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Plaintiff Network Systems Architects (“NSA”)
previously employed Defendant Dimitruk as director of
sales. In connection with his employment, Dimitruk
allegedly had access to confidential information
concerning current and prospective customers. Following
his departure from NSA, Dimitruk accepted employment
with Defendant Accunet and made sales to several
businesses that had formerly been NSA customers. NSA
sued Dimitruk for misappropriation, breach of fiduciary
duty and duty of loyalty, intentional interference with
contractual relations, and conversion. NSA also brought
an intentional interference claim against Accunet, along
with a claim for violation of G.L. c. 93A. All parties
moved for summary judgment.
The Court held there were issues of fact
on elements of Plaintiff’s case including that “it
possessed non-public information of value to its
business; that it took reasonable steps to preserve the
secrecy of that information; that Dimitruk used or
disclosed that information for his benefit or that of
Accunet, and that it has been harmed as a result.”
Id. at *7. NSA’s evidence of harm was only weakly
connected to Defendant’s alleged misconduct. Plaintiff’s
complaint reflected “an unrealistically broad assertion
of trade secrets, encompassing virtually all information
about NSA’s business, as well as its customers and
vendors.” Id. On the other hand, Plaintiff had
evidence suggesting that Dimitruk transferred files from
an NSA laptop to an Accunet laptop and that he attempted
to hide the contents of both computers from Plaintiff
during discovery.
On the claim for breach of fiduciary
duty, the Court observed that “[e]mployees occupying
positions of trust and confidence owe a duty of loyalty
to their employer and must protect the interests of the
employer.” Id. at *8. But |
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“that duty ends when the employment ends;
once the employment relationship has terminated, the
former employee’s only duty to the former employee is to
refrain from misappropriation of trade secrets.” Id.
Most of Plaintiff’s breach of duty allegations focused
on Dimitruk’s post-employment conduct; their success
therefore would depend upon the success of the
underlying misappropriation claims. The remaining
allegations, however, were based on disputed facts
concerning Dimitruk’s conduct while employed at NSA.
The Court also declined to enter summary
judgment for either side with respect to Plaintiff’s
claims for conversion and violation of c. 93A. However,
the Court did enter summary judgment for Defendants on
Plaintiff’s claim for intentional interference with
contractual relations. This claim required NSA to prove
that “(1) [it] had a contract with a third party; (2)
the Defendant knowingly induced the third party to break
that contract; (3) the Defendant’s interference, in
addition to being intentional, was improper in motive or
means; and (4) the Plaintiff was harmed by the
Defendant’s actions.” Id. at *9. But in this
case, “NSA has offered no evidence to show that any
contract it had with any third party was breached at
all, let alone at Dimitruk’s or Accunet’s urging.”
Id.
As a final matter, the Court imposed
sanctions upon Dimitruk for spoliation of evidence –
Dimitruk had deleted files from his laptop with the
apparent purpose of preventing discovery of those files
by NSA. The Court declined to enter judgment in favor of
NSA as a remedy, in part because NSA’s evidence on the
merits was not strong. Instead, the Court dismissed
Defendants’ counterclaims and ordered Defendants to pay
the fees and costs incurred by Plaintiff as a result of
the spoliation.
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