Walmart Zest Labs Trade Secret Lawsuit, a 2026 Guide

The Walmart Zest Labs trade secret lawsuit is over. After eight years of legal battles, a $222.7 million jury verdict, and a confidential settlement, this case has finally reached its end.

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It started when a small California tech startup shared its food waste technology with the world’s largest retailer. What followed was a story of broken NDAs, alleged technology theft, and two separate jury trials.

This case now ranks among the largest trade secret verdicts in Arkansas history. The jury found Walmart’s conduct “willful and malicious.” That finding unlocked massive punitive damages on top of compensatory losses.

In this article, you’ll learn the full timeline of the case. You’ll see how the damages broke down. And you’ll understand why the retrial actually backfired on Walmart, nearly doubling what the retailer owed.

What Is the Walmart Zest Labs Trade Secret Lawsuit

The Walmart Zest Labs trade secret lawsuit is a federal case in which Zest Labs accused Walmart of stealing its proprietary food freshness technology. The complaint was filed in the United States District Court for the Eastern District of Arkansas, Western Division, for violation of the Arkansas Trade Secrets Act, the federal Defend Trade Secrets Act, unfair competition, unjust enrichment, breach of contract, and fraud.

Zest Labs entered into a multi-year relationship with Walmart beginning in 2014, sharing trade secrets, proprietary algorithms, software platforms, and supply chain techniques under confidentiality agreements.

In late 2017, Walmart abruptly ended their engagement. By March 2018, Walmart launched a competing platform called “Eden,” claiming it had been developed in just six months.

Zest Labs and Ecoark filed suit against Walmart on August 1, 2018, claiming Walmart stole its technology that prolongs shelf life of produce to reduce spoilage. The damages at issue exceeded $2 billion.

Walmart Zest Labs Settlement 2026: What We Know

Walmart and Zest Labs reached a confidential settlement in July 2025, ending all litigation between them. Walmart reached a settlement with Zest Labs and won’t appeal a federal jury award of $222.7 million. U.S. District Judge James M. Moody Jr. said in an order filed Monday that he had been notified that the case has settled.

An order of dismissal will be filed within 15 days, and both sides have until then to file any remaining motions.

Walmart said in a statement that Zest Labs Holdings LLP, Zest Labs Inc., and Walmart “have agreed to a confidential settlement that resolves all issues between them.” The lead trial counsel for Zest Labs, Patrick M. Ryan of Bartko Pavia LLP, issued a matching statement.

Walmart said at the time it would appeal that verdict, but this week’s settlement rules out that option. That means Walmart dropped its planned appeal entirely.

• Settlement date: July 29, 2025
• Settlement terms: Confidential
• Appeal status: Dropped by Walmart
• Case status: Resolved, dismissal pending
• Judge: James M. Moody Jr.

How Did the $222 Million Verdict Break Down

The $222.7 million verdict included two separate components: compensatory damages and punitive damages. Walmart owes Zest Labs $72.7 million in compensation for damages caused by Walmart’s trade secret misappropriation and $150 million for exemplary damages, the jury decided.

The $150 million punitive ruling will be reduced by $4.6 million, however, because under the federal Defend Trade Secrets Act, the most Zest could receive is twice the amount of compensatory damages. That means the real punitive cap sits at $145.4 million (two times $72.7 million).

The jury’s decision includes $72.7 million in compensatory damages and $150 million in punitive damages, making it one of the largest verdicts in state history and possibly the largest ever in an Arkansas trade secrets case.

Key Takeaway: The jury awarded $222.7 million, but federal law capped punitive damages at twice the compensatory amount, trimming the actual total by $4.6 million.

What Is Zest Labs Trade Secret Misappropriation

Trade secret misappropriation means someone improperly acquires, uses, or discloses another party’s confidential business information. The jury concluded that Zest Labs proved its claim of “trade secret misappropriation” and found Walmart’s misappropriation was “willful and malicious,” according to court documents.

Zest Labs, formerly Rogers-based Ecoark, collaborated with Walmart from 2014 to 2017, enabling the retailer to use their technology and reduce food waste by 30% among perishable goods.

The suit claimed Walmart developed its own technology using Zest Labs’ trade secrets. Instead of licensing Zest Fresh, Walmart built Eden. That’s the core of the misappropriation claim.

The standard is straightforward. The information must have economic value because it’s secret. The owner must take reasonable steps to protect it. And someone else must improperly acquire or use it.

• Zest Labs shared its technology under an NDA
• Walmart had direct access for three years
• Walmart launched a near-identical product afterward
• The jury found this met the legal definition of misappropriation

Walmart Trade Secret Lawsuit Damages Explained

Trade secret damages can come in several forms under federal law. Under the UTSA and the DTSA, trade secret owners can seek damages for actual loss, unjust enrichment, reasonable royalties, or exemplary damages up to double any other remedy when willful and malicious misappropriation exists.

In the Walmart case, Zest Labs sought compensation for the business value Walmart destroyed. Bartko Pavia’s Ryan told Arkansas Business that Zest’s product was “truly a really important revolutionary piece of technology which could have reduced global food waste by billions a year and that technology was destroyed here.”

Plaintiffs argued that Walmart’s misappropriation cost them billions in lost profits and opportunities. They claimed Eden was essentially a replica of Zest Fresh, built using stolen data. This, they said, not only deprived them of licensing revenue but harmed their credibility and business prospects.

Why Did the Jury Award Walmart Zest Labs Punitive Damages

The jury awarded punitive damages because it found Walmart’s misappropriation was deliberate, not accidental. The jury concluded that Zest Labs proved its claim of “trade secret misappropriation” and found Walmart’s misappropriation was “willful and malicious,” according to court documents.

Where the trade secret is “willfully and maliciously misappropriated,” a court may award exemplary damages double the damages amount already awarded.

Think of punitive damages like a speeding ticket multiplier. Regular damages cover what you broke. Punitive damages punish you for how recklessly you drove. In Walmart’s case, the jury decided the retailer didn’t just stumble into using Zest’s technology. It chose to.

By fighting for a new trial after losing the initial one, Walmart put itself in a position where its payout is almost twice as high.

• Willful means Walmart knew what it was doing
• Malicious means there was intent to cause harm
• The DTSA caps punitive damages at 2x compensatory damages
• The jury’s $150M slightly exceeded the cap, requiring a $4.6M reduction

Key Takeaway: Punitive damages exist to punish and deter, and the jury’s “willful and malicious” finding is what unlocked the extra $150 million on top of the $72.7 million in compensatory damages.

What Does Willful and Malicious Mean in This Case

“Willful and malicious” is a legal standard that goes beyond ordinary negligence. To establish that the defendant acted willfully and maliciously, the plaintiff must prove that the defendant intentionally engaged in conduct with knowledge that it was wrongful or with reckless disregard for the plaintiff’s rights.

The retailer acted in a manner that jurors deemed “willful and malicious,” according to court documents. This was a unanimous jury finding, meaning all jurors agreed.

There are generally two approaches to defining the phrase “willful and malicious,” with the main difference being the interpretation of “malicious.” The minority view requires a “conscious disregard for the rights of another,” while the majority view focuses on whether there is “an intent to cause injury or harm.”

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The evidence in the Walmart case included:

• Three years of direct access to Zest’s proprietary information
• An NDA that Walmart allegedly violated
• The launch of Eden shortly after ending the Zest partnership
• Walmart’s claim that Eden was built in just six months at a hackathon

Zest Labs Lawsuit Timeline: 2014 to 2026

Here is the complete chronological history of this case from first contact to final resolution.

On March 5, 2014, Walmart and Zest Labs entered into a confidentiality agreement and document of understanding. Beginning in the fall of 2014, representatives of Zest Labs engaged with Walmart regarding Zest Labs fresh technology.

In late 2017, after in depth access to and reviews of Zest Labs’ solution, technology and approach, Walmart informed EcoArk and Zest Labs that it would not license or deploy Zest Fresh. In March 2018, Walmart publicly announced Eden.

Key Takeaway: From first handshake to final settlement, this case spanned over a decade and produced two separate jury verdicts before both sides finally agreed to walk away.

What Is Zest Fresh Technology

Zest Fresh is a food waste reduction technology that uses data analytics and machine learning to predict the shelf life of produce throughout the supply chain. The case centered on Zest’s proprietary technology, the Zest Fresh Solution, which was designed to reduce food waste by using machine learning to predict the shelf life of produce throughout the supply chain.

Zest Fresh is proven to reduce field-to-shelf food waste by 50 percent or more while improving delivered freshness to consumers.

Imagine you ship a truckload of strawberries from California to Arkansas. Zest Fresh would track the temperature, handling, and conditions during that trip. It would then predict exactly when those berries would spoil, allowing stores to route, sell, or discount accordingly.

The data and insights provided by Zest Fresh help growers, food distributors, and retailers reduce the $85 billion problem of fresh food waste.

• Type: Cold-chain management and shelf-life prediction
• Method: Machine learning and data analytics
• Waste reduction: Up to 50% or more
• Industry problem: $85 billion in annual food waste
• Key feature: Real-time predictive tracking from farm to shelf

How Did Walmart’s Eden Technology Lead to Trade Secret Theft

Walmart’s Eden technology is at the center of the trade secret theft allegation. In early 2018, Zest Labs claimed the retailer released a solution called Eden that “looks, sounds, and functions” like its own produce shelf life solution.

Eden was launched by Walmart in March 2018 as a high-tech “Intelligent Food” initiative designed to improve the quality of its perishable foods business and eliminate waste from its perishable food supply chain.

Walmart argued that Eden was developed independently through an internal “hackathon” and was based on publicly available USDA standards and Walmart’s own data. The jury didn’t buy that explanation.

Plaintiffs’ counsel emphasized the detailed and prolonged access Walmart received to Zest Fresh and argued that Walmart used this confidential knowledge to reverse engineer Eden. They stressed that Walmart’s public statement about Eden being created in six months was not only implausible but intentionally misleading.

The timeline tells the story. Walmart spent three years testing Zest’s technology. It ended the relationship. Then it launched a nearly identical product months later and claimed it was homegrown.

Walmart NDA Violation and Confidentiality Breach

Walmart allegedly violated the non-disclosure agreement (NDA) it signed with Zest Labs in March 2014. During this time, Zest Labs’ proprietary information and trade secrets were shared with Walmart under a mutual Non-Disclosure Agreement.

Over the course of its relationship with Zest, a large number of Walmart employees had direct access to Zest Labs’ trade secret technology, described in numerous confidential Zest documents provided to Walmart and in Walmart’s emails and conversations with Zest employees.

An NDA is supposed to work like a locked vault. You give someone a key so they can look inside. The agreement says they can’t take anything out or build a copy. In this case, the jury determined that Walmart picked the vault clean.

Zest first sued the Bentonville retailer back in 2018 over allegations that Walmart stole Zest’s revolutionary technology and incorporated it into a patent that was later published, destroying Zest’s trade secret.

• Walmart signed the NDA in March 2014
• Access lasted through mid-2017
• Multiple Walmart employees saw confidential materials
• Walmart filed its own patent applications using similar concepts
• The published patents allegedly destroyed Zest’s trade secret status

Key Takeaway: The NDA was supposed to protect Zest Labs’ proprietary information, but the jury found that Walmart used that access to build a competing product rather than licensing the original.

Zest Labs, Ecoark Holdings, and the Parent Company

Zest Labs is a subsidiary of Ecoark Holdings, Inc., a diversified holding company. Founded in 2011, Ecoark is a diversified holding company with three wholly owned subsidiaries: Zest Labs, Inc., Banner Midstream Corp, and Trend Discovery Holdings, Inc.

Rogers-based Ecoark alleged that the retail giant’s Eden technology looks a lot like the information it shared with Walmart between 2014 and 2017 during a pilot of Zest Labs, a subsidiary of Ecoark.

Ecoark was founded by former Walmart exec Randy May. That connection is worth noting. The company’s founder was a former Walmart executive who understood the retailer’s supply chain challenges.

Both Zest Labs and Ecoark were co-plaintiffs in the lawsuit. The case was filed under both names, and both stood to benefit from any verdict or settlement.

The Defend Trade Secrets Act and the Walmart Case

The Defend Trade Secrets Act (DTSA) is the federal law that gave Zest Labs the right to sue Walmart in federal court. On May 11, 2016, President Obama signed the Defend Trade Secrets Act into law. This legislation creates a federal, private, civil cause of action for trade-secret misappropriation.

The complaint was filed for violation of the Arkansas Trade Secrets Act, violation of the federal Defend Trade Secrets Act, unfair competition, unjust enrichment, breach of contract, breach of the covenant of good faith and fair dealing, conversion and fraud.

The DTSA matters here because it set the rules for damages. If the trade secret is willfully and maliciously misappropriated, the court may award exemplary damages in an amount not more than 2 times the amount of the damages awarded.

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That’s exactly why the $150 million punitive award needed a $4.6 million trim. The cap is strict: two times compensatory, no more.

• Signed into law: May 11, 2016
• What it does: Creates a federal cause of action for trade secret theft
• Key provision: Exemplary damages up to 2x compensatory
• Statute of limitations: Three years from discovery of misappropriation
• Applied in this case: Yes, alongside the Arkansas Trade Secrets Act

What Are the Confidential Settlement Terms

The exact terms of the Walmart Zest Labs settlement are not public. Walmart said in a statement to Arkansas Business that Zest Labs Holdings LLP, Zest Labs Inc. and Walmart “have agreed to a confidential settlement that resolves all issues between them.”

The word “confidential” tells us the dollar figure and specific terms won’t be released. This is standard practice in high-profile corporate disputes. Both sides have reasons to keep the number quiet.

The deal brings to a close a complex legal battle that just months ago resulted in a federal jury ordering Walmart to pay Zest Labs more than $222 million. Walmart said at the time it would appeal that verdict, but this week’s settlement rules out that option.

What we can infer is this: Walmart chose to settle rather than appeal. That suggests the retailer believed the risk of an appeal upholding or even increasing the verdict outweighed the cost of settling now.

• Settlement amount: Confidential, not disclosed
• Settlement date: July 29, 2025
• Appeal status: Walmart dropped its appeal
• All issues resolved: Yes, per both parties’ statements
• Public court filings: Settlement notification filed, dismissal order pending

Key Takeaway: While the exact settlement figure remains secret, Walmart’s decision to drop its appeal after a $222.7 million verdict suggests the settlement was likely in a range both sides could accept rather than risk further litigation.

How the Retrial Doubled Walmart’s Damages

The retrial is one of the most striking elements of this case. Walmart fought for a new trial and ended up paying nearly twice as much. Zest Labs originally filed a civil lawsuit against Walmart in 2018, with a jury awarding Zest Labs $115 million in a verdict delivered three years later. An Arkansas federal judge granted Walmart’s request for a new trial in late 2023 after finding that Zest Labs withheld relevant evidence in the original trial.

By fighting for a new trial after losing the initial one, Walmart put itself in a position where its payout is almost twice as high.

The first trial in 2021 produced a $115 million verdict. That jury verdict was later vacated due to the fact that Zest Labs withheld evidence. Walmart saw an opening and pushed for Round 2.

The second trial went even worse for Walmart. The retrial jury awarded $222.7 million, nearly double the original amount.

This is the legal equivalent of asking for a rematch and losing by a wider margin. Walmart’s gamble didn’t pay off.

Lessons for Small Businesses Sharing Trade Secrets

This case is a warning signal for every startup that walks into a meeting with a larger company. If you share proprietary information, protect yourself before you walk through the door.

Zest Labs Manager Gary Metzger said, “This legal victory is a small but crucial triumph for small businesses that often face exploitation by larger corporations.”

The relationship between Zest Labs and Walmart followed a pattern that small businesses should recognize. A large company shows interest. You share your technology under an NDA. The pilot goes well. Then the big company walks away and builds its own version.

Here’s what small businesses can take away from this case:

• Get your NDA right. Make sure it includes specific definitions of what constitutes your trade secret.
• Document everything. Keep records of every meeting, demonstration, and file shared.
• Watch for copycat products. Monitor the market after a partnership ends.
• File your own patents first. Don’t rely solely on trade secret protection.
• Know the DTSA. The federal Defend Trade Secrets Act gives you a path to federal court.
• Hire experienced counsel. After Judge Moody ordered a new trial, Zest hired the law firm of Bartko Pavia LLP of San Francisco. That decision proved to be significant.

The DTSA exists specifically to give smaller companies a fighting chance when larger corporations take what isn’t theirs. This case proves the law works. But it also shows the fight can take eight years.

Frequently Asked Questions

Did Walmart steal Zest Labs’ technology?

An Arkansas federal jury found that Walmart owes Zest Labs more than $222 million over claims that the mass retailer stole Zest Labs’ technology. The jury concluded that Zest Labs proved its claim of “trade secret misappropriation” and found Walmart’s conduct “willful and malicious.”
Walmart denied all allegations throughout the case.

How much did Walmart pay Zest Labs in the settlement?

The exact settlement amount is confidential and has not been publicly disclosed.
Walmart reached a settlement with Zest Labs and won’t appeal a federal jury award of $222.7 million.
The settlement likely reflects a negotiated figure based on the verdict.

What is Zest Fresh and how does it reduce food waste?

Zest Fresh is proprietary technology designed to reduce food waste by using machine learning to predict the shelf life of produce throughout the supply chain.
It is proven to reduce field-to-shelf food waste by 50 percent or more.

Why was there a retrial in the Walmart Zest Labs case?

An Arkansas federal judge granted Walmart’s request for a new trial in late 2023 after finding that Zest Labs withheld relevant evidence in the original trial.
The first verdict of $115 million was vacated as a result.

Is the Walmart Zest Labs case fully resolved in 2026?

Yes, the case is fully resolved. Walmart has agreed to a settlement with Zest Labs, the food waste technology company that first sued the retailer seven years ago.
An order of dismissal was expected to be filed within 15 days of the July 2025 settlement announcement.

This case is now closed. The settlement is signed. The appeals are gone.

If you’re following trade secret law, this verdict and settlement represent a major data point. A startup won more than $222 million from the world’s largest retailer.

Keep an eye on how courts apply the Defend Trade Secrets Act in future cases. And if you’re a small business sharing your ideas with a bigger company, remember what happened to Zest Labs, and make sure you’re protected before you share a single slide.

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