Financial Information Technologies, Inc. v. Lopez
Filing
25
ORDER: Defendant's Motion to Dismiss Amended Complaint 16 is granted in part and denied in part. The motion is granted with respect to Count V, Plaintiff's misleading advertising claim under Fla. Stat. § 817.41. The motion is otherwise denied. Count V of Plaintiff's amended complaint is dismissed with prejudice. Defendant shall file an answer to the amended complaint within fourteen (14) days of this Order. Signed by Judge James S. Moody, Jr on 2/19/2016. (LN)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
FINANCIAL INFORMATION
TECHNOLOGIES, INC.,
Plaintiff,
v.
CASE NO: 8:15-cv-2784-T-30AEP
MARK LOPEZ,
Defendant.
____________________________________/
ORDER
THIS CAUSE comes before the Court upon Defendant’s Motion to Dismiss Amended
Complaint (Dkt. 16) and Plaintiff’s Response in opposition (Dkt. 22). The Court, having
reviewed the motion, response, and being otherwise advised in the premises, concludes that
the motion should be granted in part and denied in part. The motion is granted with respect
to Count V, Plaintiff’s misleading advertising claim under Fla. Stat. § 817.41. The motion
is otherwise denied.
BACKGROUND
Plaintiff Financial Information Technologies, Inc. (“Fintech”) filed the instant action
against its former employee/independent contractor Mark Lopez alleging the following
claims related to Lopez’s actions after he left Fintech: breach of contract; misappropriation
of confidential business information and trade secrets in violation of Florida’s Uniform Trade
Secrets Act (“FUTSA”); tortious interference with business relationships; unfair and
deceptive acts in violation of Florida’s Deceptive & Unfair Trade Practices Act
(“FDUTPA”); misleading advertising in violation of Fla. Stat. § 817.41; injurious falsehood;
and unfair competition. Lopez moves to dismiss each claim, except the breach of contract
claim, under Rule 12(b)(6) of the Federal Rules of Civil Procedure. The relevant allegations
of the amended complaint now follow. Notably, the Court assumes the truth of the
allegations at this juncture.
Fintech is the industry leader in providing electronic data, analytics, and payments to
the beverage alcohol industry. Fintech provides customized invoice information and
electronic payments for distributors of all sizes. Fintech’s proprietary electronic funds
transfer (“EFT”) services produce a cash equivalent for the payment of beer, wine, and
spirits, through the use of electronic invoices. Fintech’s unique suite of proprietary software
systems and data analytics tools enables beverage alcohol distributors to streamline business
processes and receive every payment in full and on time.
Fintech’s success is dependent on its proprietary softare and data analytics systems,
as well as the trusted relationships it has cultivated with its extensive customer base. On
average, Fintech processes more than 450,000 invoices each week, representing $21 billion
in payments annually. Fintech develops and maintains valuable long-standing business
relationships and substantial good will with its customers.
Fintech engages in reasonable efforts to maintain the confidentiality, secrecy, and
proprietary nature of its confidential information and trade secrets. Pursuant to Fintech’s
policies, its employees, independent contractors, and staff must keep its proprietary
information confidential.
-2-
In January 2000, Fintech hired Lopez as a systems analyst. In that capacity, Lopez’s
duties and responsibilities included developing and maintaining Fintech’s proprietary
customer applications, includings its EFT System. Lopez resigned from Fintech in May
2002.
In 2009, Lopez returned to Fintech as a contractor in the sales department. In that
capacity, Lopez gained acccess to Fintech’s confidential information and trade secrets,
including its customer information, business model, pricing structure, and information about
Fintech’s proprietary software and data analytics applications. As a condition of his
employment, Lopez executed a Confidentiality and Non-Compete Agreement and a
Consulting Agreement (the “Agreements”).
The Agreements define what categories of information Fintech deems confidential.
They also contain nondisclosure and confidentiality covenants that preclude Lopez from,
among other things, disclosing Fintech’s confidential information to third parties and using
Fintech’s confidential information for any purpose other than to further Fintech’s business.
In April 2010, Lopez was appointed Fintech’s Vice President of Operations. In that
capacity, Lopez’s duties and responsibilities included managing the activities of the
activation department, overseeing the installation process for new customers, and managing
the customer support department. Subsequently, Lopez became manager of the technology
department. In those roles, Lopez had access to every aspect of Fintech’s confidential
information and trade secrets, including its customer information, proprietary software
applications, and Fintech’s data analytics tools and unique EFT System.
-3-
In May 2012, Lopez separated his employment from Fintech. From March 2015 to
the present, Lopez has been employed by iControl Systems, USA, LLC, as its Executive Vice
President of Operations. iControl was formed in 2005 to provide scan-based trading systems.
More recently, with Lopez’s assistance, iControl has expanded into the area of EFT payment
transactions for the beverage alcohol industry and has begun soliciting Fintech’s customers.1
Fintech alleges that, in his capacity as Executive Vice President for iControl, Lopez
has misappropriated, disclosed, and used for iControl’s benefit, Fintech’s confidential
business information and trade secrets, including Fintech’s confidential customer information
and Fintech’s proprietary EFT System.
According to Fintech, Lopez has also conspired with other iControl employees to
disseminate false and disparaging statements in the relevant business community about
Fintech to Fintech’s customers and prospective customers, including knowingly false
statements about the capabilities and pricing structure of Fintech’s software solutions and
services, for the purpose of interfering with Fintech’s advantageous business relationships.
These statements include the following: Fintech does not have data integrity or analytics;
Fintech does not offer bi-directional data flow commerce; Fintech does not offer customers
help with credit and discrepancy reconciliation; Fintech offers only a single solution; and
because Fintech does not provide bi-directional data flow commerce, iControl was chosen
to be a Board member of the Beer Industry Electronic Commerce Coalition.
1
Fintech considers the identity of its long-standing customers and prospective customers
to be confidential and proprietary, subject to disclosure after the Court’s entry of a protective
order.
-4-
Fintech alleges that Lopez’s actions violate the Agreements. It further avers that
Lopez’s actions constitute unfair competition and propose a significant threat of unlawful
disclosure and use of Fintech’s confidential business information and trade secrets. As a
result of Lopez’s interference with Fintech’s advantageous business relationships, Fintech
has suffered economic damages of more than $1.8 million.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(6) allows a complaint to be dismissed for
failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). When
reviewing a motion to dismiss, a court must accept all factual allegations contained in the
complaint as true, and view the facts in a light most favorable to the plaintiff. See Erickson
v. Pardus, 551 U.S. 89, 93-94 (2007). However, unlike factual allegations, conclusions in
a pleading “are not entitled to the assumption of truth.” Ashcroft v. Iqbal, 129 S. Ct. 1937,
1950 (2009). On the contrary, legal conclusions “must be supported by factual allegations.”
Id. Indeed, “conclusory allegations, unwarranted factual deductions or legal conclusions
masquerading as facts will not prevent dismissal.” Davila v. Delta Air Lines, Inc., 326 F.3d
1183, 1185 (11th Cir. 2003).
DISCUSSION
I.
Lopez’s Argument that the “Single Publication” Rule Precludes Multiple Claims
Lopez argues that Florida’s “single publication/single action” rule does not allow
multiple actions when they stem from the same defamatory publication or event. See
Callaway Land & Cattle Co. v. Banyon Lakes C. Corp., 831 So. 2d 204 (Fla. 4th DCA 2002).
Lopez contends that the single publication rule warrants dismissal of Fintech’s tortious
-5-
interference claim, injurious falsehood and unfair competition claims, as well as its statutory
claims arising under FDUTPA and Fla. Stat. § 817.41 because these claims rely on the same
set of operative facts.
Lopez’s argument is without merit because the single publication/single action rule
relates to claims that are based on a failed defamation claim. In other words, the rule
provides that when a defamation claim is dismissed, the court should also dismiss related tort
claims predicated on the same publication. See Callaway, 831 So. 2d at 208-09 (noting that
if “the defamation claim fails, the other counts based on the same publication must fail as
well because the same privileges and defenses apply.”) (citations omitted).
Here, Fintech has not alleged a defamation action. And, even if it had, Lopez does
not explain how dismissal of such a claim would be warranted. Thus, to the extent Fintech’s
common law tort claims rely, in part, on a defamatory statement, the single publication rule
is inapplicable.2
II.
Lopez’s Argument that FUTSA Precludes Other Tort Actions or Remedies
Lopez argues that FUTSA expressly precludes “conflicting tort, restitutory, and other
law of this state providing civil remedies for misappropriation of a trade secret.” Fla. Stat.
§ 688.008(1). Lopez contends that FUTSA essentially preempts all but Fintech’s breach of
contract claim because the tort claims rely on the same set of facts. This argument, like
Lopez’s argument about the single publication rule, misses the mark.
2
Notably, Fintech alleges multiple statements, made to multiple customers, at multiple
times—each statement is separate and distinct and could potentially support a separate cause of
action against Lopez.
-6-
Although it is true as a general matter that FUTSA preemption applies to other civil
remedies that are based upon the same misappropriation of a trade secret, Fintech’s other tort
claims allege materially distinct facts. For example, Fintech’s tortious interference claim
relies on the additional allegation that Lopez intentionally and unlawfully interfered with
Fintech’s business relationships by making false statements about Fintech to persuade
Fintech’s customers and prospective customers to abandon Fintech. As such, at this juncture,
the Court will not dismiss any claims based on FUTSA preemption. However, Lopez may
renew this argument at the dispositive motion stage if discovery reveals that the tort claims
are essentially premised on the same facts as the FUTSA claim.
III.
Lopez’s Argument that the FUTSA Claim Is Insufficiently Pled
Lopez argues that Fintech’s FUTSA claim is insufficient under Rule 12(b)(6). The
Court disagrees. Fintech alleges detailed facts that: (1) Fintech possessed confidential and
proprietary information and took reasonable steps to protect its secrecy; (2) Lopez
misappropriated this secret information and used it for improper means; and (3) Fintech’s
confidential and proprietary information derives independent economic value from not being
generally known or ascertainable through proper means. See Fla. Stat. § 688.002.
Contrary to Lopez’s contentions, Fintech avers more than just “conclusory
allegations” that Lopez had knowledge of and misappropriated Fintech’s trade secrets. The
amended complaint alleges that, as a Fintech contractor and employee, Lopez had access to
every aspect of Fintech’s confidential information and trade secrets and, within months of
joining iControl, iControl expanded into the area of EFT payment transactions for the
beverage alcohol industry and began soliciting Fintech’s customers to abandon Fintech and
-7-
engage iControl. Accordingly, the motion to dismiss is denied with respect to Fintech’s
FUTSA claim.
IV.
Lopez’s Argument that the Tortious Interference Claim Is Insufficiently Pled
Lopez argues that the tortious interference claim is insufficient under Rule 12(b)(6).
The Court disagrees. A tortious interference claim requires the following elements: (1) the
existence of a business relationship; (2) the defendant’s knowledge of the relationship; (3)
the defendant’s intentional and unjustified interference with the relationship; and (4) damage
to the plaintiff as a result of the breach of the relationship. See Tamiami Trail Tours, Inc. v.
Cotton, 463 So. 2d 1126, 1127 (Fla. 1985). Fintech alleges facts in support of these
elements; Fintech discusses in detail its long-standing business relationship with numerous
customers—notably, Lopez had intimate knowledge of those relationships during his tenure
at Fintech. The amended complaint also includes facts describing false statements that were
made to Fintech’s customers to interfere with their relationship with Fintech. Finally,
Fintech alleges facts related to the damages it has suffered as a result of the loss of business.
Accordingly, the motion to dismiss is denied with respect to the tortious interference claim.
V.
Failure to Allege a Consumer Transaction under the FDUTPA
Lopez’s only basis for dismissal of the FDUTPA claim is that Fintech failed to allege
a “consumer transaction” that constituted an unfair or deceptive act or practice. But, as
Fintech points out, Lopez relies on an outdated version of section 501.211. The current
version of section 501.211 expands the class of potential claimants, replacing “consumer”
with “person.” Accordingly, the motion to dismiss is denied with respect to the FDUTPA
claim.
-8-
VI.
Failure to Allege a Claim of Misleading Advertising
Lopez argues that Fintech fails to state a claim of misleading advertising under Fla.
Stat. § 817.41. The Court agrees to the extent that it concludes that a claim under section
817.41 is inapplicable under the circumstances of this case.
“A consumer party may state a claim for statutory misleading advertising under
Florida law by pleading that the party relied on some identifiable alleged misleading
advertising plus, where appropriate, all of the other elements of the common law tort of fraud
in the inducement, as follows: (a) the representor made a misrepresentation of a material fact;
(b) the representor knew or should have known of the falsity of the statement; (c) the
representor intended that the representation would induce another to rely and act on it; and
(d) the plaintiff suffered injury in justifiable reliance on the representation.” Third Party
Verification, Inc. v. Signaturelink, Inc., 492 F. Supp. 2d 1314, 1322 (M.D. Fla. 2007).
The allegations make clear that Fintech is not a “consumer” that was harmed by any
misrepresentation Lopez made to the public. But Fintech argues that a competitor exception
applies. Fintech contends that, when a competitor makes false statements to the public and
the public relies on them to Fintech’s detriment, Fintech may state a claim under section
817.41. In Third Party Verification, the court implied that an allegation of competition is
permitted to “stand-in” for the element of direct reliance that a consumer is typically
obligated to plead. See id. at 1322. The Court takes no position on whether the competitor
exception applies under Florida law because, even if it is a viable theory, it is inapplicable
here because Fintech did not file this claim against iControl, its competitor. As such, the
-9-
Court concludes that section 817.41 does not apply under the facts of this case and dismisses
this claim with prejudice.
VII.
Fintech’s Remaining Claims of Injurious Falsehood and Unfair Competition
Lopez summarily argues that Fintech’s claims of injurious falsehood and unfair
competition fail to state a claim because they are too conclusory. The Court disagrees. With
respect to the former claim, Fintech alleges detailed facts about the falsehoods Lopez made
about Fintech to third parties. Specifically, the amended complaint lists the specific false
statements that Lopez made about Fintech’s technology and capabilities to Fintech’s
customers and prospective customers at conferences and trade shows after Lopez joined
iControl in March of 2015. Fintech also pleads damages associated with these false
statements. See Salit v. Ruden, McClosky, Smith, Schuster & Russell, P.A., 742 So. 2d 381,
386 (Fla. 4th DCA 1999) (noting that the “gist of the tort of injurious falsehood is the
intentional interference with another’s economic relations.”) (internal quotations and
citations omitted).
With respect to the latter claim, Fintech sufficiently alleges that Lopez engaged in
conduct that is contrary to honest practice in industrial and commercial matters. See Third
Party Verification, 492 F. Supp. 2d at 1325 (noting that “ [t]he Florida common law of unfair
competition is an umbrella for all statutory and nonstatutory causes of action arising out of
business conduct which is contrary to honest practice in industrial or commercial matters.”)
(internal quotations and citations omitted).
Accordingly, Lopez’s motion to dismiss is denied with respect to Fintech’s claims of
injurious falsehood and unfair competition.
-10-
It is therefore ORDERED AND ADJUDGED that:
1.
Defendant’s Motion to Dismiss Amended Complaint (Dkt. 16) is granted in
part and denied in part. The motion is granted with respect to Count V,
Plaintiff’s misleading advertising claim under Fla. Stat. § 817.41. The motion
is otherwise denied.
2.
Count V of Plaintiff’s amended complaint is dismissed with prejudice.
3.
Defendant shall file an answer to the amended complaint within fourteen (14)
days of this Order.
DONE and ORDERED in Tampa, Florida on February 19, 2016.
Copies Furnished To:
Counsel/Parties of Record
S:\Even\2015\15-cv-2784.mtdismiss-16-deny.wpd
-11-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?