Elevance Health, Inc. v. Mohan
| Docket Number | 1:23-cv-01497-SEB-MJD |
| Decision Date | 15 September 2023 |
| Parties | ELEVANCE HEALTH, INC., Plaintiff, v. VINOD MOHAN, Defendant. |
| Court | U.S. District Court — Southern District of Indiana |
1
ELEVANCE HEALTH, INC., Plaintiff,
v.
VINOD MOHAN, Defendant.
No. 1:23-cv-01497-SEB-MJD
United States District Court, S.D. Indiana, Indianapolis Division
September 15, 2023
ORDER
SARAH EVANS BARKER, JUDGE.
On August 22, 2023, Plaintiff Elevance Health, Inc. ("Elevance") filed this diversity action against its former employee, Defendant Vinod Mohan ("Ms. Mohan"), alleging that Ms. Mohan misappropriated trade secrets. Dkt. 1. Elevance also filed a Motion for a Temporary Restraining Order ("TRO"), requesting that we enjoin Ms. Mohan from starting her new position with its competitor, Molina Healthcare, Inc. ("Molina"). Dkt. 7. On August 30, 2023, Ms. Mohan filed a Motion to Dismiss for lack of personal jurisdiction and improper venue, pursuant to Federal Rules of Civil Procedure 12(b)(2) and (b)(3), respectively. Dkt. 22. Alternatively, Ms. Mohan asks us to transfer this action to the Central District of California, pursuant to 28 U.S.C. 1404(a). The Court, mindful of the need to resolve these pending issues expeditiously, now DENIES Defendant's Motion to Dismiss and DENIES Plaintiff's Motion for Temporary Restraining Order.
FACTS[1]
I. The Parties
Elevance, one of the nation's leading healthcare benefit companies, is an Indiana corporation with its principal place of business in Indiana. As an independent licensee of Blue Cross Blue Shield Association ("BCBS"), it serves approximately forty million medical members through its affiliated health plans across the United States. Elevance maintains its success through a strategic structuring and implementation of its distribution, provider networks, portfolio of member benefit plans, and substantial investments in operational improvement-all of which are driven by information that Elevance (and its competitors) regard as highly confidential. Consequently, Elevance protects its confidential information from public dissemination by storing it in secure computer systems and password-protected databases. Further, only specific user profiles can access certain folders of confidential information, and these select few Elevance personnel are required to execute confidentiality agreements.
From September 2020 to July 2023, Ms. Mohan worked for Elevance as President, Medicare West Region, responsible for Medicare-related business in Arizona, California, Colorado, New Mexico, Nevada, Texas, Washington, and Florida. In that position, Ms. Mohan oversaw that division of Elevance's strategy, financial performance, and operational
execution of its Medicare business. As a senior executive, she had comprehensive access to a "significant amount" of highly confidential and proprietary information. Throughout her employment, Ms. Mohan primarily worked out of her home office in California, where she regularly printed documents containing aspects of Elevance's confidential information to which her position granted her access. During her tenure, she traveled to Elevance's Indianapolis headquarters on three occasions to attend in-person meetings to discuss matters related to Elevance's bid planning and Medicare planning, which Elevance characterizes as involving "confidential and trade secret information key to maintaining its competitive advantage." Dkt. 24 at 5.
II. Ms. Mohan's Employment Agreement
When Ms. Mohan joined Elevance in September 2020, she "reviewed and negotiated," dkt. 23 at 4, the terms of an Employment Agreement ("Employment Agreement"), wherein she expressly acknowledged that, by virtue of her employment with Elevance, she would have access to confidential information. The Employment Agreement provided further that this confidential information "constitutes trade secrets and confidential and proprietary business information" that was considered Elevance's "exclusive property." Dkt. 1-6 at 4. Under the Employment Agreement, Ms. Mohan also agreed not to:
(A) use Confidential Information for the benefit of any person or entity other than the Company or its affiliates (B) remove, copy, duplicate or otherwise reproduce any document or tangible item embodying or pertaining to any of the Confidential Information, except as required to perform the Participant's duties for the Company or its affiliates; or (C) while employed and thereafter, publish release, disclose or deliver or otherwise make available to any third party any Confidential Information by any communication, including oral,
documentary, electronic or magnetic information transmittal device or media.
Id. at 4-5.
The Employment Agreement also contained a forum selection clause, and a consent to personal jurisdiction, which provides in relevant part:
To the extent that any party wishes to seek such relief from a court, the parties agree to the following with respect to the location of such actions. Such actions brought by the Executive shall be brought in a state or federal court located in Indianapolis, Indiana. Such actions brought by the Company shall be brought in a state or federal court located in Indianapolis, Indiana; the Executive's state of residency; or any other forum in which the Executive is subject to personal jurisdiction. The Executive specifically consent to personal jurisdiction in the State of Indiana for such purposes.
Id. at 12 ("Section 17(f)").
Relatedly, the Employment Agreement contained a choice-of-law provision, which provides:
This Agreement forms part of an employee benefit plan subject to the Employee Retirement Income Security Act of 1974 ("ERISA"), and shall be governed by and construed in accordance with ERISA and, to the extent applicable and not preempted by ERISA, the law of the State of Indiana applicable to contracts made and to be performed entirely within that State, without regard to its conflicts of law principles.
Id. ("Section 18").
III. Ms. Mohan's Resignation
On July 17, 2023, at 9:54 a.m. ET, Ms. Mohan texted her supervisor, Elena McFann ("Ms. McFann"), President of Elevance's Government Business Division, requesting that she "let me know when you have a few minutes," to which Ms. McFann replied, "now." During a three-minute ensuing phone call at 9:55 a.m. ET, Ms. Mohan disclosed that she
was leaving Elevance and would be joining Molina Health, Inc. ("Molina"), one of Elevance's direct competitors. After Ms. Mohan reported that she had not yet logged onto her computer that day, Ms. McFann advised her to log in and create an out-of-office message directing all inquiries to her assistant, to submit a formal letter of resignation, and then to "step away from the keyboard." Dkt. 1-5 at 3. Ms. McFann also promptly contacted Elevance's technology department and requested that Ms. Mohan's account be disabled. At 10:08 a.m. ET, Ms. Mohan emailed to Elevance Health her notice of resignation, and at 12:05 p.m. ET, Elevance disabled Ms. Mohan's login and network access.
Also on July 17, Molina's Senior Vice President & Deputy General Counsel Eric Alderete ("Mr. Alderete") wrote to Elevance's Chief Legal Counsel Blair Todt ("Mr. Todt") at Ms. Mohan's direction, confirming, inter alia, that (1) Ms. Mohan had accepted a position as Senior Vice President of Medicare at Molina; (2) her start date was August 30, 2023; and (3) pursuant to California Labor Code section 925, Ms. Mohan was "exercising her rights . . . to void certain provisions of her Employment Agreement [and] hereby immediately voids Sections 17(f) and (18) of the Agreement." Dkt. 1-15 at 2. Elevance never responded to this letter.
After receiving instructions from Elevance's IT Asset Reclaim Team on July 21, 2023, Ms. Mohan promptly mailed back her work-issued devices, including an iPad, laptop, printer, and phone, on July 22, 2023. When Elevance later examined Ms. Mohan's technology, it discovered that at 10:01 a.m. ET on July 17, 2023, Ms. Mohan "attempted to print a file entitled 'CY2024 Medicare Pass 2 West Region Bid Strategy041023.pptx'
on her work-at-home printer." Dkt. 1-13 at 2.[2] The content of the file, we are told, was a PowerPoint presentation containing highly confidential proprietary information, data, and trade secrets related to Elevance's Medicare bid strategy for the West Region.
Then, on August 4, 2023, Mr. Alderete again reached out to Mr. Todt, this time explaining that Ms. Mohan held a box of Elevance-related documents in her possession. At Elevance's direction, Mr. Alderete coordinated the shipment of these documents to Elevance's headquarters in Indianapolis, Indiana, where they arrived on August 17, 2023. An accounting of the documents, however, did not recover a copy of the aforementioned attempted print. The uncertainty of whether Ms. Mohan may still retain a copy of the PowerPoint (and the confidential information contained therein) forms the basis of Elevance's conclusion that Ms. Mohan has not been forthcoming in honoring the terms of her Employment Contract.
IV. Procedural Background
On August 22, 2023, Elevance filed this lawsuit against Ms. Mohan, alleging counts of (1) breach of contract; (2) violation of the Indiana Uniform Trade Secrets Act, Ind. Code § 24-2-3-1 et seq.; (3) violation of the Defend Trade Secrets Act of 2016, 18 U.S.C. § 1823 et seq.; (4) breach of fiduciary duty; (5) conversion; (6) violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030; and (7) violation of Indiana's Computer Trespass law, Ind. Code § 34-43-2-3. Dkt. 1. On the same day, Elevance moved for a TRO and preliminary injunction to delay Ms. Mohan's first day of work with Molina and prevent the
potential exposure and misappropriation of Elevance's confidential information and trade secrets. Dkt. 7. At a telephonic pretrial conference on August 25, 2023, Ms. Mohan indicated her plans to file a motion to dismiss and agreed to defer her start date with Molina, thereby postponing our ruling on Elevance's TRO. Dkt. 19.
On August 30, 2023, Ms....
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