360 Imaging, LLC v. ITXPros Dental, Inc. et al

Filing 14

OPINION AND ORDER: ITXPros, LLC's Motion to Dismiss 3 is DENIED. Signed by Judge Thomas W. Thrash, Jr. on 8/2/2022. (jra)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
360 IMAGING, LLC,
Plaintiff,
v.

CIVIL ACTION FILE
NO. 1:21-CV-5237-TWT

ITXPROS LLC, et al.,
Defendants.
OPINION AND ORDER
This is an action for breach of contract and misappropriation of trade
secrets. It is before the Court on ITXPros LLC’s Motion to Dismiss [Doc. 3]. 1
For the reasons set forth below, ITXPros LLC’s Motion to Dismiss [Doc. 3] is
DENIED.
I.

Background

The Plaintiff 360 Imaging, LLC is in the business of creating dental
implant plans, surgical guides, and other digital tools for dental healthcare
providers nationwide. (Compl. ¶¶ 7, 20.)2 These services are made possible by
a proprietary treatment planning software, which the Plaintiff developed using

ITXPros Dental, Inc. originally joined the Motion to Dismiss but was
then dismissed without prejudice by the Plaintiff in January 2022 [Doc. 9].
1

The Court accepts the facts alleged in the complaint as true for
purposes of a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6).
See Wildling v. DNC Servs. Corp., 941 F.3d 1116, 1122 (11th Cir. 2019).
2

its own computer code and guards from public disclosure as a trade secret. (Id.
¶¶ 46-48.) The Plaintiff maintains its principal place of business in Atlanta
and formerly employed all of the individual defendants in this case (the
“Former Employee Defendants”). (Id. ¶¶ 1, 7.) According to the Complaint, the
Former Employee Defendants—Karim Mohamed ElSayed, Ahmed Khater,
Hussein Tarek, Sara Amin, Shenouda Samir, Basem Tarek, Aya Abdel Kader
Moustafa, and Maram Alaa Eldin Azmy—left their jobs with the Plaintiff to
form and work for a direct competitor, Defendant ITXPros LLC. (Id. ¶ 1.)
Allegedly, the Former Employee Defendants (with ITXPros’ knowledge and
participation) copied, took, disclosed, and used the Plaintiff’s confidential
information and trade secrets to divert business to ITXPros. (Id. ¶¶ 2-3, 25,
28-29, 37, 40, 42-43, 49, 54-55.) All this despite the fact that Defendants
ElSayed, Samir, and Azmy allegedly signed non-compete and non-solicitation
agreements during their employment with the Plaintiff. (Id. ¶¶ 30-33.)
Following these events, the Plaintiff filed suit against the Defendants
asserting claims for breach of contract, breach of fiduciary duty and duty of
loyalty, misappropriation of trade secrets, theft and conversion, and tortious
interference with contractual and business relations, among others. Now,
ITXPros moves to dismiss the claims against it under Rules 12(b)(2) and
12(b)(6) for lack of personal jurisdiction and failure to state a claim for relief,
respectively. As a Delaware company with no employees or assets in Georgia,
ITXPros argues that it does not have sufficient contacts in the state to trigger
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either general or specific jurisdiction. In the alternative, it argues that the
Complaint’s allegations are too conclusory and vague to supply the necessary
factual basis for the Plaintiff’s claims. The Court addresses—and ultimately
rejects—each argument for dismissal in turn.
II.

Legal Standard

On a motion to dismiss for lack of personal jurisdiction under Rule
12(b)(2), “the plaintiff has the burden of establishing a prima facie case by
presenting enough evidence to withstand a motion for directed verdict.” United

States ex rel. v. Mortgage Invs. Corp., 987 F.3d 1340, 1356 (11th Cir. 2021). In
evaluating a plaintiff’s case, “[t]he district court must construe the allegations
in the complaint as true, to the extent they are uncontroverted by defendant’s
affidavits or deposition testimony.” Morris v. SSE, Inc., 843 F.2d 489, 492 (11th
Cir. 1988). Where the defendant contests the allegations in the complaint
through affidavits, “the burden shifts back to the plaintiff to produce evidence
supporting personal jurisdiction, unless the defendant’s affidavits contain only
conclusory assertions that the defendant is not subject to jurisdiction.” Stubbs

v. Wyndham Nassau Resort & Crystal Palace Casino, 447 F.3d 1357, 1360
(11th Cir. 2006). “And where the evidence presented by the parties’ affidavits
and deposition testimony conflicts, the court must draw all reasonable
inferences in the plaintiff’s favor.” Mortgage Invs. Corp., 987 F.3d at 1356
(quotation marks omitted).
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A complaint should be dismissed under Rule 12(b)(6) only where it
appears that the facts alleged fail to state a “plausible” claim for relief. Ashcroft

v. Iqbal, 556 U.S. 662, 678 (2009); Fed. R. Civ. P. 12(b)(6). A complaint may
survive a motion to dismiss for failure to state a claim, however, even if it is
“improbable” that a plaintiff would be able to prove those facts; even if the
possibility of recovery is extremely “remote and unlikely.” Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 556 (2007). In ruling on a motion to dismiss, the court
must accept the facts pleaded in the complaint as true and construe them in
the light most favorable to the plaintiff. See Quality Foods de Centro Am., S.A.

v. Latin Am. Agribusiness Dev. Corp., S.A., 711 F.2d 989, 994-95 (11th Cir.
1983); see also Sanjuan v. American Bd. of Psychiatry & Neurology, Inc., 40
F.3d 247, 251 (7th Cir. 1994) (noting that the plaintiff “receives the benefit of
imagination” at the pleading stage). Generally, notice pleading is all that is
required for a valid complaint. See Lombard’s, Inc. v. Prince Mfg., Inc., 753
F.2d 974, 975 (11th Cir. 1985). Under notice pleading, the plaintiff need only
give the defendant fair notice of his claims and the grounds upon which they
rest. See Erickson v. Pardus, 551 U.S. 89, 93 (2007).
III.

Discussion

A. Personal Jurisdiction
A federal court sitting in diversity engages in a two-step inquiry to
determine whether it has personal jurisdiction over a nonresident defendant.
That is, the exercise of jurisdiction must (1) be appropriate under the forum
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state’s long-arm statute and (2) not violate the Due Process Clause of the
Fourteenth Amendment to the Federal Constitution. See Diamond Crystal

Brands, Inc. v. Food Movers Int'l, Inc., 593 F.3d 1249, 1257-58 (11th Cir. 2010).
“When a federal court uses a state long-arm statute, because the extent of the
statute is governed by state law, the federal court is required to construe it as
would the state’s supreme court.” Id. at 1258 (quotation marks omitted). In
particular, the Georgia Supreme Court has explained that the Georgia
long-arm statute is not coextensive with procedural due process but rather
imposes “independent obligations” that a plaintiff must demonstrate to invoke
the state’s personal jurisdiction. Id. at 1259; see also Innovative Clinical &

Consulting Servs., LLC v. First Nat’l Bank of Ames, Iowa, 279 Ga. 672, 673
(2005) (reaffirming that a nonresident defendant “must do certain acts as
delineated by the statute before the nonresident could be subjected to personal
jurisdiction in Georgia” (quotation marks omitted)).
Here, the Plaintiff relies on one subsection of the Georgia long-arm
statute—the “transacting-business” prong—to establish personal jurisdiction
over ITXPros. As the name suggests, the transacting-business prong confers
specific jurisdiction over an out-of-state defendant who, in person or through
an agent, “[t]ransacts any business within [Georgia][.]” O.C.G.A. § 9-10-91(1).
Nothing in this text “requires the physical presence of the nonresident in
Georgia or minimizes the import of a nonresident’s intangible contacts with
the State.” Innovative Clinical, 279 Ga. at 675. Instead, three factors are used
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to determine whether jurisdiction is proper under § 9-10-91(1):
(1) [if] the nonresident defendant has purposefully done some act
or consummated some transaction in this state, (2) if the cause of
action arises from or is connected with such act or transaction,
and (3) if the exercise of jurisdiction by the courts of this state
does not offend traditional fairness and substantial justice.

Amerireach.com, LLC v. Walker, 290 Ga. 261, 269 (2011) (citation omitted).
The first two factors ensure that the defendant has sufficient minimum
contacts in Georgia to support jurisdiction in its courts. See Aero Toy Store,

LLC v. Grieves, 279 Ga. App. 515, 518 (2006). Assuming the minimum-contacts
requirement is satisfied, the court next evaluates the reasonableness of
exercising jurisdiction, taking into account “the burden on defendant, the
forum state’s interest in adjudicating the dispute, plaintiff’s interest in
obtaining convenient and effective relief, the interstate judicial system’s
interest in obtaining the most efficient resolution to controversies, and the
shared interest of the states in furthering substantive social policies.” Id.
According to the declaration of its chief operating officer Bassem
ElSahhar, ITXPros is a Delaware limited liability company with its principal
place of business in Tampa, Florida. (ElSahhar Decl. ¶ 2.) The company does
not have any employees, contractors, offices, or assets in Georgia; it does not
manufacture any products that are shipped to Georgia; and its services are
performed outside the United States by an all-Egyptian staff. (Id. ¶¶ 4-5.) On
these facts, ITXPros argues that its contacts in Georgia are too few to trigger
any subsection of the long-arm statute, including the transacting-business
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prong. (Defs.’ Br. in Supp. of Defs.’ Mot. to Dismiss, at 7-8.)
In response, the Plaintiff submits a declaration from its chief financial
officer Ayman Abouhend showing that ITXPros has, in fact, worked many
times with clients in Georgia. For example, Abouhend references and attaches
multiple social media posts in which SYNrG Lab LLC, a Georgia healthcare
company and the Plaintiff’s former client, touted its business relationship with
ITXPros. (Abouhend Decl. ¶¶ 16-17, 19-21 & Exs. C (“My NEW favorite guide
partner. ITXPros – i [sic] thought my previous guide partner was great UNTIL
we started working with ITXPros.”), D (“Tomorrow’s SYNrG / ITXPros AllonX
arch with Dr.Bobby [sic] Attia and team. Beautiful implant and guide
planning, thanks ITXPros.”), E (“Successful conclusion from this mornings [sic]
single arch SYNrG / ITXPros AllonX surgical connection. . . . Thanks ITXPros
and Dr.King [sic]!”). Some of SYNrG Lab’s posts depict paper reports with the
ITXPros logo, which Abouhend claims must have been generated using the
Plaintiff’s proprietary software. (Id. ¶¶ 22-25, 27 & Exs. F, H, I, K.) Based on
this social media activity, it appears that ITXPros routinely collaborates with
SYNrG Lab to create surgical guides for oral surgeons in the Atlanta area. (Id.
¶¶ 20-21, 23, 25, 27.)
ITXPros, for its part, does not challenge the veracity of the SYNrG Lab
posts, or the inferences to be drawn from them, with any of its own evidence.
Quite the opposite, it outright admits to doing business with both SYNrG Lab
and another Georgia company, Pittman Dental Laboratory. (Reply Br. in Supp.
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of Defs.’ Mot. to Dismiss, at 5-6.) ITXPros instead urges the Court to disregard
the online posts as unauthenticated, inadmissible hearsay. (Id. at 4-5.) But
ITXPros cites no authority for the notion that evidence must be admissible to
support a prima facie case for personal jurisdiction. In fact, courts often refuse
to address “questions regarding the ultimate admissibility of evidence” at the
Rule 12(b)(2) stage, especially when the plaintiff has not had the benefit of
jurisdictional discovery. Universal Leather, LLC v. Koro AR, S.A., 773 F.3d
553, 561 (4th Cir. 2014); see also Mwani v. bin Laden, 417 F.3d 1, 7 (D.C. Cir.
2005) (“[T]o establish a prima facie case, plaintiffs are not limited to evidence
that meets the standards of admissibility required by the district court.”);

Vasquez v. Hong Kong & Shanghai Banking Corp., Ltd., 477 F. Supp. 3d 241,
251 n.6 (S.D.N.Y. 2020) (“Courts commonly decline to rely on non-admissible
evidence in the context of Rule 12(b)(2) motions made after jurisdictional

discovery.” (emphasis added)); Head v. Las Vegas Sands, LLC, 298 F. Supp. 3d
963, 968 (S.D. Tex. 2018) (“[T]he general rules of evidence concerning
admissibility (e.g., the rule against hearsay etc.) do not apply in the Rule
12(b)(2) context.”). This Court will follow the same approach in weighing the
Plaintiff’s evidence.
Accordingly, the Court is satisfied that the Plaintiff has demonstrated
the first element of the transacting-business test: that is, ITXPros purposefully
consummated transactions in Georgia by performing surgical planning
services for in-state healthcare providers. The second element is also met
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because the Plaintiffs’ cause of action arises from or is connected with these
transactions. The Complaint alleges that ITXPros, with help from the Former
Employee Defendants, has taken and used the Plaintiff’s customer lists,
software, surgical guides, and other trade secrets to solicit its customers in
Georgia. (Id. ¶¶ 40, 42-43, 77, 82, 90, 93.) Indeed, Abouhend’s declaration
identifies at least one “longstanding” Georgia client, SYNrG Lab, that switched
from working with the Plaintiff to ITXPros. (Abouhend Decl. ¶ 16.) There is a
direct nexus, then, between ITXPros’ alleged business activities in the state
and the Plaintiff’s claims for misappropriation of trade secrets, theft and
conversion, and tortious inference with contractual and business relations.
Finally, the Court can exercise jurisdiction in accordance with traditional
fairness and substantial justice. As the Georgia Court of Appeals has reasoned,
a company like ITXPros should expect “to respond to a suit in a state from
which it derives the benefits and privileges of conducting business.” Showa

Denko K.K. v. Dangle, 202 Ga. App. 245, 247 (1991). So, the Plaintiff has made
a prima facie showing of personal jurisdiction under § 9-10-91(1).
The Court’s inquiry, of course, does not end there since the assertion of
personal jurisdiction must also comport with constitutional due process. The
Due Process Clause requires that a nonresident defendant have certain
“minimum contacts” with the forum state “such that he should reasonably
anticipate being haled into court there.” Burger King Corp. v. Rudzewicz, 471
U.S. 462, 474 (1985) (citation omitted). In a specific jurisdiction case like this
9

one, 3 the Eleventh Circuit applies a three-part due process test that examines:
(1) whether the plaintiff’s claims arise out of or relate to at least
one of the defendant’s contacts with the forum; (2) whether the
nonresident defendant purposefully availed himself of the
privilege of conducting activities within the forum state, thus
invoking the benefit of the forum state’s laws; and (3) whether the
exercise of personal jurisdiction comports with traditional notions
of fair play and substantial justice.

Louis Vuitton Malletier, S.A. v. Mosseri, 736 F.3d 1339, 1355 (11th Cir. 2013)
(quotation marks omitted). “The plaintiff bears the burden of establishing the first
two prongs, and if the plaintiff does so, a defendant must make a compelling case
that the exercise of jurisdiction would violate traditional notions of fair play and
substantial justice.” Id. (quotation marks omitted).
As the Court’s analysis above illustrates, ITXPros purposefully directed its
business activities at the Georgia market, and there is a direct causal relationship
between those activities and the claims asserted in this litigation. See id. at 1356
(“A relationship among the defendant, the forum, and the litigation is the essential
foundation of in personum jurisdiction.” (alteration and bracketts omitted)). In

The Plaintiff makes a passing argument that ITXPros is subject to
general jurisdiction because it was previously formed and registered to do
business in Georgia. (Pl.’s Br. in Opp’n to Defs.’ Mot. to Dismiss, 11.) But the
company registered in Georgia, iTXpros LLC, was administratively dissolved
on September 30, 2021. (Abouhend Decl., Ex. A.) It has not been named as a
party in this action. (Compl. ¶ 10 (describing Defendant ITXPros as “a
corporation organized and existing under the laws of the State of Delaware”).)
Nor is there any evidence in the record (and ITXPros denies) that the
now-defunct Georgia company is at all related to Defendant ITXPros.
(Abouhend Decl. ¶¶ 12-13; ElSahhar Decl. ¶ 3.) Therefore, the Court does not
have a sufficient foundation to assert general jurisdiction over ITXPros.
3

10

particular, ITXPros has provided implant and guide planning services to SYNrG
Lab (the Plaintiff’s former client) as well as multiple oral surgeons in the Atlanta
area. The Complaint alleges that ITXPros procured this business by
misappropriating the Plaintiff’s confidential information and trade secrets. See id.
at 1357-58 (finding “purposeful availment” in Florida where the defendant sold
and distributed infringing goods through his website to Florida customers and the
plaintiff’s cause of action derived directly from those contacts). Meanwhile,
ITXPros offers no arguments or evidence to suggest that the assertion of personal
jurisdiction would offend fair play and substantial justice. 4 For these reasons, the
Court concludes that ITXPros can constitutionally be sued in Georgia under both
the state long-arm statute and the Due Process Clause.

B. Failure to State a Claim
Next, ITXPros moves for dismissal on the grounds that the Complaint’s
allegations are “vague, broad, conclusory, and fail to satisfy the Twombly and

Iqbal standards.” (Defs.’ Br. in Supp. of Defs.’ Mot. to Dismiss, at 14.) This is,

There are no apparent financial or other limitations precluding
Florida-based ITXPros from defending this action in Georgia. And Georgia has a
strong interest in protecting its registered companies from trade-secret theft and
unfair interference with their business relations. There are also obvious benefits
to the Plaintiff, a company registered inand with its principal place of business in
Georgia, from continuing to litigate in its chosen forum. Finally, the judiciary has
an interest in efficiently resolving this dispute in the state where many of the
underlying events took place and much of the relevant evidence is presumably
located. See Louis Vuitton, 736 F.3d at 1358 (an analysis of fair play and
substantial justice should consider the burden on the defendant, the forum’s
interest in adjudicating the dispute, the plaintiff’s interest in obtaining convenient
and effective relief, and the judicial system’s interest in resolving the dispute).
4

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in essence, a shotgun pleading argument. A shotgun pleading is a complaint
that fails “to identify claims with sufficient clarity to enable the defendant to
frame a responsive pleading[.]” Beckwith v. Bellsouth Telecomms. Inc., 146 F.
App’x 368, 371 (11th Cir. 2005). Shotgun pleadings place an undue burden not
only on defendants but also on courts, “which must be able to determine which
facts support which claims [and] whether the plaintiff has stated any claims
upon which relief can be granted[.]” Barmapov v. Amuial, 986 F.3d 1321, 1324
(11th Cir. 2021) (quotation marks omitted). There is little tolerance for shotgun
pleadings in the Eleventh Circuit: “[t]hey waste scarce judicial resources,
inexorably broaden the scope of discovery, wreak havoc on appellate court
dockets, and undermine the public’s respect for the courts.” Vibe Micro, Inc. v.

Shabanets, 878 F.3d 1291, 1295 (11th Cir. 2018) (quotation marks and
alterations omitted). Consequently, a district court must order repleading sua

sponte when confronted with a shotgun pleading. See id. at 1296.
Here, ITXPros complains of two general deficiencies in the five counts
against it: first, that the counts do not allege specific facts but mostly parrot
the legal elements of the Plaintiff’s claims, and second, that the counts lump
together ITXPros and the other Defendants without differentiating their
respective conduct. (Defs.’ Br. in Supp. of Defs.’ Mot. to Dismiss, at 11-14.) But
ITXPros’ argument seems to ignore the incorporation paragraph in each count,
which bolsters some otherwise vague allegations with details from earlier in
the Complaint. (Compl. ¶¶ 76, 89, 92, 95, 96.) For example, Count IV—for
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misappropriation of trade secrets—lists specific trade secrets that the Former
Employee Defendants allegedly took from the Plaintiff, including customer
lists, software, surgical guides, treatment plans, and other customer and
patient information. (Id. ¶ 77.) The Former Employee Defendants, the
Complaint continues, have misappropriated and disclosed these trade secrets
to and on behalf of ITXPros without consent. (Id. ¶ 82.) And ITXPros has
allegedly used the stolen information to pursue the Plaintiff’s customers in
Georgia. (Id. ¶¶ 40, 42-43.) While ITXPros claims not to know “what [it is]
accused of doing or receiving,” this protest rings hollow given the ample
allegations set forth and adopted in Count IV. (Defs.’ Br. in Supp. of Defs.’ Mot.
to Dismiss, at 12.)
The same analysis applies to Count VI—for theft and conversion—and
Count VII—for tortious interference with and conspiracy to interfere with
prospective and existing contractual and business relations. Count VI accuses
the Defendants collectively of taking and converting the Plaintiff’s computer
files, designs, laptops, customer lists, software, and other property. (Compl.
¶ 90.) In previous allegations, the Complaint clarifies which Former Employee
Defendants took which pieces of property and how the property was used to
divert business from the Plaintiff to ITXPros. (Id. ¶¶ 27-29, 36-37, 40, 42-43,
54-55.) Count VII, meanwhile, claims that the Defendants (again collectively)
have tortiously interfered with the Plaintiff’s employee and customer relations.
(Id. ¶ 93.) Allegedly, ITXPros was aware of the non-compete and
13

non-solicitation agreements binding Defendants ElSayed, Samir, and Azmy,
but ITXPros caused or permitted these individuals to breach their contractual
duties on its behalf. (Id. ¶¶ 36-39, 42-43.) The Complaint also asserts that
ITXPros has taken and used the Plaintiff’s confidential information and trade
secrets to solicit the Plaintiff’s current and potential customers. (Id. ¶¶ 40,
42-43.) No more detail is required to meet the lenient standard for notice
pleading, and the Court thus denies the Motion to Dismiss on Rule 12(b)(6)
grounds. 5 See Twombly, 550 U.S. at 555 (holding that a complaint need not
present “detailed factual allegations” but must “raise a right to relief above the
speculative level”).
IV.

Conclusion

For the foregoing reasons, ITXPros, LLC’s Motion to Dismiss [Doc. 3] is
DENIED.
SO ORDERED, this

2nd

day of August, 2022.

______________________________
THOMAS W. THRASH, JR.
United States District Judge

Because Counts IV, VI, and VII are well pled as to ITXPros, so too are
the Plaintiff’s derivative claims for exemplary damages and attorney’s fees in
Counts VIII and IX, respectively.
5

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