Employment: Company granted injunction against former employees

Where two former employees violated their own non-solicitation/non-compete agreements, they were enjoined from soliciting any other clients, customers or employees.

Background

U.S. Healthtek Inc, or USHT, filed a multi-count complaint, and moved for injunctive relief. USHT essentially argues three categories of claims support injunctive relief: (i) misappropriation of trade secrets; ii) breach of contract/tortious interference and (iii) business conspiracy.

Trade secret

USHT identifies two categories of alleged trade secret information: “(a) the highly complex documentation drafted by [USHT employee Barbara] Breeden; and (b) the insider knowledge [former employees Robert Negosian and Kiranmayee Digavinti had that would enable them both to interpret the documentation and use it to complete the project.”

As the Supreme Court of Virginia has recognized, information retained and “compiled solely from [employees’] memories” does not constitute misappropriation of a trade secret. The Fourth Circuit, relying on this decision, has likewise held that an employee’s “knowledge . . . was neither a trade secret nor confidential or proprietary information.” Thus, USHT has not established that any of the defendants misappropriated a trade secret through Negosian or Digavinti.

Even assuming that the unspecified Breeden documentation constitutes a trade secret, USHT has not established a reasonable likelihood of success of establishing that such documentation was misappropriated. Unlike other cases considered by this court, USHT has not adduced evidence that the documentation was downloaded, copied or printed before Negosian’s or Digavinti’s departure.

As USHT argued in the Reply Brief and at oral argument, its central theory with respect to misappropriation is: (i) Negosian and Digavinti “must have” unlawfully obtained that documentation and (ii) “must have” used it to assist ACM. But this argument builds on speculative assertions that are not supported by concrete facts. Moreover, as [defendant ACM Global Laboratories] noted, “Virginia does not recognize the inevitable disclosure doctrine.”

Contract/interference

USHT asserts that ACM has breached the ACM contract’s non-solicitation clause by working with Negosian and Digavinti. The court accepts, for purposes of this motion, that USHT has established a likelihood of success on the merits with respect to the breach of contract alleged against ACM. But the ACM contract provided for a liquidated damages provision. And USHT terminated Negosian, while Digavinti was an independent contractor, and her contract was set to expire by Dec. 31, 2026. Because there is a lack of irreparable harm associated with ACM’s alleged breach of contract, no injunctive relief is warranted with respect to that claim.

USHT also alleges that Negosian and Digavinti have breached their own non- solicitation/non-compete agreements. USHT has also shown a likelihood of success on the merits of its breach of contract claims against both. The remaining elements support an injunction prohibiting ordering Negosian and Digavinti not to solicit any other clients or customers and prohibiting Negosian from soliciting any additional USHT employees.

To the extent the aiding and abetting claim against ACM is premised on the misappropriation of trade secrets, that claim fails for the reasons discussed above. To the extent that the aiding and abetting is premised on Negosian and Digavinti’s breaches of contract, there is no allegation that ACM knew the contents of their employment contracts with USHT and, based on the evidence presented, ACM did not engage to work with either Negosian or Digavinti until after their employment with USHT had ended.

Business conspiracy

USHT primarily premises its business conspiracy claim on the alleged misappropriation of trade secrets claims, which, as discussed above, fails. USHT asserts that the business conspiracy claim also rests on the alleged breaches of fiduciary duty. But, as noted, USHT has also failed to establish a likelihood of success on the aiding and abetting breach of fiduciary duty claim. Thus, USHT has not established an act that is itself wrongful or tortious, beyond merely a breach of contract. Furthermore, USHT has failed to adequately allege a conspiratorial agreement. USHT alleges a conspiracy in only the most conclusory terms.

Conclusion

The motion is granted only as to the breach of contract claims against Negosian and Digavinti and is denied with respect to the misappropriation of trade secrets claim and all claims against ACM.

Plaintiff’s motion for injunctive relief granted in part, denied in part.

U.S. Healthtek Inc. v. Negosian, Case No. 1:25-cv-130, Feb. 28, 2025. EDVA at Alexandria (Alston). VLW 025-3-080. 20 pp.