Divided Federal Circuit Panel Nixes $452 Million Trade Secret Judgment as Time-Barred

On May 28, 2026, a divided panel of the U.S. Court of Appeals for the Federal Circuit dismissed a $452 million judgment awarded by a jury to Insulet Corp. (Insulet), a medical device company, finding that Insulet failed to timely assert a trade secret misappropriation claim against its competitor, EOFlow Co. Ltd. (EOFlow).¹

Background

Insulet and EOFlow each design and produce medical devices. In 2023, Insulet sued EOFlow under the Defend Trade Secrets Act (DTSA), asserting that EOFlow misappropriated trade secrets related to Insulet's adhesive insulin patch pump product, the Omnipod. EOFlow employed multiple ex-Insulet employees who disclosed confidential information about the Omnipod to EOFlow, which already produced its own adhesive insulin pump called the EOPatch. EOFlow capitalized on the employees' knowledge to develop a new version of its product, EOPatch 2, to better compete with the Omnipod.

Finding that EOFlow misappropriated Insulet's trade secrets, as well as evidence of willful and malicious intent, a jury awarded $452 million in damages to Insulet.

Federal Circuit Appeal and Decision

On appeal to the Federal Circuit, EOFlow asserted that Insulet's misappropriation claim was time-barred because Insulet had enough evidence to sue EOFlow more than three years before it ultimately filed its complaint. In early 2018, EOFlow hired various former Insulet engineers, each of whom had executed confidentiality and non-disclosure agreements with Insulet. Moreover, and critically, Insulet knew by at least March 2019 that the employees were assisting EOFlow with developing EOPatch 2. The court held that Insulet's claim expired long before it filed suit in 2023.

The parties disagreed on which claim accrual standard applied – either inquiry notice or the discovery rule² – but the court determined that under either principle, "the undisputed evidence show[ed] that Insulet knew or should have known before the critical date the facts it needed" to file its DTSA claim.

The court focused on Insulet's knowledge of EOFlow's access to confidential information about the Omnipod, the obvious similarities between the Omnipod and EOPatch 2, and Insulet employees' visual observations of EOPatch 2 at various trade shows. Id. at 14. Based upon that evidence, Insulet "plainly had at least a cause for concern that defendants had engaged in prohibited conduct by early 2019," which triggered the statute of limitations. Id. at 10. The court rejected Insulet's argument that it lacked enough technical information at the time, ruling that "[k]knowledge of such details as the nominal dimensions of EOPatch 2 is unnecessary to plead a trade secret misappropriation claim." Id. at 14.

One judge on the three-member panel dissented, positing that the court's holding could inadvertently cause a misappropriation claim to accrue simply when an employee laterals to a competitor that makes a comparable product. The majority dismissed that concern, reasoning that the opinion adequately explained the distinction between a party's possession of sufficient facts to state a claim versus mere suspicion of the same. Here, for example, the evidence showed that when one Insulet employee noticed the EOPatch 2 at an industry conference, he reported via email to senior management that "EOFlow has cloned our product ... Our legal team is aware of this. Someone should request samples." Id. at 22.

Next Steps

Insulet may seek rehearing of the case before the en banc Federal Circuit or appeal to the U.S. Supreme Court. As this case demonstrates, businesses should timely investigate potential threats to their trade secrets when credible facts surface supporting a cause for concern.

Notes

¹ The case is Insulet Corp. v. EOFlow Co., Ltd., Case No. 25-1807 (Fed. Cir. May 28, 2026).

² Under the inquiry-notice standard, "the statute of limitations begins to run when the plaintiff or a reasonably diligent plaintiff would have begun an investigation that would allow it to discover these facts," while the discovery rule dictates that "the statute of limitations begins whenever a plaintiff did discover or should have discovered the facts underlying its cause of action[.]" Id. at 10.