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Restaurant Technologies, Inc. v. Allora

August 15, 2008

RESTAURANT TECHNOLOGIES, INC., PLAINTIFF,
v.
VINCENT ALLORA, DEFENDANT.



The opinion of the court was delivered by: Cooper, District Judge

FOR PUBLICATION

MEMORANDUM OPINION

INTRODUCTION

Plaintiff, Restaurant Technologies, Inc. ("RTI"), alleges claims of (1) breach of contract, (2) misappropriation of trade secrets, and (3) unfair competition against defendant, Vincent Allora ("Allora"). (Dkt. entry no. 1, Compl.) RTI also alleges that it is entitled to a constructive trust "on proceeds [Allora] has obtained through his wrongful acts." (Id.) RTI now moves for summary judgment in its favor pursuant to Federal Rule of Civil Procedure ("Rule") 56(c) as to (1) the claims of (a) breach of contract, and (b) unfair competition, and (2) its entitlement to a constructive trust. (Dkt. entry no. 26.) Allora opposes the motion. (Dkt. entry no. 30.) The Court determines this motion on briefs without an oral hearing, pursuant to Rule 78(b). For the reasons stated herein, the Court will deny the motion.

BACKGROUND

RTI employed Allora from approximately December 1999 until February 2004 in a sales and marketing position. (Dkt. entry no. 26, RTI Stmt. of Material Facts ("RTI Facts"), at ¶ 1.) In December 1999, Allora signed a document entitled "Receipt and Acknowledgment of RTI Employee Manual". (Id. at ¶ 2; see dkt. entry no. 7, Decl. of Peter M. Lancaster ("Lancaster Decl."), Ex. B, Receipt and Acknowledgment of RTI Employee Manual ("Manual Receipt").) This document states that, inter alia,

I am aware that during the course of my employment confidential information will be made available to me, for instance, product designs, marketing strategies, customer lists, pricing policies and other related information. I understand that this information is proprietary and critical to the success of RTI and must not be given out or used outside of RTI's premises or with non-RTI employees. In the event of termination of employment, whether voluntary or involuntary, I hereby agree not to utilize or exploit this information with any other individual or company. (Manual Receipt.)

The RTI Employee Manual further provides that, inter alia, "[e]mployees may not take an outside job, either for pay or as a donation of her/his personal time, with a customer or competitor of RTI; nor may they do work on their own if it competes in any way with the sales of products or services we provide our customers." (Dkt. entry no. 26, Certification of Meghan J. Ryan ("Ryan Cert."), Ex. I, RTI Employee Manual.)

Allora also signed a non-competition agreement with RTI in December 1999 ("1999 Non-Competition Agreement"). (RTI Facts, at ¶ 3; see Lancaster Decl., Ex. A, 1999 Non-Competition Agreement.) The 1999 Non-Competition Agreement provided that, inter alia, Allora would not compete with RTI for six months after termination of his employment with RTI. (Lancaster Decl., Ex. A, 1999 Non-Competition Agreement.)

Allora also signed an "Employee Agreement/Employment Separation" form in January 2004 ("2004 Employee Agreement/ Employment Separation Form"), acknowledging, inter alia, his agreement not to use or disclose any confidential information he acquired while employed by RTI. (Id., Ex. D, 2004 Employee Agreement/Employment Separation.) Allora thereafter left his employment with plaintiff and began working for Oilmatic Systems, LLC ("Oilmatic"). (Dkt. entry no. 26, RTI Br., at 3; dkt. entry no. 30, Allora Br., at 15.)

Allora subsequently brought an action in state court against Oilmatic and Michael Allora in November 2005, alleging various state law claims related to Michael Allora's management of Oilmatic (the "State Action"). (RTI Br., at 6; Lancaster Decl., Ex. E, Allora, et al. v. Allora, et al., No. C-363-05 (the "State Action"), Revised Am. Compl.) This action was settled in May 2006. (Ryan Cert., Ex. J, Settlement Agreement.) One of the terms of the settlement agreement provides that, inter alia, Oilmatic will purchase Allora's membership interests in Oilmatic after "entry of a final judgment . . . or the conclusion of a settlement of" two actions in this Court, Restaurant Technologies, Inc. v. Jersey Shore Chicken, Civil Action No. 05-5356, and Oilmatic Systems, LLC v. Restaurant Technologies Inc., Civil Action No. 06-363 (the "Federal Actions"), and upon fulfillment of certain conditions. (Id.)*fn1

RTI brought this action in October 2006, alleging claims of

(1) breach of contract, (2) misappropriation of trade secrets, and (3) unfair competition. (Compl.) RTI also alleges that it is entitled to a constructive trust on "on proceeds [Allora] has obtained through his wrongful acts." (Id.) RTI previously moved for summary judgment in its favor as to the claims of (a) breach of contract, and (b) unfair competition. (See dkt. entry no. 7.) The Court denied the motion without prejudice as premature, as discovery was ongoing. (Dkt. entry no. 19, 8-17-07 Order.) RTI now moves for summary judgment in its favor as to (1) the claims of (a) breach of contract, and (b) unfair competition, and (2) its entitlement to a constructive trust. (Dkt. entry no. 26.) Allora opposes the motion. (Dkt. entry no. 30.)

DISCUSSION

I. Summary Judgment Standard

Rule 56(c) provides that summary judgment is proper if the pleadings, the discovery and disclosure materials, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. Id. The summary judgment movant bears the initial burden of showing that there is no genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the movant has met this prima facie burden, the non-movant must set out specific facts showing that there is a genuine issue for trial. Fed.R.Civ.P. 56(e)(2). A non-movant must present actual evidence that raises a genuine issue of material fact and may not rely on mere allegations. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986).

The Court must view the evidence in the light most favorable to the non-movant when deciding a summary judgment motion. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). At the summary judgment stage, the Court's role is "not . . . to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249. Under this standard, the "mere existence of a scintilla of evidence in support of the [non-movant's] position will be insufficient [to defeat a Rule 56(c) motion]; there must be evidence on which the jury could reasonably find for the [non-movant]." Id. at 252. "By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Id. at 247-48 (emphasis in original). A fact is material only if it might affect the action's outcome under governing law. Id. at 248. "[T]here is no ...


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