Iqe Plc v. Newport Fab, LLC

• Court: Court of Appeals for the Federal Circuit
• Decided: October 15, 2025
• Docket: 24-1124
• Status: Published

Opinion

Case: 24-1124 Document: 36 Page: 1 Filed: 10/15/2025

United States Court of Appeals for the Federal Circuit ______________________

IQE PLC, Plaintiff-Appellee

v.

NEWPORT FAB, LLC, DBA JAZZ SEMICONDUCTOR, TOWER U.S. HOLDINGS INC., TOWER SEMICONDUCTOR LTD., PAUL D. HURWITZ, EDWARD PREISLER, DAVID J. HOWARD, MARCO RACANELLI, Defendants-Appellants ______________________

2024-1124 ______________________

Appeal from the United States District Court for the Central District of California in No. 8:22-cv-00867-CJC- KES, Judge Cormac J. Carney. ______________________

Decided: October 15, 2025 ______________________

MICHAEL E. JOFFRE, Sterne Kessler Goldstein & Fox PLLC, Washington, DC, argued for plaintiff-appellee. Also represented by KRISTINA CAGGIANO KELLY, JOHN CHRISTOPHER ROZENDAAL.

ADAM LLOYD, Skadden, Arps, Slate, Meagher & Flom LLP, Los Angeles, CA, argued for defendants-appellants. Case: 24-1124 Document: 36 Page: 2 Filed: 10/15/2025

Also represented by ZACHARY FAIGEN, ERIC J. GREENBERG, JASON D. RUSSELL; DOUGLAS R. NEMEC, New York, NY. ______________________

Before HUGHES, STARK, Circuit Judges, and WANG, District Judge.1 HUGHES, Circuit Judge. Newport Fab, LLC dba Jazz Semiconductor; Tower U.S. Holdings Inc.; Tower Semiconductor Ltd.; Paul D. Hurwitz; Edward Preisler; David J. Howard; and Marco Racanelli appeal the denial of their motion to strike Cali- fornia state-law claims of trade secret misappropriation and interference with economic opportunity by the United States District Court for the Central District of California under California laws that seek to limit Strategic Lawsuits Against Public Participation (SLAPP). We conclude that the denial of that motion in this instance is immediately appealable as a matter of Federal Circuit law under the collateral order doctrine. Because we hold that the district court erred in its analysis, we vacate the district court’s de- nial of the motion to strike and remand for further proceed- ings consistent with this opinion. I IQE PLC “makes ‘wafer’ products, which are used in semiconductors and ultimately consumer electronics like smartphones and car sensors.” J.A. 2. IQE claims that “[i]n 2018, it developed a ‘porous silicon technology’ that is a ‘su- perior alternative’ to non-porous silicon technology.” J.A. 2. Newport Fab, LLC dba Jazz Semiconductor; Tower U.S. Holdings Inc.; Tower Semiconductor Ltd.; Paul D. Hurwitz; Edward Preisler; David J. Howard; and Marco Racanelli

1 Honorable Nina Y. Wang, District Judge, United States District Court for the District of Colorado, sitting by designation. Case: 24-1124 Document: 36 Page: 3 Filed: 10/15/2025

(hereinafter referred to collectively as Tower) are semicon- ductor manufacturers known for making specialized inte- grated circuits that utilize wafers like the ones that IQE makes. J.A. 2. In November 2015, “IQE and Tower entered into a mu- tually binding Non-Disclosure Agreement (NDA) as to any confidential information they disclose to one another as part of their business transactions.” J.A. 24; see J.A. 55–56 (NDA). In November 2018, IQE and Tower began discus- sions contemplating a potential collaboration in which IQE would provide its porous wafers for Tower to use in its sem- iconductor products. J.A. 2. During those discussions with Tower, IQE alleged that Tower disclosed “proprietary trade secrets pertaining to IQE’s porous silicon and crystalline epitaxy wafers during two presentations and follow-up communications.” J.A. 2 (internal citations removed). In October 2019, while discussions between the parties were ongoing, Tower filed a patent application that ulti- mately issued as U.S. Patent No. 11,164,740. J.A. 58. In February 2020, the parties ended their negotiations, which failed to result in any collaboration. J.A. 3. By Au- gust 2021, Tower filed three more patent applications: two issued as U.S. Patent Nos. 11,195,920 and 11,145,572, and the third remains pending as U.S. Pat. App. No. 17/400,712. J.A. 3; J.A. 74; J.A. 91; 128. IQE alleges that those patent applications all “recite the porous semi- conductor technology developed by IQE” and thus were de- rived from IQE’s trade secrets disclosed to Tower during negotiations. J.A. 3. Individuals associated with IQE were not named as inventors in any of the four patent applica- tions. J.A. 3. In April 2022, IQE sued Tower in the Central District of California asserting two federal law claims: (1) violation of the Defend Trade Secrets Act, and (2) correction of in- ventorship under 35 U.S.C. § 256; and five claims arising under California state law: (1) violation of the California Case: 24-1124 Document: 36 Page: 4 Filed: 10/15/2025

Trade Secrets Act, (2) breach of contract, (3) violation of California’s Unfair Competition Law, (4) intentional inter- ference with prospective economic advantage, and (5) neg- ligent interference with prospective economic advantage. J.A. 3. Tower moved to dismiss IQE’s complaint for failure to state a claim under FED. R. CIV. P. 12(b)(6) and simulta- neously filed an anti-SLAPP motion to strike2 IQE’s inten- tional interference with prospective economic advantage and California trade secret misappropriation claims. J.A. 4. The district court granted in part and denied in part, with leave to amend, Tower’s motion to dismiss and denied Tower’s motion to strike. J.A. 12. This appeal concerns only the denial of Tower’s anti- SLAPP motion to strike. On October 4, 2022, Tower timely appealed the district court’s Order Denying its Special Mo- tion to Strike, issued on September 28, 2022, to the Ninth

2 “A [Strategic Lawsuit Against Public Participation,

(SLAPP)] is one in which the plaintiff’s alleged injury re- sults from petitioning or free speech activities by a defend- ant that are protected by the federal or state constitutions.” Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1109 (9th Cir. 2003). When a plaintiff attempts to base state law tort liability on a defendant’s exercise of its right to petition the government, California law “provides for a special mo- tion to strike that is intended to stop such lawsuits early in the litigation process.” DC Comics v. Pac. Pictures Corp., 706 F.3d 1009, 1013 (9th Cir. 2013). This “special motion to strike” is often referred to as an “anti-SLAPP motion.” CAL. CIV. PROC. CODE § 425.16(b)(1). Under California’s anti-SLAPP statute, if a cause of action “aris[es] from any act . . . in furtherance of [a] person’s right of petition or free speech,” the court shall strike the cause of action unless “the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.” Id. Case: 24-1124 Document: 36 Page: 5 Filed: 10/15/2025

Circuit. J.A. 148–50; see 28 U.S.C. § 2107. The Ninth Cir- cuit determined that “the Federal Circuit would have had jurisdiction at the time this appeal was filed” under 28 U.S.C. § 1295(a) and accordingly transferred the appeal to this Court pursuant to 28 U.S.C. § 1631. J.A. 15-17. II This appeal raises a jurisdictional question of first im- pression for this Court: whether we have jurisdiction over an appeal from a district court’s denial of an anti-SLAPP motion to strike before entry of a final judgment. Before reaching the merits of the case, we “ha[ve] a special obliga- tion to ‘satisfy [ourselves] . . . of [our] own jurisdiction.” Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986) (quoting Mitchell v. Maurer, 293 U.S. 237, 244 (1934)). We are not restricted to the arguments made by the parties in considering the scope of our jurisdiction. See Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 434 (2011); Uniloc 2017 LLC v. Apple, Inc., 964 F.3d 1351, 1357 (Fed. Cir. 2020). We must establish that we have two dif- ferent types of jurisdiction to reach the merits of this ap- peal: (1) subject-matter jurisdiction and (2) appellate jurisdiction. In its transfer order, the Ninth Circuit determined that “[t]he Federal Circuit has exclusive [subject matter] juris- diction over [this] appeal[]” because “IQE’s well-pleaded complaint contains a claim for correction of inventorship under 35 U.S.C. § 256,” which is “a claim created by federal patent law.” J.A. 14–15. It accordingly concluded that transfer to this court was “in the interest of justice” because Tower “raise[d] non-frivolous merits questions” and there was “no evidence of wrongdoing.” J.A. 17. We agree with the Ninth Circuit that subject matter jurisdiction properly lies in our court, for the reasons identified by our sister cir- cuit. The Ninth Circuit also noted that it would have had appellate jurisdiction over this appeal under Ninth Circuit Case: 24-1124 Document: 36 Page: 6 Filed: 10/15/2025

law, if it had subject matter jurisdiction, because “[t]he de- nial of an anti-SLAPP motion [to strike] is an immediately appealable final decision pursuant to the collateral order doctrine.” J.A. 14–15 (quoting Langer v. Kiser, 57 F.4th 1085, 1104 (9th Cir. 2023)). Tower argues that we “must accept that transfer deci- sion ‘by adhering strictly to principles of law of the case’ unless [we] make[] the ‘exceptional’ finding that the Ninth Circuit’s transfer decision was implausible or ‘clearly erro- neous.’” Appellant’s Opening Br. 7 (quoting Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 819 (1988)). While we agree that Christianson may provide some limits on our ability to scrutinize subject matter jurisdiction in cases where an appeal comes to us by way of transfer by a sister circuit, see 486 U.S. at 816 (“[T]ransferee courts that feel entirely free to revisit transfer decisions of a coordinate court threaten to send litigants into a vicious cycle of liti- gation.”), to the extent Tower contends that Christianson requires us to accept as law of the case a sister circuit’s de- termination regarding appellate jurisdiction, we reject that contention. We have unequivocally stated, in connection with a dispute as to whether the collateral order doctrine confers jurisdiction, that “[q]uestions of our jurisdiction are governed by Federal Circuit law.” DePuy Synthes Prods., Inc. v. Veterinary Orthopedic Implants, Inc., 990 F.3d 1364, 1368 (Fed. Cir. 2021) (first citing Ultra-Precision Mfg. Ltd. v. Ford Motor Co., 338 F.3d 1353, 1356 (Fed. Cir. 2003) (“We apply our own law and not the law of the regional cir- cuit to issues concerning our jurisdiction.”); and then citing Woodard v. Sage Prods., Inc., 818 F.2d 841, 844 (Fed. Cir. 1987) (holding “deference” to regional circuit law “is inap- propriate on issues of our own appellate jurisdiction”)). We thus consider de novo whether we have appellate jurisdiction. Our appellate jurisdiction is typically limited to “a final decision of a district court.” 28 U.S.C. § 1295(a); see CAE Screenplates Inc. v. Heinrich Fiedler GmbH & Co. KG, 224 F.3d 1308, 1314 (Fed. Cir. 2000) (“Under the [final Case: 24-1124 Document: 36 Page: 7 Filed: 10/15/2025

judgment] rule, parties may only appeal ‘final decisions of the district courts.’” (citation omitted)). This “requir[es] parties to raise all claims of error in a single appeal follow- ing final judgment on the merits” and “forbid[s] piecemeal disposition on appeal of what for practical purposes is a single controversy.” Nystrom v. TREX Co., 339 F.3d 1347, 1350 (Fed. Cir. 2003) internal citations and quotations omitted). But “[t]he collateral order doctrine is a narrow excep- tion to the usual rule of finality and allows an interlocutory appeal when a trial court’s order affects rights that will be irretrievably lost in the absence of an immediate appeal.” DePuy Synthes, 990 F.3d at 1368 (internal alterations and quotation marks omitted). “For the collateral order doc- trine to apply, an order must meet three requirements; it must (1) ‘conclusively determine the disputed question’; (2) ‘resolve an important issue completely separate from the merits of the action’; and (3) ‘be effectively unreviewa- ble on appeal from a final judgment.’” Id. “Exceptions to [the final judgment rule] are rare and disfavored.” MIT v. Shire Pharms. Inc., 839 F.3d 1111, 1126 (Fed. Cir. 2016) (O’Malley, J., concurring). Because this case has not been finally decided by the district court, we must determine whether the denial of Tower’s anti-SLAPP motion to strike is immediately ap- pealable under the collateral order exception as a matter of Federal Circuit law—a question of first impression. We consider each of the three collateral order factors in making this determination, looking at California state anti-SLAPP law as analyzed by both California courts and the Ninth Circuit. 3

3 While we are not bound by the Ninth Circuit’s caselaw on this matter, we still consider it persuasive Case: 24-1124 Document: 36 Page: 8 Filed: 10/15/2025

Regarding the first collateral order factor, the Ninth Circuit has stated that denial of an anti-SLAPP motion conclusively determines the disputed question because “[i]f an anti-SLAPP motion to strike is granted, the suit is dis- missed, and the prevailing defendant is entitled to recover his or her attorney’s fees and costs. If the motion to strike is denied, the anti-SLAPP statute does not apply and the parties proceed with the litigation.” Batzel v. Smith, 333 F.3d 1018, 1025 (9th Cir. 2003) (citing CAL. CIV. PROC. CODE § 425.16(c)). 4 Thus, the district court’s denial of Tower’s anti-SLAPP motion to strike conclusively deter- mined the disputed issue below—that the anti-SLAPP stat- ute did not apply to the claims Tower challenged. Regarding the second collateral order factor, the anti- SLAPP motion to strike resolves an important issue sepa- rate from the merits of the action. “The purpose of an anti- SLAPP motion is to determine whether the defendant is being forced to defend against a meritless claim.” Id.; see also Varian Med. Sys., Inc. v. Delfino, 35 Cal. 4th 180, 193 (Cal. 2005) (“[T]he point of the anti-SLAPP statute is that you have a right not to be dragged through the courts be- cause you exercised your constitutional rights.” (citation omitted)); DC Comics v. Pac. Pictures Corp., 706 F.3d 1009,

authority. See, e.g., Bank of Guam v. United States, 578 F.3d 1318, 1326 n.4 (Fed. Cir. 2009) (citing Summit Tech., Inc. v. Nidek Co., 435 F.3d 1371, 1376–77 (Fed. Cir. 2006)) (“We have not previously addressed some of the ex- act issues presented in this appeal and, thus, while not binding, the decisions of other regional circuits are persua- sive authority and instructive.”). 4 We find the Ninth Circuit’s reasoning evaluating the three collateral order factors in Batzel, as reiterated in DC Comics, 706 F.3d at 1011, particularly persuasive on the issue of whether the collateral-order exception should apply to California anti-SLAPP motions to strike. Case: 24-1124 Document: 36 Page: 9 Filed: 10/15/2025

1015–16 (9th Cir. 2013) (“It would be difficult to find a value of a ‘high[er] order’ than the constitutionally-pro- tected rights to free speech and petition that are at the heart of California’s anti-SLAPP statute.” (citation omit- ted)). As explained by the Ninth Circuit in a concurring opinion, “while the inquiry on the motion to strike may glance at the merits, its central purpose is to provide an added statutory protection from the burdens of litigation that is unavailable during the ultimate merits inquiry.” Makaeff v. Trump Univ., LLC, 736 F.3d 1180, 1185 (9th Cir. 2013) (Wardlaw & Callahan, JJ., concurring) (em- phasis added). That purpose of protecting a party from hav- ing to defend itself in court for exercise of a constitutionally protected right is separate from the merits of a case. Regarding the third collateral order factor, “[b]ecause the anti-SLAPP motion is designed to protect the defend- ant from having to litigate meritless cases aimed at chilling First Amendment expression, the district court’s denial of an anti-SLAPP motion would effectively be unreviewable on appeal from a final judgment.” Batzel, 333 F.3d at 1025. The purpose of an anti-SLAPP motion would not be served if a party is forced to litigate the entire case before denial of its motion to strike can be reviewed. If Tower’s conduct challenged by IQE is in fact protected by California anti- SLAPP law, forcing Tower to defend its conduct in court would deprive it of the protections provided by the anti- SLAPP statute. Thus, the denial of the motion to strike would be effectively unreviewable on appeal after final judgment has been entered, since Tower will already have had to litigate the case. The denial of an anti-SLAPP motion to strike under California law thus appears to fit squarely within the col- lateral order exception to the final-judgment rule. We agree with the Ninth Circuit that it is further “instructive that California’s anti-SLAPP statute provides that an order denying an anti-SLAPP motion may be appealed immedi- ately” when litigated in California state court. Id. (citing Case: 24-1124 Document: 36 Page: 10 Filed: 10/15/2025

CAL. CIV. PROC. CODE § 425.16(j)). We thus conclude that denial of an anti-SLAPP motion to strike under California law is immediately appealable under the collateral order doctrine as a matter of Federal Circuit law. IQE makes two arguments that the exercise of our ju- risdiction over this appeal would nonetheless be improper; we address each in turn. First, IQE cites its filing of an amended complaint after Tower’s appeal of the denial of its first motion to strike as indicative that the district court must nonetheless revisit the merits to rule on Tower’s sec- ond motion to strike its new complaint. Appellee’s Br. 16–17. IQE’s amended complaint was improper under Ninth Circuit law, which dictates proper procedure in the district court, because it attempted to replead claims that were pending appeal. See Small v. Operative Plasterers’ & Cement Masons’ Int’l Ass’n Loc. 200, AFL-CIO, 611 F.3d 483, 495 (9th Cir. 2010) (district court proceedings cannot “alter[] the status quo” pending resolution of appeal be- cause notice of appeal is jurisdictional); Davis v. United States, 667 F.2d 822, 824 (9th Cir. 1982) (district court erred in permitting plaintiff to amend claims after notice of appeal on file). There is no doubt that “there is still a live controversy concerning the district court’s order.” Green- springs Baptist Christian Fellowship Tr. v. Cilley, 629 F.3d 1064, 1066 n.1 (9th Cir. 2010) (rejecting argument that fil- ing “an amended complaint and renewed motion to strike” rendered appeal moot where district court “stayed the ac- tion pending the resolution of this appeal”). Moreover, as Tower explained to the district court, Tower’s second anti- SLAPP motion “was filed solely to preserve [its] position” pending appeal given IQE’s improper amended complaint, not “to relitigate the Court’s September 28 order.” Appel- lants’ Reply Br. 12–13 (quoting J.A. 294). Second, IQE argues the basis for Tower’s argument that the denial of an anti-SLAPP motion is immediately appealable hinges on anti-SLAPP law being applicable in federal courts at all, and some circuit courts have rejected Case: 24-1124 Document: 36 Page: 11 Filed: 10/15/2025

the applicability of anti-SLAPP statutes, holding that they conflict with the Federal Rules of Civil Procedure. Appel- lee’s Br. 20–22 (collecting cases). This is neither a jurisdic- tional question nor one unique to patent law; thus, we defer to the Ninth Circuit’s caselaw on this matter. Allergan, Inc. v. Athena Cosms., Inc., 738 F.3d 1350, 1354 (Fed. Cir. 2013) (“Where an issue is not unique to patent law, we ap- ply the law of the regional circuit from which the case arises.” (citation omitted)). The Ninth Circuit recognizes California anti-SLAPP law as applicable in federal court despite potential conflicts with the Federal Rules of Civil Procedure. See Planned Parenthood Fed’n of Am., Inc. v. Ctr. for Med. Progress, 890 F.3d 828, 833–35 (9th Cir.), amended, 897 F.3d 1224 (9th Cir. 2018) (analyzing the “de- gree to which the anti-SLAPP provisions are consistent with the Federal Rules of Civil Procedure”). We do not hold here that denials of anti-SLAPP mo- tions to strike arising under any state’s law are immedi- ately appealable as a matter of right before this Court. Our holding today applies only, at this point, to California’s anti-SLAPP statute. If we are presented with a case arising under another state’s law, in determining whether we have appellate jurisdiction for a given case raising an issue re- garding an anti-SLAPP motion to strike, we must evaluate the relevant state’s anti-SLAPP statute at issue on appeal and evaluate how that tool has been exercised in practice to understand whether that given instance comports with the collateral-order exception to the final decision rule un- der Federal Circuit law. III Because we conclude that we have jurisdiction over this appeal, we reach the merits and consider whether the district court erred in denying Tower’s anti-SLAPP motion to strike at step one of its analysis. We conclude that it did. Because the interpretation and application of Califor- nia’s anti-SLAPP statute “is not unique to patent law, [the Case: 24-1124 Document: 36 Page: 12 Filed: 10/15/2025

panel must] apply the law of the regional circuit from which the case arises.” Allergan, Inc., 738 F.3d at 1354 (ap- plying Ninth Circuit law). The Ninth Circuit reviews the denial of anti-SLAPP motions to strike de novo. See Doe v. Gangland Prods., Inc., 730 F.3d 946, 951 (9th Cir. 2013). The Ninth Circuit has held that it is bound by “pronounce- ments of the state’s highest court” in interpreting Califor- nia’s anti-SLAPP statute, Hilton v. Hallmark Cards, 599 F.3d 894, 905 (9th Cir. 2010), and regularly “tak[es] [its] cue from the California legislature and courts.” Greater Los Angeles Agency on Deafness, Inc. v. Cable News Network, Inc., 742 F.3d 414, 421–22 (9th Cir. 2014). Be- cause “the California Supreme Court has interpreted the anti-SLAPP statute broadly,” the Ninth Circuit has “fol- lowed suit.” Id. at 421; see also CAL. CIV. PROC. CODE § 425.16(a) (“[T]his section [providing for anti-SLAPP pro- tections] shall be construed broadly.”). Under California’s anti-SLAPP statute, if a cause of ac- tion “aris[es] from any act . . . in furtherance of [a] person’s right of petition or free speech,” the court shall strike the cause of action unless “the plaintiff has established that there is a probability that the plaintiff will prevail on the claim.” CAL. CIV. PROC. CODE § 425.16(b)(1). Thus, analyz- ing an anti-SLAPP motion involves a two-step inquiry with shifting burdens. See Herring Networks, Inc. v. Maddow, 8 F.4th 1148, 1155 (9th Cir. 2021). In the first step, the de- fendant must “show[] that the plaintiff’s suit arises from an act in furtherance of the defendant’s rights of petition or free speech.” Id.; Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1110 (9th Cir. 2003); see also Gangland, 730 F.3d at 954 (activity often simply referred to as “protected activ- ity”). “If the defendant satisfies this requirement, [in the second step] ‘the burden then shifts to the plaintiff . . . to establish a reasonable probability that it will prevail on its claim in order for that claim to survive dismissal.’” Herring Networks, 8 F.4th at 1155 (quoting Makaeff, 715 F.3d at 261) (alteration in original). Case: 24-1124 Document: 36 Page: 13 Filed: 10/15/2025

Tower argued to the district court that IQE’s claims of negligent and intentional interference with prospective economic advantage claims and its claim for violation of the California Unfair Trade Secrets Act (CUTSA) were based on Tower’s acts in furtherance of its right of petition under the United States and California Constitutions, namely, the filing of patent applications, and that IQE cannot es- tablish a probability that it will prevail on those claims. The district court ended its analysis at step one, concluding that “[IQE]’s injury [did] not result from the mere filing of a patent application, as [Tower] argue[s]. Rather, [IQE]’s injury results from [Tower’s] alleged trade secret theft and alleged misrepresentations to the United States Patent and Trademark Office that they invented the porous silicon technology disclosed in the patent application.” J.A. 10. This conclusion improperly collapsed the two steps. The question for the district court at step one should have been only whether the suit was based on protected activity. Here, that basis clearly was: the filing of the pa- tent application. Whether IQE’s trade secret claims are meritorious is assessed at step two. The Ninth Circuit’s de- cision in Mindys Cosms., Inc. v. Dakar is instructive. 611 F.3d 590, 594–95 (9th Cir. 2010). In Mindys, the de- fendant, an attorney, filed an anti-SLAPP motion to strike claims of legal malpractice, breach of fiduciary duty, fraud- ulent concealment, and conversion against him related to his filing of a trademark application. There, the Ninth Cir- cuit broke step one of the anti-SLAPP analysis into two prongs: (1) identifying the protected act, and (2) determin- ing whether the causes of action arose from this protected act. Id. at 596–98. Regarding the first prong of step one, it held that a trademark application filing is a protected act under the anti-SLAPP statute. The Ninth Circuit noted that under California law, “communications made in the course of ‘official’ proceedings . . . are protected,” while “‘ministerial’ acts involving primarily private transactions are not.” Id. at 596–97. It explained that “[f]iling a Case: 24-1124 Document: 36 Page: 14 Filed: 10/15/2025

trademark application is more than merely a ministerial act connected with a business transaction. It is an attempt to establish a property right under a comprehensive federal statutory scheme.” Id. at 597. That reasoning applies with equal force to patent applications, the filing of which ac- cordingly is also a protected act. Regarding the second prong of the step one analysis, Mindys further specifies that a claim arises from protected activity for the purposes of step one if, but-for the protected activity, the plaintiff would not have a claim against the defendant. Id. at 598; see also Navellier v. Sletten, 29 Cal. 4th 82, 89 (Cal. 2002) (“In deciding whether the initial ‘aris- ing from’ requirement is met, a court considers ‘the plead- ings, and supporting and opposing affidavits stating the facts upon which the liability or defense is based.’”) (quot- ing CAL. CIV. PROC. CODE § 425.16(b)(2)). IQE argues that its misappropriation claim would have arisen regardless of whether Tower chose to actually file the patent application because its misappropriation claim arose when Tower pre- pared its patent applications. Appellee’s Br. 34. However, in its complaint, IQE alleged only that Tower’s “disclosure and use of IQE’s trade secrets” in its patent applications “amounts to misappropriation under CAL. CIV. [PROC.] CODE § 3426.1(b).” J.A. 42–43 (small caps added). J.A. 42– 43. IQE did not allege any other activity by Tower that would have otherwise given rise to its trade secret misap- propriation claim. But for the act of filing the patent appli- cations, IQE’s claims of trade secret misappropriation, as alleged in its complaint, would not have arisen. There would have been no disclosure of the alleged trade secrets if, for example, Tower had merely prepared patent applica- tions containing IQE’s trade secrets without filing them with the USPTO. Thus, under step one of the anti-SLAPP analysis, Tower’s protected activity of filing a patent appli- cation is what gave rise to the cause of action that is the subject of the anti-SLAPP motion to strike. California law is clear that “mere possession of information is not enough Case: 24-1124 Document: 36 Page: 15 Filed: 10/15/2025

to establish improper acquisition of a trade secret.” Hooked Media Grp., Inc. v. Apple Inc., 55 Cal. App. 5th 323, 333 (2020); see also FLIR Sys., Inc. v. Parrish, 174 Cal. App. 4th 1270, 1279 (2009) (under CUTSA “[m]ere possession of trade secrets . . . is not enough”); Cent. Valley Gen. Hosp. v. Smith, 162 Cal. App. 4th 501, 528 (2008) (“[M]isappropria- tion requires a greater showing than mere possession by a defendant of trade secrets where the defendant acquired the trade secret by proper means.”) (citations omitted). The California Supreme Court has explained that this is the proper scope of the inquiry at step one; the step one analysis should not include scrutinizing the lawfulness of the protected activity. In Navellier, the plaintiff accused the defendant of breach of contract and fraud related to his filing of counterclaims and negotiating, executing, and re- pudiating a release. 29 Cal. 4th at 89–90. The Court held that these were acts the defendant took “in furtherance of [his] right of petition or free speech . . . as that phrase is defined in the anti-SLAPP statute. The constitutional right of petition encompasses the basic act of filing litigation.” Id. at 90 (internal quotations and citations omitted). The Court clarified that “conduct alleged to constitute breach of contract may also come within constitutionally protected speech or petitioning. The anti-SLAPP statute’s defini- tional focus is not the form of the plaintiff’s cause of action but, rather, the defendant’s activity that gives rise to his or her asserted liability—and whether that activity consti- tutes protected speech or petitioning.” Id. at 92. (emphasis in original). It explained, “no cause of action qualifies as a SLAPP merely because the defendant’s actions conceptu- ally fall within the ambit of the [anti-SLAPP] statute’s ini- tial prong.” Id. at 95. It then clarified that “[d]espite the fact [the defendant] has made a threshold showing that plaintiffs’ action is one arising from statutorily protected activity, plaintiffs may defeat the anti-SLAPP motion by establishing a probability of prevailing on their claim”— something that is established under step two. Id.; see also Case: 24-1124 Document: 36 Page: 16 Filed: 10/15/2025

Gangland, 730 F.3d at 954 (analyzing and quoting to Na- vellier to explain that “any claimed illegitimacy of the de- fendant’s acts is an issue which the plaintiff must raise and support in the second step of the analysis when the plaintiff bears the burden to show a probability of prevailing”(quo- tation modified)). IQE may be able to prove that Tower’s patent filing is outside the scope of the protected right to file a patent ap- plication if it can prove Tower, in fact, misappropriated a trade secret. However, IQE and the district court were in- correct in conducting this analysis at step 1. As Tower ar- gues, if the step one analysis has the scope IQE and the district court contend it does, a court would never reach step two: “because the mere allegation of ‘wrongful’ peti- tioning activity would always defeat the defendant’s show- ing under the first step.” Appellant’s Opening Br. 5. Thus, we vacate and remand for the district court to reconsider Tower’s anti-SLAPP motion to strike by consid- ering the possibility of trade secret misappropriation by Tower only at step two of its analysis. 5 IV We have considered the parties’ remaining arguments and find them unpersuasive. Because the district court erred in its analysis of Tower’s anti-SLAPP motion to strike, we vacate its denial of the motion and remand for

5 IQE implies that we may reach step two in the first in- stance. See Appellee’s Br. 46. We disagree per the holdings of the California state courts on the matter. See Collier v. Harris, 240 Cal. App. 4th 41, 58 (2015), as modified (Sept. 1, 2015) (remanding to the trial court because “[t]he majority of appellate courts” have declined to reach the sec- ond step of the anti-SLAPP because deciding the merits would “deprive the parties of a layer of independent re- view”). Case: 24-1124 Document: 36 Page: 17 Filed: 10/15/2025

proper consideration of that motion consistent with this opinion. VACATED AND REMANDED COSTS No costs.