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Advanced Fluid Sys. v. Huber

United States District Court for the Middle District of Pennsylvania

June 18, 2014, Decided; June 18, 2014, Filed

CIVIL ACTION NO. 1:13-CV-3087

Opinion

 [*312]  MEMORANDUM

Plaintiff Advanced Fluid Systems, Inc. ("AFS") filed the above-captioned action seeking injunctive relief and compensatory and punitive damages based upon violations of the Lanham Act, 15 U.S.C. § 1051 et seq., the Computer Fraud and Abuse Act, 18 U.S.C. § 1030, and the Pennsylvania Uniform Trade Secrets Act, 12 Pa. Cons. Stat. § 5301 et seq., along with various  [**2] common law claims. Before the court are two motions filed by Livingston & Haven, LLC ("L&H"), Clifton B. Vann IV, and Thomas Aufiero, (Doc. 28), and Kevin Huber and Integrated Systems and Machinery, LLC ("INSYSMA") (Doc. 33),1 seeking dismissal of AFS's amended complaint  [*313]  in its entirety. In a memorandum and order (Docs. 53-54) dated May 7, 2014, the court rejected defendants' arguments related to subject-matter jurisdiction, personal jurisdiction, compulsory joinder, and transfer under 28 U.S.C. § 1404(a). This memorandum will assess the parties' arguments under Federal Rule of Civil Procedure 12(b)(6). For the reasons that follow, the court will grant in part and deny in part the motions.

I.Factual Background and Procedural History2

A. Parties

Plaintiff AFS is a Pennsylvania corporation that designs, assembles, and installs hydraulic systems that use pressurized fluids to move heavy machinery for complex operations. (Doc. 65 ¶ 1). Relevant to the instant action, AFS created the Transporter/Erector/Launcher/Hydraulic System ("TELHS") for the Mid-Atlantic Regional Spaceport ("MARS") on Wallops Island, Virginia, pursuant to a contract with the Virginia Commercial Space Flight Authority ("VCSFA") dated September 30, 2009. (Id.) Under the TELHS contract, VCSFA hired AFS to "provide the complete specification, engineering drawings, analyses, testing requirements, operating descriptions, interfaces with other launch facility systems and all related engineering and professional design services to develop the final and complete design for the Antares' [sic] rocket['s] hydraulic motion control system." (Id. ¶ 26).

Orbital is the developer of the Antares rocket and agreed to launch the rocket from the MARS facility upon construction of the facility  [**4] and the purchase of certain hardware, including TELHS. (Id. ¶ 25). AFS successfully designed, assembled, and installed TELHS at the MARS facility, and the first test launch of the Antares rocket took place in February 2013. (Id. ¶¶ 29-31). In the process of completing the contract, AFS generated substantial internal documentation, including thousands of engineering drawings and diagrams and proprietary software code, which are kept in password-protected electronic files on AFS's server. (Id. ¶ 36). VCSFA acquired "legal ownership to all inventions or works" created under the contract, but AFS remained in physical possession and control of the trade secrets and continued to used them in a confidential manner to fulfill its obligations. (Id. ¶ 37). When necessary, AFS provided Orbital with certain confidential information to help integrate TELHS with the Antares rocket. (Id.)

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28 F. Supp. 3d 306 *; 2014 U.S. Dist. LEXIS 82562 **; 2014 WL 2770231

ADVANCED FLUID SYSTEMS, INC., Plaintiff, v. KEVIN HUBER, INSYSMA (INTEGRATED SYSTEMS AND MACHINERY, LLC), LIVINGSTON & HAVEN, LLC, CLIFTON B. VANN IV, and THOMAS AUFIERO, Defendants.

Subsequent History: Affirmed by Advanced Fluid Sys. v. Huber, 2020 U.S. App. LEXIS 13903 (3d Cir. Pa., Apr. 30, 2020)

Prior History: Advanced Fluid Sys., Inc. v. Huber, 2014 U.S. Dist. LEXIS 62799 (M.D. Pa., May 7, 2014)

CORE TERMS

trade secret, misappropriation, alleges, defendants', ownership, amended complaint, bid, damages, accessed, Lanham Act, courts, authorization, Hydraulic, upgrade, false designation, false advertising, advertising, violations, confidential information, website, secret, contracts, asserts, contractual relationship, motion to dismiss, installed, preemption, customers, launch, intentionally

Civil Procedure, Subject Matter Jurisdiction, Federal Questions, General Overview, Jurisdiction, Diversity Jurisdiction, Supplemental Jurisdiction, Same Case & Controversy, Defenses, Demurrers & Objections, Motions to Dismiss, Failure to State Claim, Pleading & Practice, Motion Practice, Pleadings, Amendment of Pleadings, Leave of Court, Complaints, Requirements for Complaint, Trade Secrets Law, Misappropriation Actions, Definitions of Misappropriation, Elements of Misappropriation, Existence & Ownership, Business & Corporate Compliance, Trade Secrets Law, Federal Versus State Law, Uniform Trade Secrets Act, Improper Means, Computer & Internet Law, Criminal Offenses, Data Crimes & Fraud, Torts, Multiple Defendants, Concerted Action, Civil Aiding & Abetting, Remedies, Damages, Opposing Memoranda, Trademark Law, Federal Unfair Competition Law, False Advertising, False Designation of Origin, Lanham Act, Scope, Standing, Elements of False Advertising, Puffery, Elements of False Designation of Origin, Palming Off, Reverse Palming Off, Contracts, Intentional Interference, Elements