed Boeing’s argument on its merits. [2, p. 10]

There was no dispute that the inventorship counterclaims arose under patent law. The decisive question was whether they were compulsory under Rule 13(a): did they arise from the transaction or occurrence that formed the subject of Zunum’s claim? The majority applied the Ninth Circuit’s logical-relationship test, looking to the operative facts necessary to prove the respective claims. [2, pp. 11–15] [6, Rule 13(a)]

Zunum alleged many forms of misuse; the patents were only one part of that account. It did not need to disprove Boeing’s inventorship to establish trade-secret misappropriation. Indeed, Boeing had won both patent counterclaims on summary judgment before Zunum won at trial. The majority found insufficient overlap in essential proof to make the counterclaims compulsory, and reached the same result under the Federal Circuit’s approach. The Ninth Circuit could hear the appeal. [2, pp. 14–21]

Related enough for one lawsuit, but not compulsory

Boeing had a fallback argument. If its patent counterclaims were merely permissive, it argued, how could the district court have supplemental jurisdiction over Zunum’s state claims? Boeing treated the compulsory-counterclaim and supplemental-jurisdiction inquiries as requiring the same factual connection. [2, p. 21]

The panel rejected that equivalence. Section 1367(a) reaches claims forming part of the same constitutional case or controversy. Its common-nucleus-of-operative-fact standard is broader than Rule 13(a)’s transaction-or-occurrence requirement. Joining the First, Second and Seventh Circuits, the Ninth Circuit held that permissive counterclaims can participate in a case that supports supplemental jurisdiction. Here, access to and alleged misuse of Zunum’s confidential aircraft information connected the patent and state-law claims. [2, pp. 21–25] [5, § 1367(a)]

The practical consequences help explain why the tests differ. Calling a counterclaim compulsory can bar a party from bringing it later if omitted. Finding supplemental jurisdiction establishes power to hear related claims together. The power to hear related claims together therefore reached further than the obligation to bring a counterclaim now or risk losing it. [2, pp. 23–24]

Jurisdictional power also does not settle whether the court should exercise it. Section 1367(c) preserves grounds for declining supplemental jurisdiction, including the dismissal of all claims within original jurisdiction. The published order resolved Boeing’s claim that permissive status necessarily defeated federal power; it did not abolish that separate statutory discretion. [2, pp. 21–25] [5, § 1367(c)]

Bade agreed with the result, but challenged the method

Judge Lucy H. Koh wrote the published order for the majority; Judge Bridget S. Bade concurred in part and in the denial of rehearing. Bade agreed that the patent counterclaims were permissive and joined the supplemental-jurisdiction analysis. Her disagreement concerned how to apply Rule 13(a): the rule’s transaction-and-occurrence language should control, rather than a rigid reading of a judicial formulation of “logical relationship.” [2, pp. 25–28]

Bade gave a concrete illustration of why the two kinds of intellectual-property claim can diverge. Even if Boeing misappropriated secrets concerning the patents’ subject matter, it could still prevail on inventorship if that information was insufficient to enable its employees to construct and operate the patented inventions. That was an explanation of legally compatible outcomes, not a new factual finding about exactly what Boeing’s engineers received. [2, pp. 31–32]

She also warned against treating compatible victories as decisive. A plaintiff and counterclaimant can sometimes both win even when the counterclaim is compulsory. The majority expressly agreed that compatibility is not conclusive. For lawyers, the useful inquiry remains the events and proof each claim requires—not simply whether the claims concern the same technology or can succeed together. [2, p. 15 n.7, pp. 29–32]

What counsel should take from the case

The litigation offers several practical lessons, drawn from the appellate reasoning rather than new duties announced by the court:

• Make each secret traceable through the record. Definitions, witness testimony and examples should identify the same claimed information. Preserve attempts to introduce fuller definitions when the court restricts the presentation. The record of those restrictions mattered here. [1, p. 3]
• Separate access from permitted use. An investment review may legitimately expose technology while leaving competitive development outside the agreement. The exact permitted purpose and evidence of actual use both matter. [1, pp. 4–6]
• Separate admissibility from sufficiency. Once expert testimony was properly admitted, the judge could not simply disbelieve it to grant JMOL. An alternative new-trial request also needed an analysis that survived appellate review. [1, pp. 4, 7–8]
• Analyze the appellate forum claim by claim. A patent counterclaim’s label is not enough. Identify what each side must prove, assess compulsory status, and evaluate supplemental jurisdiction independently. [2, pp. 11–25]

Which decision to cite

The merits appeal was decided by Judges Johnnie B. Rawlinson, Bridget S. Bade and Lucy H. Koh. Their August 14, 2025 memorandum identifies no individual author and expressly states that it is not precedent except as Ninth Circuit Rule 36-3 provides. It is useful for understanding this record; it should not be presented as a new binding circuit rule on trade-secret proof. Its foundational authorities include InteliClear on identifying secrets, Reeves on JMOL review and Krechman on admitted expert testimony. [1, pp. 1–4]

The August 26, 2026 order is published and addresses appellate and supplemental jurisdiction. It applies Mattel v. MGA Entertainment and discusses Hydranautics v. FilmTec on compulsory counterclaims; it joins Global NAPs, Jones v. Ford Motor Credit and Channell v. Citicorp on the broader reach of supplemental jurisdiction. These are the connections to follow when preparing a jurisdictional argument. [2, pp. 12–24]

The verified later development covered here is the denial of panel rehearing in that 2026 order. The sources reviewed do not establish a final net recovery, payment, settlement or subsequent Supreme Court disposition. The procedural account should be read with that limit, rather than as a claim that every possible later proceeding has concluded.

Sources and citations

1. Ninth Circuit merits memorandum

   August 14, 2025 · Nos. 24-5212 & 24-5751 · Unpublished · pp. 2–7 (merits), 8–9 (new trial and reassignment).

2. Ninth Circuit order denying panel rehearing

   August 26, 2026 · Nos. 24-5212 & 24-5751 · Published · pp. 6–9 (history), 10–25 (jurisdiction), 25–32 (Bade concurrence).

3. Washington Uniform Trade Secrets Act: definitions

   RCW 19.108.010(2)(b), (4) · Misappropriation and trade-secret requirements.

4. Federal Circuit appellate jurisdiction

   28 U.S.C. § 1295(a)(1) · Compulsory patent counterclaims.

5. Supplemental jurisdiction

   28 U.S.C. § 1367(a), (c) · Jurisdictional connection and discretionary grounds.

6. Counterclaims and crossclaims

   Federal Rule of Civil Procedure 13(a)–(b) · Compulsory and permissive counterclaims.

7. Removal of patent cases

   28 U.S.C. § 1454(a), (d) · Patent counterclaims and remand of other claims.

Illustration references

Participant illustrations were generated from the Zunum company mark, the Boeing mark hosted by Smithsonian National Zoo, and a Business Insider image of James L. Robart. They identify participants and are not evidence from the litigation.