E-Ntech Indep. Testing Servs., Inc. v. Air Masters, Inc.

2017 NCBC 2
CourtNorth Carolina Business Court
DecidedJanuary 5, 2017
Docket16-CVS-3092
StatusPublished

This text of 2017 NCBC 2 (E-Ntech Indep. Testing Servs., Inc. v. Air Masters, Inc.) is published on Counsel Stack Legal Research, covering North Carolina Business Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
E-Ntech Indep. Testing Servs., Inc. v. Air Masters, Inc., 2017 NCBC 2 (N.C. Super. Ct. 2017).

Opinion

e-nTech Indep. Testing Servs., Inc. v. Air Masters, Inc., 2017 NCBC 2.

STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION FORSYTH COUNTY 16 CVS 3092

E-NTECH INDEPENDENT TESTING SERVICES, INC.

Plaintiff,

v. ORDER AND OPINION ON DEFENDANTS’ MOTION TO DISMISS AIR MASTERS, INC., JOSH WHITE, and MATTHEW KENDLE,

Defendants.

1. THIS MATTER is before the Court upon Defendants Air Masters, Inc. (“Air

Masters”), Josh White (“White”), and Matthew Kendle’s (“Kendle”) (collectively,

“Defendants”) Motion to Dismiss Plaintiff’s Verified First Amended Complaint (the

“Motion”) in the above-captioned case.

2. The Court, having considered the Motion, briefs in support of and in

opposition to the Motion, and arguments of counsel made at the hearing on the

Motion, hereby DENIES the Motion.

Bell, Davis & Pitt, P.A., by Charlot F. Wood and Bradley C. Friesen, for Plaintiff e-nTech Independent Testing Services, Inc.

Womble Carlyle Sandridge & Rice, LLP, by Brent F. Powell and Ryan H. Niland, for Defendants Air Masters, Inc., Josh White, and Matthew Kendle.

Bledsoe, Judge. I.

PROCEDURAL HISTORY

3. Plaintiff e-nTech Independent Testing Services, Inc. (“e-nTech” or

“Plaintiff”) filed this action on May 25, 2016. On August 17, 2016, Plaintiff filed its Verified First Amended Complaint (“Amended Complaint”), which asserts claims for

tortious interference with business relations, misappropriation of trade secrets, and

unfair trade practices under N.C. Gen. Stat. § 75-1.1, and seeks injunctive relief, all

arising out of White’s and Kendle’s termination of their employment with Plaintiff

and entry into competition against Plaintiff through their new company, Air Masters.

4. Defendants subsequently filed this Motion to Dismiss on September 16,

2016. The Motion has been fully briefed, and the Court held a hearing on the Motion

on November 2, 2016, at which all parties were represented by counsel. The Motion

is now ripe for resolution.

II.

FACTUAL BACKGROUND

5. The Court does not make findings of fact on motions to dismiss under Rule

12(b)(6), but only recites those allegations in the Amended Complaint that are

relevant and necessary to the Court’s determination of the Motion.

6. Plaintiff e-nTech is a North Carolina corporation that is engaged in the

business of providing HVAC independent testing services, including critical room

pressurization verification testing, fire damper testing, and other test and balance

services for hospitals and other facilities throughout North Carolina, South Carolina,

and Virginia.1 (Am. Compl. ¶¶ 1, 7.)

1 Critical room pressurized verification involves testing the air pressure in rooms in which constant air pressure must be maintained, such as operating rooms, isolation rooms, bronchoscopy and endoscopy labs, catheterization labs, and sterile storage rooms. (Am. Compl. ¶ 9.) Fire damper testing is required for new construction, renovations, hospitals, and certain medical facilities. (Am. Compl. ¶ 8.) 7. Buddy W. Sechrist (“Sechrist”) served as the President of e-nTech at all

times relevant to this dispute. (Am. Compl. ¶ 6.) Until May 22, 2015, Sechrist and

Andrew Adams were shareholders of e-nTech, and after May 22, 2015, Sechrist was

the sole shareholder of the company. (Am. Compl. ¶¶ 6, 18.) Until his resignation in

the spring of 2015, Adams was employed as e-nTech’s Vice President. (Am. Compl.

¶¶ 18, 38.)

8. Defendants White and Kendle were employed by e-nTech as technicians.

(Am. Compl. ¶¶ 10–11.) White was employed from October 24, 2011 to September

25, 2015, and Kendle was employed from August 4, 2003 to September 23, 2015. (Am.

Compl. ¶¶ 10–11.)

9. Plaintiff alleges that, as employees of e-nTech, White and Kendle had access

to allegedly confidential and proprietary information, including information about

customers and potential customers, scope of work to be performed for customers, and

specifications provided by customers of e-nTech (“Accessible C&P Information”).

(Am. Compl. ¶ 13.)

10. Plaintiff further alleges that White and Kendle did not have access to certain

other information e-nTech claims constitutes its trade secrets, including e-nTech’s

customer lists, information about customer contacts for those with financial and

project approval authority, and pricing methodology (“Inaccessible C&P

Information”). (Am. Compl. ¶ 14.) Plaintiff contends that during the time White and

Kendle were employed by e-nTech, the Inaccessible C&P Information was only

accessible to Sechrist, Adams, and e-nTech’s office manager. (Am. Compl. ¶¶ 6, 14.) The Inaccessible C&P Information was on Sechrist’s computer and kept in hardcopy

form in Sechrist’s locked office but not on e-nTech’s server. (Am. Compl. ¶¶ 14, 54.)

11. Wayne Memorial Hospital in Goldsboro, North Carolina (“Wayne

Memorial”) was one of e-nTech’s primary customers for its HVAC independent testing

services beginning in 2005. (Am. Compl. ¶ 17.) In particular, Wayne Memorial had

used e-nTech’s fire damper testing services from time to time during this period. (Am.

Compl. ¶ 17.)

12. In the spring of 2015, Adams resigned from his employment with e-nTech to

become the Director of New Construction and Renovation for Wayne Memorial,

effective on or about May 3, 2015. (Am. Compl. ¶ 18.)

13. On May 20, 2015, White filed Articles of Incorporation for Air Masters with

the North Carolina Secretary of State and listed the company’s address as Kendle’s

home address. (Am. Compl. ¶ 28.)

14. On June 1, 2015, and consistent with e-nTech’s past practices in its business

dealings with Wayne Memorial, e-nTech’s CEO, Sechrist, met with employees of

Wayne Memorial, including former e-nTech employee Adams, Archie Mooring

(“Mooring”), and Steve Herring (“Herring”), to discuss upcoming projects for e-nTech

at Wayne Memorial. (Am. Compl. ¶ 19). These discussions covered, among other

work, a comprehensive fire damper testing project. (Am. Compl. ¶ 19.) During these

discussions, Adams requested that e-nTech assign White as technician for the

projects. (Am. Compl. ¶ 19.) Wayne Memorial also requested, as it had in the past,

that e-nTech submit its proposed budget for the fire damper testing project, so that Wayne Memorial could schedule the project for completion by the end of 2015. (Am.

Compl. ¶ 19.) e-nTech complied on or about June 5, 2015. (Am. Compl. ¶ 20.)

Plaintiff contends that in its usual course of dealing with Wayne Memorial, Wayne

Memorial always issued a schedule for the work to be performed sometime after e-

nTech submitted its proposed budget. (Am. Compl. ¶ 38.)

15. Plaintiff alleges, however, that beginning as early as August 1, 2015 and

while still employed at e-nTech, White and Kendle, acting as Air Masters, performed

fire damper testing services for Wayne Memorial on multiple projects. (Am. Compl.

¶¶ 34, 36.) Plaintiff further alleges that White and Kendle used e-nTech’s equipment,

report forms, and proprietary information, as well as the services of a current e-nTech

employee, in providing services to Wayne Memorial without the express or implied

consent or authority of e-nTech. (Am. Compl. ¶¶ 40–41, 43–44.) In particular,

Plaintiff contends that White and Kendle misappropriated e-nTech’s Accessible C&P

Information by copying or recording it from e-nTech’s computer system and hard files

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