Hilco Diligence Services, LLC v. Sikich, LLC

CourtDistrict Court, N.D. Illinois
DecidedMay 21, 2025
Docket1:25-cv-01002
StatusUnknown

This text of Hilco Diligence Services, LLC v. Sikich, LLC (Hilco Diligence Services, LLC v. Sikich, LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hilco Diligence Services, LLC v. Sikich, LLC, (N.D. Ill. 2025).

Opinion

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

HILCO DILIGENCE SERVICES, LLC, and HILCO VALUATION SERVICES, LLC, No. 25 CV 1002 Plaintiff Judge Jeremy C. Daniel v.

SIKICH, LLC, Defendant

MEMORANDUM OPINION AND ORDER The defendant’s motion to dismiss [16] is granted as to Count IV. The motion is denied in all other respects. The defendant’s motion for in camera review of documents [22] is denied as moot. The plaintiff’s request for leave to amend is granted. The plaintiff shall file any amendment with respect to Count IV by June 3, 2025, and the defendant shall answer the operative complaint on or before June 24, 2025. BACKGROUND The plaintiffs, Hilco Diligence Services, LLC, and Hilco Valuation Services, LLC (“Hilco”), provide financial and accounting diligence services and asset appraisals for commercial lenders. (R. 1 ¶¶ 2, 14–15.)1 According to Hilco, two of its former employees, Mark Stevens and Michael Baiocchi, left Hilco and went to work for the defendant, Sikich, LLC, one of Hilco’s competitors. (Id. ¶¶ 1–3.) Stevens, an

1 For ECF filings, the Court cites to the page number(s) set forth in the document’s ECF header unless citing to a particular paragraph or other page designation is more appropriate. Executive Director at Hilco, left in June 2023, joining Sikich the next month as Director of Transaction Advisory Lending Services. (Id. ¶¶ 47–48.), Baiocchi left Hilco to join Sikich in October 2024. (Id. ¶¶ 53–54, 56–57, 59–60.) Hilco alleges that Stevens

and Baiocchi both accepted positions with Sikich in violation of the non-competition provisions in their respective employment agreements with Hilco. (Id. ¶¶ 3, 34–35, 44–45, 50.) To secure trade secret information, Hilco requires its employees “to sign agreements that include provisions relating to non-disclosure/nonuse/non-transfer of its Confidential and Trade Secret Information during employment and thereafter,”

reviews employee’s devices and accounts containing such information, and limits access to its databases, among other things. (Id. ¶¶ 25–26.) According to Hilco, prior to his departure, Baiocchi sent Hilco’s trade secret information to Sikich employees via email and text message and emailed other trade secret information to his personal email account. (Id. ¶¶ 62–75.) This trade secret information included Hilco’s workbooks, field exam reports, engagement letters, testing trackers, field exam outlines, an information request list, a contact list, a cash management overview, and

project lists, among other things. (Id. ¶ 76.) Hilco filed the present action claiming Sikich misappropriated Hilco’s trade secrets in violation of the Defend Trade Secrets Act (“DTSA”) (Count I) and the Illinois Trade Secrets Act (“ITSA”) (Count II), and that Sikich tortiously interfered with Hilco’s non-competition agreements with Baiocchi (Count III) and Stevens (Count IV). (Id. ¶¶ 28–32.) Sikich now moves to dismiss the complaint in its entirety under Federal Rule of Civil Procedure 12(b)(6).2 (R. 16.) LEGAL STANDARD

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of a complaint, not the merits of the allegations. McReynolds v. Merrill Lynch & Co., 694 F.3d 873, 878 (7th Cir. 2012). “To defeat a [Rule 12(b)(6)] motion to dismiss, a plaintiff must ‘state a claim to relief that is plausible on its face.’” Sabo v. Erickson, 128 F.4th 836, 842 (7th Cir. 2025) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Facial plausibility exists ‘when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.’” Thomas v. Neenah Joint Sch. Dist., 74 F.4th 521, 523 (7th Cir. 2023) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “When examining a motion to dismiss, [the Court] accept[s] as true all well-pleaded facts in the complaint and draw[s] reasonable inferences in favor of the plaintiff.” Kap Holdings, LLC v. Mar-Cone Appliance Parts Co., 55 F.4th 517, 523 (7th Cir. 2022). However, “[t]hreadbare recitals of the elements of the cause of action, supported by

2 Sikich also argues that Hilco’s request for injunctive relief is moot because “Sikich quarantined the documents and engaged a third-party forensic firm to review its system and certify that there were no Hilco documents.” (R 17 at 4 n.3.) These facts are not in the complaint, and Sikich does not claim to challenge the Court’s jurisdiction under Federal Rule of Civil Procedure 12(b)(1). (R. 1, 16, 17, 32;) see Lumpkin v. United States, 791 F. Supp. 747, 749 (N.D. Ill. 1992) (“On a motion to dismiss under Rule 12(b)(1), the court may hold an evidentiary hearing if requested or may organize a documentary inquiry into jurisdiction.”). In analyzing the complaint’s sufficiency under Rule 12(b)(6), the Court cannot consider the facts supporting Sikich’s mootness argument and therefore denies Sikich’s request for dismissal on that basis. See Wilson v. Price, 624 F.3d 389, 391 n.1 (7th Cir. 2010) (stating the court “only consider[s] those allegations made within the four corners of the complaint” at the Rule 12(b)(6) stage). mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. The Court may “only consider those allegations made within the four corners of the complaint” or attachments to the complaint. Wilson v. Price, 624 F.3d 389, 391 n.1 (7th Cir. 2010);

see also Wright v. Associated Ins. Cos. Inc., 29 F.3d 1244, 1248 (7th Cir. 1994) (“[D]ocuments attached to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to his claim.”). ANALYSIS I. MISAPPROPRIATION OF TRADE SECRETS CLAIMS—COUNTS I AND II The Court first examines the plaintiff’s federal claim, which must survive for the Court to exercise supplemental jurisdictions over the plaintiff’s state law claims.

See 28 U.S.C. § 1367(c)(3). The plaintiffs bring two claims of misappropriation of trade secrets: Count I under the federal DTSA, 18 U.S.C. § 1831 et seq., and Count II under the ITSA, 765 ILCS 1065/1 et seq. (R. 1 at 28–30.) “Courts often analyze motions to dismiss DTSA and ITSA claims together because ‘the pertinent definitions of the two acts overlap.’” Aon PLC v. Infinite Equity, Inc., 19 C. 7504, 2021 WL 4192072, at *12 (N.D. Ill. Sept. 15, 2021) (quoting PrimeSource Bldg. Prods., Inc. v. Felton, No. 16 C

11468, 2017 WL 11500971, at *6 n.5 (N.D. Ill. July 6, 2017)). The Court therefore analyzes these two claims together.

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Hilco Diligence Services, LLC v. Sikich, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hilco-diligence-services-llc-v-sikich-llc-ilnd-2025.