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Plastronics Socket Partners Ltd. v. Highrel Inc.

United States District Court for the District of Arizona

May 9, 2019, Decided; May 9, 2019, Filed

No. CV-18-03201-PHX-SMB

Opinion

ORDER

Pending before this court are two motions: Defendant Paul Shubring's Motion to Dismiss Plaintiffs' First Amended Complaint and Request For Injunction (Doc. 20) and Defendant Dong Weon Hwang's Motion to Dismiss Plaintiffs' First Amended Complaint and Request For Injunction (Doc. 41). The motions are fully briefed and there is no request for oral argument.

I. Factual Background

Plastronics [*2]  Socket is a provider of technology and innovation for the semiconductor industry, including burn-in sockets and related components. (Doc. 11 ¶ 2, "FAC"). Defendants Hwang and Schubring are both former Plastronics employees. (FAC ¶¶ 3-4). Defendant Hwang worked for Plastronics as the Chief Technology Officer from October 2004 until April 2008. (FAC ¶¶ 36, 46). Defendant Schubring worked for Plastronics from October 2007 until April 2009 (FAC ¶¶ 50, 54). Defendant Schubring managed the supply chain for burn-in sockets and related components. (FAC ¶ 50).

Plaintiffs allege that Hwang "received, agreed, and signed a letter agreement from Plastronics regarding the Proprietary Information of Plastronics (the 'Confidential Information Acknowledgment Agreement')" upon leaving the company and that the agreement informed Hwang of his obligations to maintain the secrecy of the proprietary information. (FAC ¶ 47). Plaintiffs further allege that Schubring signed a proprietary information agreement as a condition of his employment and that it required Schubring to keep proprietary material confidential. (FAC ¶¶ 51-52).

Defendant Hwang formed HiCon Ltd. on or about April 30, 2008, to manufacture and [*3]  sell competing products. (FAC ¶ 57). On or about July 27, 2009, Hwang formed HiCon Co. to design and sell competing products. (FAC ¶ 60). In 2016, Hwang and Schubring formed HiCon USA, which signed an exclusive distribution agreement with HiCon Ltd. and/or HiCon Co. for the territory of North America. (FAC ¶ 65).

On October 10, 2018, Plaintiffs filed their First Amended Complaint (FAC) alleging the following counts: (1) patent infringement against HiCon USA, (2) patent infringement against HighRel, (3-4) misappropriation of trade secrets in violation of the Federal Defend Trade Secrets Act ("DTSA"), 18 U.S.C. 1836(c), and the Arizona Uniform Trade Secrets Act ("AUTSA"), A.R.S. § 44-401 et seq., against Hwang, (5-6) misappropriation of trade secrets in violation of DTSA and AUTSA against Schubring, (7) breach of contract against Hwang, (8) breach of fiduciary duty against Hwang, (9) breach of contract against Schubring, and (10) tortious interference with business expectancy, prospective business relations against all Defendants.

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2019 U.S. Dist. LEXIS 78569 *; 2019 WL 2054362

Plastronics Socket Partners Limited, et al., Plaintiffs, v. Highrel Incorporated, et al., Defendants.

Subsequent History: Dismissed without prejudice by, in part Plastronics Socket Partners Ltd. v. HighRel Inc., 391 F. Supp. 3d 896, 2019 U.S. Dist. LEXIS 85923 (D. Ariz., May 22, 2019)

Motion granted by, Dismissed by, Without prejudice, Motion denied by, As moot Plastronics Socket Partners Ltd. v. Highrel Inc., 2020 U.S. Dist. LEXIS 11149 (D. Ariz., Jan. 21, 2020)

CORE TERMS

trade secret, misappropriated, motion to dismiss, allegations, confidential information, proprietary information, amended complaint, trade secret information, Socket, misappropriation of trade secrets, independent economic value, preempted, derives