GHC - Kaplan Resolves Lawsuit Against Dalton for Alleged Misappropriation of Trade Secrets

Kaplan North America, a division of global education provider Kaplan, Inc., has settled its federal lawsuit against a competitor, Dalton Education, LLC after Dalton terminated certain employees and agreed to terms including verifying that it no longer possesses Kaplan’s asserted trade secrets. Kaplan’s original complaint alleged nine counts of unlawful behavior, including trade secrets misappropriation, computer fraud and abuse, and tortious interference. Kaplan previously settled with two former Kaplan employees who were also named as defendants in the lawsuit. Both companies provide continuing education, licensing and certification for employees in the wealth management and financial analysis fields and compete for the same or similar clients.

In early 2019 Kaplan discovered that its former employees were hired by Dalton and took valuable and confidential Kaplan documents, including sensitive pricing and client strategy information, as they left Kaplan. Kaplan took immediate action to protect its intellectual property and prevent Dalton from unfairly using this information. Kaplan filed a federal lawsuit and subsequently discovered  that the former employees shared the confidential Kaplan documents with a Dalton manager. Additionally, Kaplan discovered that a third Kaplan employee, a senior executive who joined Dalton last summer, emailed extensive Kaplan trade secrets related to its Chartered Financial Analyst (“CFA”) business to an executive at a Dalton affiliate and met with Dalton owners to discuss starting a competing CFA business, all while still employed by Kaplan. This individual is still employed at Dalton and agreed to be personally bound by the settlement terms. As a result of the lawsuit, Dalton also terminated certain employees and conducted comprehensive company-wide forensic analysis and electronic remediation to ensure that all of Kaplan’s confidential information was purged from Dalton’s systems and cannot be used.

The settlement requires Dalton to ensure that it no longer possesses certain alleged Kaplan trade secrets and prevents Dalton from using any of that information in the future. In addition, the former Kaplan executive who shared Kaplan’s CFA trade secrets will be required to provide affirmations assuring, under penalty of perjury, that he no longer has, and has not used, any such Kaplan confidential or proprietary information to support Dalton.

"Our goal was to stop Dalton from using confidential Kaplan information to compete unfairly in the marketplace,” said Andrew Temte, President and Global Head of Corporate Learning for Kaplan North America. “I wish it was not necessary to file a lawsuit but we are satisfied with the results and that Dalton agreed to our terms."

Kaplan will continue to take quick and aggressive steps where necessary to protect its valuable intellectual property and trade secrets and to ensure fair competition in the education, licensure, and test preparation sectors.

About Kaplan

Kaplan provides individuals, universities, and businesses a broad array of educational services, including higher and professional education, test preparation, language training, corporate and leadership training, and student recruitment, online enablement and other university support services. With operations in nearly 30 countries, Kaplan serves nearly 1.1 million students each year and has partnerships with 2,000-plus universities, colleges, and schools/school districts, and more than 4,000 businesses globally. Kaplan is a subsidiary of Graham Holdings Company (NYSE: GHC). For more information, please visit www.kaplan.com.

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