United States District Court, N.D. Alabama, Northeastern Division
EMORANDUM OPINION AND ORDER
C. BURKE UNITED STATES DISTRICT JUDGE
case is before the Court on the Defendant Rick Yanac's
motion to dismiss portions of the Plaintiff M5 Management
Services, Inc.'s complaint and motion to grant summary
judgment as to the remaining claims. The Plaintiff asserts
five causes of action against the Defendant: breach of
contract (Count I) (Doc. 26, p. 7); injunctive relief
pursuant to 18 U.S.C. § 1836(b)(3)(A) (Count II) (Doc.
26, p. 8); monetary relief pursuant to 18 U.S.C. §
1836(b)(3)(B) & (C) (Count III) (Doc. 26, p. 8); breach
of fiduciary duty (Count IV) (Doc. 26, p. 9); and request for
preliminary and permanent injunction (Count V) (Doc. 26, p.
10). The Defendant asks the Court to dismiss Count I(c) and
Counts II-V and also asks the Court to grant summary judgment
as to Counts I(a-b) and again to Counts IV and V. (Doc. 31).
The Court will consider Counts I(c), II, and III for the
motion to dismiss and Counts I(a-b), IV, and V for the motion
for summary judgment. For the reasons stated below, the Court
finds that the Defendant's motion to dismiss is due to be
granted and the Defendant's motion for partial summary
judgment is due to be granted in part and denied in part.
Plaintiff is a corporation that assists its clients “to
improve their fixed operations business in their parts,
service and collision centers” and has developed unique
business methods and procedures that are valuable to the
company. (Doc. 26, ¶ 7, 9). The Defendant entered
employment negotiations with the Plaintiff in August 2010.
(Doc. 31, ¶ 5). The Plaintiff claims that the Defendant
began working for the company in October 2010 and stopped in
July 2017. (Doc. 26, ¶ 10). While serving as Vice
President of Operations, the Defendant had access to the
Plaintiff's confidential information, such as trade
secrets, candidate lists, and valuable business information.
(Doc. 26, ¶ 11). As a condition of his employment, the
Defendant signed an agreement on November 11, 2010, that he
would not: personally use the confidential information or
trade secrets he learned while employed; directly or
indirectly compete with the Plaintiff within the United
States for two years after his termination; contact or
solicit any of the Plaintiff's clients within two years
after his termination; or solicit any of the Plaintiff's
employees to leave their jobs or request business from the
Plaintiff's customers for two years after his
termination. (Doc. 26, ¶ 13).
the Defendant left his position in July 2017, he started a
business called Consulting Automotive Resource Specialists,
or (“CARS”). (Doc. 26, ¶ 14). The Defendant
described CARS as a “brand new fixed operations
consulting firm” that can improve its customers'
service departments in an email to a potential client on
October 18, 2017. (Doc. 26, p. 21). The Plaintiff claims that
the Defendant violated his employment agreement by operating
a competing organization and soliciting business from one of
its customers. (Doc. 26, ¶ 14; p. 21-22). Additionally,
the Plaintiff claims that the Defendant used its confidential
information while operating CARS. (Doc. 26, ¶ 15). The
Plaintiff attempted to contact the Defendant on October 26,
2017, to inform him that he was in violation of his
employment agreement and needed conform his behavior to its
terms. (Doc. 26, ¶ 16, p. 24). As the Defendant did not
respond to this demand, the Plaintiff requests relief from
the Court in the form of compensatory damages, punitive
damages, and injunctive relief. See (Doc. 26).
STANDARD OF REVIEW - MOTION TO DISMISS
Rule of Civil Procedure Rule 8(a)(2) mandates that a pleading
contains “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). A pleading does not have to include
“detailed factual allegations” to survive.
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
However, a complaint cannot simply have “a formulaic
recitation of the elements of a cause of action.”
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555
(2007). “Threadbare recitals of the elements of a cause
of action, supported by mere conclusory statements, do not
suffice.” Iqbal, 556 U.S. at 678.
defendant can move to dismiss a complaint when he believes it
is deficient. Rule 12(b)(6) allows defendants to request that
the court dismiss a case for “failure to state a claim
upon which relief can be granted.” Fed.R.Civ.P.
12(b)(6). To survive a motion to dismiss, a plaintiff must
“state a claim to relief that is plausible on its
face.” Iqbal, 556 U.S. at 678, quoting
Twombly, 550 U.S. at 570. A claim is facially plausible
“when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant
is liable for the misconduct alleged.” Iqbal,
556 U.S. at 678.
reviewing a motion to dismiss, the court “accept[s] the
allegations in the complaint as true and construe[s] them in
the light most favorable to the plaintiff.” Hunt v.
Aimco Properties, 814 F.3d 1213, 1221 (11th Cir. 2016).
The court is not bound to accept the plaintiff's
allegations as true if they are legal conclusions.
Iqbal, 556 U.S. at 678. Moreover, “where the
plaintiff refers to certain documents in the complaint and
those documents are central to the plaintiff's claim,
then the Court may consider the documents part of the
pleadings for purposes of Rule 12(b)(6) dismissal, and the
defendant's attaching such documents to the motion to
dismiss will not require conversion of the motion into a
motion for summary judgment.” Brooks v.
Blue Cross and Blue Shield of Fla, Inc.,
116 F.3d 1364, 1369 (11th Cir. 1997).
DISCUSSION - MOTION TO DISMISS
Count I(c) - Breach of Contract
Plaintiff claims the Defendant breached his employment
agreement in several ways including: “a) operating as a
competitive business, including soliciting, selling, or
assisting in the sale or provision of services such as those
provided by [the Plaintiff]; b) soliciting and working with
[the Plaintiff's] customers and/or clients on behalf of
themselves or other competitive entities; and c) removing,
using, and/or sharing [the Plaintiff's] confidential and
proprietary information.” (Doc. 26, ¶ 20). The
Defendant only targets Count I(c) in his motion to dismiss.
He claims that the pleading is deficient as the Plaintiff
does not detail what information is “confidential and
proprietary, ” nor does it detail what information was
removed, used, or shared. (Doc. 28, p. 5).
Plaintiff justifies its allegation that the Defendant misused
its confidential and proprietary information by repeating the
same statements listed in the complaint. (Doc. 35, p. 2-3).
It claims that the Defendant used the confidential
information he obtained as a former employee in the operation
of his new business. (Doc. 35, p. 2). To support its
reasoning, the Plaintiff argues that it did not refer to the
confidential information in a general fashion but listed it
as things like “sensitive and valuable business
information, trade secrets, pricing information, [and]
prospect lists.” (Doc. 26, ¶ 11). While defending
its claims under Count II, the Plaintiff suggests that its
allegations in Count I are adequate, and confidential
information can be discussed in general terms, (Doc. 35, p.
3), citing Trade Secrets Law by Melvin F. Jager.
does not have to fully divulge the details of its
confidential and proprietary information to survive a motion
to dismiss. See DynCorp Int'l v. AAR Airlift
Grp., Inc. 664 Fed.Appx. 844, 849 (11th Cir.
2016). However, the allegations must be more than general
categorizations to be sufficiently pled. See id. at
849 (the Court finding that the plaintiff's pleading
identifying trade secrets was sufficient as it contained more
than “broad categories of information.”) See
also RxStrategies, Inc. v. CVS
Pharmacy, Inc., 390 F.Supp.3d 1341, 1352 (M.D.
Fla. 2019) (district court finding that pleadings were
adequate when they did more than suggest “the existence
of general categories of ‘confidential
information.'”) The allegations must allow the
defendant to have notice of the basis of the plaintiff's
claims. DynCorp Int'l, 664 Fed.Appx. at 850.
Construed in the light most favorable to the Plaintiff, the
confidential information alleged in the complaint and then
reincorporated in Count I(c) is simply a generalized list of
alleged proprietary material. Such a broad listing of
information is not enough to survive a motion to dismiss.
Id. at 849.
even if the Plaintiff's description of its confidential
information was adequate, the Plaintiff has not
satisfactorily alleged in what ways the Defendant removed,
used, or shared the information in violation of his
employment agreement. The Plaintiff argues that the complaint
read in its entirety supports the allegation the Defendant
used the confidential information inappropriately in his
business. (Doc. 35, p. 2-3). However, the Plaintiff does not
support its claims with any of the necessary factual
allegations to move its claim “across the line from
conceivable to plausible.” Iqbal, 556 U.S. at
680. The Defendant having access to confidential information
and operating a business does not automatically create a
plausible presumption that he is in breach regarding this
allegation. Accordingly, because the Plaintiff does not
plausibly state a claim for which relief can be granted,
Count I(c) of the complaint is dismissed.
Counts II & III - Injunctive and Monetary Relief Under 18