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Brunswick Corporation v. Thorsell

United States District Court, N.D. Illinois, Eastern Division

April 21, 2014

BRUNSWICK CORPORATION, Plaintiff,
v.
JON THORSELL, Defendant.

MEMORANDUM OPINION

CHARLES P. KOCORAS, District Judge.

This matter comes before the Court on the motion of Defendant Jon Thorsell ("Thorsell") to dismiss the complaint brought by Plaintiff Brunswick Corporation ("Brunswick") pursuant to Federal Rule of Civil Procedure 12(b)(3). For the reasons set forth below, the motion to dismiss, or in the alternative, to transfer the case to the United States District Court for the Central District of California, Western Division is denied.

BACKGROUND

The following well-pleaded allegations are derived from Brunswick's complaint, and the Court accepts them as true for the purposes of the instant motion. Brunswick is headquartered and has its principal place of business in Illinois. Thorsell is a California resident who worked for Life Fitness, a division of Brunswick, between 1983 and 1991, and then from 1996 until November 20, 2013. His last position at Life Fitness before termination was as Vice President of Sales-Western Region, which included Illinois. During the entire time Thorsell worked for Life Fitness, he maintained an office out of his home in San Clemente, California and only traveled to Illinois for business purposes. In his position, Thorsell was privy to confidential and proprietary information about Life Fitness.

On May 29, 1998, Thorsell signed a non-compete and confidentiality agreement (the "Non-Compete Agreement") restricting his work with a competitor for no more than twenty-four months. He also agreed to an Illinois choice-of-law provision and acknowledged that "the Company's headquarters and principal place of business is located [in] Illinois and that harm to the Company that results from any violation of this Agreement will occur [in] Illinois, and, therefore, the State of Illinois has a legitimate interest in the Company's rights protected by this Agreement." Finally, Thorsell agreed not to disclose Life Fitness's trade secrets or confidential information to any third party, both during and after his employment.

After an investigation in October 2013, Brunswick discovered that Thorsell had been providing at least one hotel customer with significant product discounts in exchange for hundreds of thousands of dollars, which is a direct violation of Life Fitness's policies. Thorsell had been disciplined for similar activity in 2004. To obtain this credit, the quotations had to have gone through Life Fitness's headquarters, where the equipment would then be ordered, and manufactured in Illinois and Minnesota. On November 20, 2013, Brunswick terminated Thorsell.

At the time the complaint was filed, the laptop was still in Thorsell's possession. In its response, Brunswick provides supplemental facts which include that after receiving and investigating the contents of the laptop, Life Fitness discovered signs of data destruction, including: (i) missing documents which should be on the laptop; (ii) a synched hard drive linked to an Apple desktop computer (Thorsell owns an Apple desktop computer); (iii) six hidden files created by an Apple Mac computer; (iv) an empty hard drive where user settings, files, history, and generally-found artifacts are usually found; and (v) no deleted files suggesting that the files were wiped. On December 23, 2013, over 1, 500 files were deleted and their file names stripped while the laptop was powered off. All this new evidence suggests to Brunswick that Thorsell has Life Fitness's trade secrets and confidential information in his possession and may be sharing it with his new employer.

On December 26, 2013 Brunswick filed a complaint against Thorsell for: (i) breach of fiduciary duty (Count I); (ii) breach of the Non-Compete Agreement (Count II); and a violation of the Illinois Uniform Trade Secret Act, 765 ILCS § 1065/1 (Count III). Brunswick seeks injunctive relief, monetary damages, and punitive damages, plus costs and expenses.

On January 23, 2014, Thorsell moved to dismiss the complaint for improper venue pursuant to Federal Rule of Civil Procedure 12(b)(3) and 28 U.S.C. § 1391, or in the alternative, to transfer the case to the United States District Court for the Central District of California, Western Division.

LEGAL STANDARD

Rule 12(b)(3) provides that a party may move to dismiss an action when it is not filed in the proper venue. Fed.R.Civ.P. 12(b)(3). The plaintiff bears the burden of establishing proper venue. See Int'l Travelers Cheque Co. v. BankAmerica Corp., 660 F.2d 215, 222 (7th Cir. 1981). When ruling on a 12(b)(3) motion, the Court must take the allegations in the complaint as true unless they are contradicted by affidavits, draw all reasonable inferences in favor of the plaintiff, and resolve factual disputes in the plaintiff's favor. Nagel v. ADM Investor Servs., Inc., 995 F.Supp. 837, 843 (N.D. Ill. 1998). If venue is improper, the Court "shall dismiss [the case], or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought." 28 U.S.C § 1406(a).

DISCUSSION

I. Motion to Dismiss Under 12(b)(3)

Thorsell first argues that this Court should dismiss Brunswick's complaint under 12(b)(3) because it fails to provide a proper basis for venue in the Northern District of Illinois ...


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