Open Text Corp. v. Grimes

262 F. Supp. 3d 278
CourtDistrict Court, D. Maryland
DecidedJune 26, 2017
DocketCivil Action No.: RDB-17-1248
StatusPublished
Cited by13 cases

This text of 262 F. Supp. 3d 278 (Open Text Corp. v. Grimes) is published on Counsel Stack Legal Research, covering District Court, D. Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Open Text Corp. v. Grimes, 262 F. Supp. 3d 278 (D. Md. 2017).

Opinion

MEMORANDUM OPINION

Richard D. Bennett, United States District Judge

Plaintiff Open Text Corporation brings this action against its former employee, defendant Steven Grimes, and Grimes’ new employer, defendant Nuxeo Corporation, seeking injunctive and monetary relief based on defendants’ alleged violations of the federal Defend Trade Secrets Act, 18 U.S.C. §§ 1836-39 et seq., the Maryland Uniform- Trade Secrets • Act, Md. Com. Law § 11-1201 et seq., and several common law causes of action. (EOF No. 1.) The gravamen of Open Text’s Complaint is that Grimes wrongfully downloaded thousands of Open Text computer files containing the company’s confidential and proprietary trade- secrets; that - Grimes transferred these files to his new employer, Nuxeo, a direct competitor of Open Text; that Nuxeo has used Open Text’s proprietary data to solicit Open .Text’s clients; that Grimes and Nuxeo have improperly solicited Open Text employees to leave that company and begin working for Nuxeo;. and that Open Text already has lost clients, business opportunities, arid reveiiué as a result' of these actions. (Id.) See also EOF Nos. 8,10, 32.

Now pending before this Court is defendants Steven Grimes, and Nuxeo Corporation’s Motion to Dismiss the Complaint or, in the Alternative, to -Stay Any Claim Not Dismissed (“Defendants’ Motion”). (EOF No. 31.) Defendants’ Motion, framed under Rule 12(b)(6), is premised on their view that this Court is forum non coveniens based on a forum selection clause com tained in Grimes’ “Employee Confidentiality, Non-Solicitation, and Invention Assignment Agreement” with Open Text. (ECF No. 31-2.) This Court has already held Motions Hearings- on May 11, 2017 and June. 7,. 20l7, as more fully discussed, infra. This Court has reviewed .the parties’ submissions, and no additional hearing on [280]*280the subject Motion to Dismiss is necessary. For the reasons stated below, Defendants’ Motion (ECF No. 31) is DENIED.

Plaintiffs pending Motion for Temporary Restraining Order or, in the Alternative, for Preliminary Injunction (“Motion for TRO/PP) (ECF No. 8) will be addressed promptly, and a Scheduling Order will be issued in this case.1

BACKGROUND

I. Open Text’s Complaint and Preliminary Motions

On May 5, 2017, plaintiff Open Text Corporation filed a ten count Complaint against its former employee, Steven Grimes, and Grimes’ new employer, Nuxeo Corporation, alleging, inter alia, violations of the federal Defend Trade Secrets Act (“DTSA”), 18 U.S.C. §§ 1836-39 et seq., violations of the Maryland Uniform Trade Secrets Act (“MUTSA”), Md. Com. Law § 11-1201 et seq., breach of contract, and breach of fiduciary duty. (ECF No. 1.)

Plaintiff Open Text Corporation (“plaintiff’ or “Open Text”) is a Canadian corporation with principal place of business in Waterloo, Ontario, Canada. (ECF No. 1 at ¶7.) Open Text is a software company specializing in enterprise information management (“EIM”), Digital Asset Management (“DAM”), and consulting services, and works with an array of businesses and organizations around the world. (Id.) Plaintiff employs over 3,300 American workers and maintains over thirty offices in the United States, including one located in Gaithersburg, Maryland. (ECF No. 41 at 9, 29-30.)

Defendant Nuxeo Corporation (“defendant” or “Nuxeo”) is a Delaware corporation with principal place of business in Brooklyn, New York. (ECF No. 1 at ¶ 9.) Nuxeo is a software company specializing in the provision of enterprise content management (“ECM”) platforms and solutions for organizations around the world. (Id. at ¶ 10.) Nuxeo is a direct competitor of Open Text. (Id.)

Defendant Steven Grimes (“defendant” or “Grimes”) is a former employee of Open Text who resides in Clarksville, Maryland. (ECF No. 1 at ¶ 11.) Until March 31, 2017, Grimes worked for Open Text out of his home office and at the company’s Gaithers-burg, Maryland office. (Id. at ¶92; ECF No. 41 at 10.) Grimes’ relationship with Open Text dates to 1999, when he was employed by corporations which Open Text subsequently acquired. (Id. at ¶¶ 66-67.) Shortly after Grimes began working for Open Text itself, on September 7,2004, he executed an “Employee Confidentiality, Non-Solicitation and Invention Assignment Agreement — Development” (the “Grimes Agreement”) with Open Text. (Id. at ¶ 68.) A copy of the Agreement is attached to the Complaint. (ECF No. 1-2.) The Agreement provided, inter alia, that Grimes would “keep confidential and hold in secrecy” Open Text’s confidential information for a period of three years following the end of his employment; that he would not publish or share any confidential information; and that he would not solicit or attempt to solicit other employees to leave Open Text for a period of six months following his termination. (ECF No. 1 at ¶ 69-71.) The Agreement also contains a forum selection clause (“FSC”) which provides that:

“This agreement and all the rights and obligations arising herefrom shall be interpreted and applied in accordance with the laws of the Province of Ontario and [281]*281in the courts of the Province of Ontario there shall be exclusive jurisdiction to determine all disputes relating to this Agreement and all the rights and obligations created thereby. I hereby irrevocably attorn to the jurisdiction of the courts of the Province of Ontario.”

(Grimes Agreement-§ V(D), ECF No. 1-2 at 4.)

During the over twelve years that Grimes worked for Open Text, he was promoted, most recently, in September 2015, to the position of Vice President, Solutions Consulting, Americas. (ECF No. 1 at ¶ 73.) In this role, Grimes led Open Text’s North America Solutions Consulting Presales Team and had access to Open Text’s Confidential Information and Trade Secrets, as well as Open Text’s Salesforce customer database. (Id. at ¶¶ 74-77.)

As alleged in the Complaint, the actions giving rise to the instant case began on March 20, 2017, when Grimes sent an email announcing his resignation from Open Text, with his last date of work to be' March 31, 2017.2 (ECF No. 1 at ¶ S3.) Grimes sent his resignation letter at 4:22 p.m. on that day. (Id. at ¶ 85.) Earlier in the day, however, from 1:30 p.m. to 3:46 p.m., Grimes accessed hundreds of confidential and proprietary Open Text files. (Id. at ¶ 88.) Among the files which Grimes accessed were Open Text’s “Process Play” and “Sales Play” files.- (Id.) These files, Open Text alleges, contain its most closely-held consulting - and sales proposals and are a core part of Open Text’s sales and business strategy. (Id. at ¶¶ 37-46.) These proposals are developed through extensive labor on the part of Open Text personnel, taking four to fourteen months to complete before presentation to the prospective clients.- (Id. at ¶ 46.) The sales and consulting packages sold by Open Text can generate tens of millions of dollars in revenue. (Id.)

Having already accessed hundreds of sensitive and confidential files on March 20, Grimes against accessed hundreds more files, including nearly 200 unpublished Process Play files and 400 published Process Play files, on his last day of work, March 31, 2017. (ECF No.

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262 F. Supp. 3d 278, Counsel Stack Legal Research, https://law.counselstack.com/opinion/open-text-corp-v-grimes-mdd-2017.