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Robert Half International, Inc v. Theodore M. Stout

September 23, 2011

ROBERT HALF INTERNATIONAL, INC., PLAINTIFF,
v.
THEODORE M. STOUT, DEFENDANT.



The opinion of the court was delivered by: Sue E. Myerscough, U.S. District Judge:

Clerk, U.S. District Court, ILCD

OPINION

This matter comes before the Court on Robert Half International, Inc.'s Emergency Ex Parte Motion for Temporary Restraining Order and Preliminary Injunction (d/e 4) (Motion). For the reasons that follow, the Motion is GRANTED IN PART.

BACKGROUND

Yesterday, Plaintiff Robert Half International, Inc. filed a Verified Complaint for Injunctive and Other Relief (d/e 1) (Complaint) against its former employee, Defendant Theodore M. Stout. The Complaint alleges a violation of the Computer Fraud and Abuse Act (CFAA) (18 U.S.C. § 1030), as well as state law claims under the Illinois Computer Crime Prevention Law (720 ILCS 5/16D-1) and for breach of contract. Plaintiff seeks a Temporary Restraining Order (TRO) requiring Defendant to return a laptop computer and security fob assigned to him for work purposes.

The Complaint (signed under penalty of perjury by its corporate counsel) explains that Plaintiff is a staffing firm that provides temporary and permanent professionals in various fields. In June 2011, Defendant was hired as a consultant by Plaintiff to provide information technology services to one of Plaintiff's clients, Wells Fargo Services. Defendant signed an employment agreement, which provided for "at-will" employment terminable at any time by either party. The agreement also required Defendant to maintain the confidentiality of trade secret and prohibit the disclosure of confidential information he received from Plaintiff or the client during the course of employment. Additionally, the agreement required Defendant to return, when the assignment ended, all "information, data, and other materials supplied by or obtained from Client," and copies thereof.

On August 29, 2011, Plaintiff placed Defendant on assignment with Wells Fargo. Wells Fargo issued Defendant a laptop, which contained "proprietary, confidential[,] and trade secret information." The assignment did not last long. On September 9, 2011, Plaintiff notified Defendant that the assignment was terminated effective immediately. Since that date, Plaintiff has demanded the return of the laptop and the security fob, but Defendant has refused. Based on e-mail exchanges attached to the Complaint, Defendant apparently believes that Plaintiff and Wells Fargo have committed fraud and discrimination against him. In the e-mails, Defendant also stated that he has turned over the computer to an attorney, and Defendant believes that the computer contains "relevant information for a racial discrimination case." What concerns Plaintiff, among other things, is that Defendant also stated, "I have already sta[r]ted posting [about] this online. All information and emails will be published online."

Plaintiff asks for a temporary restraining order requiring Defendant to: (1) return the laptop and security fob; and (2) refrain from disseminating or using any trade secret or confidential information.

Today at 1:30 PM, the Court conducted an ex parte hearing via telephone. Counsel for Plaintiff was present. Neither Defendant nor counsel for Defendant were present, even though Plaintiff informed Defendant via email that the hearing would be taking place and of the phone number Defendant (or his counsel) could use to call into the hearing if so desired.

Plaintiff has filed two certifications pursuant to Federal Rule of Civil Procedure 65(b)(1)(B). The first certification explains that Plaintiff is unable to obtain a current mailing or physical address for Defendant because he refuses to provide the address. The first certification also explains the risk Defendant may divulge or disseminate trade secrets, proprietary, and confidential information contained on the laptop if he is notified of the hearing. The second Rule 65(b)(1)(B) certification explains that Plaintiff's counsel emailed Defendant a notification of the hearing at an email address counsel had previously used to correspond with Defendant. The Court finds Plaintiff has sufficiently attempted notice and that at this time notice to Defendant would create the risk that Defendant would disclose the confidential and proprietary information which would be irreparable. Once notice is given to Defendant, he may apply to dissolve the TRO as described below.

JURISDICTION AND VENUE

This Court has subject matter jurisdiction because Plaintiff's CFAA claims are based on a federal statute. See 28 U.S.C. § 1331. Section 1030(g) of the CFAA provides for federal civil actions alleging a CFAA violation, so long as the conduct involves one of the first four subclauses in § 1030(c)(4)(A)(1). The only possible candidate in this case is subclause (I), which requires "loss" aggregating at least $5,000 in value. Under the CFAA, "loss" includes "any reasonable cost to any victim, including the cost of responding to the offense . . . ." § 1030(e)(11). Plaintiff alleges over $5,000 in costs "in assessing the scope of the damages" and in "attempting to recover" the laptop. That is a sufficient allegation for jurisdictional purposes, which does not require likelihood of success on the claim itself. See Back Doctors Ltd. v. Metropolitan Property and Casualty, 637 F.3d 827, 829 (7th Cir. 2011) (discussing analogous diversity-jurisdiction issue). The Court has jurisdiction over the remaining state claims pursuant to its supplemental jurisdiction.

See 28 U.S.C. ยง 1367(a). Personal jurisdiction exists because the Defendants' actions took place in Illinois. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980) (personal jurisdiction exists where a defendant "'purposefully avail[ed] itself of the privilege of conducting activities'" in the forum state)(quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)). Venue exists because Defendant resides in Champaign, Illinois, which is in this judicial district and a substantial ...


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