Digital Assurance Certification, LLC v. Pendolino

Filing 203

PERMANENT INJUNCTION entered 198 . Signed by Magistrate Judge Thomas B. Smith on 2/25/2019. (Smith, Thomas) (Additional attachment(s) added on 2/25/2019: # 1 Exhibit A) (RMF).

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
DIGITAL ASSURANCE CERTIFICATION,
LLC,
Plaintiff,
v.

Case No: 6:17-cv-72-Orl-41TBS

ALEX PENDOLINO, JR. and LUMESIS,
INC.,
Defendants.
PERMANENT INJUNCTION 1
This case comes before the Court on the parties’ Stipulated Motion for Entry of
Consent Injunction as to Defendant Alex Pendolino, Jr.—and—Notice of Settlement
Contingent Upon Entry of Injunction (Doc. 198).
Plaintiff Digital Assurance Certification, LLC (“DAC”) has filed this lawsuit
(“Lawsuit”) against Defendants Alex Pendolino, Jr. (“Pendolino”) and Lumesis, Inc.
(“Lumesis”) in which it has alleged the following claims: (i) misappropriation of trade
secrets in violation of the Defend Trade Secrets Act of 2016, 18 U.S.C. § 1836 against
Pendolino and Lumesis; (ii) misappropriation of trade secrets in violation of the Florida
Uniform Trade Secrets Act against Pendolino and Lumesis; (iii) breach of contract against
Pendolino; and (iv) tortious interference with business and contractual relationships
against Lumesis, and DAC has requested damages and injunctive relief in the Lawsuit,
which claims and right to relief Pendolino and Lumesis have denied.
1 The parties have consented to the referral of this case to the magistrate judge for resolution of
this motion (Doc. 200). On February 21, 2019, the district judge entered his Order referring the case to the
magistrate to conduct all proceedings and enter a final order on the motion in accordance with 28 U.S.C. §
636(c) (Doc. 201).

The parties have represented to the Court that:
(i) DAC on the one hand, and Pendolino and Lumesis, on the other hand, have
entered into a Settlement Agreement to resolve any and all controversies and
disputes between them existing as of this date without any admission of liability with
respect to the claims and demands asserted in the Lawsuit, conditioned upon the
entry by the Court of this consent permanent injunction as to Pendolino.
(ii) Pursuant to the Settlement Agreement, DAC has agreed to dismiss its
claims for damages and attorneys' fees and costs following the entry by the Court of
this consent permanent injunction as to Pendolino in consideration for the terms and
conditions set forth in the Settlement Agreement executed by the parties.
(iii) Pursuant to the Settlement Agreement, Pendolino has agreed and
consented to entry by the Court of this permanent injunction.
(iv) Pendolino and DAC entered into a Confidentiality Agreement, attached as
Exhibit 2 to the Second Amended Verified Complaint (ECF #90-2) and attached
hereto as Exhibit A, which defines DAC's "Proprietary Property" as "the Company's
methodologies, systems and tools and other confidential or proprietary information of
the Company, including client lists, pricing and other confidential business
information and/or confidential or proprietary information of its clients" and further
provides that the restrictions of the Confidentiality Agreement do not apply to
information: in the public domain through no fault or breach of the Confidentiality
Agreement by Pendolino; previously and lawfully known by Pendolino prior to
disclosure by DAC; and rightfully learned from a third-party not under restriction of
disclosure; and Pendolino asserts he does not have possession of DAC Proprietary
Property.

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The parties agree that a "trade secret" is information that: (a) derives independent
economic value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use; and (b) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy. See FLA. STAT. § 688.002(4); 18 U.S.C. § 1839(3).
The Court in an Order issued in the Lawsuit on September 9, 2018 (ECF 149)
directed DAC to produce to Lumesis and Pendolino all additional documents and
information that DAC contended contained DAC trade secrets, and only those documents
so produced and designated by DAC would be considered a Trade Secret upon which
DAC based its claims. DAC asserts that the documents, electronic information and
testimony it has designated in the Lawsuit as "Highly Confidential" or "Highly
Confidential-Counsel Only" contain its trade secret information in the Lawsuit (the "DAC
Trade Secret Information"), including the documents identified on Exhibit B to the Expert
Report of Charles Platt. For purposes of this permanent injunction, the documents,
electronic information and testimony designated by DAC in the Lawsuit as "Highly
Confidential" or "Highly Confidential-Counsel Only" shall be the "DAC Trade Secret
Information." Pendolino has not admitted that the DAC Trade Secret Information
constitutes protectable trade secrets under Florida and federal law or that he has
possession of DAC Trade Secret Information.
The DAC Trade Secret Information does not include information which: (i) is in the
public domain in the same form; (ii) is or was received by Pendolino from an independent
source having the right to such information without restriction or obligation of confidence
or non-disclosure, and without the information having been solicited, obtained, or
assembled by any use of DAC Trade Secret Information; or (iii) is or was independently

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developed by Pendolino either prior to his employment at DAC or after his separation by
DAC and without the use of any DAC Trade Secret Information.
Pendolino has consented and agreed that this Court enter this injunction
permanently enjoining him, and all others in active concert or participation with him who
receive actual notice of this permanent injunction, from misappropriating, possessing,
retaining, distributing or utilizing any of DAC Trade Secret Information as described or
identified herein, or from breaching his continuing obligations under the Confidentiality
Agreement, which he agrees, remains in full force and effect.
Now, upon the consent of DAC and Pendolino, it is ORDERED, ADJUDGED,
and DECREED:
(1) Pendolino and all other persons in active concert or participation with him
who receive actual notice of this permanent injunction are hereby permanently enjoined
from misappropriating, possessing, retaining, distributing or utilizing, in hard copy or
electronic format or otherwise, any DAC Trade Secret Information as described or
identified herein to the extent protectable under Florida and Federal law. The restriction
in this paragraph on "possession" of DAC Trade Secret Information shall not include
any information which is known to or remembered by Pendolino by virtue of his
employment with DAC.
(2) Pendolino and all other persons in active concert or participation with him
who receive actual notice of this permanent injunction are hereby permanently enjoined
from breaching or inducing the breach of the continuing obligations of Pendolino under
the Confidentiality Agreement.

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(3) Each and every claim for damages, costs, and attorneys’ fees by DAC
against Pendolino asserted in the Lawsuit, other than this permanent injunction is
hereby dismissed without prejudice.
(4) There shall be no appeal herefrom.
(5) Following entry of this permanent injunction, and upon the filing by DAC of
the voluntary stipulated dismissal of Lumesis with prejudice (as per Doc. 198), this case
shall be closed, except that this Court shall retain jurisdiction for the purpose of
enforcing this permanent injunction.
DONE and ORDERED in Orlando, Florida on February 25, 2019.

Copies furnished to:
Counsel of Record
Unrepresented Parties

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