United States District Court, D. Utah
MEMORANDUM DECISION AND ORDER
Benson United States District Judge
the court is Defendant’s Motion to Dismiss pursuant to
Federal Rule of Civil Procedure 12(b)(6). Dkt. No. 6. The
motion has been fully briefed by both parties, and the court
has considered the facts and arguments set forth in those
filings. Pursuant to civil rule 7-1(f) of the United States
District Court for the District of Utah Rules of Practice,
the court elects to determine the motion on the basis of the
written memoranda and finds that oral argument would not be
helpful or necessary. DUCivR 7-1(f).
following facts are taken from Ivanti’s complaint. They
are accepted as true and viewed in the light most favorable
to the plaintiff as the non-moving party. GFF Corp. v.
Associated Wholesale Grocers, Inc., 130 F.3d 1381, 1384
(10th Cir. 1997).
the early 2000s, Ivanti and StayLinked have been in direct
competition in the market for terminal emulation products.
Complaint ¶¶ 13-18, Dkt. No. 2. Over the years,
StayLinked changed their products to resemble Ivanti’s.
Id. ¶ 14. StayLinked hired at least six Ivanti
employees and leveraged their familiarity with Ivanti to gain
access to Ivanti’s technologies and strategies. Id
2012, at the request of its largest client, Ivanti began
developing a new terminal emulation product initially called
Smart TE. Id. ¶¶ 20-22. Jay Cichosz was
then the Vice President of Products and Marketing for Ivanti
and was “very familiar” with the development of
the Smart TE product. Id. ¶ 23. In this role,
Cichosz had access to confidential information related to the
product. Id. ¶¶ 24-25. In April 2014, when
Ivanti’s Smart TE prototypes had been developed and
were being tested, Cichosz left Ivanti to join StayLinked as
its Vice President of Marketing and Business Development.
Id. ¶ 30. Ivanti’s Smart TE product was
renamed Ivanti Velocity and launched in February 2015.
Id. ¶¶ 31-32.
than a year after Ivanti’s product was launched,
StayLinked launched its own terminal emulation product in
February 2016 under the name SmartTE. Id.
¶¶ 35-36. To develop this product, StayLinked
relied on confidential Ivanti information obtained and shared
by Cichosz. Id. ¶¶ 41-43. StayLinked used
this new product to compete directly with Ivanti for key
supply chain customers. Id. ¶¶ 45-46.
SmartTE became a centerpiece of StayLinked’s supply
chain business and helped them increase their market share
following year, around September 2017, StayLinked began to
recruit Ivanti’s Asia-Pacific Territory Manager,
Stephen Shea. Id. ¶ 48. Soon thereafter, Shea
resigned from Ivanti, claiming that he intended to take time
off to care for his ailing parents in California.
Id. ¶ 50. Shea then joined StayLinked without
returning sensitive and confidential information he had
acquired while working at Ivanti. Id. ¶¶
51. Within a month of his resignation, he started recruiting
Ivanti’s Asia-Pacific customers to join StayLinked.
Id. ¶ 52. In doing so, Shea misappropriated and
transferred confidential Ivanti documents and information.
Id. ¶ 56-57. Ivanti obtained a stipulated
injunction in a case against Shea (See No.
2:18-cv-00092), which prohibited Shea from competing with
Ivanti in the Asia-Pacific region for six months.
Id. ¶ 54. This period was extended after Shea
failed to comply with that requirement. Id.
misappropriation of Ivanti’s confidential information
resulted in financial gains by StayLinked and commensurate
financial losses by Ivanti. Id. ¶¶ 45-46,
60. The misappropriated information included confidential
strategies, documents, and prototypes, and Ivanti took
substantial steps to preserve the confidentiality of the
information. Id. ¶ 63, 65.
February 1, 2019, Ivanti filed suit in the United States
District Court for the District of Utah alleging that
StayLinked has violated Utah’s Uniform Trade Secrets
Act (UTSA) as well as the federal Defend Trade Secrets Act
(DTSA). Dkt. No. 2. In the complaint, Ivanti also alleged
that StayLinked engaged in tortious interference with
Ivanti’s business relations. Id. StayLinked
moved to dismiss the complaint, arguing that (1)
Ivanti’s UTSA and DTSA claims relating to Cichosz are
barred by the statute of limitations under those acts; (2) a
portion of Ivanti’s claims under the DTSA arose before
the effective date of the statute; (3) Ivanti’s
tortious interference claims are barred by the UTSA and Utah
case law; and (4) Ivanti’s complaint does not set forth
facts establishing the elements of its claims. Dkt. No. 6.
TO DISMISS STANDARD
considering a motion to dismiss pursuant to Rule 12(b)(6),
all well-pleaded factual allegations, as distinguished from
conclusory allegations, are accepted as true and viewed in
the light most favorable to the non-moving party. GFF
Corp. v. Associated Wholesale Grocers, Inc., 130 F.3d
1381, 1384 (10th Cir. 1997). Plaintiff must
provide “enough facts to state a claim to relief that
is plausible on its face.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). This requires
“more than an unadorned,
Iqbal, 556 U.S. at 678 (2009). This court’s
role “is not to weigh potential evidence that the
parties might present at trial, but to assess whether the
plaintiff’s complaint alone is legally
sufficient.” Miller v. Glanz, 948 F.2d 1526,
1565 (10th Cir. 1991). In doing so, “courts
must consider the complaint in its entirety, as well as other
sources courts ordinarily examine when ruling on Rule
12(b)(6) motions to dismiss, in particular, documents
incorporated into the complaint by reference, and matters of
which a court may take judicial notice.” Tellabs,
Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308,
322 (2007). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Iqbal, 556 U.S.
moves to dismiss the complaint on several distinct grounds.
Each of ...