Vox Falls ‘Far Short’ of Pleading Standard in Trade Secrets Complaint, Says Gage

Vox Network Solutions’ April 21 opposition to Gage Technologies’ motion to dismiss Vox’s misappropriation of trade secrets complaint (see 2304240010) “makes clear that nothing actionable happened” while individual defendants Kristopher McGreevey and Kevin Frazier worked for Vox, said Gage’s reply brief Tuesday (docket 3:22-cv-09135) in U.S. District Court for Northern California in San Francisco. Vox alleges McGreevey, its then regional sales director, and Frazier, then senior account executive, conspired with Gage to “raid and exploit” confidential Vox information and resources in order to “poach” Vox clients and employees.

Vox “is really suing about the loss of a single customer relationship,” Consumer Cellular, that occurred after Gage, McGreevey and Frazier “had an absolute right to compete with Vox” under the California business and professional code, said Gage’s reply. To litigate around California’s well-established public policy favoring “unrestricted competition and employee mobility,” Vox takes “a shotgun approach,” claiming trade secret misappropriation and eight other causes of action, it said.

As Gage asserted in its opening brief, Vox’s complaint falls “far short of the pleading standard” of the Northern District of California because “it never explains what unlawful things” the defendants supposedly did “beyond conclusory allegations devoid of facts,” said Gage’s reply. Vox’s opposition brief doesn’t rebut the defendants’ showing in the opening brief, “and it identifies no allegations that could cure the deficiencies through amendment,” it said. Gage’s motion should be granted and the complaint dismissed with prejudice, it said.

Vox’s California Uniform Trade Secrets Act (CUTSA) claim must be dismissed without leave to amend because it’s “inadequately pled,” and Vox’s arguments to the contrary are inconsistent with Rule 8 of the Federal Rules of Civil Procedure and with California law, said Gage’s reply. The CUTSA claim also isn’t supported by adequate allegations of misappropriation, it said. Vox also fails to allege harm involving a trade secret, it said. Vox’s CUTSA claim also “is fundamentally at odds with employees’ rights to engage in lawful competition with a former employer,” it said.

Vox doesn’t seriously dispute it must plead its trade secrets with sufficient specificity, but its complaint falls “short of the standard,” said Gage’s reply. Vox’s complaint just alleges Vox requires employees to sign confidentiality agreements, but it doesn’t identify any trade secrets “beyond general categories of information that could be confidential,” it said.

What’s missing from Vox’s opposition and complaint is identification of trade secrets that defendants Gage, McGreevey or Frazier “supposedly took, used, stole, or otherwise misappropriated,” said the reply. It’s “not enough” to say Vox “generally has some trade secrets somewhere in its business -- so what?” it said. “Vox must identify the trade secrets at issue in this case,” which it hasn’t done, it said.

Vox’s allegations for the “second element” of a CUTSA claim, the actual misappropriation, “are also inadequate,” said Gage’s reply. “Vox must allege facts showing improper acquisition or use of the alleged trade secrets -- which it has not,” it said. Vox makes a “conclusory allegation” that McGreevey and Frazier used Vox-registered email accounts to “covertly transmit” Vox’s confidential information to Gage, it said.

But Vox and Gage were business partners and they executed a mutual nondisclosure agreement, it said. Vox doesn’t allege “what was transferred and why it was improper in light of the partnership and NDA,” it said: “The conclusory allegation is meaningless because Vox agreed to share at least some confidential information with Gage.”