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United States District Court for the Southern District of New York
May 10, 2022, Decided; May 10, 2022, Filed
21 Civ. 4855 (KPF)
OPINION AND ORDER
KATHERINE POLK FAILLA, District Judge:
Plaintiff Catalyst Advisors, L.P. ("Catalyst," or the "Company"), an international executive recruitment firm, filed suit against two of its former partners, Catalyst Advisors Investors Global Inc. ("CAIG") and Christos Richards (together, "Defendants"), for allegedly appropriating Plaintiff's proprietary information and then exploiting it to unfairly compete with Plaintiff. For this conduct, Plaintiff asserts claims for violation of the Defend Trade Secrets Act ("DTSA"), 18 U.S.C. §§ 1831-1839, common-law misappropriation of trade secrets, breach of contract, breach of the implied covenant of good faith and fair dealing, and breach of fiduciary duty. Defendants have moved to dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) on the grounds that Plaintiff [*2] has failed to establish the elements of its only federal claim under the DTSA and that the Court should decline to exercise supplemental jurisdiction over the remaining state-law claims. For the reasons outlined in the remainder of this Opinion, the Court grants in part and denies in part Defendants' motion to dismiss.
A. Factual Background
1. Plaintiff's Business and Trade Secrets
Plaintiff is a Delaware limited partnership with its principal place of business in New York. (Am. Compl. ¶ 13). Plaintiff operates as an international executive recruitment firm that specializes in the placement of board members, CEOs, and other "C-suite" level positions in the biopharmaceutical and life sciences industry. (Id. at ¶ 14). Plaintiff explains that in the ordinary course of its business, it creates and maintains "confidential and proprietary" information, which includes: "resumes, curricul[a] vitae, proposal letters, contracts, progress reports, firm brochures, notes from client update calls and discussions with candidates, marketing materials, references, and other Catalyst internal documents" (together, "Catalyst IP"). (Id. at ¶ 38). Within the broad category of Catalyst IP is [*3] personalized information and analytics specific to each executive candidate that Plaintiff was hired to assess and recruit on behalf of its clients. (Id. at ¶ 39). Plaintiff expended hundreds of hours developing Catalyst IP, which included interviewing candidates and assessing their fit and eligibility for various roles that their clients sought to fill. (Id. at ¶¶ 40, 90). These information-gathering efforts allowed Plaintiff to garner institutional knowledge that endowed Plaintiff with a competitive advantage in the recruiting industry. (Id. at ¶ 40).
One specific component of Catalyst IP identified by Plaintiff in the Amended Complaint is its list of candidates, which list includes the names, current employers, titles, and contact information of more than 1,100 Chief Medical Officers and physician executives in the pharmaceutical industry around the world (the "Candidate List"). (Am. Compl. ¶ 89). In developing the Candidate List, Plaintiff spent hundreds of hours and thousands of dollars in data subscription fees. (Id. at ¶ 90). The Candidate List contains information that is not publicly available and that is valuable to anyone conducting executive searches in the field of biopharmaceuticals. [*4] (Id. at ¶ 93). This compilation of detailed information on specialized professionals attracts clients to Plaintiff's services. (Id. at ¶¶ 90, 94).
Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.
2022 U.S. Dist. LEXIS 84509 *; 2022 WL 1471033
CATALYST ADVISORS, L.P., Plaintiff, -v.- CATALYST ADVISORS INVESTORS GLOBAL INC. ("CAIG") and CHRISTOS RICHARDS, Defendants.
trade secret, Candidate, misappropriation, allegations, partner, motion to dismiss, breach of contract claim, confidential, fair dealing, good faith, plaintiff's claim, duplicative, confidentiality provision, employees, customer, breach of the implied covenant, breach of fiduciary duty, proprietary information, third party, contractor, recruiting, measures, secrecy, hire, disclosure, documents, breached, secret, trade secret protection, new employer