Power Equipment Maintenance, Inc. v. Airco Power Services, Inc.

953 F. Supp. 2d 1290, 36 I.E.R. Cas. (BNA) 207, 2013 WL 3422779, 2013 U.S. Dist. LEXIS 91484
CourtDistrict Court, S.D. Georgia
DecidedJune 28, 2013
DocketCase No. CV413-55
StatusPublished
Cited by10 cases

This text of 953 F. Supp. 2d 1290 (Power Equipment Maintenance, Inc. v. Airco Power Services, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Power Equipment Maintenance, Inc. v. Airco Power Services, Inc., 953 F. Supp. 2d 1290, 36 I.E.R. Cas. (BNA) 207, 2013 WL 3422779, 2013 U.S. Dist. LEXIS 91484 (S.D. Ga. 2013).

Opinion

ORDER

WILLIAM T. MOORE, JR., District Judge.

Before the Court are Defendants’ Motion to Dismiss or Transfer Venue (Doc. 14) and Plaintiffs Motion for Temporary Restraining Order (Doc. 12). For the following reasons, Defendants’ motion is GRANTED and Plaintiffs complaint is DISMISSED. Should Plaintiff desire, it shall have fourteen days from the date of this order to file an amended complaint. In addition, Plaintiffs Motion for Temporary Restraining Order is DENIED.

[1292]*1292BACKGROUND

This case involves classic allegations by an employer that former high-ranking employees misappropriated confidential information, solicited customers, and poached employees in connection with their move to a direct competitor.1 (Doc. 1 ¶ 1.) Plaintiff Power Equipment Maintenance, Inc. (“PEM”)2 provides maintenance and support services to customers engaged in the generation of electricity. (Id. ¶ 2.) Both Defendants Onofry and Burrows3 were employed by Plaintiff: Defendant Onofry as Executive .Vice President of Turbine Services for approximately two years (id. ¶ 11), while Defendant Burrows’s held the position of Vice President of Maintenance Services for the same period of time (id. ¶ 12). Based on their positions within Plaintiffs organizational structure, Defendants Onofry and Burrows had access to Plaintiffs confidential information and trade secrets, such as financial information, pricing and bidding strategies, profit margins, customer contacts and preferences, and marketing strategies. (Id. ¶ 13.) In short, Plaintiff alleges that these Defendants had access to all of its confidential information and trade secrets. (Id. ¶ 15.)

Sometime beginning around the summer of 2011, Plaintiff identified AIRCO Industrial Services, Inc. (“AIRCO I”) as a potential acquisition. (Id. ¶ 15.) As a result, Defendant Onofry was involved in both researching AIRCO I and negotiating the terms of any acquisition. (Id. ¶ 16.) By the fall of 2011, however, Plaintiff ceased its pursuit of AIRCO I, having been unable to successfully negotiate agreeable terms for an acquisition. (Id. ¶ 17.)

Subsequently, AIRCO I was purchased by the private equity firm Azalea Capital, which employed Plaintiffs founder and former President, Keith Ravan. The company was then divided into two separate entities, Defendants AIRCO Power Services, Inc. (“AIRCO Power”) and AIRCO Industrial Services, Inc. (“AIRCO Industrial”), both of which are owned by the same holding company. (Id. ¶ 25.) According to Plaintiff, however, Defendants Onofry and Burrows decided to leave Plaintiffs employ and join AIRCO I sometime prior to Azalea Capital acquiring AIRCO I. (Id. ¶ 26.) Moreover, Plaintiff contends that Defendants Onofry and Burrows, despite having earlier decided to leave for AIRCO I, waited until November 21, 2012 to announce their resignations. (Id. ¶ 28.)

Plaintiff alleges that, between the time Defendants Onofry and Burrows decided to leave its employ and actually announced their intentions, they surreptitiously accessed and acquired Plaintiffs confidential information and trade secrets for use during their employment with AIRCO I. For example, Plaintiff contends that Defendant Onofry emailed Defendant Burrows a copy of Plaintiffs Steam/Gas Turbine Service Five Year Strategy Plan so that AIRCO I would have a competitive advantage over Plaintiff. (Id. ¶¶ 31-33.) Also, Plaintiff claims, that Defendant Burrows sent, from his work account to his personal account, an email containing key information regarding one of its customers. (Id. ¶¶ 34-36.)

[1293]*1293Plaintiff also contends that, after Defendant Burrow’s November 21, 2012 resignation, he continued to steal confidential information despite his computer access being strictly limited. (Id. ¶ 40.) In this regard, Plaintiff alleges that Defendant Burrows solicited one of its customers by sending an email from his work account informing the customer that he was leaving for AIRCO I. (Id. ¶¶ 41-42.) In addition, Plaintiff claims that, following the revocation of his access, Defendant Burrows directed an PEM administrative assistant to print a draft contract between PEM and one of its largest clients, which contained information as to PEM’s staffing, compensation policies, and profit margins. (Id. ¶ 43.) According to Plaintiff, Defendants Onofry and Burrows acted on behalf of Defendants AIRCO Power and AIRCO Industrial, who encouraged, condoned, or ratified their actions. (Id. ¶ 48.)

Plaintiff also contends that, after leaving its employ, Defendant Burrows logged into a database of turbine industry information and upcoming business opportunities using Plaintiffs login credentials. (Id. ¶ 49.) Plaintiff pays a subscription for access to. this database, which can be used to identify potential customers. (Id. ¶ 50.) Finally, Plaintiff alleges that since Defendant Burrows’s departure, he has continuously solicited its customers, directly resulting in the loss of one client and millions of dollars in lost revenue. (Id. ¶¶ 53-55.)

Plaintiff maintains that it takes reasonable measures to protect the confidentiality of its information. (Id. ¶¶ 56-61.) For example, Plaintiff’s high level employees, who have access to particularly sensitive information, are required to enter into nondisclosure agreements. (Id. ¶ 58.) Those documents most dear to Plaintiff are marked “confidential.” (Id. ¶ 59.) In addition, Plaintiffs email system automatically appends a confidentiality notice to all outgoing emails, stating that the email may contain confidential information not intended for public disclosure. (Id. ¶ 60.) Finally, Plaintiff employs a variety of other security measures, including passwords, security time-outs, training, and segregation of confidential information. (Id. ¶ 61.)

On March 8, 2013, Plaintiff filed its complaint in this Court. (Doc. 1.) In the complaint, Plaintiff brings claims against all Defendants for violations of the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030, tortious interference with business relations, misappropriation of trade secrets, and conspiracy. (Id.) Also, Plaintiff alleges that Defendants Onofry and Burrows breached the duty of loyalty owed by employees to their employers, and that Defendants AIRCO Power, AIRCO Industrial, and Onofry aided and abetted the breach of loyalty. (Id.) Later, Plaintiff filed a Motion for Temporary Restraining Order (Doc. 12), seeking to prevent Defendants from using any misappropriated trade secrets and prohibiting them from contacting any of Plaintiff’s customers or employees.

On March 29, 2013, Defendants filed a Motion to Dismiss or Transfer Venue. (Doc. 14.) In this motion, Defendants argue that Plaintiff failed to allege a cause of action under the CFAA, (Id. at 4-14.) In this regard, Defendants contend that Burrow’s and Onofry’s actions are not violations of the CFAA because they were authorized to access that information. They reason that the CFAA only creates a cause of action for wrongfully accessing the information, not the wrongful use of that information. (Id. at 4-12.) In addition, Defendants maintain that Plaintiff has failed to adequately plead the appropriate damage or loss required under the CFAA. (Id.

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953 F. Supp. 2d 1290, 36 I.E.R. Cas. (BNA) 207, 2013 WL 3422779, 2013 U.S. Dist. LEXIS 91484, Counsel Stack Legal Research, https://law.counselstack.com/opinion/power-equipment-maintenance-inc-v-airco-power-services-inc-gasd-2013.