IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
ZAGG, INC., ) ) Plaintiff, ) ) v. ) C.A. No. 2023-1275-KSJM ) DERMOT KEOGH and RFA BRANDS, ) LLC d/b/a MYCHARGE, ) ) Defendants. )
POST-TRIAL MEMORANDUM OPINION
Date Submitted: February 21, 2025 Date Decided: April 7, 2025
Stephen E. Jenkins, Samuel M. Gross, ASHBY & GEDDES, P.A., Wilmington, Delaware; Jeffrey B. Korn, WILLKIE FARR & GALLAGHER LLP, New York, New York; Counsel for Plaintiff ZAGG, Inc.
Thomas A. Uebler, Sarah P. Kaboly, MCCOLLOM D’EMILIO SMITH UEBLER LLC, Wilmington, Delaware; Counsel for Defendant Dermot Keogh.
McCORMICK, C. After working for ZAGG, Inc. for twelve years, Dermot Keogh left in November
2023. He went to work for myCharge, which makes products that compete with
ZAGG’s products. ZAGG brought this litigation against Keogh and myCharge,
claiming that Keogh’s employment with myCharge breached non-compete, non-
interference, non-disparagement, and confidentiality provisions of a restrictive
covenant agreement. MyCharge then fired Keogh, and ZAGG dismissed myCharge
from this lawsuit. Keogh denied ZAGG’s allegations but decided that litigation was
not worth it. He turned over documents to ZAGG that he found on his home computer
and waited out the restrictive period, which was one year. This litigation went into
a holding pattern. The restrictive covenant period expired. Two days later, Keogh
accepted work for another ZAGG competitor, PanzerGlass. ZAGG then sprung back
to life, threatened to sue PanzerGlass as it had myCharge, and argued that Keogh’s
restrictive covenants were tolled during this litigation. PanzerGlass fired Keogh. A
surprised and understandably frustrated Keogh asked for a prompt trial on the
merits, which the court granted. This post-trial decision finds in favor of Keogh on
all claims asserted by ZAGG.
I. FACTUAL BACKGROUND
The record comprises 161 joint trial exhibits, trial testimony from three fact
witnesses, deposition testimony from three fact witnesses, and 27 stipulations of fact
in the pre-trial order.1 These are the facts as the court finds them after trial.
1 This decision cites to: C.A. No. 2023-1275-KSJM docket entries by docket (“Dkt.”)
number; the trial exhibits (Dkt. 82) (cited by “JX” number); the trial transcript by page and line numbers (Dkt. 92) (cited as “Trial Tr.”); the transcripts of the depositions of Dermot Keogh, Daniel Allen, and Daniel Allred (Dkt. 80) (by the A. Keogh’s Employment History At ZAGG
ZAGG, Inc. (“ZAGG” or the “Company”) is a Delaware corporation based in
Utah that operates in the mobile accessories and technologies market.2 ZAGG hired
Dermot Keogh in May 2011. Keogh is an Irish citizen, and he was initially employed
at ZAGG’s Irish offices.3 He first worked as a social media manager, and later
assumed roles as product manager for ZAGG’s audio and screen protection products,4
and power bank products.5
ZAGG moved Keogh and his family to the United States in 2017, where Keogh
was a senior product manager for ZAGG’s main screen protection product.6
ZAGG promoted Keogh in 2023 to Associate Vice President of Product
Protection. He continued to focus on ZAGG’s screen protection and case product
lines.7 Keogh’s responsibilities included price negotiation, innovation, factory
management, delivery, customer relationships, and ZAGG’s program with partners
deponent’s last name and “Dep. Tr.”); and the Parties’ Joint Pre-Trial Order (Dkt. 74) (“PTO”). 2 PTO ¶¶ 4–5.
3 Trial Tr. at 5:1–6:2 (Keogh); PTO ¶ 7.
4 Trial Tr. at 5:22–23, 7:4–9 (Keogh).
5 Id. at 6:8–13, 7:10–19, 8:19–23 (Keogh).
6 Id. at 7:20–8:11 (Keogh).
7 Id. at 9:13–17 (Keogh); PTO ¶ 8.
2 such as Samsung, Motorola, and Google.8 At this time, Keogh’s manager was Patrick
Keenan, a Senior Vice President. Keenan was on the executive team; Keogh was not.9
B. The Restrictive Covenant Agreement
In connection with Keogh’s 2023 promotion, Keogh signed a restrictive
covenant agreement (the “Restrictive Covenant Agreement”).10 In exchange for
entering the agreement, Keogh received a pay increase, a title increase, and a
$100,000 retention bonus if he stayed at ZAGG through 2025.11 The Restrictive
Covenant Agreement prevents Keogh from engaging in “Competitive Activities” and
“Interfering Activities,” disparaging ZAGG, and misusing ZAGG’s confidential
information.12 The relevant text of the Restrictive Covenant Agreement is quoted
and discussed in the legal analysis.
C. ZAGG Denies Keogh A Promotion.
In August 2023, Keogh applied for a Head of Product Development role at
ZAGG.13 Although ZAGG’s human resources department received Keogh’s
application,14 his application was not seriously considered. 15 ZAGG’s Vice President
8 Trial Tr. at 9:18–10:6 (Keogh).
9 Id. at 10:7–12 (Keogh).
10 Id. at 12:18–20 (Keogh); JX-25 (“Restrictive Covenant Agr.”).
11 Trial Tr. at 13:7–14 (Keogh); PTO ¶ 9. Keogh entered into restrictive covenant agreements when he first started working for ZAGG in 2011 and when ZAGG moved him to the United States. Trial Tr. at 12:9–17 (Keogh). 12 Restrictive Covenant Agr. §§ 1, 3, 6.
13 Trial Tr. at 11:2–13, 47:9–19 (Keogh).
14 JX-29.
15 Trial Tr. at 48:8–11 (Keogh); id. at 204:14–205:9 (Allred).
3 of Human Resources, Daniel Allred, testified that he had a group of new recruiters
that stopped reviewing applications because there were several candidates far along
in the application process.16 Allred was unaware of Keogh’s application for weeks
until Keogh reached out to inquire about the status of hiring the position.17
Keogh was unhappy about ZAGG’s response to his application18 and began
looking for alternative employment. The same day that Keogh messaged Allred about
the Head of Product Development position, he texted his wife Jodee that he sent Tim
Smart a message and that he would “go” if Tim gave him “$250k, 25% Bonus, 5%
401k match and indemnification[.]”19 Tim Smart was Keogh’s former colleague at
ZAGG before he went to another mobile accessories company called Strax.20 Keogh
testified that he was not seeking a job at this time and that he was joking with his
wife about going to work for Smart,21 but the contemporaneous communications
suggest otherwise.
16 Id. at 204:14–205:3 (Allred).
17 Id. at 205:4–9 (Allred); JX-30 (8/29/23 Teams message from Keogh to Allred asking
for an update on the status of hiring a new Head of Product Development). 18 JX-30 (8/29/23 Teams message from Keogh to Allred: “I’m more than a little disappointed over the way this has panned out.”); Trial Tr. at 205:5–9 (Allred); id. at 48:6–14 (Keogh). 19 JX-159 at -091.
20 Trial Tr. at 53:14–17 (Keogh).
21 Id. at 55:1–7 (Keogh); id. at 75:11–20 (Keogh).
4 D. Keogh Downloads Documents To His Home Computer.
During the COVID-19 pandemic, Keogh began the practice of accessing his
ZAGG work documents on his home computer by remapping his OneDrive.22 Keogh
was unaware of any ZAGG policy preventing him from downloading company
documents to his home computer.23
A new iPhone launched in September 2023, which started a new work cycle for
Keogh.24 On September 11, 2023, the night before the iPhone launched, Keogh
downloaded approximately 17,000 files from ZAGG’s servers to his personal home
computer.25 Keogh testified that this download resulted from a communication error
between his computer and OneDrive.26 According to Keogh, he had to remap his
OneDrive to access his work documents, which caused all documents in his OneDrive
to download onto his home computer.27 Although Keogh remapped the documents on
September 11, 2023, Keogh testified that the information had been available on his
home computer since approximately March 2020, including from at least one prior
remapping.28
22 Id. at 14:11–15:10 (Keogh); Keogh Dep. Tr. at 25:6–12, 26:4–13.
23 Trial Tr. at 16:1–3 (Keogh).
24 Id. at 98:6–22 (Keogh); Keogh Dep. Tr. at 25:14–21, 154:5–13; see also JX-159
at -090 (8/29/23 message from Keogh to his wife sending an article titled: “Apple Sets Sept. 12 Date for Launch of iPhone 15, New Watches”); Trial Tr. at 17:15–18 (Keogh). 25 Trial Tr. at 15:11–13, 50:23–51:5 (Keogh); id. at 217:11–15 (Allred); PTO ¶ 14;
Keogh Dep. Tr. at 24:7–19. 26 Trial Tr. at 15:11–17 (Keogh); Keogh Dep. Tr. at 25:14–21.
27 Trial Tr. at 15:15–24, 51:3–5 (Keogh); Keogh Dep. Tr. at 25:14–29:4.
28 Trial Tr. at 15:3–13 (Keogh).
5 The same day that Keogh downloaded the 17,000 documents, he emailed a copy
of the Restrictive Covenant Agreement to Smart.29 Keogh testified that he could not
recall why he sent Smart the Restrictive Covenant Agreement, but the surrounding
events indicate that Keogh was looking for new employment.30
E. Keogh Starts A Job With MyCharge.
On September 19, 2023, former ZAGG CEO Chris Ahern introduced Keogh to
Ron Ferber, CEO of myCharge,31 a Michigan-based designer and distributor of
portable charging solutions.32 After their initial email correspondence, Keogh and
Ferber had a Zoom call and then met in person in Michigan to discuss Keogh’s
potential employment.33 Ferber inquired about Keogh’s restrictive covenants and
29 Trial Tr. at 53:8–13 (Keogh); JX-31 (9/11/23 email from Keogh to Smart, attaching
the Restrictive Covenant Agreement). 30 Compare Trial Tr. at 54:3–55:3 (Keogh), with JX-159 at -091 (8/29/23 message from
Keogh to his wife about sending Smart a message and that he would “go” if Smart gave him “$250k, 25% Bonus, 5% 401k match and indemnification”). 31 JX-32 at -061 (9/19/23 email from Ahern connecting Keogh and Ferber); Trial Tr.
at 17:21–18:10 (Keogh). 32 myCharge – Our Story, https://mycharge.com/pages/our-story (last visited April 4,
2025). 33 Trial Tr. at 18:11–17 (Keogh).
6 was hesitant to hire him.34 So Keogh consulted an attorney,35 and Keogh and Ferber
connected their respective counsel to discuss.36
On October 19, 2023, Ferber sent Keogh an offer letter for a position as Chief
Product Officer of myCharge,37 and Keogh accepted.38 Keogh submitted his letter of
resignation from ZAGG on October 26, 2023. His last day was November 9, 2023.39
F. Keogh Retains ZAGG Documents.
In preparation for Keogh’s departure from ZAGG, the Company’s interim CFO
reached out to Keogh to inquire about Company-owned equipment and property in
Keogh’s possession.40 Keogh testified that he returned everything on the list provided
to him by the Company that was still within his possession, but some items had been
destroyed from “drop testing”—a procedure used to evaluate how a product reacts to
being dropped.41 In the midst of his departure, Keogh forgot about the ZAGG
34 See JX-38 (10/4/23 messages between Keogh and his wife concerning Ferber and
his attorney having concerns about the Restrictive Covenant Agreement); JX-43 (10/13/23 messages between Keogh and his wife about Keogh hoping to “convince Ron [Ferber] to see the light” and that Ferber wanted to “part ways”). 35 Trial Tr. at 19:12–14 (Keogh); Keogh Dep. Tr. at 194:19–195:8; see JX-40 (10/9/23
email exchange between Keogh and his Utah attorney). 36 Keogh Dep. Tr. at 195:9–12; JX-40 (10/9/23 email from Keogh’s Utah attorney
stating that he “spoke with [Keogh’s] prospective employer’s attorney today”); JX-41 (10/9/23 emails between Keogh’s and Ferber’s attorneys); JX-123 (10/10/23 messages between Keogh and his wife about discussions between Ferber’s and Keogh’s attorneys). 37 JX-45.
38 Trial Tr. at 20:3–5 (Keogh).
39 JX-48.
40 JX-161 at -166.
41 Trial Tr. at 22:11–15 (Keogh).
7 documents on his home computer from the September 11 download.42 Keogh testified
that he had not used his home computer since leaving ZAGG because myCharge gave
him a laptop.43
In December 2023, when one of Keogh’s former ZAGG colleagues called him
with questions about ZAGG’s business, Keogh realized that the ZAGG documents
remained on his computer.44 Keogh testified that he intended to return the
documents to ZAGG, as he had done with ZAGG’s electronic equipment, and planned
to contact ZAGG to arrange their return.45
Around December 18, 2023, Allred, Allen, and Dow Shirley from ZAGG’s IT
department investigated Keogh’s September 11 document download.46 Shirley could
not ascertain the origin and frequency of this download with certainty.47
G. ZAGG Sues Keogh And MyCharge.
Before Keogh reached out to ZAGG to return the data on his home computer,
ZAGG filed this suit against Keogh and myCharge. ZAGG had been preparing for
42 Id. at 22:16–22 (Keogh).
43 Id. at 24:21–23 (Keogh).
44 Id. at 24:2–20 (Keogh).
45 Id. at 26:1–10 (Keogh).
46 See JX-75; JX-76.
47 See JX-76 at -309–10 (12/19/23 Teams messages from Shirley stating, “[t]he logs do
not provide the process that initiated the download” and “I can only go back 6 months”).
8 litigation even without knowing where Keogh was going—and, indeed, before Keogh
had resigned.48
ZAGG asserted claims for: breach of the non-compete, non-interference, non-
disparagement, and confidentiality provisions of the Restrictive Covenant
Agreement; misappropriation of trade secrets; unfair competition; unjust enrichment;
and tortious interference.49 After ZAGG filed suit, myCharge effectively cut off Keogh
from its business.50 Keogh and myCharge answered and denied ZAGG’s claims.51
H. MyCharge Fires Keogh.
On January 29, 2024, myCharge fired Keogh as part of a settlement with
ZAGG.52 In exchange, ZAGG dismissed its claims against myCharge.53 In the
settlement agreement with ZAGG, myCharge represented, among other things, that
it did not access, review, or obtain ZAGG data or files, or solicit ZAGG employees,
customers, or suppliers.54
48 JX-46; JX-47; JX-56 (10/29/23 email from Allen informing ZAGG’s IT department
that there was “a decent chance of litigation” and instructing them to monitor Keogh’s IT activity); see also Trial Tr. at 124:2–126:15 (Allen); Allen Dep. Tr. at 87:21–88:6; Allred Dep. Tr. at 97:10–12; PTO ¶ 18. 49 Dkt. 1.
50 Trial Tr. at 27:17–24 (Keogh).
51 Dkts. 9, 10.
52 JX-87; see also JX-120 (agreement between ZAGG and myCharge in which ZAGG
agreed to dismiss myCharge from this action within three business days of myCharge providing written notice to ZAGG that Keogh no longer worked for myCharge). 53 Dkt. 13.
54 JX-120.
9 I. Keogh Returns ZAGG Documents.
On February 5, 2024, the court entered the Joint Stipulation and Order
Governing Company Documents, which required Keogh to return to ZAGG all
Company Documents in his possession, custody, or control; to provide ZAGG with a
computer-useable copy of the documents; and to delete the documents from his
system and devices.55 Keogh worked with counsel and Parcels to fully comply and,
on February 12, 2024, provided ZAGG with an affidavit certifying compliance.56
J. Keogh Waits Out His Non-Compete.
After being fired from myCharge, Keogh sought alternative employment. 57
Keogh testified that he applied to over 140 jobs, but none of his applications were
successful.58 He and his wife used their savings to pay for this lawsuit, and he went
on unemployment benefits for six months.59 They suffered from anxiety and
depression and received medication and counseling.60
It was not entirely clear at this stage of the litigation what relief ZAGG was
seeking. ZAGG slow-rolled discovery. For example, the original case schedule
provided that the substantial completion deadline was June 7, 2024,61 but the parties
55 Dkt. 15.
56 Trial Tr. at 29:10–21 (Keogh); JX-93, JX-94.
57 JX-145 (Keogh discussing job interviews with a friend).
58 Trial Tr. at 33:11–18 (Keogh).
59 Id. at 33:19–34:3 (Keogh).
60 Id. at 40:2–17 (Keogh).
61 Dkt. 19.
10 did not enter a confidentiality stipulation—necessary for the exchange of confidential
discovery materials—until June 14, 2024.62 Keogh asserts that ZAGG sought to stay
the litigation.63 The parties rescheduled trial and entered an amended case schedule
on September 25, 2024.64
K. Keogh Accepts A Job With PanzerGlass After His Non-Compete Expires.
Instead of risking further escalation by ZAGG, Keogh sat out the remainder of
his non-compete. He found a job with PanzerGlass that he started shortly after his
non-compete expired.65
L. ZAGG Asserts A Tolling Claim To Keep Keogh Benched.
Four days before the expiration of Keogh’s non-compete, on November 5, 2024,
ZAGG filed a motion for leave to amend the complaint, seeking for the first time to
toll Keogh’s non-compete period.66 After Keogh opposed,67 ZAGG withdrew its filing
and stated that it would “promptly” replace the proposed amended complaint.68 Over
three weeks later, on December 6, 2024, ZAGG filed a Motion for Leave to File a
62 Dkt. 24.
63 Dkt. 96 (“Keogh’s Post-Trial Answering Br.”) at 13 (citing JX-118).
64 Dkt. 27.
65 Keogh had a meeting with PanzerGlass in November 2023. See JX-68. Keogh did not begin discussions about employment with PanzerGlass until much later in 2024 and did not begin working at PanzerGlass until approximately November 9, 2024. See JX-36; Trial Tr. at 36:10–16 (Keogh). 66 Dkt. 35.
67 Dkt. 40.
68 Dkt. 44.
11 Verified Second Amended and Supplemental Complaint, Motion for a Preliminary
Injunction, and Motion to Schedule a Preliminary Injunction and Reschedule the
Current Trial Date.69 The aim was to delay the trial (again).
M. PanzerGlass Fires Keogh.
ZAGG did not rush to refile its motion for leave to amend, but it did rush to
threaten Keogh’s new employer. On November 19, 2024, ZAGG, through counsel that
has lurked in the background throughout this case but never appeared, sent a letter
threatening PanzerGlass, stating:
In short, Keogh’s obligation not to work for any competitor in the mobile accessories market remains currently in effect. His employment with PanzerGlass, which sells screen protection for mobile devices in direct competition with ZAGG, is therefore a breach of this obligation. Given Keogh’s recent revelation that he is now working for PanzerGlass, ZAGG intends to seek leave to amend its complaint against Keogh and will seek appropriate relief from the Court.70
ZAGG knew this statement was false because it had just requested the court’s
permission to add such a tolling claim.71 As a direct result of ZAGG’s threats,
PanzerGlass fired Keogh.72 This mooted ZAGG’s motion for a preliminary injunction.
N. The Parties Go To Trial.
At the December 23, 2024 scheduling conference, the court ordered the parties
to go forward with the January trial dates given the court’s “extreme[] reticen[ce] to
69 Dkt. 48.
70 JX-108 at 1 (emphasis added).
71 Dkt. 48.
72 JX-74.
12 slow things down when doing so affects people’s livelihood, or at least have that
possibility[.]”73
On January 3, 2025, the court permitted ZAGG to amend its complaint and
add a tolling claim, noting that it would be an uphill battle for ZAGG given the
intuitive appeal of Keogh’s position.74 ZAGG filed its Second Amended Complaint on
January 13, 2025,75 which Keogh answered before trial. In his answer, Keogh also
counterclaimed for a declaratory judgment that his non-compete expired as of
November 9, 2024, and for tortious interference given ZAGG’s interference with
Keogh’s PanzerGlass employment.76 The court held a one-day trial on January 21,
2025.77 The parties completed post-trial briefing on February 21, 2025.
II. LEGAL ANALYSIS
ZAGG claims that Keogh breached the Restrictive Covenant Agreement and
misappropriated ZAGG’s trade secret information in violation of the Delaware
Uniform Trade Secrets Act.78 Keogh argues that the Restrictive Covenant Agreement
73 JX-112 at 12–13.
74 Dkt. 75 at 24.
75 Dkt. 67.
76 Dkt. 73.
77 Dkt. 87.
78 The Second Amended and Supplemental Verified Complaint also includes claims
for unfair competition and unjust enrichment. Because ZAGG did not dedicate any time during trial or in pre- or post-trial briefing to prove these claims, it has waived them. Emerald P’rs v. Berlin, 726 A.2d 1215, 1224 (Del. 1999) (“Issues not briefed are deemed waived.”).
13 is unenforceable and invalid, that ZAGG did not prove any of its claims of breach or
misappropriation, and that Keogh is entitled to attorneys’ fees and expenses.
A. Breach Of The Restrictive Covenant Agreement
ZAGG claims that Keogh breached the agreement by: (i) engaging in
Competitive Activities through his myCharge and PanzerGlass employment;
(ii) engaging in Interfering Activities; (iii) disparaging ZAGG; and (iv) misusing
ZAGG’s confidential information. ZAGG bore the burden of proving its claim for
breach of the Restrictive Covenant Agreement by a preponderance of the evidence,79
except that ZAGG must prove its entitlement to specific performance by clear and
convincing evidence.80
Keogh argues that the Restrictive Covenant Agreement is unenforceable and
invalid because it is overbroad in geographic scope, does not protect ZAGG’s
legitimate business interests, and fails a balancing of the equities. Keogh also denies
that he breached the terms of the Restrictive Covenant Agreement. Because ZAGG
failed to prove breach, this decision skips Keogh’s arguments concerning the
enforceability of the agreement.
79 See S’holder Representative Servs. LLC v. Gilead Scis., Inc., 2017 WL 1015621, at
*15 (Del. Ch. Mar. 15, 2017) (“To succeed at trial, Plaintiffs, as well as Counterclaim- Plaintiffs, have the burden of proving each element, including damages, of each of their causes of action against each Defendant or Counterclaim-Defendant, as the case may be, by a preponderance of the evidence.” (internal quotation marks and citation omitted)). 80 Cirrus Hldg. Co. v. Cirrus Indus., Inc., 794 A.2d 1191, 1201–02 (Del. Ch. 2001).
14 1. Competitive Activities
The Restrictive Covenant Agreement prevents Keogh from competing with
ZAGG (the “Non-Compete Provision”).
Section 6(a) states:
During the Non-Compete Period, I shall not, directly or indirectly, individually or on behalf of any person, company, enterprise, or entity, or as a sole proprietor, partner, shareholder, director, officer, principal, agent, or executive, or in any other capacity or relationship, engage in any Competitive Activities, within the United States or any other jurisdiction in which the Company Group is actively engaged in business.81
Section 6(c) defines “Competitive Activities” to mean the “design, manufacture,
marketing, sales, or distribution of accessories for consumer mobile electronic
devices” and “Non-Compete Period” as 12 months from the “anniversary of the date
of any termination of the Employment Period.”82
ZAGG claims that Keogh violated the Non-Compete Provision by working at
myCharge and PanzerGlass during the Non-Compete Period. The Non-Compete
Provision does not expressly prohibit Keogh from working for a competitor. Rather,
it prevents him from “directly or indirectly . . . engaging in any Competitive
Activities,” which is defined to include activities involving the “design, manufacture,
marketing, sales, or distribution of accessories for consumer mobile electronic
81 Restrictive Covenant Agr. § 6(a).
82 Id. § 6(c)(ii), (iv).
15 devices.”83 ZAGG thus bore the burden of proving that Keogh engaged in these
prohibited activities.
ZAGG did not prove that Keogh breached the Non-Compete Provision during
the short period he worked for myCharge. ZAGG argues that Keogh’s employment
at myCharge violated the Non-Compete Provision because myCharge operates in the
field of “accessories for consumer mobile electronic devices”84 and Keogh was hired as
myCharge’s “Chief Product Officer.”85 ZAGG argues that Keogh must have been—
even if only indirectly—engaging in Competitive Activities. ZAGG also points to a
handful of emails that Keogh had downloaded through the OneDrive mapping and
then forwarded to his myCharge email account, including a November 8, 2023 email
to a supplier in Hong Kong asking for information on a Kevlar phone case.86
None of this evidence demonstrates that Keogh engaged in Competitive
Activities while working at myCharge. ZAGG did not seek discovery from myCharge.
Keogh was the only percipient witness to testify concerning his work at myCharge.
83 Keogh makes a persuasive argument that the definition of “Competitive Activities”
would prevent him from doing something as attenuated from ZAGG’s business as working as a UPS driver or a cashier at a convenience store that sells chargers and cords (which presumably falls within the meaning of “distribut[ing]” accessories for consumer mobile electronic devices). Keogh’s Post-Trial Answering Br. at 23–24. This decision does not resolve the issue of whether ZAGG had a legitimate business interest in such restrictions. 84 See JX-153 (document titled “Competitive Products” showing two myCharge products as compared to ZAGG’s mophie products). 85 Trial Tr. at 20:12–14 (Keogh).
86 JX-134; JX-65.
16 According to Keogh, while at myCharge, he worked exclusively on a line of pet
products that did not include any “accessor for consumer mobile electronic device.”87
Tacitly conceding that it failed to prove actual competition, ZAGG cites to
Sorrento Therapeutics, Inc. v. Mack to argue that taking steps to prepare a product
to compete constitutes an activity indirectly competitive with ZAGG.88 The
restrictive covenant in Sorrento, however, restricted the defendant from “having any
Relationship” in which he engages in or assists any entity “directly or indirectly” on
“any activity” that is “directly or indirectly competitive” with the plaintiff’s product
“or any business related to” the plaintiff’s product.89 By contrast, the Non-Compete
Provision does not prohibit Keogh from “having a relationship” with myCharge.
ZAGG also did not prove that Keogh violated the Non-Compete Provision by
working for PanzerGlass. As support, ZAGG cites only to the fact that PanzerGlass
is a competitor. ZAGG made no effort to prove that Keogh designed, manufactured,
marketed, sold, or distributed accessories for consumer mobile electronic devices
while employed by PanzerGlass.
Keogh is entitled to judgment in his favor on ZAGG’s claims for breach of the
Non-Compete Provision relating to Keogh’s work for myCharge and PanzerGlass.
87 Trial Tr. at 19:15–20:2, 20:18–21:12 (Keogh).
88 Dkt. 94 (“ZAGG’s Post-Trial Opening Br.”) at 37 (citing Sorrento Therapeutics, Inc.
v. Mack, 2023 WL 5670689, at *19 (Del. Ch. Sept. 1, 2023)). 89 Sorrento, 2023 WL 5670689, at *19.
17 2. Interfering Activities
The Restrictive Covenant Agreement prevents Keogh from interfering with
ZAGG’s business (the “Non-Interference Provision”).
Section 6(b) states, “During the Non-Interference Period, I shall not, directly
or indirectly for my own account or for the account of any other individual or entity,
engage in Interfering Activities.”90
Section 6(c) defines “Interfering Activities” as
(A) encouraging, soliciting, or inducing, or in any manner attempting to encourage, solicit, or induce, any Person employed by, or providing consulting services to, any member of the Company Group to terminate such Person’s employment or services (or in the case of a consultant, materially reducing such services) with the Company Group; (B) hiring any individual who was employed by the Company Group within the six (6) month period prior to the date of such hiring; or (C) encouraging, soliciting, or inducing, or in any manner attempting to encourage, solicit, or induce, any Business Relation to cease doing business with or reduce the amount of business conducted with any member of the Company Group, or in any way interfering with the relationship between any such Business Relation and any member of the Company Group.91
Section 6(c) defines “Non-Interference Period” as 24 months from the
“anniversary of the date of any termination of the Employment Period.”92
ZAGG makes conclusory allegations that Keogh violated the Non-Interference
Provision, arguing that Keogh must have encouraged, solicited, and induced people
90 Restrictive Covenant Agr. § 6(b).
91 Id. § 6(c)(iii).
92 Id. § 6(c)(v).
18 employed by ZAGG to terminate their employment or services. ZAGG does not point
to any record evidence, instead arguing that Keogh engaged in spoliation and that
the court should “draw a reasonable inference these deleted communications would
provide further evidence of Keogh’s improper solicitation efforts.”93
ZAGG asserts that Keogh deliberately and systematically spoliated evidence
relevant to key issues and events in this litigation by deleting text messages.94 To be
entitled to such extreme sanctions, ZAGG must prove that Keogh “acted recklessly or
with the intent to deprive another party of the information’s use in the litigation”95
and that ZAGG suffered prejudice.96 “The party seeking to prove spoliation, for its
part, must identify specific documents that existed and would support its position; it
cannot make a vague and general complaint that evidence has been destroyed.”97
ZAGG’s argument flounders on the fact that Keogh’s deletion was of zero
consequence in this litigation. Keogh’s counsel later recovered the automatically
deleted text messages and produced them. ZAGG has not demonstrated that any
93 ZAGG’s Post-Trial Opening Br. at 38–39 (citing Gener8, LLC v. Castanon, 2023 WL
6381635, at *17 (Del. Ch. Sept. 29, 2023)). Gener8 is inapposite because the defendant only produced twelve text messages, and failed to produce text messages that the plaintiff otherwise acquired through discovery (and that constituted “the most damning evidence in the case” against the defendant). Gener8, LLC v. Castanon, 2023 WL 6381635, at *14 (Del. Ch. Sept. 29, 2023), judgment entered, (Del. Ch. 2023). 94 Id. at 64.
95 Goldstein v. Denner, 310 A.3d 548, 583 (Del. Ch. Jan. 26, 2024) (citing Ct. Ch. R.
37(e)(2)). 96 Id.
97 Seibold v. Camulos P’rs LP, 2012 WL 4076182, at *23 (Del. Ch. Sept. 17, 2012).
19 relevant WhatsApp or WeChat messages existed and that Keogh intentionally
deleted them. This is not reckless behavior with an intent to deprive. There is no
document that should have been preserved and produced but was destroyed. ZAGG
has not suffered prejudice.98 ZAGG has not demonstrated that sanctions or adverse
inferences are warranted concerning its claims under the Non-Interference Provision
or otherwise.
Keogh is entitled to judgment in his favor on ZAGG’s claim to enforce the Non-
Interference Provision.
3. Disparagement
The Restrictive Covenant Agreement prevents Keogh from disparaging ZAGG
(the “Non-Disparagement Provision”).
Section 6(d) states:
I agree that during the Employment Period, and at all time thereafter, I will not make any disparaging or defamatory comments regarding any member of the Company Group or its respective current or former directors, officers, employees or shareholders in any respect or make any comments concerning any aspect of my relationship with any member of the Company Group or any conduct or events which precipitated any termination of my employment from the Company. However, my obligations under this subsection (d) shall not apply to disclosures required by applicable law, regulation, or order of a court or governmental agency. Further, nothing in this Agreement prohibits me from speaking with law enforcement, the Equal Employment Opportunity
98 Trial Tr. at 180:7–183:4 (Allen).
20 Commission, any state or local division of human rights or fair employment agency, or my attorney.99
ZAGG spent zero time addressing its disparagement claim at trial. In post-
trial briefing, ZAGG cites four text messages not discussed at trial where Keogh
expressed frustrations over this litigation to friends.
In a December 2023 exchange with former ZAGG team member Edward Li,
Keogh described the Restrictive Covenant Agreement as “harsh.”100 When Li, who
signed a similar agreement, said that no one pointed out the covenants to him, Keogh
responded: “Slimy pricks.”101 That was the worst of it. The rest of the exchange
includes chatter about non-competes.
In a January 2024 exchange with someone named Vince Fontaine, Keogh said
that he left ZAGG “in November. Place went soooo toxic. Wouldn’t wish working
there on my worst enemy..New CEO a psychopath.”102
In a February 2024 exchange with someone named Francois Gravel, Keogh
informed Gravel that he was unemployed. In speaking about the CEO, Keogh states
that Allen “[r]uined [Keogh’s] career, hurt [his] family, and tarnished [his]
reputation” and that if he “had money [he’d] counter.”103 Keogh sent Gravel the terms
99 Restrictive Covenant Agr. § 6(d).
100 JX-122.
101 Id.
102 JX-85.
103 JX-89 at -655.
21 of the Non-Compete Provision so Gravel could “run it by a buddy of [his] which is
Canada’s leading labour lawyer[.]”104
In a February 2024 exchange with someone named Edgar Guzman, Keogh
informed Guzman about the lawsuit, Keogh’s termination from myCharge, and
Keogh’s efforts to find alternative employment.105 Keogh criticizes Allen’s strategy of
“hiring big expensive guys to try to fix [mophie,]” including “2x Apple guys
recently.”106 Keogh states that Allen “accused [him] of downloading files[,]” [s]pread
awful rumors around CES about [Keogh] and hurt [his] reputation.”107 Keogh calls
Dan “an unbelieve POS.”108
These texts are not very nice. Nor are they terribly scandalous. Are they
disparaging or defamatory? The parties did not brief the legal standard. And it does
not matter because ZAGG has not identified any harm or damages resulting from
Keogh’s statements. ZAGG asserts that Keogh’s “ongoing pattern of conduct [is]
designed to damage ZAGG.”109 But ZAGG “do[es] not explain, or attempt to prove,
any measure for these damages.”110
104 Id.
105 JX-91 at -620.
106 Id.
107 Id. at -621.
108 Id.
109 ZAGG’s Post-Trial Opening Br. at 39.
110 Kuramo Cap. Mgmt., LLC v. Seruma, 2024 WL 1888216, at *39 (Del. Ch. Apr. 30,
2024).
22 If ZAGG seeks injunctive relief on this claim, which is unclear, under Section
9 of the Restrictive Covenant Agreement and based on ZAGG generally seeking
injunctive relief for (presumably all of) Keogh’s purported breaches, ZAGG “fail[s] to
explain what form this would take.”111 ZAGG articulates no basis on which it has
been damaged by Keogh’s conduct or will suffer irreparable harm. Indeed, ZAGG’s
CEO could not identify any lost business, customers, or employees as a result of
Keogh’s conduct, including because ZAGG did not seek discovery on this issue.112
ZAGG has failed to prove its claim for breach of the Non-Disparagement
Provision.
4. Confidential Information
The Restrictive Covenant Agreement restricts Keogh’s use of confidential
information and requires Keogh to return confidential information on the termination
of his employment (the “Confidentiality Provisions”).113
111 Id. The cases on which ZAGG relies in support of its argument that Keogh contractually stipulated that ZAGG would be irreparably harmed in the event of breach do not involve non-disparagement claims and involved stronger facts. See Martin Marietta Materials, Inc. v. Vulcan Materials Co., 68 A.3d 1208 (Del. 2012) (upholding the trial court’s factual finding of irreparable injury based on violations of a non-disclosure agreement and a confidentiality agreement); Vitalink Pharmacy Servs., Inc. v. Grancare, Inc., 1997 WL 458494 (Del. Ch. Aug. 7, 1997) (finding irreparable harm based on a violation of a non-competition agreement, including based on the factual record). Furthermore, because Section 9 references only the Non-Compete and Non-Interference Periods, this provision alone does not relieve ZAGG of its burden to prove the elements of the Non-Disparagement claim. 112 Trial Tr. at 180:7–189:24 (Allen).
113 Restrictive Covenant Agr. §§ 1(a), 3.
23 Section 1(a) requires that Keogh “hold in confidence, and not to use, except for
the benefit of the Company Group, or to disclose to any person, firm, corporation, or
other entity without prior written authorization of the Company, any Confidential
Information that [he] obtain[s] or create[s].”114
Section 1(a) defines “Confidential Information” as “information that the
Company Group has developed, acquired, created, compiled, discovered, or owned or
will develop, acquire, create, compile, discover, or own, that has value in or to the
business of the Company Group.”115 “Confidential Information” also includes:
any and all non-public information that relates to the actual or anticipated business and/or products, research, or development of the Company Group, or to the Company Group’s technical data, trade secrets, or know-how, including, but not limited to, research, product plans, or other information regarding the Company Group’s products or services and markets, customer lists, and customers (including, but not limited to, customers of the Company Group on whom I called or with whom I may become acquainted during the Employment Period), software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, finances, and other business information disclosed by the Company Group either directly or indirectly in writing, orally, or by drawings or inspection of premises, parts, equipment, or other Company Group property.116
Section 3 governs “Returning Company Group Documents.” Through it, Keogh
agreed:
114 Id. § 1(a).
115 Id.
116 Id.
24 that, at the time of termination of my employment with the Company for any reason, I will deliver to the Company (and will not keep in my possession, recreate, or deliver to anyone else) any and all Confidential Information, Third Party Information and all other documents, materials, information, and property developed by me pursuant to my employment or otherwise belonging to the Company and, if so requested, will certify in writing that I have fully complied with the foregoing obligation. I agree further that I will not copy, delete, or alter any information contained upon my Company computer or Company equipment before I return it to the Company. In addition, if I have used any personal computer, server, or e-mail system to receive, store, review, prepare or transmit any Company information, including but not limited to, Confidential Information, I agree to provide the Company with a computer-useable copy of all such Company information and then permanently delete and expunge such Company information from those systems; and I agree to provide the Company access to my system as reasonably requested to verify that the necessary copying and/or deletion is completed.117
ZAGG claims that Keogh violated the Confidentiality Provisions by
downloading documents that fit the definition of “Confidential Information” to his
home computer on September 11, 2023, forwarding it to his personal and myCharge
email addresses, and failing to return the documents upon his termination.
ZAGG focuses on the September 11 document remapping, but Keogh
convincingly explained that at trial. Keogh explained why and how the remapping
occurred, that he was not aware of it when he left ZAGG, and what he did once he
realized he retained the documents.118 There is no evidence of a policy that prevented
117 Id. § 3.
Trial Tr. at 14:11–17:1 (Keogh). ZAGG presented evidence to suggest that the 118
download could not have been from a remapping from the Company’s HR coordinator, Daniel Allred. Trial Tr. at 216:8–221:3 (Allred). But Allred is not an IT expert, and
25 him from downloading the documents in the first place.119 At trial, ZAGG pointed to
several ZAGG policies regarding the use of ZAGG data, but none prohibited Keogh
from remapping the documents.120 ZAGG witnesses could not say one way or another
whether Keogh had ZAGG’s permission to use his personal devices,121 whether ZAGG
enforces that policy,122 or whether ZAGG tracks approvals.123 The remapping alone
did not breach the Confidentiality Provisions.
Nor is there evidence that Keogh disclosed any Confidential Information.
Keogh testified that he never disclosed ZAGG confidential information to myCharge,
Panzer, or anyone else.124 In January 2024, myCharge said the same.125
The reality is that ZAGG did not try hard to prove its claim for breach of the
Confidentiality Provisions. That is not a criticism. That was not an attorney error;
ZAGG had high quality attorneys representing it. Rather, ZAGG did not try because
it was a rational business decision not to bust the bank prosecuting a former employee
who was waiting out his restrictive covenant period at home on unemployment.
ZAGG’s CEO Allen did not run from this reality in his deposition and trial
his testimony alone is insufficient to prove ZAGG’s claim. Furthermore, messages from ZAGG’s IT employee, Dow Shirley, demonstrate that the source initiation and frequency of Keogh’s download were uncertain. See JX-76 at -309–10. 119 Trial Tr. at 16:1–3 (Keogh); id. at 223:19–224:4 (Allred). 120 Id. at 209:15–212:9, 223:19-224:4 (Allred). 121 Id. 223:15–18 (Allred). 122 Id. 227:24–229:16 (Allred). 123 Id. 229:11–16 (Allred). 124 Id. at 26:11–19 (Keogh). 125 JX-120 ¶ 2(a).
26 testimony.126 Having made the rational decision not to prove an essential element of
its case, it should be no surprise that ZAGG failed to meet its burden of proof.
ZAGG did not prove that Keogh breached the Confidentiality Provisions of the
Restrictive Covenant Agreement.
B. Misappropriated Trade Secrets
Under the Delaware Uniform Trade Secrets Act, a trade secret is:
information, including a formula, pattern, compilation, program, device, method, technique or process, that:
a. Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and
b. Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.127
To prove trade secret misappropriation, the plaintiff must demonstrate that:
(1) a trade secret exists; (2) the plaintiff communicated the secret to the defendant;
(3) there was an express or implied understanding that the secrecy of the matter
would be respected; and (4) the secret information was improperly used or disclosed
to the injury of the plaintiff.128
ZAGG fails to prove multiple elements of its trade secret misappropriation
claim. For starters, ZAGG failed to prove that the Company files Keogh possessed
126 Allen Dep. Tr. at 30:18–31:10; Trial Tr. at 177:5–8, 177:14–17 (Allen). 127 6 Del. C. § 2001.
128 Elenza, Inc. v. Alcon Lab’ys Hldg. Corp., 183 A.3d 717, 721 (Del. 2018).
27 constitute protectable trade secrets. ZAGG proffers the conclusory assertion that the
files at issue “represent a trove of proprietary documents” that “would be a goldmine
to any ZAGG competitor[.]”129 But Allen could not identify a trade secret in the
documents Keogh had on his home computer.130
In its post-trial brief, ZAGG points to the Customer ASP spreadsheet as a trade
secret131 but does not explain how that spreadsheet falls within the meaning of “trade
secret” under the statute. That is, ZAGG does not explain how it has “independent
economic value . . . from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value from
its disclosure or use[.]”132 ZAGG only points to Allen’s testimony that “[n]obody
outside the company would know what prices [ZAGG has] negotiated for [its] key
products.”133 ZAGG could have presented an expert to elaborate on the industry
standard and practice with respect to customer pricing in the consumer mobile
electronic accessories industry. Allen’s testimony alone is not sufficient to establish
a trade secret.
ZAGG also failed to prove that the allegedly secret information was improperly
used or disclosed to the injury of ZAGG. ZAGG has offered no evidence demonstrating
129 ZAGG’s Post-Trial Opening Br. at 52–53.
130 Trial Tr. 176:1–177:17 (Allen); Allen Dep. Tr. at 101:12–102:6.
131 ZAGG’s Post-Trial Opening Br. at 53.
132 6 Del. C. § 2001.
133 ZAGG’s Post-Trial Opening Br. at 54.
28 that Keogh shared any ZAGG information with myCharge (or anyone).134 Instead,
ZAGG asks the court to rely on “a web of perhaps ambiguous circumstantial evidence
from which the trier of fact may draw inferences which convince him that it is more
probable than not that what plaintiffs allege happen did in fact take place.”135
The circumstantial evidence in the Utilisave case on which ZAGG relies was
stronger than the record here. There, the download occurred on equipment that was
the property of another competitor business. Here, the download occurred on Keogh’s
home computer while he was still employed by ZAGG (and ZAGG has not offered
sufficient evidence that the Company prohibited home computer use). As another
example, the plaintiffs hired a forensic IT specialist to delete information from the
competitor company computer and see if any copies were made. Here, ZAGG made
no efforts to see if any copies were made of the downloaded information. Last, the
court found the defendant’s testimony concerning the download not credible because
it was refuted by more credible testimony. As explained above, that is not the case
here.
To save its trade secret misappropriation claim, ZAGG again asserts that
Keogh engaged in spoliation and the court should infer the deleted communications
would have provided incriminating evidence.136 But Keogh explained his practice of
deleting iPhone messages (but not from his iCloud) and is unaware of any relevant
134 Trial Tr. at 26:11–19 (Keogh); id. at 173:8–177:2 (Allen).
135 ZAGG’s Post-Trial Opening Br. at 55 (quoting Utilisave, LLC v. Khenin, 2015 WL
4920078, at *11 (Del. Ch. Aug. 18, 2015)). 136 ZAGG’s Post-Trial Opening Br. at 57–58.
29 messages that were permanently deleted and not recoverable.137 And ZAGG has not
put forth any evidence disproving that explanation. In fact, there is evidence that
ZAGG engaged in deletion of relevant discovery materials.138 The court denies
ZAGG’s request to make reasonable inferences that incriminating evidence exists,
particularly where ZAGG made little to no effort to seek discovery to prove its claims.
ZAGG has failed to prove its trade secret misappropriation claim.
C. Attorneys’ Fees
Both sides seek their attorneys’ fees. ZAGG seeks attorneys’ fees under 6 Del.
C. § 2004 in connection with its trade secret claims. Because ZAGG did not prove
that claim, ZAGG is not entitled to fees. Keogh also seeks attorneys’ fees under 6 Del.
C. § 2004, arguing that ZAGG litigated the trade secret misappropriation claim in
bad faith.139 Keogh also argues that he is entitled to attorneys’ fees under the bad-
faith exception to the American Rule.140
137 Trial Tr. at 99:1–20 (Keogh) (testifying about JX-26, a text message between Allen
and John Habbouch, ZAGG’s former CFO, containing a Teams message that ZAGG did not produce stating, “We had Dermot terminated from MyCharge, and everyone in the industry knows that, so we’ve shown that we are serious about protecting our business. But at what point will our customers feel that the things we are doing have shifted from simply protecting our business to us trying to destroy someone’s livelihood[?]”). 138 Id. at 153:2–156:2 (Allen).
139 Keogh’s Post-Trial Answering Br. at 54–57 (citing 6 Del. C. § 2004).
140 Id. at 57–59. Delaware follows the “American Rule,” which provides that each party is generally expected to pay its own attorneys’ fees regardless of the outcome of the litigation. Montgomery Cellular Hldg. Co. v. Dobler, 880 A.2d 206, 227 (Del. 2005) (citing Goodrich v. E.F. Hutton Gp., Inc., 681 A.2d 1039, 1043 (Del. 1996)).
30 Both of Keogh’s arguments ask the court to determine whether ZAGG litigated
in bad faith, so the following analysis addresses both arguments. There is no single,
comprehensive definition of “bad faith,” but courts have previously awarded
attorneys’ fees where “parties have unnecessarily prolonged or delayed litigation,
falsified records or knowingly asserted frivolous claims.”141 “The bad faith exception
is applied in ‘extraordinary circumstances’ as a tool to deter abusive litigation and to
protect the integrity of the judicial process.”142
ZAGG failed to prove its claims.143 And ZAGG did not put much effort in trying
to prove its claims. But ZAGG’s litigation conduct did not rise to the level of bad faith
necessary to support fee shifting.
III. CONCLUSION
For the foregoing reasons, judgment is entered in favor of Keogh. Counsel shall
submit a form of order implementing this decision within one week. Keogh seeks
permission to proceed with his tortious interference claim at a later stage in this
action or through another action.144 In connection with submitting a form of order
implementing this decision, counsel shall submit their positions on Keogh’s
outstanding tortious interference claim within one week.
141 Montgomery, 880 A.2d at 227 (quoting Johnston v. Arbitrium (Cayman Islands)
Handels AG, 720 A.2d 542, 546 (Del. 1998)). 142 Id.
143 BecauseZAGG failed to prove that Keogh breached the Restrictive Covenant Agreement, ZAGG’s tolling arguments are moot. 144 Keogh’s Answering Br. at 58.
31 32