Opus Fund Servs. (Usa) LLC v. Theorem Fund Servs., LLC, Case No. 17 C 923
| Decision Date | 29 September 2017 |
| Docket Number | Case No. 17 C 923 |
| Parties | OPUS FUND SERVICES (USA) LLC, Plaintiff, v. THEOREM FUND SERVICES, LLC, STEPHEN GIANNONE, MIKHAIL DAVIDYAN, MELISSA BOCKWINKEL, and ELIZABETH WRIGHT, Defendants. |
| Court | U.S. District Court — Northern District of Illinois |
MEMORANDUM OPINION AND ORDER
Plaintiff Opus Fund Services (USA) LLC ("Opus") filed a ten count Amended Complaint against Theorem Fund Services LLC ("Theorem") and individual defendants Stephen Giannone, Mikhail Davidyan, Melissa Bockwinkel, and Elizabeth Wright for violations of the Defend Trade Secrets Act of 2016 ("DTSA"), 18 U.S.C. § 1832, the Computer Fraud and Abuse Act ("CFAA"), 18 U.S.C. § 1030, and several state law claims. Melissa Bockwinkel moves to dismiss the complaint against her pursuant to Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction. Defendants also move to dismiss the complaint entirely pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim [33]. For the reasons set forth below, this Court the motions are granted in part and denied in part.
The following facts are taken from the Amended Complaint. (Dkt. 32). Opus is a full-service, domestic, and international fund administrator with offices in New York, Chicago, San Francisco, and Bermuda. Opus is a Delaware Limited Liability Company ("LLC") with its principal place of business in Bermuda. Theorem is an Illinois LLC with its principal place of business in Chicago. Stephen Giannone was a senior executive at Opus until he resigned on September 30, 2015. After resigning from Opus, Giannone founded Theorem, a competing company. Mikhail Davidyan is a former Senior Vice President at Opus. Elizabeth Wright is a former Senior Vice President at Opus.
Melissa Bockwinkel is a former Senior Vice President at Opus and was an executive at Opus in its Illinois office prior to her move to Oregon in 2013, where she continued to work remotely for Opus through its Illinois office. (Dkt. 32, at ¶13). Bockwinkel also worked for Theorem through its Illinois office. Id. In her affidavit submitted to contest personal jurisdiction in Illinois, Bockwinkel states that she has resided in Portland, Oregon since January 2013. She worked for Opus as an account manager from 2009 to 2013, when she resigned from the position. From March 2014 to October 2015, Bockwinkel worked for Opus as a Senior Vice President. Bockwinkel avers that she performed all her work for Opus since January 2013 in Oregon. She further asserts that she owns no real estate in Illinois nor does she transact any business in Illinois and her only continuing contacts with the state are personal and familial. Bockwinkel states that she was never an employee of Theorem, but only briefly provided consulting services from February to May 2016.
The Amended Complaint alleges that in August 2015, Giannone was negotiating potential employment with Perennial, a competitor of Opus. (Id. at ¶ 20). Opus alleges that, prior to his departure from Opus, Davidyan accessed Opus' iSymphony platform and took confidential proprietary information and trade secrets. During this time, Giannone was negotiating with Thiele Capital to bring its fund administration services to Opus. Thiele Capital took its business to Perennial and then Theorem instead of signing on with Opus.
On September 8, 2015, Giannone traveled to New York City, billing his expenses to Opus. Opus alleges that, while there, Giannone met with a Perennial executive, bringing along an OpusSenior Vice President and Head of Sales.1 On September 23, 2015, Opus paid for Giannone to travel to California, instead of conducting Opus business, he met with Perennial personnel. Giannone resigned from Opus on September 30, 2015, giving 30-days' notice. When he resigned, Opus told Giannone to stay away from the office and not to conduct any business on behalf of Opus and to refrain from speaking to any clients or other employees of Opus. Giannone accessed or tried to access iSimphony after his resignation and without authorization three times on October 5, 2015, and again on January 4, 2016.
Davidyan resigned from Opus on September 4, 2015, giving 26-days' notice before joining Perennial. Bockwinkel resigned from Opus on September 21, 2015, giving two weeks' notice and joining Perennial. Opus alleges that prior to her departure from Opus, Bockwinkel accessed its iSymphony platform to obtain proprietary information, including manuals and contracts. On October 9, 2015, Opus promoted Wright to the position of Senior Vice President, Fund Accounting, a role that was intended to replace the vacancies left by both Davidyan and Bockwinkel.
On October 26, 2015, Mauka Capital notified Opus of its intent to terminate the services of Opus in favor of Perennial. Giannone and Davidyan attended a symposium on November 18, 2015, with Perennial nametags. Giannone, Davidyan, and Bockwinkel left Perennial in January 2016. On January 29, 2016, Theorem was registered in Illinois with Giannone and Davidyan as members. Theorem announced its launch on February 16, 2016, with an article posted to HFM (a website publishing news in the fund management industry). Opus alleges that Giannone made a disparaging comment about Opus in this article.
On May 31, 2016, Wright resigned from Opus with no notice and joined Theorem. Opus alleges that Wright improperly accessed the iSymphony platform to take Opus' confidential proprietary information and trade secrets, including client referral sources, business prospects, futurebusiness development plans, and proprietary client information, manuals and contracts. On July 21, 2016, Lindsey Vertin gave two weeks notice to Opus and joined Theorem.
On August 5, 2016, Opus was negotiating with Ironwood Funding ("Ironwood"), one of its existing clients, to manage Ironwood's new fund. Ironwood decided to give its new business to Theorem. On September 21, 2016, Ironwood gave notice to Opus that it was reassigning all its funds from Opus to Theorem. Also in September 2016, Giananone allegedly slandered Opus to a third-party service provider, assailing Opus' financial and business methods. On September 30, 2016, Ranger Capital Group ("Ranger") notified Opus that it was reassigning two of its four funds from Opus to Theorem. In October 2016, Giannone allegedly solicited Haider Capital one of Opus' biggest clients to move its business from Opus to Theorem.
On May 8, 2017, Opus filed a ten count Amended Complaint, alleging (Count I) breach of fiduciary duty, (Counts II and III) tortious interference with prospective economic advantage, (Count IV) tortious interference with business relations, (Count V and VI) violation of the Defend Trade Secrets Act DTSA 18 U.S.C. § 1832, (Count VII) violation of the Consumer Fraud and Abuse Act 18 U.S.C. § 1030, (Count VIII) defamation per se, (Count IX) breach of contract, and (Count X) conversion.
Rule 12(b)(2) permits dismissal of a claim based on lack of personal jurisdiction over the defendant. Fed. R. Civ. P. 12(b)(2). The party asserting personal jurisdiction bears the burden of proof. See Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). The Court may consider affidavits submitted by the parties when resolving the question of personal jurisdiction. Id. at 782. The plaintiff need only establish a prima facie case of personal jurisdiction when the Court rules on the motion without an evidentiary hearing. Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002). Factual disputes and all reasonable inferences are resolved in favor of theplaintiff at this stage. Purdue, 338 F.3d at 782.
A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the complaint, not its merits. Fed. R. Civ. P. 12(b)(6); Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir. 1990). When considering the motion, the Court accepts as true all well pleaded facts in the plaintiff's complaint and draws all reasonable inferences from those facts in the plaintiff's favor. AnchorBank, FSB v. Hofer, 649 F.3d 610, 614 (7th Cir. 2011). To survive dismissal, the complaint must not only provide the defendant with fair notice of a claim's basis, but must also be facially plausible. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009); see also Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L. Ed. 2d 929 (2007). Carlson v. CSX Transp., Inc., 758 F.3d 819, 826-27 (7th Cir. 2014) (emphasis in original) (internal citations omitted).
Defendants move for dismissal of Melissa Bockwinkel as a defendant based on a lack of personal jurisdiction. Defendants claim that Bockwinkel is an Oregon resident and lacks sufficient minimum contacts with Illinois to support personal jurisdiction here. This Court may exercise jurisdiction over Bockwinkel only if authorized both by the United States Constitution and Illinois law. Be2LLC v. Ivanov, 642 F.3d 555, 558 (7th Cir. 2011). Illinois's long-arm statute "permits its courts to exercise personal jurisdiction on any basis permitted by the constitutions of both Illinois and the United States." Id.; see 735 ILCS 5/2-209(c). Thus, the state and federal inquiries merge. Tamburo v. Dworkin, 601 F.3d 693, 700 (7th Cir. 2010). Under the Illinois long-arm statute, personal jurisdiction may be general or specific. uBid, Inc. v. GoDaddy Grp., Inc., 623 F.3d 421, 425 (7th Cir.2010). This Court agrees that it does not have general jurisdiction over Bockwinkel.
Specific jurisdiction arises from the "relationship among the defendant, the forum, and the litigation."...
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