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Lakeview Technology, Inc. v. Vision Solutions

January 9, 2007

LAKEVIEW TECHNOLOGY, INC., PLAINTIFF,
v.
VISION SOLUTIONS, INC., STEPHEN MASSEY, AND ALLAN CAMPBELL, DEFENDANTS.



The opinion of the court was delivered by: Marvin E. Aspen, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff Lakeview Technology, Inc. ("Lakeview") brings eight counts against defendants Vision Solutions, Inc. ("Vision"), Stephen Massey ("Massey"), and Allan Campbell ("Campbell"), relating to an alleged campaign on the part of Defendant Vision to induce Plaintiff's employees to breach their employment contracts and misappropriate Plaintiff's protected information. Plaintiff's claims are as follows: Count I, tortious interference with contract against Vision and Massey; Count II, breach of contract against Campbell; Count III, tortious interference with contract against Vision and Massey; Count IV, misappropriation of trade secrets against Vision and Massey; Count V, conversion against Vision and Massey; Count VI, aiding and abetting and/or inducing a breach of fiduciary duty against Vision and Massey; Count VII, violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030, against Vision and Massey; Count VIII, civil conspiracy against Vision, Massey, and Campbell.

Before us is Massey's motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction and Campbell's motion to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(2) for lack of personal and subject matter jurisdiction. Alternatively, Campbell moves to dismiss Count II under Rule 12(b)(6) for failure to state a claim, and for a more definite statement of Count VIII under Rule 12(e). For the reasons set forth below, we grant both defendants' motions to dismiss for lack of personal jurisdiction. Campbell's remaining motions are denied as moot.

BACKGROUND

Plaintiff Lakeview is a Delaware corporation with its principal place of business in Oakbrook Terrace, Illinois. (Compl. ¶ 5.) Lakeview develops and supports "information availability software," technology which provides continuous access to information during scheduled system maintenance or when a computing system unexpectedly shuts down. (Id. at ¶ 6.) Because the software must "interact seamlessly with various hardware and software components," Lakeview relies heavily on partnerships with hardware and software providers. (Id. at ¶ 15.) Through those partnerships, Lakeview receives "invaluable technical information" that ensures that its products remain compatible with and compliment the latest generations of hardware and software components. (Id.) Additionally, these partnerships increase demand and broaden the channels of distribution for Lakeview's software, making them vital to its "worldwide sales network." (Id. at ¶ 16.) On average, Lakeview devotes 12 months to developing each partner or customer relationship, and spends in excess of $10 million annually doing so. As a result of this investment, Lakeview enjoys"notable partner and customer loyalty. (Id. at ¶ 17.) Lakeview's relationship with its partners relies heavily on its ability to maintain the confidentiality of the information that it receives, particularly as it relates to its partners' prospective customers. (Id. at ¶ 18.)

Defendant Vision, a direct competitor of Lakeview, is a Delaware corporation with its principal place of business in Irvine, California. (Compl. ¶¶ 7-8.) All of Lakeview's claims center around Vision's alleged campaign to misappropriate Lakeview's trade secrets and confidential information. (Id. at ¶ 2.) Over the past few years, Vision has repeatedly hired Lakeview's sales executives, who then assume the same position and sales territories that they formerly managed at Lakeview. (Id.) By hiring these employees, Vision has -- according to Lakeview -- taken its confidential information and trade secrets and attempted to use them to gain a competitive advantage. (Id.) Additionally, Lakeview alleges that some of these former employees provided Vision with Lakeview's marketing materials, allowing it to copy those materials and misappropriate Lakeview's marketing strategies. (Id. at ¶¶ 57-59.)

Defendants Massey and Campbell are two of the former Lakeview employees that Vision has hired. Massey, a resident and citizen of Texas, is a former senior sales executive for Lakeview, but left to serve as Vision's Vice President of Worldwide Sales. (Compl. at ¶¶ 9-10, 56.) Campbell, a resident and citizen of Australia, is a former Lakeview consultant responsible for marketing and selling Lakeview's products in the Asia Pacific region, and currently serves as Vision's Vice President for Sales in the Asia/Pacific region. (Id. at ¶¶ 11-12.)

Lakeview retained Campbell, under a consulting agreement, to market and sell its products and services in the in the Asia Pacific region. (Compl. ¶ 4.) Pursuant to that agreement, Lakeview entrusted Campbell with access to confidential information regarding its products, marketing strategies, business partners, and customers. (Id.) It included restrictive covenants that prohibited Campbell from "perform[ing] services . . . for any competitor of Lakeview," and from retaining or using Lakeview's confidential information. By joining Vision, Lakeview alleges, Campbell has breached those covenants. (Id.) Further, Lakeview claims that Vision and Massey had knowledge of the Consulting Agreement, and tortiously interfered with it by inducing Campbell to so breach his obligations. (Id. at ¶¶ 72-74.)

Lakeview also alleges that -- after joining Vision -- Massey induced both Campbell and Eric Robinson ("Robinson"), its former Vice President of Sales and Marketing, to breach their contracts with Lakeview, and to misappropriate Lakeview's confidential information and trade secrets. (Id. at ¶¶ 2, 19.)*fn1 In his position at Lakeview, Robinson was responsible for knowing, amassing, and safeguarding detailed, sensitive information about Lakeview, its products and pricing, the industry, and its network of customers and business partners. (Compl. ¶¶ 3, 19-28.) Robinson had an employment agreement with Lakeview, under which he agreed that, for one year after his employment with Lakeview ended, he would not "participate in or be engaged directly or indirectly anywhere in the world where [he] actively participated to generate business for Lakeview . . . in any Competitive Business, whether as owner, partner[], director, shareholder, consultant, agent, employee, co-venturer, or otherwise." (Id.) Additionally, Robinson agreed that he would not, for one year following his employment with Lakeview, "solicit or accept on behalf of another or attempt to entice away from Lakeview (i) any customer of Lakeview . . . or (ii) any prospective customer of Lakeview." (Id.)

Robinson announced his resignation in May 2005, assuring Lakeview that he was retiring from the software industry altogether. (Compl. ¶ 3.) When rumors surfaced that he was going to join Vision, he "specifically and adamantly" denied them when confronted by Lakeview. (Id. at ¶ 36.) However, Robinson immediately began working for Vision after leaving Lakeview. (Id. at ¶ 3.) Lakeview alleges that this deceit was part of an agreement between Robinson, Vision, and Massey to conceal Robinson's employment at Vision, so that he could continue to work at Lakeview in the interim and gain access to valuable information. (Id. at ¶¶ 38-40.) Specifically, Lakeview alleges that Vision knew and approved of Robinson's alleged lies, and that Massey instructed Vision's human resources department not to publicly or internally (within Vision) announce Robinson's hiring. (Id. at ¶ 38-41.) As a result, Lakeview allowed Robinson to continue working, attend annual sales meetings, and access its sales and marketing plans for the coming year. (Id. at ¶¶ 46-48.) During that time period, Robinson accessed dozens of Lakeview reports maintained on confidential sales databases (Id. at ¶ 49.)

STANDARD OF REVIEW

In a motion to dismiss under Federal Rule of Civil Procedure 12(b)(2), plaintiff bears the burden of showing a prima facie case of personal jurisdiction. Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). See also RAR, Inc. v. Turner Diesel, Ltd., 101 F.3d 1272, 1276 (7th Cir.1997). In determining whether we have personal jurisdiction over the defendant, we may receive and consider affidavits and other materials submitted by the parties. See Turnock v. Cope, 816 F.2d 332, 333 (7th Cir.1987), superceded by statute on other grounds as stated in FMC Corp. v. Varonos, 892 F.2d 1308, 1310 (7th Cir.1990). For purposes of a motion to dismiss based on personal jurisdiction, we "accept all allegations of the complaint as true except those controverted by defendants' affidavits." Northwestern Corp. v. Gabriel Mfg. Co., No. 96 C 2004, 1996 WL 73622, at *2 (N.D. Ill. Feb. 6, 1996). Where the defendant submits an affidavit contesting personal jurisdiction, "the plaintiff must go beyond the pleadings and submit affirmative evidence supporting the existence of jurisdiction." Purdue, 338 F.3d at 783. We resolve all factual disputes in the record in plaintiff's favor, but we may accept as true those facts presented in defendant's affidavit that remain uncontested. Id.; RAR, 107 F.3d at 1275.

DISCUSSION

I. Defendant Massey's Motion ...


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