» Lawsuit by Austin’s Torchy’s Tacos Accuses Competitor of Theft of Trade Secrets

Lawsuit by Austin’s Torchy’s Tacos Accuses Competitor of Theft of Trade Secrets

A taco restaurant based in Austin, Texas has filed a lawsuit against a competing restaurant in Houston alleging theft of trade secrets. Torchy’s Tacos, with 20 outlets in Austin, Houston and the Dallas-Ft. Worth area, claims that three-store, Houston-based Texas Taco Co. stole its recipes and duplicated menu items.

The lawsuit, filed in Harris County, claims that a former Torchy’s employee stole the company’s “Taco Bible,” which contains detailed recipes. The grill cook now works for Texas Taco, where the menu items are allegedly duplicated. The lawsuit seeks unspecified damages and an injunction requiring Texas Taco to stop using confidential information gained from Torchy’s.

Although a taco recipe may seem like something that is generally known, and therefore not capable of being a trade secret, Torchy’s says that its Taco Bible and “Build Book” are different because they contain detailed start-to-finish processes of the way that food ingredients are combined, the order in which they are cooked and the manner in which they are assembled.

The lawsuit claims that Torchy’s Chef Michael Rypka — who started the company in Austin in 2006 with a motor scooter and food trailer — personally developed or approved all the menu items and “food concepts and food designs” served at the restaurants.

The lawsuit claims that a security camera at Torchy’s captured a then-employee putting a copy of the Taco Bible under his shirt and then exiting the restaurant. According to the lawsuit, a manager saw the security video and demanded that the employee return the book, which he did approximately six hours later. The employee was then fired.

The complaint alleges that approximately two months after the incident, Torchy’s discovered that the new Texas Taco restaurant in Baytown, approximately 30 miles outside Houston, had a similar menu. A Torchy’s manager visited the restaurant and claims he found the ex-employee working there and nearly-identical items on the menu.

According to a local news report, the descriptions of some items on Texas Taco’s menu are a word-for-word match to Torchy’s menu items, with only the name of the item changed. A taco that Texas Taco named the “William Travis” has the same 27-word description as the item that Torchy’s calls the “Republican.” The same is allegedly true for other items, including quirks such as the use of all-capitalized letters for some ingredients.

The lawsuit alleges that the ex-employee gave trade secrets to Texas Taco in violation of a nondisclosure agreement that he signed with Torchy’s.

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