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Airfacts, Inc. v. Amezaga

United States District Court, D. Maryland

August 2, 2016




         Presently pending and ready for resolution in this case is a motion for leave to file an amended complaint filed by Plaintiff AirFacts, Inc. (“AirFacts” or “Plaintiff”). (ECF No. 33). The issues have been briefed, and the court now rules, no hearing being deemed necessary. Local Rule 105.6. For the following reasons, Plaintiff’s motion will be denied.

         I. Background

         Plaintiff commenced this action on May 22, 2015 by filing a complaint against Defendant Diego de Amezaga (“Defendant”) alleging breach of contract, misappropriation of trade secrets, and conversion. (ECF No. 1). Plaintiff is a Maryland corporation that develops and licenses revenue accounting software for airlines, and the company concentrates primarily on developing customized airfare auditing software, specifically proration software. (Id. ¶ 14). Proration software assists airlines in receiving revenue that accurately reflects industry standards and negotiated rates when two or more airlines share ticket revenues in a single transaction. (Id. ¶¶ 15-16). This software, according to Plaintiff, is in high demand and therefore has been a critical focus of Plaintiff’s development team. Plaintiff avers:

AirFacts has invested significant technical and management resources easily valued in the six figures to develop significant proprietary information relating to the Proration Software. For example, the entire AirFacts technical team and the product development director and CEO have had several intense code sprints to produce a prototype that has been integrated into the existing audit product.

(Id. ¶ 18).

         Plaintiff employed Defendant from June 2008 until February 2015 during which time Defendant worked on the development of this proration software. (Id. ¶ 19). According to Plaintiff, Defendant, in addition to providing Plaintiff’s development team with functional and technical specifications for how the custom audit programming should operate, was also “principally responsible for developing AirFacts’ Proration Software from the program’s inception in April 2012.” (Id. ¶¶ 20-21). Defendant disputes this fact and contends that he did not spend very much time on the project and was primarily a business analyst, not a programmer. (ECF No. 14 at 1-2).

         At the start of Defendant’s employment with Plaintiff, the parties executed an Employment Agreement. (ECF No. 2-6). The Employment Agreement restricted Defendant’s post-employment opportunities for a twelve-month period and prohibited Defendant from making unauthorized use or disclosure of certain confidential company information. (ECF No. 1 ¶ 26-28). Specifically, the Employment Agreement provides:

During or after the term of his engagement with AirFacts, the Employee will not make any unauthorized use of, will not disclose, and will maintain in secrecy and in confidence, as the secret and sole property of AirFacts, any Confidential Information. The Employee will not, in any event, disclose or use any Confidential Information, or information or knowledge described immediately above, unless the Employee receives specific permission in writing from the President of AirFacts to disclose or use such Confidential Information . . . such information shall remain the sole property of AirFacts and Consultant agrees to return all such property (including all copies and summaries) upon request and/or upon the termination of this Agreement. It is the express intent of this Agreement that Consultant not disclose to any third party Confidential Information learned in the performance of Services hereunder concerning the business of AirFacts or its clients.

(ECF No. 2-6 ¶ 2.2). Approximately three months after Defendant stopped working with Plaintiff, he began working for American Airlines, one of Plaintiff’s major customers. American Airlines assured Plaintiff that Defendant was not performing services that were in competition with, or similar to, services that he provided for Plaintiff, which the Employment Agreement would restrict. Defendant maintains that his work at American Airlines was restricted to processing passenger refunds in the Refund Department and did not involve performing any services that were in breach of the Employment Agreement. (ECF No. 14, at 3).

         Plaintiff alleges that Defendant stole confidential information, specifically “spreadsheets and database table designs for an essential component of the Proration Software, ” which Defendant allegedly sent to himself on his private email server. (ECF No. 1 ¶ 30). Plaintiff contends that:

Due to the highly confidential and proprietary nature of the Confidential Information, the significant amount of time and resources that AirFacts has invested in developing the Proration Software, and the importance of the Proration Software to AirFacts’ future business plans, the use and/or disclosure of the Confidential Information to a third party would cause irreparable harm to the Company.

(Id. ¶ 32).

         Upon learning that Defendant possessed these documents after his termination, Plaintiff commenced the present action and contemporaneously filed a motion for a temporary restraining order and preliminary injunctive relief. (ECF Nos. 1; 2). The court held a motions hearing and granted the temporary restraining order. The order temporarily restrained and enjoined Defendant from destroying, erasing, mutilating, concealing, altering, transferring, or otherwise disposing of, in any manner, directly or indirectly, any document that ...

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