Nooks & Crannies
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Let me tell you about my latest reporting trip. I stayed in this fascinating corner of Alabama. Four small cities along the Tennessee River. Muscle Shoals, Tuscumbria, Florence, and Sheffield. And what struck me wasn't just the history or the architecture. It was the way these towns completely drew me in.

Each street corner seemed to tell a story. Little cafes tucked away in historic buildings. Recording studios where legends once played. You know that feeling when a place surprises you in the most unexpected ways? Speaking of travels, if you're planning your own adventure, why not let your space work for you? You can host your home on Airbnb for extra cash, and it's so simple. Your home might be worth more than you think. Find out how much at airbnb.com slash host.

Hold on, let's take a little bite here. One morning, not long ago, my colleague Ben-Nadav Hafri and I huddled in a small back room at Pushkin Industries to solve a mystery. It like hits the back of your palate. There's like a funk to it. You know what I mean? Through the glass wall of the room, we could see our fellow Pushkinites working on various prosaic podcasts and audiobooks, while we alone wrestled with an eternal question.

Toasted bread. Just from a sensory perspective, there's a lot of crunch. Let's also not forget its size. Yes. Palmable. It's palmable.

Breakfast is the meal you make when you're barely conscious. So the breakfast table is a Super Bowl for food companies. Lunch is eaten out. Dinner, if you're lucky, is prepared from scratch. But think about breakfast. All the day lies before you and you are in need of sustenance. You want something wholesome, but crucially easy, a little ready-made.

Breakfast foods become lifelong habits. Brands fight tooth and nail for a prime spot at that table. Many have fought valiantly. Cheerios, Lucky Charms, Pop-Tarts, Rice Krispies. But there's only one breakfast item, legendary enough, that when I take a bite, suddenly I remember my childhood. Also, how my father felt about cutting the cross-saw bread.

I think he viewed that as a kind of a sign of, as a kind of an effete move. A sign of moral weakness, moral and sort of a lack of real kind of fiber when it came to eating your food. Or Ben takes a bite and suddenly he's off for the millionth time about Proust. It does have that kind of like Proustian association thing. Like it tastes like, I remember this taste.

Yes. When I have this, it does take me back. Like, I am seeing my family's kitchen where we would eat breakfast and, like, the big spread. Our breakfast mystery comes in packages of six, but they cannot be eaten right out of the box. Each item inside must be split in two, then toasted, then buttered for the magic to work. And, oh, the magic works.

I'm talking, of course, about Thomas' English muffins, the most iconic breakfast bread of all time. And for that reason, it is nearly a half a billion dollar a year in sales product. It is the sine qua non of bread products, baked goods. Yeah. The champ. Undisputed. What sets a Thomas' English muffin apart from all the others? It says right there on the package.

Nooks and crannies. The recipe for Thomas's English muffin has been one of the most closely held trade secrets there is. Until, allegedly, one baking executive tried to make off with the family's jewels. I'm Malcolm Gladwell. You're listening to Revisionist History, my show about things overlooked and misunderstood. Today on the show, Ben-Nadav Hafri peers into the nooks and crannies of one of the greatest legal cases you've never heard of.

It's a big story, this muffin case. Today, we're getting part one. Here's Ben. I once hired a lawyer who dreams about suing people. He told me this on a call once. I asked for proof. And he showed me a video of himself asleep, very clearly muttering, I'll sue you. And something to the effect of, you're going to jail. There were some swears in there too. My first thought was, this man is the best lawyer I'll ever have. Second thought, I better pay him quickly.

We were going over an employment contract. We got to the part about intellectual property, and I thought the degree to which an employer could punish you if you ever divulged one of their trade secrets seemed a little crazy. To which my lawyer replied, well, it snooks and crannies. And even recognizing I was paying by the second, I was like, what did you just say? Why have so many of you switched from toast to Thomas's English muffins? Definitely the cranny. It was the nooks.

The key to English muffin supremacy comes down to the balance of nooks, which catch and pull the melted butter, and the thin, crisp walls of the crannies. But somehow, nooks and crannies are now lawyer shorthand for trade secret. Why? Thomas's, the nooks and crannies muffin. Making breakfast better for over 100 years. In 1874, a baker named Samuel Bath Thomas left England for the United States.

Little's known about his life before he lands in New York, but he arrived with a recipe in his pocket for what typically would be called Welsh muffins or crumpets. He cooked them on a griddle so they'd be crisp on the outside and doughy yet pockmarked in the inside in a way few other breads were.

Thomas's Nooks and Crannies took New York by storm. Demand skyrocketed. He opened another bakery. Then it became a corporation. Eventually, the words Nooks and Crannies became a registered trademark of Thomas's English muffins. You will note if you look at the bakery shelves at your local grocery store that other English muffin brands live in fear of this fact. Dave's Killer Bread boasts of butter-catching flavor craters.

Trader Joe's has pockets and crevices. Bae's has raised the white flag and left the field entirely with a claim about packaging, now resealable. Because all of them know better than to cross the entity that now owns Thomas's, Grupo Bimbo. Did you know that your bread is owned by Mexico? CNBC's Michelle Caruso Cabrera caught up with the nation's largest bakery, Grupo Bimbo

Grupo Bimbo, international baking conglomerate. Entenmann's, owned by a Mexican bread company. Sara Lee, bought by a Mexican bread company. Grupo Bimbo isn't just the biggest baker in the United States, it is the biggest baker in the entire world. Wow. Bimbo is everywhere. They've taken over half the bread brands you've heard of and 50% of the rest. They've swept through the U.S., acquiring one bakery after another. It's the first bakery with a big national footprint, and they plan to be global.

No one stands in the way of Grupo Bimbo. And in 2009, at the height of their powers, they acquired the holy grail of baked goods, the Nooks and Crannies. Promises English muffins, owned by a Mexican bread company. The secret recipe for Nooks and Crannies brought in about half a billion dollars in annual revenue to Grupo Bimbo. But then, according to Bimbo, someone tried to steal it. Can you just tell me the...

The basic facts of the case. Well, in this case, I guess we can go through it. I'm speaking with Louis Del Giudice, partner at the major law firm Troutman Pepperlock, in a conference room high above Manhattan. This is where my lawyer sent me when I asked about cranny law.

Louis is an expert in intellectual property. He says a lot of people come to him to determine if they have their own trade secrets. And he tells them, sit down, my friends, and let me teach you the lessons of the muffin. You know, one of the best kept trade secrets is, and everybody thinks Coke. And I'm like, well, Thomas's English muffins, which we've all grown up on, there's only 10 people in the world that know how to make a Thomas's English muffin. And people go, what?

Actually, it's fewer than 10, but we'll get to that. Trade secrets are one of the pillars of IP protection in the United States, along with patents, trademarks, and copyright. But unlike the others, a trade secret never expires. And the Muffin case is one of the best examples of a trade secret's power and how to protect it. Louis was not involved in the case directly, but he studied it at length.

In any telling, he begins by introducing the defendant, a former Grupo Bimbo employee named Chris Botticella. Executive officer, he's in charge of the entire West Coast United States, and he's privy to all this information, all the recipe books, and all of this other financial information and efficiencies. He has to sign a nondisclosure agreement, but that nondisclosure agreement's only while he's employed. It's 2010, the year after Grupo Bimbo acquired Thomas'.

According to documents presented in court, the information required to produce a Thomas's English muffin is known by only seven people at the company. It's kept in secret code books that only a few people have access to. Botticella, as a senior executive, is one of those people. He oversees a facility in Placentia, California, where the muffins are made. He's been in the industry since he was 16 and has risen through the ranks through sheer skill, till finally he's reached the pinnacle.

Bimbo Bakery's executive of almost a decade. But lately, Chris has been unhappy.

He had said that they had done some cost-cutting and some head-cutting, so that sort of left a bad taste in his mouth. It sounded like from the one email that's attached to the complaint that maybe he had a little bit of friction with his manager, you know, the guy above him. He's just like, you know, there's a line that literally says, you know, you and I may not have always seen eye to eye, but we've always known what was best for the company. So when you read that, you know, that's a polite way of saying, you and I used to fight a lot.

Chris gets a job offer at Hostess, famed owner of Twinkies. One of Bimbo's only competitors, but just barely. Hostess had just gone through bankruptcy. Hostess was a possible target for Bimbo acquisition, but then Bimbo would have owned almost every baked good on the planet, and at that point, where's the fun? Chris probably knew that Grupo Bimbo wasn't going to be thrilled about the Hostess of it all, but he wants to get his year-end bonus, so he doesn't leave right away.

So now he's sitting all through Q4 at his role with Thomas's, getting all the Q4 information, all the look forward information for the next year, all the financials, on top of all the other knowledge he had.

Chris signs with Hostess in October. His start date is January. The weeks tick by. Chris finally announces he's leaving Bimbo, but he doesn't say he's going to a new job. Given his long tenure, his colleagues probably assume he's retiring. According to court documents, he asked about how to enroll in health coverage. Oh, I need COBRA, meaning that's code word for I'm going to retire almost, right? But then, Hostess puts out a press release.

They find out from a hostess press release that he's going to work in the next two days for hostess. And Bimbo's like, oh shit. We've got this 75-year-old plus secret of how to bake Thomas's English muffins. It's a half a billion dollar product.

And he knows it. Does Hostess have an English muffin? Not yet. Fuck. HR calls Chris. No, no, you weren't retiring. You were going to the hated competitor. This is bad. HR says get out now. He got to a certain point where he knew too much. And now he's iced out. Chris is walked out of the building. He has no idea what's coming for him. Least of all, that he's about to be swallowed up by the nooks and crannies. We'll be right back.

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Recently, I learned there's a Frank Lloyd Wright house in Florence, not Italy, but Alabama, right in the heart of the Tennessee River Valley. I was there on revisionist history business with my colleague Ben, and we went to see it, the Rosenbaum House on Riverview, right near McFarland Park. It's considered one of Wright's masterpieces. Cypress wood, brick and glass with a cantilever roof. It's stunning.

And it made me realize, if you're going to Florence, why not try and stay in the real Florence? Not some chain hotel. Be a neighbor to the Rosenbaums for a few days. That's what Airbnb can do. Put you at the center of the communities you want to explore. And by the way, if you're planning a trip soon, consider hosting your home on Airbnb while you're away. It's such an easy and simple way to make some extra money that can go to your next vacation.

Your home might be worth more than you think.

Find out how much at airbnb.com slash host. There's only one place where go-go beats post through the streets, where you can visit the only national museum dedicated exclusively to African-American life, history, and culture. There's only one D.C. Visit Washington.org to plan your trip. We're leaving today and entering a world of Cinderella castle sightseeing, Tron light cycling, jungle cruise punting,

We're gonna return to the Nooks and Grannies, I promise.

But first, we have to talk about Willy Wonka. So I'll start by saying that one of my favorite books as a kid was Roald Dahl's Charlie and the Chocolate Factory. Jeannie C. Frommer is a vice dean at the New York University Law School. She's also the Walter J. Durenberg Professor of Intellectual Property Law and a scholar of Charlie and the Chocolate Factory. When my kids were younger, I was rereading the book to them.

And I was struck now that I was working in intellectual property by how much of the story was actually driven by trade secrets in that Willy Wonka had had to shut down his factory because all of his competitors were sneaking in spies to work there so they could steal his amazing candy innovations. And he couldn't tolerate it as a business matter anymore. So he shut down.

For those in need of a refresher, in the book, Wonka's factory has started back up. But nobody understands how. Nobody ever goes in. Nobody ever comes out. This is why it's so exciting when Charlie gets the golden ticket to go see the inside of the factory. Nobody sees the inside of the factory. And so what we learn is that Willy Wonka has found the magical solution to trade secret theft.

By having Oompa Loompas work in the factory. Why are they the magical solution? Because they don't leave. They live there. So they're not going to be sneaking out any trade secrets. They're paid in chocolate. They're happy. Let's not talk about some of the racist and other aspects. Maybe in violation of some employment law, but it's... Totally. Oompa Loompa, what do you do? I've got a problem.

Jeannie's insight about the Oompa Loompas became the seed of not one, but two brilliant articles she wrote, using Willy Wonka as the skeleton key for understanding trade secrecy. Her major revelation? Willy Wonka's paranoia, the spying and extreme secrecy, was totally justified. It was essentially based on a true story. This is just part of being in the candy industry.

Everything from reading about the Mars company, blindfolding any repair people that would come in to fix machines so they wouldn't see anything else, to spies being put into factories and guarding against that. So it felt actually very true to life, and that was a little bit shocking to me. Trade secrecy is the part of the law where life begins to resemble Willy Wonka. This is the most secret machine in my entire factory.

But what's it do? Can't you see? It makes everlasting gobstoppers. People love secrets from a very early age. It's why Charlie and the Chocolate Factory is a classic children's story. It's not just the candy. It's the secrets. The world is already full of things you can't understand when you're little. And now someone's going to share the most special true knowledge behind it all.

But secrets are also dangerous. If I tell you a secret, it means I trust you. It binds us together. But it also alters the balance of power between us. You know something I don't want other people to know. That puts me at risk. So I need you to know it's a secret. I tell you, don't tell anyone. Before I whisper in your ear. I put up a sign on my bedroom door saying, top secret, keep out. Trade secrecy works on playground rules.

Now imagine I'm a major corporation in the real world.

This is the crux of it. At their best, trade secrets protect valuable intellectual property from being stolen.

But at their worst, they're a powerful tool for a company that wants to turn an employee into an Oompa Loompa. It used to be the easiest way to turn a human being into an Oompa Loompa was a non-compete clause. But Janie says that's going away.

We've been living in a world where fast food workers have been asked to sign non-compete agreements. And, you know, historically, people understood non-competes as being for the a small number of employees, the highest level employees, the ones with the access to the most sensitive information.

And they're just being deployed as form contracts for so many workers and workers with lower incomes in ways that are keeping them in jobs that they might want to leave and go somewhere else. A lot of states are banning non-competes now, which is one of the reasons a company might come to Louis Deljudice, IP expert, to help identify and protect their secrets.

Could you make that bit in a secret room? Can you have a black vault in the office? Could there be a secret code book? Because a trade secret will be the only way to stop somebody if you really think they're taking something that's proprietary to your company someplace else. Because a non-compete's not going to really be in play. But trade secrets can have a dangerous power. Sometimes people are just good at what they do.

And they have advantages to continue working in the same industry because they know that industry. And their business has over claimed things as secrets. And that might prevent them from taking another job. Trade secrets are the only intellectual property protection that can last forever. And because of that permanence and the way we're geared to think about secrets already, they have a kind of mystical aura.

In our secular, disenchanted world, they are the closest thing we have to magic. The authentic Coca-Cola formula is written on a tiny grain of rice, kept in an old, weakened chest. A curse on anyone who opens it.

The most famous ones are the recipes. Coca-Cola's secret formula. KFC's 11 spices. The exact way to create Wrigley's gum. But actually, a whole lot of things can be trade secrets. Software code, financial information. You may know a trade secret and not even totally realize it. But a good way to recognize one is the nooks and crannies test. This feels like a good transition to me to Bimbo Bakeries versus Botticella. Can you tell me...

How you came across the case and how you teach it. I know the case through working on trade secret scholarship and teaching. It's a more recent classic, I would say. Bimbo Bakeries versus Botticella.

It seemed like every lawyer I talked to knew about the case. It wasn't a precedent so much as a legend. A piece of lore. A fairytale warning about the Oompa Loompa who took the everlasting gobstopper out of Willy Wonka's factory and tried to sell it to a competitor. Like any good fairytale, it's a good teaching tool because the moral's clear. Except, then I realized, the lessons of this case aren't clear at all.

Recently, I learned there's a Frank Lloyd Wright house in Florence, not Italy, but Alabama, right in the heart of the Tennessee River Valley. I was there on revisionist history business with my colleague Ben, and we went to see it, the Rosenbaum House on Riverview, right near McFarland Park. It's considered one of Wright's masterpieces. Cypress wood, brick and glass with a cantilever roof. It's stunning.

And it made me realize, if you're going to Florence, why not try and stay in the real Florence? Not some chain hotel. Be a neighbor to the Rosenbaums for a few days. That's what Airbnb can do. Put you at the center of the communities you want to explore. And by the way, if you're planning a trip soon, consider hosting your home on Airbnb while you're away. It's such an easy and simple way to make some extra money that can go to your next vacation.

"'Your home might be worth more than you think.'

Find out how much at airbnb.com slash host. There's only one place where go-go beats post through the streets, where you can visit the only national museum dedicated exclusively to African-American life, history, and culture. There's only one D.C. Visit Washington.org to plan your trip. We're leaving today and entering a world of Cinderella castle sightseeing, Tron light cycling, jungle cruise punting,

Pirate swashbuckling. Everest climbing. Dapper danning. Soaring. Firework show. I'm not crying, you're crying. World of favorites for whatever you love. Infinite worlds await at the most magical place on earth. Walt Disney World Resort. If somehow you missed the 2017 edition of the Pennsylvania Super Lawyers magazine, I would encourage you to look it up.

Specifically, an article titled, I Can Do That, about a Pennsylvania super lawyer named Elizabeth Ainslie.

Liz Ainsley is fearless. She was head of the Eastern District of Pennsylvania's fraud team. As Super Lawyers Magazine puts it, quote, Ainsley has represented whistleblowers in several major cases, defended and prosecuted high-profile RICO cases against law firms and pharmaceutical companies, defended a major national bank in a lender liability trial, and successfully defended the New York Times in a federal defamation trial. End quote. Legend.

And yet, in that whole article, they don't mention a call she got sometime in January 2010 regarding a secret recipe for English muffins. It was a pretty small budget to begin with, and I was at a big firm, so there was some question about whether I could take it or not, but they let me take it. When you say let you take it, were you eager to take it? Yeah, it was an interesting case. It was kind of a David and Goliath situation. I thought...

Chris Botticella, as I have mentioned, was in trouble.

Bimbo Bakeries has just found out that one of seven employees who knew the secret recipe for their newly acquired and extremely valuable Thomas's English muffins was going to work for a competitor.

Grupo Bimbo is one of the largest bakeries in the world. Grupo Bimbo bows to nobody. So within days of Chris's termination, before he starts his new job at Hostess, attorneys for Bimbo file an injunction in a Pennsylvania court, which is technically where Thomas's is based, but mainly it's a way better place for them to argue the case than California. I would like to read to you from the factual allegations section of what they filed. Items 1 through 10 cover the basics of the case.

And then they get to the secret. BBU and its predecessors have gone to great lengths to keep secret the recipe and process for making Thomas' English muffins for over 75 years.

Thomas's English muffins are a unique product famous for their distinctive nooks and crannies characteristics. As a result of his employment, Botticella learned trade secrets relating to the production of the Thomas's English muffins, including not only its recipe, but also the equipment necessary for production, necessary moisture level, and the way the product is baked, which all contribute to its distinctive characteristics.

With the knowledge described in paragraph 13, Botticella could produce an English muffin that might look a bit different, but that would nevertheless possess the distinctive taste, texture, and flavor character that distinguish the Thomas's English muffins. And that have been the foundation of the product's success. If you're Chris, this is bad.

Because you have to remember, the judge is coming to this cold. Louis Del Giudice, partner Troutman Pepper Locke, muffin trade secret enthusiast. He knows nothing about what's going on. He gets a slice of paper that's, you know, this emergency order on top of his desk that says, we need you to act now and we need you to stop somebody from getting a job, right? That's a pretty tall order to ask a judge to do. And the judge looks at it and says, Thomas's English muffins. Oh, the nooks and crannies.

An immediately recognizable trade secret. Absolutely you can't let someone take the secret behind the greatest breakfast product of all time. The judge grants Bimbo's wish. Chris can't join Hostess till the case is heard.

Meanwhile, Grupo Bimbo has hired a computer forensics expert who starts looking through Chris's laptop. Right after he got off the phone with HR when they said, hey, we heard the announcement from Hostess, all of a sudden three flash drives ends up getting plugged into the laptop. When confronted with this information, Chris told the court he was practicing for his new job.

The court is like, are you serious? I was practicing for my new job how to copy stuff onto a flash drive and take it off the flash drive and put it back on the flash. He's got, you know, you figure he's in his late 50s. He's not good with technology. But yeah, so the court found that a little bit unbelievable that he was practicing. Chris conceded that it was complicated. But there are mitigating factors here. First, the rush of it all. And the fact that he just met Liz, his lawyer.

Then, too, he'd signed a document with Hostess saying that he wouldn't share any confidential Bimbo information. He said he'd stuck around because he wanted to get his year-end bonus and finished two projects he was working on. But the court was not convinced. There's not a lot of confusion or new law that was made. It's just everything's really black and white. This is the classic version of the case: black and white. Bimbo catches Muffin Thief, accuses executive of stealing all sorts of trade secrets,

Except his lawyer Liz says, if you look at those documents, there's no evidence of that. I saw all of that stuff and none of it had anything to do with the products that Bimbo produced. It had nothing to do with not only English muffins, but also, you know, cupcakes or anything else. Sandwich thins. Yeah, exactly. Exactly.

Liz says, sure, in those documents there's financial information, cost-saving strategies, etc. Confidential stuff, but that's in a different category than the ancient muffin trade secret. I can actually read it to you, this section. Okay, so documents in Exhibits 9 through 25 include Bimbo's cost-reduction strategies, product launch dates, anticipated plant and line closures, labor contract information, production strength and weaknesses of many Bimbo bakeries, and the cost structure's...

for individual products by brand. All of this documentation is highly confidential, even within Bimbo, and would be extremely harmful to Bimbo in the hands of the competitor. You don't think that's sufficient? I agree that it was confidential. It's confidential, but it's not a trade secret. Bimbo leads with the nooks and crannies in the muffins. But in all the fine print of their complaint, nary a nook nor a cranny. And yet Liz thinks that's really what this was all about.

Anytime any executive leaves a big company and goes to another company, he'll be taking with him the knowledge that he's acquired of how to be a chief executive or a senior executive. You can't say that that's a secret just because he's learned it at one company.

What anyone on the outside of the case knows is the result.

Chris got crushed. If you search this case online, you'll see an example made of it on all sorts of law firm websites. You'll find it in an introductory textbook for intellectual property law. But in none of those will you hear whether Bimbo Bakeries was truly able to hold its most legendary secret up under scrutiny. Because the case never went to trial. It was meant to go to trial. But Liz told me there wasn't money for a trial. The judge ruled in favor of Bimbo.

Hostess told the New York Times, Now I'll grant you that Chris was not an ideal defendant, but this case had real consequences for his life.

After the fact that said you go anywhere near the baking industry, you have to tell Thomas's that you're going to be employed there. And which means Thomas is now would have the right to go to court and get some subpoenas and ask questions of the new employer. And what is he going to do? Like, what is this poor guy? If you want to take his side of the story, what is this poor guy supposed to do?

Does now he have a set of handcuffs on? He has to continue to work and can't go anywhere else, which is essentially what happened to him. No one's going to touch that guy now with a 10-foot pole. Bimbo didn't respond to a request for comment by the time we recorded this episode. I tried for months to reach Chris Botticella. Finally, I found an address, and I wrote him a letter.

He wrote me an email in which he described traveling to the hearing across the country, even though he lived in California, scrambling to pay for the appeal and going bankrupt. He writes, quote, You will never understand the impact that this had on my personal and professional life. What first grabbed me about this story was the idea that the nooks and crannies of a Thomas's English muffin had some supercharged legal power. But by this point, after reporting the story, I realized what this had meant, at least to Chris.

And when I talked to Louis and Jeannie about the future of trade secrecy, I saw a world of trade secrets opening up before me. A once futuristic and medieval, where every company had mystical code books full of secret recipes. A nook and cranny for every employee. Nooks and crannies is a shorthand for trade secret. But the actual trade secret of the nooks and crannies never came before a jury. I had learned that this controversy was, to my mind, unresolved.

So we at Revisionist History decided to resolve it. We are trying to free the muffin. So we're reverse engineering the muffin recipe. Whoa, I kind of love this. Don't tell people. Next week, we attempt to crack the code of the English muffin. My question for you is, is this like you're trying to create their exact product? Yeah, can we make this exact English muffin?

Revisionist History is produced by me, Ben Natafafri, with Lucy Sullivan and Nina Byrne-Lawrence. This episode was edited by Julia Barton. Special thanks to Jake Flanagan, Jordan Manikin, Greta Cohn, and Sarah Nix. Fact-checking on this episode by Kate Furby. Original scoring by Louis Scara. Mixing and mastering by Echo Mountain. Our executive producer is Jacob Smith. I'm Ben Natafafri.

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