Titan Cloud Software, LLC v. Moore

CourtDistrict Court, M.D. Tennessee
DecidedDecember 12, 2024
Docket3:24-cv-00400
StatusUnknown

This text of Titan Cloud Software, LLC v. Moore (Titan Cloud Software, LLC v. Moore) is published on Counsel Stack Legal Research, covering District Court, M.D. Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Titan Cloud Software, LLC v. Moore, (M.D. Tenn. 2024).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION

TITAN CLOUD SOFTWARE, LLC, ) ) Plaintiff, ) ) v. ) ) Case No. 3:24-cv-00400 CLAY MOORE, ) Judge Aleta A. Trauger ) Defendant, ) ) And ) ) PROTEAN VENTURES, LLC, ) ) Intervenor. )

MEMORANDUM Before the court is defendant Clay Moore’s Motion for Partial Dismissal (Doc. No. 27), seeking dismissal of three of the six claims set forth in plaintiff Titan Cloud Software, LLC’s Complaint (Doc. No. 1): (1) intentional interference with business relationships and/or prospective business advantage (Count II); (2) common law unfair competition (Count III), and (3) violation of the Tennessee Consumer Protection Act (“TCPA”) (Count VI). The motion is supported by a Memorandum of Law. (Doc. No. 28.) The plaintiff opposes the motion (Doc. No. 33), and the defendant has filed a Reply (Doc. No. 34). For the reasons set forth herein, the motion will be granted in part and denied in part. I. LEGAL STANDARDS The defendant’s motion seeks dismissal of claims based on Rule 12(b)(6) of the Federal Rules of Civil Procedure. A motion to dismiss pursuant to Rule 12(b)(6) tests the legal sufficiency of the complaint. RMI Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125, 1134 (6th Cir. 1996). Such a motion is properly granted if the plaintiff has “fail[ed] to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6); Marvaso v. Sanchez, 971 F.3d 599, 605 (6th Cir. 2020). To survive a motion to dismiss, a complaint must allege facts that, if accepted as true, are sufficient to state a claim to relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S.

544, 555–57 (2007); see also Fed. R. Civ. P. 8(a)(2). A complaint has “facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556). The complaint need not contain “detailed factual allegations,” but it must contain more than “labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Twombly, 550 U.S. at 555 (2007). A complaint that “tenders ‘naked assertions’ devoid of ‘further factual enhancement’” will not suffice. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 557). In ruling on a motion to dismiss under Rule 12(b)(6), the court must “construe the complaint in the light most favorable to the plaintiff, accept all well-pleaded factual allegations in

the complaint as true, and draw all reasonable inferences in favor of the plaintiff.” Courtright v. City of Battle Creek, 839 F.3d 513, 518 (6th Cir. 2016). II. FACTS AND PROCEDURAL HISTORY Plaintiff Titan Cloud Software, LLC (“Titan”) is a Tennessee limited liability company in the business of developing and marketing software for environmental compliance, advanced fuel analytics, and facility management. (Doc. No. 1 ¶ 1.) Clay Moore was employed by Titan from 2008 through April 2021 as Senior Product Manager. (Id. ¶ 6.) He is now employed as Chief Product Officer by intervenor Protean Ventures, LLC (“Protean”), a direct competitor of Titan. (Id. ¶¶ 2, 38, 39.) The plaintiff alleges, in a nutshell, that it has a basis for believing that Moore is violating non-competition and non-disclosure agreements with Titan and sharing Titan’s confidential and trade secret information with his new employer. (Id. ¶¶ 62–63. 65.) It asserts that “it is impossible for Moore to serve as Chief Product Officer without using the confidential information and trade secrets he learned at Titan.” (Id. ¶ 64.) As a basis for its belief that Moore is now sharing trade secrets and confidential information

with Protean, Titan alleges that, during Moore’s employment with Titan, he signed many agreements, including a Confidentiality and Non-Competition Agreement (“Titan Agreement”). (Id. ¶ 7; see also Doc. No. 1-1.) He resigned from Titan in 2021 to work for a direct competitor, Leighton O’Brien (“LOB”), as a Senior Director of Product Management, in connection with which Moore signed a Resignation Agreement and Release with Titan (the “Titan Release”) and an employment agreement with LOB containing confidentiality obligations to his new employer (“LOB Agreement”). (Doc. No. 1 ¶¶ 19, 25; see also Doc. No. 1-2 (Titan Release); Doc. No. 1-3 (LOB Agreement).) Titan acquired LOB in the Fall of 2023, while Moore was still employed by LOB, as a result of which Moore again became a Titan employee, and Titan, as LOB’s successor in interest, acquired the rights to the LOB Agreement and all of LOB’s trade secrets. (Doc. No. 1

¶¶ 27–31.) A few months later, in December 2023, Moore resigned (again) from Titan and went to work for Protean. (Id. ¶ 38.) Titan alleges that, after Moore left, it discovered that Moore had violated his confidentiality and non-competition agreements with Titan, even before leaving Titan to work for LOB. (Id. ¶ 46.) For example, he had shared Titan’s confidential contract with other LOB employees, providing confidential customer and pricing information to LOB. (Id. ¶¶ 48–51.) He also allegedly (“upon information and belief”) “caused LOB to incorporate Titan Confidential Information into Alarm (a[n] LOB software product) because this product shows marked similarities with the Titan Edge platform.” (Id. ¶ 53.) He is also alleged to have solicited Titan customers and shared confidential Titan information with Titan customers during the twelve-month non-compete period set forth in the Titan Release, thereby breaching the Titan Release as well as other agreements he signed with Titan during his first period of employment by Titan. (Id. ¶¶ 55–61.) The plaintiff also alleges that, “after Moore began acting as Protean’s Chief Product Officer, Protean’s website

began touting new software functionality that closely resembles Titan’s features” (id. ¶ 63), from which Titan apparently infers that Moore shared Titan’s protected intellectual property with Protean. Titan asserts claims against Moore for (1) breach of contract; (2) intentional interference with business relationships and/or prospective business advantage; (3) common law unfair competition; (4) violation of the Tennessee Uniform Trade Secrets Act (“TUTSA”), Tenn. Code Ann. § 47-25-1701, et seq.; (5) violation of the federal Defend Trade Secrets Act, 18 U.S.C. § 1836(b)(1); and (6) violation of the TCPA, Tenn. Code Ann. § 47-18-104(b)(1). Moore now seeks dismissal of Counts II, III, and VI on the basis that the claims are preempted by the TUTSA or otherwise fail to state claims for which relief may be granted.

III. DISCUSSION A. Count II: Intentional Interference with Business Relations The defendant asserts that Count II, for intentional interference, is preempted by the TUTSA.

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Titan Cloud Software, LLC v. Moore, Counsel Stack Legal Research, https://law.counselstack.com/opinion/titan-cloud-software-llc-v-moore-tnmd-2024.