Bureau Veritas Commodities & Trade, Inc. v. Nanoo

• Court: U.S. District Court — Eastern District of Louisiana
• Writing for the Court: SARAH S. VANCE UNITED STATES DISTRICT JUDGE
• Decision Date: 26 May 2021
• Docket Number: CIVIL ACTION NO. 20-3374 SECTION "R" (4)
• Citation: Bureau Veritas Commodities & Trade, Inc. v. Nanoo, CIVIL ACTION NO. 20-3374 SECTION "R" (4) (E.D. La. May 26, 2021)
• Parties: BUREAU VERITAS COMMODITIES AND TRADE, INC. v. RENISHA NANOO, ET AL.

BUREAU VERITAS COMMODITIES AND TRADE, INC. v. RENISHA NANOO, ET AL.

CIVIL ACTION NO. 20-3374 SECTION "R" (4)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA

May 26, 2021

ORDER AND REASONS

Before the Court are two motions to dismiss under Federal Rule of Civil Procedure 12(b)(6) by defendants Renisha Nanoo¹ and Cotecna Inspections, Inc.² Cotecna also moves in the alternative under Rule 12(e) for a more definite statement.³ Plaintiff Bureau Veritas Commodities and Trade, Inc. opposes the motions.⁴ As discussed below, the Court grants the Rule 12(b)(6) motions in part and denies the motions in part. The Court denies Cotecna's Rule 12(e) motion.

I. BACKGROUND

This claim arises from allegedly improper competitive trade practices. In its amended complaint, Bureau Veritas alleges that its operations include a "metals and minerals" ("M&M") inspection, sampling, testing, and certification business.⁵ Plaintiff alleges that several of its high-level employees in its M&M division, including Nanoo, colluded with defendant Cotecna to steal Bureau Veritas' trade secrets and employees to develop a competing M&M business over a matter of months.⁶ Plaintiff alleges that the leader of its M&M division, Stefanus Nel, conspired with Cotecna's CEO to orchestrate the exodus of employees from Bureau Veritas to Cotecna.⁷ Plaintiff alleges that, from February to June 2020, all but one of its M&M division's senior management resigned, opened a competing lab for Cotecna, and pursued Bureau Veritas' customers.⁸ Plaintiff alleges that Nanoo was "second in command" in its M&M division, and was responsible for operations, finances, and management of the "Solid Fuels" operations and laboratories, which were centrally located in Marrero, Louisiana.⁹

Before leaving Bureau Veritas, Nanoo allegedly gathered Bureau Veritas' confidential information.¹⁰ Plaintiff alleges that Nanoo connected two personal external hard drives to her Bureau Veritas laptop.¹¹ A forensic examination allegedly showed that at least one of the drives contained customer lists, pricing information, financial information, laboratory information, and an archive of Nanoo's Outlook files.¹² Plaintiff also alleges that Nanoo used a personal Dropbox account on her work computer.¹³ Nanoo allegedly kept both hard drives and the information they contained after leaving her employment with plaintiff.¹⁴ Plaintiff also contends that Nanoo accessed Bureau Veritas' network, and deleted information from it.¹⁵ Once at Cotecna, Nanoo allegedly began soliciting Bureau Veritas' M&M customers.¹⁶

Plaintiff alleges the following 11 "counts:" (1) breach of contract against Nanoo;¹⁷ (2) violations of the Defend Trade Secrets Act, 18 U.S.C. § 1836, et seq. ("DTSA"), against both Cotecna and Nanoo;¹⁸ (3) violation of theLouisiana Uniform Trade Secrets Act, La. Rev. Stat. § 51:1431, et seq. ("LUTSA"), against both Cotecna and Nanoo;¹⁹ (4) violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030(a)(4) ("CFAA"), against Nanoo;²⁰ (5) violation of the Louisiana Unfair Trade Practices and Consumer Protection Law, La. Rev. Stat. § 51:1401, et seq. ("LUPTA"), against both Cotecna and Nanoo,²¹ (6) breach of fiduciary duties against Nanoo,²² (7) unjust enrichment against both Cotecna and Nanoo,²³ (8) conversion against both Cotecna and Nanoo,²⁴ (9) "conspiracy" under La. Civ. Code art. 2324(a) against both Cotecna and Nanoo,²⁵ (10) fraud against Nanoo,²⁶ and (11) injunctive relief under the DTSA and LUTSA.²⁷

Cotecna and Nanoo filed motions to dismiss in response to plaintiff's original complaint.²⁸ Plaintiff responded to these motions with an amended complaint.²⁹ "An amended complaint supersedes the original complaint and renders it of no legal effect unless the amended complaint specifically refersto and adopts by reference the earlier pleadings." MacFarland v. Walker, 214 F.3d 1349 (Table), at *1 (5th Cir. 2000) (citing King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994)). Here, plaintiff's amended complaint,³⁰ is the operative complaint, as it does not adopt by reference any other pleadings. Thus, the Court finds that Cotecna's and Nanoo's first motions to dismiss are moot. See Pettawa v. Nat'l Recovery Solutions, LLC, 955 F.3d 299, 303 (2d Cir. 2020) (holding that, when faced with an amended complaint while a motion to dismiss is pending, a district court may dismiss the pending motion as moot). The Court considers defendants' second motions to dismiss³¹ below. Additionally, Cotecna moves under Rule 12(e) for a more definite statement regarding plaintiff's trade secret and LUPTA claims.³²

II. LEGAL STANDARD

To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead enough facts to "state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 547 (2007)). A claim is facially plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inferencethat the defendant is liable for the misconduct alleged." Id. at 678. The Court must accept all well-pleaded facts as true and must draw all reasonable inferences in favor of the plaintiff. Lormand v. U.S. Unwired, Inc., 565 F.3d 228, 239, 244 (5th Cir. 2009). But the Court is not bound to accept as true legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 678.

On a Rule 12(b)(6) motion, the Court must limit its review to the contents of the pleadings, including attachments. Brand Coupon Network, L.L.C. v. Catalina Mktg. Corp., 748 F.3d 631, 635 (5th Cir. 2014). The Court may also consider documents attached to a motion to dismiss or an opposition to that motion when the documents are referred to in the pleadings and are central to a plaintiff's claims. Id. "In addition to facts alleged in the pleadings, however, the district court 'may also consider matters of which [it] may take judicial notice.'" Hall v. Hodgkins, 305 F. App'x 224, 227 (5th Cir. 2008) (citing Lovelace v. Software Spectrum, Inc., 78 F.3d 1015, 1017-18 (5th Cir. 1996)).

III. DISCUSSION

Defendants Cotecna and Nanoo move under Federal Rule of Civil Procedure 12(b)(6) to dismiss plaintiff's claims for (1) misappropriation of trade secrets under the DTSA and LUTSA, and (2) unjust enrichment.Additionally, Nanoo moves to dismiss plaintiff's claims for (3) breach of contract, (4) violations of the CFAA, and (5) conversion. Cotecna also moves to dismiss plaintiff's claim for (6) unfair trade practices under LUPTA. Plaintiff opposes the motions.³³ The Court considers the parties' arguments below.

A. Misappropriation of Trade Secrets

1. Motions to Dismiss

Cotecna and Nanoo move to dismiss plaintiff's trade secret misappropriation claims on the grounds that the alleged trade secrets are not adequately identified in the complaint.³⁴ To state a claim under the DTSA, Bureau Veritas must allege: (1) the existence of a trade secret; (2) misappropriation of the trade secret by another; and (3) the trade secret's relation to a good or service used or intended for use in interstate or foreign commerce. Complete Logistical Servs., LLC v. Rulh, 350 F. Supp. 3d 512, 517 (E.D. La. 2018) (citing 18 U.S.C. § 1836(b)(1)). Similarly, to recover damages under the LUTSA, Bureau Veritas must prove: (1) the existence of a trade secret; (2) misappropriation of the trade secret by another; and (3) actual loss caused by the misappropriation. Source Prod. & Equip. Co., Inc.v. Schehr, No. 16-17528, 2017 WL 3721543 (E.D. La. Aug. 29, 2017). The element at issue in defendants' motions is the first one—whether plaintiff has alleged the existence of a trade secret.

The DTSA, which was enacted in 2016, defines "trade secret[s]" as:

[A]ll forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if--

(A) the owner thereof has taken reasonable measures to keep such information secret; and

(B) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information[.]

18 U.S.C. § 1839(3). LUTSA's definition is substantially the same. See La. Rev. Stat. § 51:1431(4).

"[T]o allege a trade secret, the plaintiff must 'describe the subject matter of the trade secret with sufficient particularity to separate it from matters of general knowledge in the trade or of special persons who are skilled in the trade, and to permit the defendant to ascertain at least the boundaries within which the secret lies.'" Am. Biocarbon, LLC v. Keating, No. 20-00259, 2020 WL 7264459, at *4 (M.D. La. Dec. 10, 2020) (emphasisadded) (quoting Navigation Holdings, LLC v. Molavi, 445 F. Supp. 3d 69, 75 (N.D. Cal. 2020)). Courts generally find that pleadings are inadequate when the alleged trade secrets are identified only by category or broad conclusory statements. See Intrepid Fin. Partners, LLC v. Fernandez, No. 20-9779, 2020 WL 7774478, at *4 (S.D.N.Y. Dec. 30, 2020) ("Plaintiff merely references categories of information concerning its clients and ordinary business operations, and conclusorily alleges that such information is not readily available and affords [plaintiff] economic value such that it should be deemed a trade secret."). In other words, a plaintiff may not "set out its purported trade secrets in broad, categorical terms," in a way that is merely "descriptive of the types of information that generally may qualify as protectable trade secrets . . . ." Vendavo, Inc. v. Price f(x) AG, No. 17-06930, 2018 WL 1456697, at *4 (N.D. Cal. Mar. 23, 2018). Instead, a...