United States District Court, D. New Jersey
McNulty United States District Judge.
plaintiff, Howmedica Osteonics Corp., acting through its
Stryker Spine division ("Stryker Spine"), brings
suit against Joe Van Cott, Eric Trama, Thomas Casal, Peter
Nunez, Michael Scheiner, and Clinton Handelson (collectively,
"Individual Defendants"), as well as NuVasive, Inc.
("NuVasive"). (DE 34).
the Court is the motion (DE 35) of the defendants under
Fed.R.Civ.P. 12(b)(6) to dismiss several counts of the
Amended Complaint for failure to state a claim upon which
relief may be granted. For the reasons set forth in this
opinion, the defendants' motion is denied.
for the parties and therefore state only the facts relevant
to this motion to dismiss.
Stryker Spine's business
Howmedica Osteonics Corp., acting through its Stryker Spine
division, is a wholly owned subsidiary of Stryker
Corporation. (AC ¶ 11). (Unless otherwise specified,
"Stryker Spine" as used herein refers to
Howmedica.) Stryker Spine invents, designs, manufactures, and
sells spine-related instruments and implants. (AC ¶ 24).
Spine directly employs sales representatives, who are
assigned territories. (AC ¶ 28). Sales representatives
are primarily responsible for building and developing
relationships with surgeons in their territories. (AC ¶
31). These sales representatives are organized into
individual branches, which are overseen by sales managers.
(AC ¶ 28). Sales managers are responsible for
supervising and driving sales for their particular branch,
managing the budget of their branch, and overseeing
inventory. (AC ¶ 30). Sales managers are also expected
to build and maintain customer relationships. (Id.).
from its own sales force, Stryker Spine sells its products
through distributors, who are not Stryker employees. (AC
¶ 29). Distributors are given exclusive rights to sell
Stryker Spine products in a given territory. (AC ¶ 29).
Distributors hire their own sales representatives and sales
Spine gives its sales representatives, and the sales
representatives of its distributors, access to confidential
and proprietary information. (AC ¶ 37). Sales managers,
too, necessarily have access to Stryker Spine's
confidential and proprietary information. That confidential
information includes Stryker Spine's product designs and
plans for the future (AC ¶ 38), as well as information
about sales representatives' performance, business, and
compensation. (AC ¶ 40).
Individual Defendants' employment with Fusion
December 29, 2016, Fusions Solutions, Inc.
("Fusion") was the exclusive distributor of Stryker
Spine products in the New York City and Long Island region.
(AC ¶ 12). Each of the Individual Defendants, who at the
relevant time were Fusion sales representatives, entered into
an "Employment, Confidentiality, and Non-Compete
Agreement" with Fusion (the "Fusion
Agreement"). (AC ¶ 62, 64-69); (DE 34-2, 34-4 to
Spine alleges that, because Fusion was an exclusive
distributor of Stryker Spine products, the Confidential
Information and customer relationships protected by
the Fusion Agreements included Stryker Spine's own
confidential information and customer relationships. (AC
December 29, 2016, Fusion Solutions and Stryker Spine entered
into a Termination and Transition Agreement. Pursuant to that
agreement, Fusion Solutions ceased operating as the exclusive
distributor of Stryker Spine in the NYC and Long Island
regions and assigned its rights in each of the Fusion
Agreements to Stryker Spine. (AC ¶ 74).
Individual Defendants' employment with Stryker
January 1, 2017, Stryker Spine hired the Individual
Defendants, who had been employed by Fusion, as Stryker
Spine's direct employees. (AC ¶ 75). Individual
Defendant Van Cott and non-party Jonathan Isopo were both
hired as sales managers. (AC ¶ 45, 50). Individual
Defendants Casal and Trama were hired as sales
representatives, reporting to Van Cott, (AC ¶ 46-47);
Individual Defendants Nunez, Handelson, Scheiner, and Brennan
were hired as sales representatives, reporting to Isopo, (AC
¶ 52, 53, 54, 55).
hired by Stryker Spine, each of the Individual Defendants
entered into a "Stryker Corporation Confidentiality,
Intellectual Property, Non-Competition and Non-Solicitation
Agreement for U.S. Employees" (the "Stryker
Agreements"). (AC ¶¶ 78, 80-85).
8.11 of the Stryker Agreement, titled "Entire
This document, including its three attachments . . . contains
the entire agreement of the parties related to the matters
addressed in this Agreement . . . This Agreement supersedes
any and all prior agreements between the parties with respect
to the matters addressed in this Agreement."
(DE 34-10 at § 8.11). Similarly, Section 8.12 of the
Stryker Agreement, titled "Prior Agreements"
states: "Except as may be stated herein, I agree and
acknowledge that this Agreement supersedes prior agreements
between me and Stryker with respect to the subject matter
addressed in this Agreement." (DE 34-10 at § 8.12).
the Individual Defendants received an incentive sign-on bonus
during their first pay period in 2017. (AC ¶ 93) They
executed an offer letter agreement obligating them to refund
their sign-on bonus if they terminated employment within
twelve months. (AC ¶ 95).
Individual Defendant's employment with NuVasive
spinal implant industry is highly competitive. (AC ¶
26). Defendant NuVasive is one of Stryker Spine's direct
and largest competitors. (Id.).
Mid-August 2017, NuVasive's Vice President of Sales, Jim
Hens, and a NuVasive sales representative met with Van Cott
and Isopo to discuss bringing Stryker Spine's New York
City and Long Island sales force to NuVasive. (AC ¶
99-100). In conjunction with this meeting, ...