Federal Circuit Reverses $59 Million Jury Verdict in Omnipod® Trade Secret Case as Time Barred Under the ‘Knew or Should Have Known’ Standard

The court held that Insulet’s DTSA claim was time-barred because Insulet knew or should have known — more than three years before filing suit — that a former employee with access to its trade secrets was working for a competitor that had developed a strikingly similar product. 

The decision offers significant guidance for determining when the DTSA’s three-year statute of limitations begins.

Background

Insulet manufactures the Omnipod®, an adhesive, wearable insulin patch pump. EOFlow, a Korean company, developed a competing product called the EOPatch®, a version of which was marketed in Europe and South Korea.

Insulet’s trade secret misappropriation claim centered on EOFlow’s hiring of several former Insulet employees — most notably Steve DiIanni, Insulet’s former Director of Mechanical Engineering — to help develop a second-generation patch pump, the EOPatch 2. DiIanni possessed detailed technical information about the Omnipod, including product specifications, material compositions, coating materials, operational software requirements, dimensional tolerances, and other product and manufacturing details. Between March and May 2018, DiIanni shared CAD files, soft cannula design and manufacturing information, and occlusion-detection algorithm details with EOFlow.

Internal Insulet emails show that Insulet knew by March 2019 that DiIanni and other former Insulet employees were working with EOFlow on the EOPatch 2. In June 2018, at an American Diabetics Association (ADA) Conference, Insulet personnel observed and photographed EOFlow’s display of the EOPatch 2 and noted similarities to the Omnipod. One Insulet employee emailed management that “EOFlow has cloned our product,” while another stated they needed to determine if the EOPatch 2 was “based on our IP.” An intelligence summary sent to Insulet management following the ADA conference concluded that EOFlow had a “[v]ery similar product to Insulet’s OmniPod as it was started by a former Insulet engineer.” 

Insulet filed its DTSA complaint on August 3, 2023, making August 3, 2020 (three years before Insulet filed its complaint) the “critical date” for DTSA statute of limitations purposes. Following trial, the jury found EOFlow had misappropriated four of Insulet’s trade secrets relating to the Omnipod — CAD files, the soft cannula design and manufacturing process, the design history file, and the occlusion-detection algorithm — and that none of Insulet’s claims were time-barred. The jury initially awarded $170 million in compensatory damages and $282 million in exemplary damages, but the district court reduced the award to $25.8 million and $33.6 million, respectively, to avoid double recovery with a permanent injunction. 

Case Information 

Insulet Corp. v. EOFlow, Co. Ltd., No. 2025-1807 (Fed. Cir. May 28, 2026)

Plaintiff-Appellee: Insulet Corp.

Defendant-Appellant: EOFlow, Co. Ltd.; EOFlow Inc.; Jesse J. Kim 

Judge: Hon. Timothy B. Dyk (joined by Jimmie V. Reyna) (Sharon Prost dissenting) 

Analysis and Outcome 

Inquiry Notice Versus Merck Standard

DTSA states that the statute of limitations period begins to run when the misappropriation “is discovered or by the exercise of reasonable diligence should have been discovered”. 18 U.S.C. § 1836(d). EOFlow argued for the application of an “inquiry-notice” standard when determining the beginning of the DTSA’s limitations period. In other words, EOFlow argued the statute of limitations for a DTSA claim begins to run “when the plaintiff or a reasonably diligent plaintiff would have begun an investigation that would allow it to discover” the relevant facts. Insulet, argued that the US Supreme Court rejected an inquiry-notice standard in Merck & Co. v. Reynolds, 559 U.S. 633 (2010), and that the DTSA’s limitation period “begins whenever a plaintiff did discover or should have discovered the facts underlying its cause of action.”

The Federal Circuit declined to decide whether the inquiry-notice or Merck standard was applicable, concluding that “even under the more demanding Merck standard, the statute of limitations expired before Insulet filed its complaint.”

The Access-Plus-Similarity Framework

The Federal Circuit recognized that under the DTSA, a trade secret misappropriation claim may be sufficiently pleaded and proven through circumstantial evidence showing the defendant’s access to the trade secrets and similarities between those secrets and the accused product. This is known as the “access-plus-similarity” framework.

The court found that by March 2019 — well before the critical date — Insulet knew that DiIanni, a “veritable repository of information” on Insulet’s products, had been hired by EOFlow to work on the EOPatch 2. Relying on Seatrax, Inc. v. Sonbeck International, Inc., 200 F.3d 358 (5th Cir. 2000), the court then held that knowledge that a former employee with access to trade secrets is working for a competitor puts the trade secret owner on notice of access as a matter of law. 

As to similarity, the court detailed undisputed evidence that Insulet knew before the critical date of specific design similarities between the Omnipod and the EOPatch 2, including the product’s walking-man hook and ratchet gears, the tube nut configuration, the reservoir and plunger O-ring, and the “nail-head” soft cannula seal. These features were observable at ADA conference displays in 2018 and 2019 and disclosed in EOFlow’s publicly available Korean IPO prospectus by July 2020. The court rejected Insulet’s argument that it needed detailed knowledge of precise nominal dimensions or internal manufacturing processes to plead misappropriation, emphasizing that “the standard is substantial similarity.” The court also stated that the relevant question is not whether the plaintiff had sufficient evidence to prove misappropriation, but rather whether it had sufficient evidence to state a claim.

Single Accrual Date for Related Trade Secrets

The court held that under the DTSA’s statute of limitations provision which states that “a continuing misappropriation constitutes a single claim of misappropriation,” 18 U.S.C. § 1836(d), all of Insulet’s trade secret claims were subject to a single accrual date. Following the approach developed in Intermedics, Inc. v. Ventritex, Inc., 822 F. Supp. 634 (N.D. Cal. 1993), and endorsed by multiple circuits, the court concluded that because DiIanni disclosed all of the asserted trade secrets to EOFlow in a single course of conduct between March and May 2018, they constituted a single claim of misappropriation. The court held that this approach “impose[s] on plaintiffs a responsibility to take prompt and assertive corrective action with respect to all of plaintiff’’ interests whenever plaintiffs detect a fracture in a once confidential relationship.”

This reasoning was particularly significant for the occlusion-detection algorithm trade secret — an internal process not visible in EOFlow’s final product. The court held that because this trade secret was disclosed by the same person, during the same time period, and for the same purpose as the other trade secrets, its limitations period ran concurrently with the others. Holding otherwise, the court reasoned, would mean “the statute of limitations would never expire for a trade secret that could not be discovered based on publicly available information.”

The Dissent

Judge Prost dissented, raising four principal objections. 

First, Judge Prost argued that the majority conflated the discovery rule with the inquiry-notice standard, focusing on when Insulet should have begun investigating rather than when it reasonably should have discovered the misappropriation. 

Second, the dissent contended that the majority’s access-plus-similarity framework was too broad, arguing that “access” must require more than the mere fact that a former employee works for the defendant, and that the similarity prong demands a fact-intensive, context-specific inquiry. Judge Prost warned that the majority’s approach would “arguably produce absurd results” and induce a “premature, and unfortunate, rush to the courthouse” whenever a former employee joins a competitor making a superficially similar product. 

Third, the dissent argued that the majority improperly substituted its own factual findings for the jury’s, treating all evidence favorable to EOFlow as undisputed while dismissing Insulet’s contrary evidence as “conclusory and subjective.” Judge Prost highlighted trial testimony that EOFlow was evasive at trade shows, that publicly available information suggested EOFlow used different technology, and that the similarities in external appearance did not necessarily indicate trade secret misappropriation given the type and size of the technology at issue. 

Fourth, Judge Prost objected to the majority’s single-accrual-date analysis for the occlusion-detection algorithm, calling it “an issue of first impression in the First Circuit” that EOFlow had not advanced on appeal. She noted that the algorithm was not visible in EOFlow’s final product, was not alleged in Insulet’s original complaint, and was discovered only during litigation discovery. 

Why It Matters

The access-plus-similarity framework sets a relatively low bar for triggering the DTSA’s statute of limitations. Under the majority’s approach, knowledge that a former employee with access to trade secrets is working for a competitor that produces a substantially similar product is sufficient to start the three-year clock — even without proof that the employee actually took confidential documents or knowledge of specific, detailed misappropriation. 

Trade secret owners must act promptly upon detecting a “fracture” in a confidential relationship. Once a plaintiff discovers or should discover misappropriation of a single trade secret, the limitations clock begins running for all related trade secrets arising from the same breach of confidence, including trade secrets that are not outwardly visible in the defendant’s product. Companies that suspect misappropriation should not wait to gather detailed evidence before filing suit or taking other protective action.

Publicly available information matters for statute of limitations purposes. The court held that a company “paying consistent attention” to a competitor should have known of major public disclosures — such as an IPO prospectus — that revealed product similarities, even if the company did not actually review those materials before the critical date. 

Conclusory testimony may be insufficient to sustain a jury verdict. The court gave little weight to generalized Insulet employee testimony expressing subjective opinions that they did not “think” trade secret theft had occurred, finding such testimony insufficient in light of specific, uncontradicted evidence of access and similarity.