Advanced Fluid Sys., Inc. v. Kevin Huber, Insysma (Integrated Sys. & Mach., LLC
| Decision Date | 06 June 2017 |
| Docket Number | CIVIL ACTION NO. 1:13-CV-3087 |
| Parties | ADVANCED FLUID SYSTEMS, INC., Plaintiff v. KEVIN HUBER, INSYSMA (INTEGRATED SYSTEMS AND MACHINERY, LLC), LIVINGSTON & HAVEN, LLC, CLIFTON B. VANN IV, and THOMAS AUFIERO, Defendants |
| Court | U.S. District Court — Middle District of Pennsylvania |
(Chief Judge Conner)
Plaintiff Advanced Fluid Systems, Inc. ("AFS") brings this action against a former employee and several competitors asserting claims for misappropriation of trade secrets, breach of fiduciary duty, and aiding and abetting said breach. AFS moves for judgment pursuant to Federal Rule of Civil Procedure 56 on each of its claims. (Doc. 156). Also before the court are cross-motions for summary judgment filed by defendants Integrated Systems and Machinery, LLC, Livingston & Haven, LLC, Clifton B. Vann IV, and Thomas Aufiero. (Docs. 171, 175).
AFS is a Pennsylvania corporation that distributes, manufactures, and installs hydraulic components for engineering projects. (Doc. 165 ¶ 2). Defendant Kevin Huber ("Huber") was employed at AFS as a full-time sales engineer between November 2006 and October 2012. (Doc. 169 ¶ 2). Huber left his position at AFS after incorporating his own firm, Integrated Systems and Machinery, LLC ("Integrated Systems"), in October 2012. (Id. ¶¶ 5, 181). This litigation arises from events circumambient to Huber's departure.
In September 2009, AFS entered into a three-year contract with the Virginia Commonwealth Space Flight Authority ("the Authority") to build and maintain equipment for the NASA rocket launch facility on Wallops Island, Virginia. (Id. ¶ 6). AFS designed, engineered, and installed a hydraulic and control launch system for the Authority at Wallops Island. . The system, referred to as theTeleporter/Erector/Launcher Hydraulic System ("Hydraulic System"), is comprised of many constitutent parts, including a component known as the "strongback." (Id. ¶¶ 6-7). The strongback is the platform that carries rockets in a horizontal position to the launch pad. (Id. ¶ 7). A pair of "gripper arms" secure the rocket against the strongback. (Id. ¶ 111; see, e.g., Doc. 166-15). The Hydraulic System then lifts the rocket and strongback from a horizontal position to a vertical position and holds the rocket in place for launch. (Doc. 169 ¶ 7).
Orbital Sciences Corporation ("Orbital") launches its Antares rocket from Wallops Island using the Hydraulic System designed and installed by AFS. (Id. ¶ 6). The Antares rocket services and supplies the International Space Station. (See id.) Huber became aware of the Hydraulic System project and introduced AFS's management team to it through his friend and Orbital engineer Keith Fava ("Fava"). (Id. ¶ 15). Huber was intimately involved with the Hydraulic System project from its inception, and he was the main point of contact between AFS and Orbital. (Id. ¶¶ 16-18). Indeed, Orbital employees considered Huber to be the de facto manager of the project. (Id.)
AFS supplied the Authority with a comprehensive package of engineering drawings generated during design and installation of the Hydraulic System. (Id. ¶¶ 12-13). Pursuant to the contract between AFS and the Authority, all materials generated during performance of the agreement are deemed "work for hire" and the "exclusive property" of the Authority. (Doc. 165 ¶ 12). The contract defers to a "Non Disclosure Agreement" for treatment of confidential information, but AFS and the Authority never executed such an agreement. (Id. ¶¶ 10-11). Nonetheless,the Authority's lead engineers testified that they released AFS's drawings only to those that "needed to know" the information. (Doc. 158-7, Reed and Nash Dep. 85:6-87:5, 88:3-89:25, 90:23-91:2, 92:3-95:15, Mar. 30, 2016 ("Reed/Nash Dep.")).
In September of 2012, the Authority experienced financial difficulty. (Doc. 169 ¶ 109). It sold both the strongback and Hydraulic System to Orbital to provide continued funding for launches at Wallops Island. (Id.) AFS did not execute a non-disclosure agreement with Orbital. (Doc. 165 ¶ 42). Consequently, Orbital considers itself to be the legal owner of AFS's engineering drawings. (Doc. 178 ¶¶ 128-29). This belief notwithstanding, Orbital maintained a practice of only disclosing AFS's drawings on a need-to-know basis. (See Doc. 172-28, Edwards Dep. 90:16-91:12, Mar. 22, 2016 ("Edwards Dep.")).
AFS employs security measures to safeguard its engineering files, including data related to the Hydraulic System. AFS secures its files on a password-protected server at its headquarters in York, Pennsylvania. (Doc. 169 ¶¶ 33-35). Its facility is monitored by security cameras. (Doc. 192-6, Burkhardt Dep. 24:10-23, May 25, 2016 ("Burkhardt Dep.")). To access files on-site, employees must enter individualized usernames and passwords; to access them remotely via virtual private network requires two passwords. (Doc. 169 ¶¶ 33-36). Authority employees and others at Wallops Island have limited access to these materials through a password-protected online repository managed by the Mid-Atlantic Regional Spaceport. (Id. ¶ 37; see Reed/Nash Dep. 79:25-81:21). AFS's finalized engineering drawings bear its name as well as a statement that the drawings are proprietary and confidential. (Doc. 169 ¶¶ 13, 34).
Defendant Thomas Aufiero ("Aufiero") was a sales manager at AFS who worked closely with Huber on the initial Hydraulic System project. (Doc. 178 ¶ 48; see also Doc. 169 ¶ 39). In January 2011, Aufiero left AFS to work as a regional sales manager for defendant Livingston & Haven, LLC ("Livingston"). (Doc. 169 ¶¶ 39-41). Livingston "designs, assembles, and installs hydraulic fluid systems" and generally competes in the same market as AFS. (See Doc. 178 ¶¶ 8-9).
Shortly after Aufiero began working for Livingston, he emailed Huber to request photos of the new Hydraulic System cylinders recently delivered to AFS's headquarters. (Doc. 169 ¶¶ 40-42). Huber emailed the requested photos to Aufiero. (Id. ¶ 41). Ten months later, in November 2011, Huber emailed Aufiero 10 photos and a video showing tests of the Hydraulic System. (Id. ¶¶ 43-44). Soon afterward, Huber requested that he and Aufiero maintain contact using Huber's personal email address. (See id. ¶ 45).
In late 2011 or early 2012, Huber began meeting with a team of Livingston employees at its headquarters in North Carolina. (Id. ¶¶ 46-47). The team consisted of Aufiero, defendant Clifton B. Vann, IV ("Vann"), president of Livingston, and Craig Hill ("Hill"), a Livingston engineer. (Id.) Huber met and communicated with this group on several occasions to discuss Orbital's needs regarding support work for and eventual upgrades to the Hydraulic System. . Huber conveyed to the Livingston team that Orbital was unhappy with AFS's services and that it was seeking new vendors to service the Hydraulic System. (Doc. 178 ¶¶ 43-50).
All told, Huber participated in 338 calls with Livingston employees on his AFS-issued cellular phone. (Doc. 169 ¶ 52). He also communicated electronically with the Livingston team. During a January 8, 2012 meeting, Livingston established an account for Huber with Dropbox.com, an online document-sharing service, and linked Huber's account with Hill's and Aufiero's Dropbox accounts. (Id. ¶¶ 53-55). A Livingston employee installed a virtual private network on Huber's AFS-issued laptop computer, allowing Huber to access Livingston's private network and AFS's private network on the same device. (Id. ¶¶ 57-58). The Livingston defendants also issued Huber a company email address. (Id. ¶ 59). By January 11, 2012, Huber's email signature on his Livingston account listed him as Livingston's "Program Manager." (Id. ¶ 60).
Huber took affirmative steps to help the Livingston employees familiarize themselves with the Hydraulic System and Orbital's operations on Wallops Island after his first meeting at Livingston headquarters. For example, on March 6, 2012, Huber requested a list of Hydraulic System component parts from Dan Vaughn, AFS's vice president and engineering manager. (Id. ¶¶ 61-62). Huber emailed the list, along with attendant prices and profit margins, to Aufiero. (Id. ¶¶ 64-65). He also arranged a tour of Wallops Island for Aufiero, Vann, and Hill on March 21, 2012. (Id. ¶¶ 67-71). Huber showed the Livingston employees a rocket assembly room, a launch pad, and the Hydraulic System. (Id. ¶¶ 73-74).
After the March 2012 tour, Huber continued to provide information about the Hydraulic System to Aufiero, Vann, and Hill via Dropbox and email. (See id. ¶ 75).Huber created a new folder on Dropbox labeled "Orbital Sciences" and shared it with Aufiero. (Id. ¶¶ 85-91). The folder contained numerous files including the Hydraulic System cylinder assembly and arrangement drawings, a "majority" of the hydraulic schematics for the system, and AFS's pricing and billing information. (Id.) Huber later emailed Hill documents containing specifications the Authority provided to AFS in their original contract for the Hydraulic System. (Id. ¶ 94).
Huber's discussions with the Livingston team continued after Huber turned over AFS's engineering files. Huber expressed frustration to Livingston that AFS was ostensibly contemplating an end to its service work on the Hydraulic System. (See Doc. 178 ¶¶ 50-51). Huber also indicated that Orbital was "nervous about not having a supplier" for necessary parts. (Id. ¶ 51). Consequently, Huber arranged another meeting between the Livingston defendants and Fava for April 12, 2012 to engage in "high level" discussions about the Hydraulic System. (Doc. 169 ¶¶ 95-97).
Fava explained during the April 12 meeting that Orbital wanted to upgrade the Hydraulic System cylinder assembly. (Id.) He told Huber, Aufiero, Vann, and Hill that Orbital would...
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