von Holdt, et al v. A-1 Tool Corp, et al

Filing 925

MEMORANDUM OPINION AND ORDER signed by the Honorable Edmond E. Chang on 1/3/2013.Mailed notice(sct, )

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
John W. von Holdt, Jr.,
Janice Anderson, and Plas-Tool Co.,
Plaintiffs,
v.
A-1 Tool Corporation, Triangle Tool
Corporation, Alfonso Arciniegas,
Geoffrey Luther, and Leroy Luther,
Defendants.

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No. 04 C 04123
Judge Edmond E. Chang

MEMORANDUM OPINION AND ORDER
John W. von Holdt, Jr., Janice Anderson, and Plas-Tool Company (collectively,
“Plaintiffs”) filed a complaint against A-1 Tool Corporation, Triangle Tool Corporation,
Alfonso Arciniegas, Geoffrey Luther, and LeRoy Luther (collectively, “Defendants”),
alleging patent infringement (Count 1), a claim under the Computer Fraud and Abuse
Act, 18 U.S.C. § 1030 et seq. (Count 2), and various state-law claims including
violations of the Illinois Trade Secrets Act, 765 ILCS 1065/1 et seq. (Count 3), breach
of fiduciary duty (Count 4), inducement to breach fiduciary duty (Count 7), tortious
interference with business expectancies (Count 8), and conspiracy to tortiously
interfere with business expectancies (Count 9).1 R. 232 (Fourth Am. Compl.).
Defendants moved for summary judgment on all claims. R. 524. In support,
Defendants filed two briefs: one seeking judgment as to the patent infringement claim,

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The Court has subject matter jurisdiction under 28 U.S.C. §§ 1331 and 1367. The
complaint does not contain claims labeled as Count 5 and 6.

R. 525, and the other as to the remaining claims, R. 526. The district judge previously
assigned to this case granted summary judgment to Defendants on the federal claims
(Counts 1 and 2), and then relinquished supplemental jurisdiction over the remaining
state-law claims. See R. 858. Plaintiffs moved to reconsider the decision to relinquish
jurisdiction over the state-law claims. R. 885. The previously-assigned judge granted
the motion, and the case was re-opened for the purpose of litigating the state-law
claims. R. 886. The case was reassigned to this Court. R. 892. For reasons explained
more fully below, the Court grants Defendants’ motion for summary judgment as to
Counts 7, 8, and 9; the motion is denied as to Counts 3 and 4 (the Trade Secrets Act
and fiduciary-duty claims).
I. Standard of Review
Summary judgment must be granted “if the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a). Rule 56 “mandates the entry of summary
judgment, after adequate time for discovery and upon motion, against a party who fails
to make a showing sufficient to establish the existence of an element essential to that
party’s case, and on which that party will bear the burden of proof at trial.” Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986). All facts, and any inferences to be drawn
from them, must be viewed in the light most favorable to the non-moving party. Wis.
Cent., Ltd. v. Shannon, 539 F.3d 751, 756 (7th Cir. 2008).

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II. Factual Background
In deciding this summary judgment motion, the Court views the evidence in the
light most favorable to Plaintiffs. Plas-Tool was a small, family-owned company in the
business of making molds that produce plastic buckets and lids.2 R. 528, Defs.’ Stmt.
of Facts (DSOF) ¶ 1; R. 543, Pls.’ Stmt. of Facts (PSOF) ¶ 1. Defendant Alfonso
Arciniegas began working at Plas-Tool as a mold design engineer in 1978. PSOF ¶ 14.
Arciniegas ultimately became Plas-Tool’s principal salesperson in Latin America and
vice president of the company. PSOF ¶ 15. Arciniegas was also the brother-in-law of
Plaintiff John von Holdt, Jr., who is Plas-Tool’s President, Chairman, and principal
shareholder. PSOF ¶¶ 3-4, 16. In 1997, Arciniegas resigned from his position at PlasTool, and began working for Defendant A-1 Tool Corporation. PSOF ¶ 18.
Plaintiffs allege that Arciniegas took a lengthy list of Plas-Tool’s customers with
him when he left Plas-Tool, and used the list to contact Plas-Tool’s customers and sell
molds manufactured by Arciniegas’s new employer, A-1. PSOF ¶¶ 21, 25-27. Plaintiffs
also claim that within months of Arciniegas joining A-1, A-1 began manufacturing
molds that incorporated Plas-Tool’s trade secrets. PSOF ¶¶ 25, 88. Defendants dispute
all of these allegations.
III. Illinois Trade Secrets Act (Count 3)
In Count 3, Plaintiffs allege that Defendants violated the Illinois Trade Secrets
Act, 765 ILCS 1065/1 et seq. To establish liability under the Act, a plaintiff must prove

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Plas-Tool closed its operations in July 2008. R. 543, Pls.’ Stmt. of Facts (PSOF) ¶ 5.

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that information is: (1) a trade secret; (2) misappropriated; and (3) used in the
defendant’s business. Delta Med. Sys. v. Mid-Am. Med. Sys., 772 N.E.2d 768, 780 (Ill.
App. Ct. 2002). Here, Plaintiffs claim trade-secret protection for both technical and
non-technical information. Plaintiffs’ technical information consists of (a) six pieces of
information relating to pail molds; (b) seven pieces of information relating to pail lid
molds; and (c) one piece of information relating to the design of pails. R. 541 (Pls.’ Br..)
at 5; PSOF ¶ 86. Plaintiffs’ non-technical information includes customer information,
customer contact information, customer order history, and pricing and credit history.
Pls.’ Br. at 5; PSOF ¶ 11.
A.

Technical information

Defendants argue that Plaintiffs have not provided evidence sufficient for a jury
to conclude that they have satisfied each element of the Trade Secrets Act.
“Trade secret” is defined by the Act as:
information, including but not limited to, technical or non-technical data, a . . .
compilation, . . . financial data, or list of actual or potential customers or
suppliers, that:
(1) is sufficiently secret to derive economic value, actual or potential, from
not being generally known to other persons who can obtain economic
value from its disclosure or use; and
(2) is the subject of efforts that are reasonable under the circumstances
to maintain its secrecy or confidentiality.
765 ILCS 1065/2(d). Thus, in order for information to qualify as a trade secret under
the Act, the information must meet two requirements: (1) the information must be
sufficiently secret to give the plaintiff a competitive advantage, and (2) the information
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must be subjected to affirmative measures to prevent others from acquiring or using
it. Sys. Dev. Servs. Inc., v. Haarmann, 907 N.E.2d 63, 73 (Ill. App. Ct. 2009). The Court
will address the second element first.
1.

Reasonable measures to keep information confidential

The determination of “[w]hether the measures taken by a trade secret owner are
sufficient to satisfy the Act’s reasonableness standard ordinarily is a question of fact
for the jury.” Learning Curve Toys, Inc. v. PlayWood Toys, Inc., 342 F.3d 714, 725 (7th
Cir. 2003); see also Rockwell Graphic Sys., Inc. v. DEV Indus., Inc., 925 F.2d 174, 179
(7th Cir. 1991) (noting that “only in an extreme case can what is a ‘reasonable’
precaution be determined on a motion for summary judgment”). That said, summary
judgment is proper in cases where it is “readily apparent that reasonable measures [to
maintain confidentiality] simply were not taken.” Tax Track Sys. Corp. v. New Investor
World, Inc., 478 F.3d 783, 787 (7th Cir. 2007) (plaintiff’s widespread nonconfidential
disclosure of memo required summary judgment to be granted; no reasonable jury
could find that plaintiff took reasonable efforts to keep the memo confidential).
Plaintiffs contend that they took reasonable measures to protect Plas-Tool’s
secret information because they limited the information provided to customers and
maintained confidentiality agreements. Defendants assert, however, that Plaintiffs
failed to protect Plas-Tool’s purported trade secrets because they disclosed the
information to customers, potential customers, vendors, employees, and others without
entering into confidentiality or non-disclosure agreements. DSOF ¶¶ 31-32. For
instance, it is undisputed that Plas-Tool’s written confidentiality agreements with
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Owens Corning and Rubbermaid (both Plas-Tool customers) are limited to protecting
only the confidential information of the customer, not that of Plas-Tool. R. 736, Pls.’
Resp. DSOF ¶ 14. And Plas-Tool was unable to locate written confidentiality
agreements for all of its customers. Id. ¶ 11.
Plaintiffs argue that written confidentiality agreements are not strictly
necessary in the mold-making industry because there is an understanding, or custom,
within the industry that a manufacturer’s proprietary information is confidential. Pls.’
Br. at 9-11. So the key issue is whether it was “reasonable,” under the Illinois Trade
Secrets Act, for Plas-Tool to rely on this alleged industry custom as a means to protect
its confidential information (or, more precisely, whether a reasonable jury could so
conclude).
Unable to point to any controlling law on this issue, Plaintiffs principally rely
on von Holdt’s affidavit, in which he states that “[t]he custom in the Industry is that
there is an understanding that proprietary pail and lid mold information disclosed to
and received from a pail and lid mold manufacturer is to be treated as confidential and
not disclosed to any third party until and unless such information becomes publicly
available.” R. 677, Pls.’ Exh. 11 (von Holdt Decl.) ¶ 11.3 Plaintiffs also refer to the
affidavits of three individuals who claim to have worked in the pail and lid

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Plaintiffs also point to Glenn Beall’s affidavit stating that it is industry custom to keep
information secret, even in the absence of a written agreement. See Pls.’ Br. at 10. But as
already discussed in the Court’s previous order granting Defendants’ motion to strike Beall’s
declaration in part and denying the motion in part, this portion of Beall’s declaration is
stricken because it contradicts his earlier deposition testimony without a valid explanation for
the contradiction. R. 919 at 2-3.

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manufacturing industry and who attest that, in the industry, “there is an
understanding that pail and lid mold information disclosed to and received from a pail
and lid mold manufacturer is to be treated as confidential and not disclosed to any
third-party until and unless such information becomes publicly available.” R. 681, Pls.’
Exh. 15 (J. Viesca Decl.) ¶ 12; R. 682, Pls.’ Exh. 16 (A. Viesca Decl.) ¶ 11; R. 683, Pls.’
Exh. 17 (Jones Decl.) ¶ 22.
Defendants respond that industry custom is not a proper basis on which to rely
to show reasonable efforts to protect secrecy under the Trade Secrets Act. R. 526, Defs.’
Br. at 11-12 (citing Web Commc’ns Group, Inc. v. Gateway 2000, Inc., 889 F. Supp. 316,
320 (N.D. Ill. 1995) and Nat’l Presto Indus. v. Hamilton Beach, Inc., 1990 WL 208594
(N.D. Ill. Dec. 12, 1990)). But, like Plaintiffs, Defendants are unable to point to any
controlling legal authority holding that, as a matter of law, industry custom cannot be
the basis of “reasonable” efforts under the Act. The district court decisions cited by
Defendants are not binding here, nor are they directly on point. The plaintiff in Web
Communications, for instance, was a print production company that claimed to have
developed a concept for use in the defendant’s printed advertisement. 889 F. Supp. at
318. After the defendant retained a different company to print the ad, the plaintiff sued
the defendant under the Illinois Trade Secrets Act. Id. at 318-19. Although the plaintiff
did not have a confidentiality agreement with the defendant, the plaintiff argued that
“industry custom and implicit confidentiality were sufficient to protect the secrecy of
the [concept].” Id. at 320. The district court disagreed, in part because the printing
trade customs cited by the plaintiff focused primarily on the ownership of items
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developed and produced in the printing industry, as opposed to the confidentiality of
those items. Id. The court also noted that the plaintiff disclosed the alleged trade secret
to one of its competitors, and the president of the plaintiff-company acknowledged that
it was possible that the competitor would then take the plaintiff’s concept and use it
for its own benefit. Web Commc’ns., 889 F. Supp. at 320.
Similarly, National Presto Industries v. Hamilton Beach, Inc., the other case
cited by Defendants, is also distinguishable. 1990 WL 208594, at *9. In that case, the
plaintiff showed its new product to hundreds of customers before formally introducing
the product to the market. Id. at *1. The plaintiff did not require customers to sign
confidentiality forms and even began selling the product from its factory outlet store
before its official release. Id. at *9. In light of these facts, the district court concluded
that the plaintiff’s reliance on “implicit confidentiality” was not enough to reasonably
protect its alleged trade secret. Id. National Presto does not address whether there was
an industry custom to keep information regarding new products as confidential in the
plaintiff’s industry, and it does not appear that the plaintiff made that argument.
In contrast, here, Plaintiffs submit admissible evidence that it is understood by
manufacturers and customers in the mold-making industry that proprietary
information is not to be disclosed to third-parties. PSOF ¶ 32. Plaintiffs assert that
adhering to this industry custom is “crucial” because just as Plas-Tool does not want
the features of its pail and lid molds disclosed to its competitors, Plas-Tool’s customers
do not want their competitors to know what pails the customers are planning to make.
PSOF ¶ 34. As discussed above, the record contains affidavits from pail and lid
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manufacturers, including von Holdt, who have decades of experience in the industry.
PSOF ¶ 32; see J. Viesca Decl. ¶ 2 (over 20 years’ experience in the pail and lid
business); A. Viesca Decl. ¶ 2 (over 24 years’ experience); Jones Decl. ¶ 2 (over 30 years’
experience). The Court concludes that these affidavits are sufficient to create a genuine
issue of material fact with respect to whether Plaintiffs took reasonable steps to protect
the confidentiality of their technical information. Of course, proving this element to a
jury is a different matter than raising a genuine issue when evidence is viewed in
Plaintiffs’ favor, but it is for a jury to decide.
Moreover, Illinois decisions interpreting the Trade Secrets Act suggest (although
admittedly they do not outright hold) that a plaintiff’s ability to show that an
understanding regarding confidentiality may constitute reasonable security measures
under the Act. See, e.g., Gillis Associated Indus. v. Cari-All, Inc., 564 N.E.2d 881, 88586 (Ill. App. Ct. 1990). Gillis held that the plaintiff failed to prove that its customer list
was the subject of reasonable efforts designed to protect its secrecy and, therefore, the
trial court erred by preliminarily enjoining the defendant from using the plaintiff’s
customer list. Id. at 886. The plaintiff in Gillis did not present any evidence “regarding
internal or external physical security [or] that confidentiality agreements or
understandings existed among those having access to plaintiff’s lists . . . .” Id.
(emphasis added); id. (“Given the testimony that copies of plaintiff’s lists were
available for use in the accounting and customer services department, it was
incumbent upon plaintiff to show its employees understood that lists were to be kept
confidential.”) (emphasis added); see also Jackson v. Hammer, 653 N.E.2d 809, 815 (Ill.
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App. Ct. 1995) (approving Gillis); Liebert Corp. v. Mazur, 827 N.E.2d 909, 921-22 (Ill.
App. Ct. 2005) (same). Liebert, for example, concluded that the plaintiffs’ customer lists
were not trade secrets under the Act because there was no evidence in the record that
the plaintiffs’ employees were required to sign confidentiality agreements or were
specifically advised that the company records were confidential. 827 N.E.2d at 923.
“When such evidence is absent from the record, the plaintiff must show, at a minimum,
that its employees understood the information was to be kept confidential.” Id. at 92324 (emphasis added). Even if these are not controlling holdings that an understanding
is sufficient to constitute a reasonable measure, these cases do show that Illinois courts
have not outright required a written confidentiality agreement in all circumstances.
Plaintiffs in this case have put forth evidence that some of Plas-Tool’s customers,
who have worked in the industry for years, understand that pail and lid mold
information received from manufacturers is to be treated as confidential. These
customers assert that it is the custom in the industry to treat such information as
confidential. Defendants argue that the customer declarations submitted by Plaintiffs
do not create a genuine issue of fact because “[n]o reasonable jury could find an
‘industry custom’ based on a couple customers out of hundreds.” R. 707, Defs.’ Reply
at 7. That is asking too much of the summary-judgment standard. Although
Defendants have submitted affidavits from other customers stating that they are not
aware of any custom or standard in the industry requiring them to keep Plas-Tool’s
designs, plans, or drawings confidential, the Court “may not weigh conflicting evidence
or make credibility determinations.” Omnicare, Inc. v. UnitedHealth Group, Inc., 629
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F.3d 697, 704 (7th Cir. 2011) (quotations and citations omitted). The Court concludes
that the affidavits from von Holdt and other experienced members of the mold-making
industry are sufficient to avoid summary judgment on this issue.4 A genuine issue of
material fact exists as to whether industry custom dictates that proprietary
information disclosed by other pail and mold manufacturers be kept confidential.
Accordingly, whether it was reasonable for Plaintiffs to rely on industry custom cannot
be resolved on summary judgment.
Alternatively, Defendants contend that, regardless of industry custom, Plaintiffs
did nothing to protect the secrecy of their purported trade secrets. For example,
Defendants assert that Plas-Tool sold or distributed its molds to customers and
potential customers without adequate confidentiality agreements in place. Defendants
state that “[s]elling these molds without any confidentiality agreement strips the
purported trade secrets the mold contained of any protection it may have had under
[the Act].” Defs.’ Br. at 6. Defendants further contend that Plas-Tool sent out
engineering drawings, customer files and other information to many of its customers
and third-parties without confidentiality agreements or stamps, and even disclosed
alleged trade secrets to the public in Plas-Tool’s marketing materials. DSOF ¶ 19, 23.

4

As discussed in the Court’s previous order, Defendants’ motion to strike portions of von
Holdt’s affidavit is denied. R. 919 at 5-6. And Defendants failed to demonstrate that the Court
must disregard the third-party affidavits proffered by Plaintiffs regarding the industry custom.
The fact that Plaintiffs rely on a few customers out of hundreds to support their position that
an industry-wide custom exists is something for the jury to consider when weighing the
evidence.

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As an initial argument, Plas-tool asserts that because it is a small company it
has a lower standard of reasonableness of protective measures than a large company.
This is true for very small companies. See Elmer Miller, Inc. v. Landis, 625 N.E.2d 338,
342 (Ill. App. Ct. 1993) (“We note reasonable steps for a two or three person shop may
be different from reasonable steps for a larger company.”); Learning Curve Toys, 342
F.3d at 717 (identifying the size and sophistication of the parties as a factor in support
of finding a two-person toy company operating out of a basement took reasonable
protective measures). In contrast to the companies in the cited cases, which involved
companies with fewer than a handful of employees, Plas-Tool had 22 employees, 40
years of experience, and claimed to be one of “the world’s leading manufacturers of pail
molds” with “highly skilled, technical expertise.” Pls.’ Br. at 1; PSOF ¶ 73. Indeed, over
the years, Plas-Tool’s founder was granted dozens of patents licensed to Plas-Tool. See
R. 718, Defs.’ Resp. PSOF ¶ 31 (citing R. 538-5, Plas-Tool Rule 30(b)(6) Dep.). The
Court concludes that Plas-Tool is not so small and unsophisticated as to substantially
lower the standard of reasonableness for measures to protect the secrecy of its
confidential information.
With respect to the reasonableness of Plas-Tool’s measures, Plaintiffs contend
that they limited the information provided to customers, limited employees’ access to
secrets, instructed employees to maintain the confidentiality, and maintained secure
facilities to protect their secrets. Pls.’ Br. at 5-8. Defendants again submit affidavits
from some customers stating that they “have never been asked by Plas-Tool to
maintain the confidentiality of any designs, plans, drawings, documents, information,
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or communications . . . have not signed any written agreement of confidentiality with
Plas-Tool . . . and . . . have never made any oral promise to keep anything secret.” See
R. 530, Pons Decl. ¶ 4; R. 531, Clemente Decl. ¶ 4. Defendants also point to employees’
testimony that they never entered into a written agreement with Plas-Tool to protect
Plas-Tool’s trade secrets. DSOF ¶ 28.
“[I]n cases that address whether an employer took reasonable steps to protect
information as a trade secret, the presence or absence of confidentiality agreements or
other means to convey confidentiality to employees often has a significant and
predictable bearing on the outcome of the case.” CMBB LLC v. Lockwood Mfg., Inc.,
628 F. Supp. 2d 881, 885 (N.D. Ill. 2009) (citations omitted). According to Defendants,
Plas-Tool did not have confidentiality agreements with its employees to protect its
confidential information. Nevertheless, several employees testified that they were
instructed to keep information secret. PSOF ¶ 58.
For instance, Jacob Kampf, a machinist at Plas-Tool since 1959, when asked
during his deposition if he had an oral confidentiality agreement with Plas-Tool, stated
“Of course. We all did.” R. 538-14 (Kampf Dep.) at 239. And when asked what the
terms of the agreement were, he responded, “Terms? Not to give out any information.”
Id. Kampf further stated that the agreement applied to “any kind” of information
including “how [the pail mold] was made or with what part it was made” and that it
was for as long as he worked at Plas-Tool. Id. at 239-241. Another employee, Robert
Carroll, when asked if he had entered into an oral confidentiality agreement, stated
“I would say so, yes,” and that he was “not to disclose anything other than what I’m
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expected to do.” R. 538-16 (Carroll Dep.) at 236-37. Carroll did later clarify that there
was no discussion in which the specific terms of the agreement were discussed, or its
beginning or end dates. Id. at 238-39. At his deposition von Holdt testified that he was
present when his father generally warned another employee, Ruben Rodriguez, right
after Rodriguez was hired that “what you learn at Plas-Tool stays at Plas-Tool,” and
that Rodriguez was not to use or disclose any of Plas-Tool’s confidential information.
R. 694, Pls.’ Exh. 26, pt. 2 (von Holdt Dep.) at 219-220. When asked if it was a global
warning or something more specific, von Holdt testified that “it was generalized.” Id.
at 220-21.
Defendants contend that even assuming that the above facts are true, Plas-Tool
cannot protect its confidential information by issuing a generalized warning to
employees not to disseminate “everything” they learned at Plas-Tool. But, as noted
above, Kampf testified that his oral confidentiality agreement with Plas-Tool
prohibited him from giving out “any kind” of information about how the pail mold was
made and with what part it was made. Kampf Dep. at 239-41. And given the context
of the employment relationship and these employees’ duties (which, after all, was the
context of the deposition questions), a jury could conclude that it was reasonable for
Plas-Tool to give general confidentiality warnings to its employees.
With respect to other measures, the Court has reviewed the parties’ briefs and
citations to the record and concludes that genuine issues of material fact abound as to
whether Plaintiffs limited employee access to its purported trade secrets, restricted
access to pricing and sales information, stamped alleged confidential information with
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a “confidential” stamp, or whether Plas-Tool ever disclosed confidential information to
a vendor (and whether any of those facts, when taken solo or combined, comply with
the Trade Secrets Act). Accordingly, viewing the evidence in a light most favorable to
Plaintiffs, and given that the determination of “[w]hether the measures taken by a
trade secret owner are sufficient to satisfy the [Illinois Trade Secrets Act’s]
reasonableness standard ordinarily is a question of fact for the jury,” Learning Curve
Toys, 342 F.3d at 725, the Court concludes that a genuine issue of material fact exists
as to whether the measures taken by Plas-Tool were sufficient to satisfy the Act’s
reasonableness standard.
2.

Sufficiently secret

Defendants next argue that Plaintiffs’ Trade Secrets Act claim fails because
Plaintiffs cannot meet the other element of the Act: the information “must be
substantially secret to impart economic value to both its owner and its competitors
because of its relative secrecy.” Sys. Dev. Servs., 907 N.E.2d at 73 (quoting Pope v.
Alberto-Culver Co., 694 N.E.2d 615, 617 (Ill. App. Ct. 1998)). For instance,
“[i]nformation that is generally known or understood within an industry, even if not
known to the public at large, does not qualify as a trade secret.” Stenstrom Petroleum
Servs. Group, Inc. v. Mesch, 874 N.E.2d 959, 972 (Ill. App. Ct. 2007) (citing Learning
Curve Toys, 342 F.3d at 722). In addition, “[w]here information can be readily
duplicated without considerable time, effort, or expense, it is not a trade secret.” Id.
(citations omitted).

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Here, Defendants argue that all of Plas-Tool’s purported trade secrets were
publicly available and known in the mold-making industry before Arciniegas left PlasTool to join A-1. Defs.’ Br. at 13. Specifically, Defendants point to the deposition
testimony of Plaintiffs’ expert, Glenn Beall, as support for their position that PlasTool’s trade secrets could only last five or six years before another company would
learn Plas-Tool’s trade-secret techniques. DSOF ¶ 53. But Beall did not testify that all
of Plas-Tool’s secrets were known to other mold manufacturers who had been in the
industry for over five or six years. R. 538-7 (Beall Dep.) at 73-81. Beall testified that,
in his opinion, it takes five to six years for a mold-maker to become a specialist in the
field. Id. at 76. Because Arciniegas left Plas-Tool in 1997, Beall was asked at his
deposition whether he believed that there were mold manufacturers who knew some
of Plas-Tool’s claimed trade secrets before December 1997. Id. at 78-79. Beall
responded, “I would think so, yes, some of them.” Id. at 79. Beall explained that mold
manufacturers who had been in the industry since at least 1992 would “probably” know
some of “those features,” but “not necessarily all of them” because “some of the non-A-1
molds . . . don’t include the Plas-Tool trade secrets in them.” Id. at 78. Beall testified
that Paragon, Wentworth, Husky, and Top Grande are all very successful pail and lid
mold manufacturers, but their molds do not incorporate all of Plas-Tool’s trade secrets.
Beall Dep. at 81. Beall opined that it is possible that these manufacturers “solved the
same problem in a different way” and that “[t]here is always more than one way to
build a mold.” Id.

16

After examining Beall’s testimony on this topic, the Court concludes that Beall’s
testimony does not mean that, as a matter of law, Plas-Tool’s mold information was
“generally known or understood within [the] industry.” Pope, 694 N.E.2d at 617. Beall
testified that, over the years, mold manufacturers learn how to improve their mold
designs. Beall Dep. at 74, 80-81. Although Beall testified that some of “those features”
(likely referring to a Plas-Tool mold’s features) would “probably” be known by other
experienced manufacturers in the industry, this is not the same as saying that the
proprietary information allegedly used by A-1 was “already commonly known” or
“clearly understood” in the industry at the time A-1 began manufacturing pail and lid
molds. See Sys. Dev. Servs., 907 N.E.2d at 79; Service Ctrs. of Chicago, Inc. v. Minoque,
535 N.E.2d 1132, 1136 (Ill. App. Ct. 1989). For these reasons, Beall’s testimony does
not serve as a basis on which to grant summary judgment.
Beall’s testimony aside, Defendants claim that they can prove that each of PlasTool’s purported technical trade secrets can be readily ascertained by examining
materials that are publicly available—i.e., the molds sold by Plas-Tool, mold prints and
drawings given to Plas-Tool’s customers, and other Plas-Tool marketing materials.
Defs.’ Br. at 14-15. Plaintiffs respond that even if one could reverse engineer PlasTool’s secrets, doing so “would be expensive, time consuming, and difficult.” Pls.’ Br.
at 16. Indeed, “[i]nformation that is derived from public sources but requires laborious
accumulation, culling, and/or analysis of the public information can, however, still
qualify as a trade secret.” Stenstrom Petroleum, 874 N.E.2d at 972; see also Hamer
Holding Group, Inc. v. Elmore, 560 N.E.2d 907, 918 (Ill. App. Ct. 1990) (“[I]nformation
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which can be duplicated only by an expensive and time-consuming method of reverse
engineering . . . could be secret, and the ability to duplicate it would not constitute a
defense.”). In any event, Plaintiffs deny that any of their technical trade secrets were
publicly available in the first place.
The Court has considered the parties’ arguments regarding whether any of PlasTool’s claimed trade secrets were in the public domain. On the one hand, Defendants
generally argue that Plas-Tool’s mold information is not protected by the Trade Secrets
Act because: (1) the information can be mathematically calculated using the molds,
pails, lids, and prints in the open market; and (2) other manufacturers in the moldmaking industry use Plas-Tool’s techniques. Defs.’ Br. at 14-35. In response, Plaintiffs
assert that von Holdt’s declaration and Beall’s declaration and expert reports refute
the evidence set forth by Defendants. Defendants reply that von Holdt and Beall’s
declarations should be disregarded because they are full of conclusory and self-serving
statements, but, as already discussed, the Court largely denied Defendants’ motion to
strike the declarations. See R. 919. Beall and von Holdt have personal knowledge of
Plas-Tool’s trade secrets and thus their testimony can be evidence of disputed, material
facts. See Berry v. Chicago Transit Auth., 618 F.3d 688, 691 (7th Cir. 2010) (“It is worth
pointing out here that we long ago buried—or at least tried to bury—the misconception
that uncorroborated testimony from the non-movant cannot prevent summary
judgment because it is ‘self-serving.’ If based on personal knowledge or firsthand
experience, such testimony can be evidence of disputed material facts.”) (citations
omitted). Accordingly, the Court denies Defendants’ motion for summary judgment on
18

the basis that Plaintiffs’ mold information is publicly available and generally
duplicated or accessible to others in the industry.
For example, Plaintiffs claim that their mold designs include a confidential and
proprietary pail shrinkage sizing technique. R. 689, Pls.’ Exh. 22 (Pls.’ Trade Secrets
List) at 1. This technique, referred to by the parties as Pail Trade Secret 1, produces
a [[[REDACTED MATERIAL PROTECTED AS TRADE SECRET

]]]. Id. Defendants argue
that this technique is not a trade secret because it is used by other mold makers
throughout the industry, is readily available through shrinkage-predicting software,
and can be easily discerned from Plas-Tool’s molds available on the open market. Defs.’
Br. at 15-19; DSOF ¶¶ 61, 63. Plaintiffs use Beall’s declaration to dispute these alleged
facts. First, Beall opines that although all mold makers apply a mold shrinkage factor
to molds, knowing where and how much different locations will shrink is a trade secret.
R. 545, Pls.’ Exh. 1 (Beall Expert Report) at 16-17. [[[REDACTED MATERIAL
PROTECTED AS TRADE SECRET

]]]. Pls.’

Trade Secrets List at 1. Beall opined that studying Plas-Tool’s molded pails will not
reveal which mold-shrinkage factor to use in different locations. R. 649, Pls.’ Exh. 3
(Beall Rebuttal Rpt.) at 5. Beall stated, however, that the amount of mold shrinkage
used at different locations on a pail mold can be determined by measuring the core and
cavity details and the corresponding dimensions on a pail produced by that mold. Id.
at 6. But one would need to measure the dimensions on a pail produced by that exact
19

mold, and measuring the dimensions would be a difficult and time consuming process.
Id. Also, computer software that simulates mold shrinkage factors did not provide the
amount of shrinkage to use for the entire product; rather, the software only provided
a mold maker with the amount of shrinkage at a particular point on a molded product.
R. 678, Pls.’s Exh. 12 (Beall Decl.) ¶ 38.
Beall’s testimony precludes summary judgment. Because a reasonable jury could
accept Beall’s testimony, Defendants have not shown as a matter of law that Pail
Trade Secret 1 can be readily derived from publicly available information.
Similarly, Defendants argue that Plas-Tool’s technique of fitting mold
components together (Pail Trade Secret 3) is taught in at least two injection molding
textbooks and used by other manufacturers in the industry. Defs.’ Br. at 22-23.
Defendants claim that this technique, also known as “interference fit” or “preload,” can
be determined using simple mathematics. DSOF ¶ 94. But Beall opined that
“[s]tudying and measuring a used pail mold would not reveal the amount of preload or
interference fit employed when the mold was originally assembled.” Beall Rebuttal Rpt.
at 5. And the textbook cited by Plaintiffs only shows preload in one of the three
locations for which Plas-Tool asserts its trade secret—the text does not disclose Pail
Trade Secret 3. Beall Decl. ¶ 50. Defendants’ motion to strike this portion of Beall’s
declaration as a conclusory, unsupported opinion was denied, and the Court concludes
that a reasonable jury could adopt Beall’s explanation of this issue.
These examples of genuine fact issues permeate the dispute over Plaintiffs’
thirteen trade secrets: Defendants propound that the information is publicly available,
20

and Plaintiffs’ expert disagrees and sets forth his own conflicting opinion. Because
Plaintiffs have put forth some evidence from which a rational jury could conclude that
the Plaintiffs’ techniques were in fact protectable secrets under the Trade Secrets Act,
the Court cannot grant Defendants motion for summary judgment on this basis.
3.

Misappropriation

In the alternative, Defendants argue that even if Plaintiffs’ technical
information qualifies as trade secrets under the Act, the Court should grant summary
judgment on Count 3 because Plaintiffs do not have evidence that the secrets were
misappropriated and used in Defendants’ business. See Sys. Dev. Servs., 907 N.E.2d
at 72. Under the Trade Secrets Act, “[m]isappropriation can be shown one of three
ways—by improper acquisition, unauthorized disclosure, or unauthorized use.” Liebert,
827 N.E.2d at 925 (emphasis omitted) (citing 765 ILCS 1065/2(b)). Defendants again
address each of the thirteen purported trade secrets and attempt to show that it is
clear that misappropriation did not occur because (1) Arciniegas did not provide A-1
with the proprietary information, and/or (2) A-1 did not use the information to
manufacture its pail and lid molds. Defs.’ Br. at 40-48.
For instance, looking at Pail Trade Secret 3 again, Defendants argue that A-1
does not use interference fit (or preload) in assembling its pail molds. Defs.’ Br. at 42.
Plaintiffs again rely on Beall to dispute this assertion. In his supplemental expert
report, Beall concludes that A-1 uses the same amount of preloads in the same
locations as Plas-Tool. PSOF ¶ 100. Even if the amount of preload used by A-1 differed
from Plas-Tool’s by 0.00035 inches, Beall opines that this difference is immaterial.
21

Beall Decl. ¶ 51. The Court agrees with Plaintiffs that this evidence raises a genuine
question of fact. See Pls.’ Br. at 44. Because Beall opined that each and every one of
Plas-Tool’s technical trade secrets appear in molds manufactured and sold by A-1,
summary judgment cannot be granted on this ground. Id. at 43-44.
Moreover, there is sufficient evidence in the record that Arciniegas may have
been responsible for the misappropriation. For instance, Beall opines that Plas-Tool’s
Pail Trade Secret 1 was not implemented at A-1 until after Arciniegas joined A-1. Beall
Decl. ¶ 45. According to Beall, before Arciniegas arrived, none of A-1’s 68 mold designs
used three different shrink rates. Id. Beall’s review of A-1’s mold designs and drawings
indicates to him that, within months of Arciniegas joining the company, A-1 was
actively manufacturing sophisticated pail molds incorporating Plas-Tool’s trade secrets
and selling those molds to Plas-Tool’s customers in Central and South America. Id. ¶
36. Additionally, Plaintiffs assert that shortly before Arciniegas resigned from PlasTool, he accessed several engineering files within minutes of each other. Von Holdt
Decl. ¶ 76. Plaintiffs’ review of Arciniegas’s electronic files revealed that Arciniegas
viewed files for a wide variety of molds, and that Arciniegas’s rapid viewing pattern is
not reflected in any other files and folders on Plas-Tool’s computers. Id. ¶ 79. Thus,
Plaintiffs believe that Arciniegas was not viewing the files for their normal use as a
starting point for new designs or to aid in repairing damaged molds. Id.
For all of these reasons, the Court denies Defendants’ motion for summary
judgment as to Plaintiffs’ technical trade secrets.

22

B.

Non-technical information
1.

Sufficiently secret

Plaintiffs also contend that Defendants misappropriated Plaintiffs’ confidential
information about Plas-Tool’s customers in violation of the Trade Secrets Act. Pls.’ Br.
at 42. Defendants first argue that information contained in Plaintiffs’ customer list is
not a trade secret because this information is commonly known and easily duplicated
from public sources. Defs.’ Br. at 36-38. For instance, Defendants assert that mold
makers can easily locate the name and contact information of mold customers through
resources such as the Yellow Pages, the Internet, trade organizations and expos,
plastic materials suppliers, and other vendors. Id. at 37; see also R. 696-1 (Stull Expert
Report) at 62-67. Plaintiffs counter that it took them considerable time, effort, and
expense to accumulate information about their customers, and identifying buyers
interested in purchasing molds on behalf of manufacturers is actually very difficult to
determine from publicly-available sources. PSOF ¶ 11; von Holdt Decl. ¶ 74. Plaintiffs
claim that the same is true for information concerning the products the customers
needed, the products the customers ordered in the past, and how much customers paid
for products. PSOF ¶ 11. Plaintiffs contend that all of this customer-related
information gave them a significant commercial advantage. Pls.’ Br. at 5.
“Where an employer has invested substantial time, money, and effort to obtain
a secret advantage, the secret should be protected from an employee who obtains it
through improper means.” Delta Med. Sys. v. Mid-Am. Med. Sys., Inc., 772 N.E.2d 768,
780 (Ill. App. Ct. 2002) (citation omitted). At the same time, in a competitive market,
23

an employee must be entitled to utilize the general knowledge and skills acquired
through experience in pursuing his chosen occupation. Id. (citation omitted). Thus,
“[t]he plaintiff must prove that the real value of the information lies in the fact that it
is not generally known to others who could benefit from using it.” Sys. Dev. Servs., 907
N.E.2d at 73 (internal quotation omitted). Illinois courts instruct that customer lists
are not trade secrets where the “information is readily available to competitors through
normal competitive means.” Id. at 75-76 (quoting Office Mates 5, North Shore, Inc. v.
Hazen, 599 N.E.2d 1072, 1085 (Ill. App. Ct. 1992)). For instance, Office Mates 5 denied
the plaintiff’s motion for a preliminary injunction because the plaintiff did not have a
protectable interest in its client information, which included the following: the client’s
name, address, and key contact person; the fee the client was willing to pay; and the
client’s order history. 599 N.E.2d at 1084-85. Office Mates 5 concluded that this
information was readily available to anyone in the business capable of canvassing or
finding a directory, whether it be the Yellow Pages or a specialized directory, placing
a cold call to that business, and asking specific questions designed to elicit the
information. Id. at 1084; see also Sys. Dev. Servs., 907 N.E.2d at 74-76 (collecting
cases).
Here, Plaintiffs argue that their customer information is not easily discoverable
by others in the mold industry. Plaintiffs rely primarily on Beall’s rebuttal report in
which he opines “that whereas it is relatively easy to find an address and phone
number for a company, it is difficult or impossible to find the name of a buyer in one

24

of that company’s several facilities that just happens to have a need for a pail mold.”
Beall Rebuttal Rpt. at 4-5. According to Beall,
These difficulties become magnified when a potential customer is located outside
of the United States. Knowing how to contact that particular buyer is an
important commercial advantage. Knowing a potential customer’s credit rating,
reordering practice, and what they are accustomed to paying for pail and lid
molds gives a supplier a commercial advantage over the uninformed
competition. This type of customer information is not readily available from
standard listings.
Id. at 5. Also, Plaintiffs’ damages expert, William Kerr, opined that although “A-1
might have acquired this information without the material brought by Arciniegas . .
. it would have taken significant amounts of time, expense and effort.” R. 653, Pls.’
Exh. 7 (Kerr Rpt.) at ¶ 82.
The parties’ experts have conflicting opinions about how difficult it is to obtain
customer information and thus it is an issue for a jury to evaluate and decide.
Plaintiffs have put forth sufficient evidence from which a reasonable jury could
conclude that Plaintiffs’ customer information meets the definition of “trade secret”
under the Act. Therefore, the Court denies Defendants’ motion for summary judgment
on this basis.
2.

Misappropriation

Defendants argue that Plaintiffs’ Trade Secrets Act claim must fail because
Defendants did not misappropriate the alleged non-technical trade secrets. Defs.’ Br.
at 48-49. According to Defendants, Plaintiffs have no evidence to support their
contention that Defendants received the customer lists. DSOF ¶ 199. As Plaintiffs note,
however, Defendants acknowledge that Arciniegas, A-1’s employee, had some of
25

Plaintiffs’ customer names in his possession. Defs.’ Br. at 48; Pls.’ Br. at 43. Moreover,
contradictory testimony exists as to whether Arciniegas acquired a lengthy list of
Plas-Tool’s customers and whether Arciniegas took the list with him when he left PlasTool. See PSOF ¶¶ 21-23; Defs.’ Reply at 13. Thus, whether Arciniegas
misappropriated the list presents a genuine issue of material fact.
Defendants further assert that Plaintiffs offer no evidence that Defendants used
any customer information, pricing information or “ordering history.” Defs.’ Br. at 48.
Plaintiff cites, however, to several instances of sales of pail molds by A-1 to former
Plas-Tool customers. PSOF ¶¶ 25-27, 105. Accordingly, a genuine issue of material fact
exists as to this issue as well.
To summarize, the Court concludes that a reasonable jury could find that
Plaintiffs have demonstrated their technical and non-technical information was (1) the
subject of reasonable efforts to maintain secrecy, (2) remained sufficiently secret to
provide economic value, and (3) was misappropriated by Defendants. The Court
therefore denies Defendants’ motion for summary judgment on Count 3.
IV. Preemption of Other Torts
Defendants contend that they are entitled to summary judgment on Plaintiffs’
tort claims (Counts 4, 7-9) because these claims are preempted by § 1065/8 of the Trade
Secrets Act. Section 1065/8 states:
(a) Except as provided in subsection (b), this Act is intended to displace
conflicting tort, restitutionary, unfair competition, and other laws of this State
providing civil remedies for misappropriation of a trade secret.
(b) This Act does not affect:
26

***
(2) other civil remedies that are not based upon misappropriation of a
trade secret;
***
765 ILCS 1065/8.
The effect of the statute was incorporated in the previously-assigned judge’s
order, which stated that “to the extent . . . [the tort claims] are based on a
misappropriation of trade secrets, they are preempted by the [Act].” R. 221 at 10.
Defendants argue that the tort claims are based on misappropriation of trade secrets
because the breaches involved using the purported trade secret of customer contact
information. This argument, however, is contrary to Seventh Circuit and Illinois law.
Hecny Transp. Inc. v. Chu, 430 F.3d 402, 404-05 (7th Cir. 2005). The Seventh Circuit
has held that claims for breach of fiduciary duty, even if they are based on conduct
involving purported trade secrets, are not preempted by the Trade Secrets Act. Hecny
Transp., 430 F.3d at 404-05 (“An assertion of trade secret in a customer list does not
wipe out claims of theft, fraud, and breach of the duty of loyalty that would be sound
even if the customer list were a public record.”); see also Alpha Sch. Bus Co. v. Wagner,
910 N.E.2d 1134, 1150 (Ill. App. Ct. 2009) (finding Trade Secrets Act does not preempt
breach of fiduciary duty claims). Therefore, Count 4 alleging breach of fiduciary duty
and Count 7 alleging inducement of breach of fiduciary duty are not preempted by the
Act.

27

Similarly, Count 8 for tortious interference and Count 9 for conspiracy to
tortiously interfere are not preempted by the Trade Secrets Act under the reasoning
of Hecny. These claims are based on Defendants’ alleged diversion of Plas-Tool’s
customers to A-1. See Pls.’ Br. at 47-48. It does not matter, for these claims, whether
Defendants used purported trade secrets or public information to deprive Plaintiffs of
a business opportunity. See Dominion Nutrition, Inc. v. Cesca, 2006 WL 560580, at *4
(N.D. Ill. Mar. 2, 2006). Therefore, Plaintiffs’ tort claims are not preempted by the
Trade Secrets Act.
V. Fiduciary Duty (Count 4)
In Count 4, Plaintiffs allege that Arciniegas breached his fiduciary duty to
Plas-tool by “diverting Plas-tool’s potential business opportunities to A-1 while he was
still employed by and a member and director of Plas-Tool.” Pls.’ Br. at 56. Illinois law
requires proof of three elements to succeed on a breach of fiduciary duty claim: a
fiduciary duty exists, that the fiduciary duty was breached, and damages proximately
caused by the breach. Gross v. Town of Cicero, Ill., 619 F.3d 697, 709 (7th Cir. 2010)
(citation omitted). In addition, although the parties do not address this, there are
different standards for employees and officers when it comes to breach of fiduciary
duty. See Veco Corp. v. Babcock, 611 N.E.2d 1054 , 1059 (Ill. App. Ct. 1993) (corporate
officers “stand on a different footing” than employees). Officers “owe a fiduciary duty
of loyalty to their corporate employer not to (1) actively exploit their positions within
the corporation for their own personal benefit, or (2) hinder the ability of the

28

corporation to continue the business for which is was developed.” Id. (citations
omitted).
Defendants argue that the record fails to establish any breach of duty by
Arciniegas or any damages to Plas-Tool. Defs.’ Br. at 58. Specifically, Defendants note
that while Arciniegas may have directed up to four potential customers—Maghfran,
Lhaura Vet, Plastigel, and Romi—to A-1 while he was still employed by Plas-Tool, the
evidence shows that von Holdt instructed Arciniegas to refer work to A-1 because
Plas-Tool could not do it, either because of lack of capacity or lack of ability. See id.;
DOSF ¶ 279. Accordingly, Defendants contend that because Arciniegas cannot be held
liable for breaching his fiduciary duty by following the directions of his principal, the
breach of fiduciary duty claim must fail. Alternatively, Defendants assert that von
Holdt directed Arciniegas to enter into a joint-referral relationship with A-1, not to
divert business away from A-1.
At his deposition, however, von Holdt appears to have testified, however,
regarding two different types of relationships with A-1. First, as noted by Plaintiffs,
von Holdt stated that he directed Arciniegas to explore a joint-referral relationship
with A-1 in which there would be “referrals back and forth depending on [the
company’s] expertise” with no commission taken. R. 538-24, Defs.’ Exh. 20 (von Holdt
Dep.) at 19. Von Holdt also testified, as pointed out by Defendants, that when
Arciniegas told von Holdt that Arciniegas had a customer who was interested in a
square mold at a time when Plas-Tool was working “almost at full capacity,” id. at 20,

29

von Holdt instructed Arciniegas to approach A-1 and see if A-1 could do the mold
construction if Plas-Tool did the design work. Id. at 21.
Because a genuine issue of material fact exists as to exactly what Arciniegas was
instructed to do, when he was instructed to do it, and as to which customers he was
instructed to do it, the motion for summary judgment on this ground must be denied.
Defendants also contend that Plas-Tool cannot show damages and, therefore, the
breach of fiduciary duty claim must fail. According to Defendants, “Plas-Tool is simply
seeking compensation for jobs it did not have the opportunity, ability or inclination to
perform.” Defs.’ Br. at 58. Plaintiffs’ damages could include, however, some or all of
Arciniegas’s salary if a breach is demonstrated; thus, damages could exist without
reference to Plas-Tool’s ability or capacity to perform. See Veco Corp., 611 N.E.2d at
1062 (“An employer may recover an employee’s total compensation paid during the
time period that an employee was breaching fiduciary duties owed the employer.”).
Moreover, on this record, it is for the jury to decide the damages that were caused by
alleged breach of duty. Accordingly, the motion for summary judgment based on
Plaintiffs’ failure to show breach or damages is denied.
VI. Inducement of Breach (Count 7)
Plaintiffs also allege a claim for inducement of breach of fiduciary duty against
Geoffrey Luther, LeRoy Luther, A-1, and Triangle (Count 7). “[A] third party who
colludes with a fiduciary in committing a breach of duty, induces or participates in
such breach, and obtains the benefits therefrom is directly liable to the aggrieved
party.” Paul H. Schwendener, Inc. v. Jupiter Elec. Co., 829 N.E.2d 818, 827 (Ill. App.
30

Ct. 2005) (citation omitted). Defendants argue that summary judgment is appropriate
on this claim for several reasons. First, they argue that because Plas-Tool cannot
establish the underlying breach of fiduciary duty, it cannot establish inducement to
breach. Defs.’ Br. at 59. But the Court concluded that a genuine issue of material fact
precluded judgment on the breach of fiduciary duty claim. Therefore, that argument
fails.
Defendants next contend that judgment is proper on the inducement claim
“because Plas-Tool has neither proof of collusion, nor evidence that the defendants
knowingly obtained the benefit of the alleged breach.” Id. at 59. In support, they simply
and generally cite to statements of material facts ¶¶ 267-300. That generalized citation
without explanation in the brief is insufficient to articulate an argument in support of
summary judgment. This ground is also rejected.
Defendants’ final argument, however, does compel the entry of summary
judgment on Count 7. Specifically, Defendants assert that they did not benefit from the
alleged referrals because they did not receive work from Lhaura Vet or Plastigel. Defs.’
Br. at 59. And although Maghfran initially awarded Defendants a contract, Maghfran
failed to pay, leaving A-1 with a substantial loss. Id. Plaintiffs do not address this
argument in their response. See Pls.’ Br. at 57. Because Plaintiffs do not point to any
evidence creating a genuine issue of material fact as to this element of their claim for
inducement, the Court concludes that Defendants’ motion for summary judgment on
Count 7 must be granted.

31

VII. Tortious Interference
A.

Tortious Interference with Business Expectancy (Count 8)

Plaintiffs claim that Arciniegas tortiously interfered with Plas-Tool’s prospective
business expectancy from five potential customers: Maghfran, Lhaura Vet, Plastigel,
Saiar, and Romi. See Defs.’ Br. at 51. In Illinois, a claim of tortious interference with
a prospective business relationship requires the following four elements be proven: (1)
the existence of the plaintiff’s reasonable expectation of entering into a valid business
relationship; (2) the defendant’s knowledge of the plaintiff’s expectancy; (3) purposeful
interference by the defendant that prevents the plaintiff’s legitimate expectancy from
being fulfilled; and (4) damages to the plaintiff resulting from the defendant’s
interference. Fellhauer v. City of Geneva, 568 N.E.2d 870, 878 (Ill. 1991). Here,
Defendants challenge only the first and fourth elements.
1.

Maghfran

Defendants first argue that Plaintiffs have no evidence in support of a finding
a reasonable business expectancy with Maghfran. Plaintiffs respond that “[t]aken
together, Plas-Tool’s success in South America and intentions to do business there, the
correspondence with Maghfran representatives, Maghfran’s visit to Plas-Tool from
Brazil and subsequent requests for quotes, clearly support the conclusion that PlasTool had a reasonable expectation of entering a business relationship with Maghfran.”
Pls.’ Br. at 51. But, under Illinois law, a plaintiff must show more than a mere hope or
opportunity of future business dealings. See Anderson v. Vanden Dorpel, 667 N.E.2d
1296, 1300 (Ill. 1996). The facts set forth by Plaintiffs do not show that Plas-Tool’s
32

expectation of a business relationship with Maghfran was “more than a mere hope.”
Indeed, Plaintiffs do not rebut Maghfran’s deposition testimony that he did not need
the round pail molds that Plas-Tool produced and that he “did not want Plas-Tool to
build this mold.” DSOF ¶ 275. Plaintiffs point to von Holdt’s deposition testimony, but
von Holdt simply testified that Maghfran visited Plas-Tool and that there had been
some communications between Maghfran and Plas-Tool. R. 693, Pls.’ Exh. 26, pt. 1 (von
Holdt Dep.) v at 90-94. In addition, Plas-Tool fails to point to any evidence establishing
a genuine issue of material fact that it suffered damages as a result of the alleged
interference. Accordingly, the motion for summary judgment on this claim as it relates
to Maghfran is granted.
2.

Lhaura Vet

Defendants also contend that no genuine issue of material fact exists as to the
existence of a reasonable business expectancy between Plas-Tool and Lhaura Vet. As
Defendants note, Lhaura Vet was not and never has been a Plas-Tool customer. Von
Holdt testified that he had not heard of Lhaura Vet until this lawsuit was filed. DSOF
¶ 191. Plas-Tool fails to point to any evidence that supports the finding of a reasonable
business expectancy with Lhaura Vet. As with Maghfran, Plas-Tool points to its
“expertise, previous business in South America and requests for quotations” as
evidence that Plas-Tool had a reasonable expectation in entering into a business
relationship with Lhaura Vet. Pls.’ Br. at 52. But Plas-Tool does not cite to any
authority supporting the argument that general assertions of expertise and previous
presence in a market support a finding of a reasonable business expectancy.
33

In addition, Plas-Tool’s reference to Lhaura Vet’s request for quotations does not
establish a reasonable business expectancy. See MPC Containment Sys. v. Moreland,
2008 WL 2875007, at *15 (N.D. Ill. July 23, 2008) (“[M]erely submitting bids for future
contracts or demonstrating a past contractual relationship may be insufficient to
demonstrate a reasonable business expectancy.”) (citations omitted); Quadro Enters.,
Inc. v. Avery Dennison Corp., 2000 WL 1029176, at *10 (N.D. Ill. Jul. 26, 2000)
(“Quadro merely received an invitation to bid on the label business. The fact that
Quadro was asked to bid implies that the contract was up for competitive bidding and
thus it cannot be said that Quadro had an expectancy of future business relations.”);
Rush-Presbyterian-St. Luke’s Med. Ctr. v. Gould, Inc., 1995 WL 340967, at *5 (N.D. Ill.
June 2, 1995) (“The general rule is that price quotations are not offers, but rather are
mere invitations to enter into negotiations or to submit offers.”). Accordingly, the Court
grants Defendants’ motion for summary judgment on the tortious interference claim
with respect to Lhaura Vet.
3.

Plastigel

As to Plastigel, Plaintiffs state that “Plastigel, through a broker, contacted
Plas-Tool regarding the possibility of purchasing a mold.” Pls.’ Br. at 52. For the
reasons stated above, simple contact regarding the possibility of purchasing a mold
does not demonstrate that Plas-Tool’s expectation was “more than a mere hope.” MPC
Containment Sys., 2008 WL 2875007, at *15. Accordingly, judgment as to Plastigel on
this count is granted.

34

4.

Sair

Plaintiffs contend that when Sair requested a price quote, Arciniegas instead
offered to license Saiar technology that he owned. PSOF ¶ 130-31. When Saiar
evaluated the license offer, it determined it was too high and declined. Id. ¶ 132. Thus,
Plas-Tool argues that it never got the opportunity to give Saiar a quote. Again,
however, even assuming that Arciniegas had given Saiar a price quote from Plas-Tool,
as already noted, providing price quotes is insufficient to establish a reasonable
expectation of business expectancy. Thus, judgment as to the tortious interference
claim with respect to Saiar is also granted.
5.

Romi

Finally, Plaintiffs state that Arciniegas, on behalf of Plas-Tool, was supposed to
meet with representatives of a company named Romi in Brazil, who were going to
introduce Arciniegas to several of Romi’s customers. PSOF ¶ 135. According to von
Holdt, Arciniegas canceled the meeting with Romi so that he could later attend on
behalf of Defendants. PSOF ¶ 136. Based on the case law already discussed above,
simply meeting with a broker who was going to provide introductions fails to establish
a reasonable business expectancy. Plaintiffs assert that Romi had two “strong projects”
in Brazil that were not consummated due to Arciniegas’s interference. Pls.’ Br. at 53.
Although Romi did indicate to Plas-Tool that it was of the “utmost importance” that it
send a representative to Brazil to close these two deals, see PSOF ¶ 137, it is
undisputed that von Holdt sent a letter to Romi indicating that Plas-Tool could not
send anyone to Brazil. Thus, any failure to obtain the business is due to Plas-Tool’s
35

own decision not to send a representative to Brazil. The Court grants summary
judgment to Defendants with respect to the tortious interference claim as to Romi.
B.

Conspiracy to Tortiously Interfere with Business Expectancy
(Count 9)

As to the conspiracy to tortiously interfere (Count 9), Defendants argue that
because the tortious interference claim fails, so does the claim for conspiracy to
tortiously interfere. The Court agrees. Because the Court granted summary judgment
on the tortious interference claim, summary judgment on the conspiracy claim is also
warranted. Sanchez & Daniels v. Koresko & Assocs., 2006 WL 3253604, at *6 (N.D. Ill.
Nov. 8, 2006) (“Because the Court has determined that Koresko cannot sustain claims
for tortious interference or abuse of process, any claims for conspiracy to commit those
torts or aiding and abetting others in committing them necessarily fail.”).

36

VIII. Conclusion
For the above reasons, Defendants’ motion for summary judgment on the statelaw claims [R. 524] is granted in part and denied in part. Defendants’ motion is
granted on Counts 7, 8, and 9; the motion is denied as to Counts 3 (Trade Secrets Act)
and 4 (fiduciary duty). At the January 29, 2013 status hearing, the parties should be
prepared to discuss whether they wish to hold a settlement conference (the parties are
encouraged to start discussing settlement amongst themselves), or instead set a trial
date.
ENTERED:
s/Edmond E. Chang
Honorable Edmond E. Chang
United States District Judge
DATE: January 3, 2013

37