Securitas Electronic Security, Inc. v. DeBon

Filing 41

DECISION AND ORDER DENYING DEFENDANT'S MOTION TO DISMISS denying 34 Motion to Dismiss. DeBon obviously did not take well to Securitas' acquisition of his long-time employer, DSSI. But he remained in the newly-acquired corporations employ , and so owed it a duty of undivided loyalty. The facts pleaded in the complaint, if proven, suggest that he breached that duty in multiple ways, to the detriment of Securitas. His motion to dismiss the complaint is denied. The Clerk is directed to remove the motion at Docket #34 from the court's list of open motions. (Signed by Judge Colleen McMahon on 3/15/2021) (mml)

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 1 of 9

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
___________________________________________
SECURITAS ELECTRONIC SECURITY,
INC.,
Plaintiff,

20-cv-5323 (CM) (KNF)

-againstBRUCE DEBON,
Defendant.
__________________________________________
BRUCE DEBON,
Third Party Plaintiff
-against
FELIX GONZALEZ,
Third Party Defendant.
__________________________________________
DECISION AND ORDER DENYING DEFENDANT’S MOTION TO DISMISS
McMahon, C.J.:
The complaint in this action alleges that Defendant Bruce DeBon violated his fiduciary
duty to his former employer, Plaintiff Securitas Electronic Security, Inc. (Securitas), by
misappropriating Securitas’ confidential and proprietary information, which he then used to form
a new venture that is competing with Securitas and disparaging the company to existing and
potential customers. The complaint also charges DeBon with unfair competition under New York

1

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 2 of 9

law and that he tortiously interfered with a contract between Securitas and a company called
Vornado.
DeBon moves for judgment on the pleadings pursuant to Fed. R. Civ. P. 12(c). For
substantially the reasons articulated by plaintiff in its opposing brief, DeBon’s motion is entirely
without merit. It is denied.
I.

Standard for Evaluating a Motion to Dismiss and Factual Background

A motion for judgment on the pleadings is judged by the familiar standards applicable to a
motion to dismiss for failure to state a claim pursuant to Fed. R. Civ. P. 12(b)(6). Hayden v.
Paterson, 594 F.3d 150, 160 (2d Cir. 2010). The court looks to the four corners of the complaint,
presumes all well-pleaded facts to be true, and draws all reasonable inferences in favor of the
pleader. See Cargo Partner AG v. Albatrans, Inc., 352 F.3d 41, 44 (2d Cir. 2003); see also Roth v.
Jennings, 489 F.3d 499, 510 (2d Cir. 2007).
To survive a motion to dismiss, “a complaint must contain sufficient factual matter . . . to
‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility
when the plaintiff pleads factual content that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.” Ibid. (citing Twombly, 550 U.S. at 556).
“While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual
allegations, a plaintiff’s obligation to provide the grounds of his entitlement to relief requires more
than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not
do.” Twombly, 550 U.S. at 555 (internal quotations, citations, and alterations omitted). Thus,
unless a plaintiff’s well-pleaded allegations have “nudged [its] claims across the line from

2

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 3 of 9

conceivable to plausible, [the plaintiff’s] complaint must be dismissed.” Id. at 570; Iqbal, 556
U.S. at 680.
The only pleading that is relevant for our purposes is the complaint. In his moving papers,
DeBon cites allegations that are not pleaded in the complaint filed by Securitas, but that are drawn
from a counterclaim he filed against Securitas, and a third-party complaint he filed against Felix
Gonzalez, a Securitas employee. Those allegations are outside the four corners of Securitas’
complaint and cannot and will not be considered in deciding DeBon’s motion. Pani v. Empire Blue
Cross Blue Shield, 152 F. 3d 67, 71 (2d Cir. 1998).
The reader is referred to the text of the complaint (Docket #1) for a full description of the
facts. The complaint alleges, in substance, that DeBon was employed by Securitas as the Managing
Director of its Diversified Security Solutions (DSSI) Division. Securitas had acquired the DSSI
Division via its purchase of DeBon’s former employer, Kratos Public Safety & Security Solutions,
Inc. (Kratos PSS). It alleges that, from the time of the acquisition, DeBon began to breach his duty
to his new employer in a variety of ways: by helping an existing Securitas client, Vornado Realty
Trust, develop its own internal life and safety division to compete with Securitas and to provide
the services that were being provided to Vornado by Securitas; by inducing other Securitas
employees to assist in this endeavor; by portraying Securitas in a negative light to DSSI employees;
by sending and causing others to send confidential Securitas information to Vornado; by
commercially disparaging Securitas during the course of his employment; and by representing
himself as the Director of Fire Safety for Vornado while he was on the Securitas payroll. Once
his actions were discovered and Securitas fired him, DeBon allegedly continued the commercial
disparagement of his former employer and used proprietary information, including pricing data
and emergency action plans to which he had access as a Securitas employee, to induce Securitas

3

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 4 of 9

customers to cancel their contracts with Securitas and to otherwise compete with his former
employer while working for a new enterprise, Croker Fire Drill (Croker). Among the customers
who cancelled or declined to renew contracts as a result of DeBon’s allegedly faithless actions
were ATCO Management Services, LLC (ATCO), Jeffrey Management Corp. (JMS), and
Vornado.
In his answer to the complaint, DeBon denied all of the material allegations of Securitas’
complaint.
II.

Discussion

A. The First Cause of Action States A Claim for Breach of Fiduciary Duty
On the basis of these factual allegations, the First Cause of Action alleges that DeBon
breached his fiduciary duty to Securitas.
DeBon moves to dismiss the First Cause of Action by characterizing it as a fraud claim that
is subject to the heightened pleading standards of Fed. R. Civ. P. 9(b). It is not, however, a fraud
claim. The fact that DeBon is alleged to have made false statements about his former employer,
disparaging it and its business to current and former customers, does not transform this gardenvariety breach-of-fiduciary-duty claim into a fraud claim that is subject to heightened pleading
requirements.
When deciding whether a claim sounds in fraud, a court reviews the facts alleged to see on
what ground the claim rests. Securitas’ complaint does not allege that DeBon defrauded Securitas;
neither does it allege that DeBon defrauded Vornado and others by making false statements to
them. It alleges that he betrayed the trust of his employer by denigrating the company, both during
and after his employment, in violation of his duty not to engage in such conduct. Rule 8(a)(2)

4

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 5 of 9

governs the pleading requirement for such a claim, and Rule 9(b) is inapplicable. Schupak v.
Florescue, No 92-cv-1189 (JFK), 1993 WL 256572, at *3 (S.D.N.Y. July 8, 1993).
The complaint pleads facts to state a breach-of-fiduciary-duty claim, including that DeBon
was an employee that owed Securitas a fiduciary duty, that DeBon intentionally breached that duty
by acting against Securitas, and that Securitas lost contracts and thus suffered damages as a result.
This pleads all the necessary elements for a cause of action. See Yukos Cap. S.A.R.L. v. Feldman,
977 F.3d 216, 241 (2d Cir. 2020).
The motion to dismiss the First Cause of Action is denied.
B. The Second Cause of Action States a Claim for Unfair Competition
In New York, unfair competition is a broad and flexible doctrine that encompasses “any
form of commercial immorality,” or “endeavoring to reap where (one) has not sown.” Roy Exp.
Co. Establishment of Vaduz, Liechtenstein v. CBS, 672 F. 2d 1095, 1105 (2d Cir. 1982) (citations
omitted). The facts set forth above, if proven, make out a claim of “endeavoring to reap where one
has not sown” – specifically in connection with DeBon’s alleged misuse of Securitas’ proprietary
information. Therefore, the claim for unfair competition is sufficiently pleaded.
DeBon’s quarrel with the Second Cause of Action rests on his dispute about what the facts
truly are: he rests on his own version of the facts, as set forth in his third-party complaint against
Felix Gonzalez. However, DeBon’s alternate version of what actually happened – who actually
developed certain information; who owned it at the time it was used; and whether it was actually
confidential – is of no moment on a motion to dismiss this particular complaint. As Securitas points

5

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 6 of 9

out, those are disputed facts; and on this motion I am presuming Securitas’ version of the facts to
be true. 1
DeBon’s motion to dismiss the Second Cause of Action is denied.
C. The Third and Fourth Causes of Action State Claims for Tortious Interference
Securitas’ Third Cause of Action alleges that DeBon tortiously interfered with DSSI’s
service contract with Vornado, ATCO, and JMS by inducing them to terminate their relationships
with Securitas/DSSI prematurely and without cause. DeBon’s contention that the claim should be
dismissed because the complaint somehow fails to allege that there was any breach of contract by
Vornado is absurd; the complaint alleges that Vornado prematurely terminated the contract, which,
if true (and it is presumed to be true), would constitute a breach of contact. For that reason alone,
the Third Cause of Action cannot be dismissed, and it is unnecessary to consider any other
arguments.
Moreover, to the extent that other contracts between Securitas/DSSI and customers were
terminable at will, Securitas’ allegation that DeBon was violating his fiduciary duty brings its
claim of tortious interference squarely within that doctrine. It has long been the law in New York
that tortious interference encompasses contracts terminable at will “when the alleged means
employed by the one interfering were wrongful as . . . in violation of a duty of fidelity owed to the
plaintiff by the defendant by reason of a relation of confidence existing between them.” Guard
Life Corp v. S. Parker Hardware Mfg. Corp., 50 N.Y. 2d 183, 194 (1980). The employment

1

Indeed, my only quarrel with the argument propounded by Securitas is its suggestion that a
motion for summary judgment, rather than a motion to dismiss, would be the appropriate vehicle
for deciding between the facts pleaded in Securitas’ complaint and in DeBon’s third-party
complaint. Two such diametrically opposed versions of the truth are rarely amenable to summary
judgment; normally a trial is required. Whether that be true in this case remains to be seen.
6

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 7 of 9

relationship between Securitas and DeBon following Securitas’ acquisition of DSSI is, of course,
a relation of confidence existing between the plaintiff and defendant.
The Fourth Cause of Action alleges that DeBon tortuously interfered with Securitas’
prospective business relations. Malice is an element of tortious interference, so ordinarily a party
alleging tortious interference must allege that the defendant acted with the sole purpose of harming
the plaintiff. However, if a pleading alleges that a defendant “used dishonest, unfair or improper
means” to interfere with a prospective business relationship, that will suffice to meet the malice
requirement. A.V.E.L.A., Inc. v. Estate of Marilyn Monroe, LLC, 241 F. Supp. 3d 461, 486
(S.D.N.Y. 2017); see also Brown v. AXA Re, No. 02-cv-10138 (LTS), 2004 WL 941959, at *7
(S.D.N.Y. May 3, 2004). I have already pointed out that Securitas’ complaint alleges the use of
dishonest, unfair and improper means, including engaging in commercial disparagement and using
proprietary business information that belonged to the plaintiff, in order to interfere with the
plaintiff’s ability to enter into contracts. That gets this claim past a motion to dismiss.
DeBon’s motion to dismiss the Third and Fourth Causes of Action is denied.
D. The Fifth Cause of Action States a Claim for Usurpation of Corporate Opportunity
Securitas’ Fifth Cause of Action accuses DeBon of usurping corporate opportunities for
himself. Under New York law, “The corporate opportunity doctrine provides that ‘corporate
fiduciaries and employees cannot, without consent, divert and exploit for their own benefit any
opportunity that should be deemed an asset of the corporation.’” Le Metier Beauty Inv. Partners
LLC v. Metier Tribeca, LLC, No. 13-cv-4650 (JFK), 2015 WL 7078641, at *4 (S.D.N.Y. Nov. 12,
2015) (quoting Alexander & Alexander of N.Y., Inc. v. Fritzen, 542 N.Y.S. 2d 530, 533 (1st Dep’t
1989)). The doctrine applies to employees even after their employment has been terminated. Pure
Power Boot Camp, Inc., v. Warrior Fitness Boot Camp, LLC, 813 F. Supp. 2d 489, 524 (S.D.N.Y.

7

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 8 of 9

2011). To state a claim, a corporation must have a “tangible expectancy” that a particular
opportunity will ensue, and when a corporation already has a business relationship with another
entity, it is easier to establish that it has a “tangible expectancy” of continuing that relationship,
not simply a desire or hope. Alexander & Alexander, 542 N.Y.S. 2d at 534. The complaint in this
case alleges that Securitas, through the DSSI Division it acquired in 2018, was providing services
to multiple entities, some of them under contracts that had been renewed again and again, and had
received no complaints about that service – all of which gave Securitas a reasonable expectation
that this would continue after it purchased DSSI. Indeed, it is difficult to understand why Securitas
would have paid valuable consideration to acquire DSSI’s business if, after conducting due
diligence, it did not have a reasonable expectation that these business relationships would continue.
The fact that Securitas had only recently acquired DSSI does not undermine this inference.
In fact, if, as is alleged, Securitas were keeping DSSI’s existing personnel (like DeBon) and using
its already proven business strategies (strategies that DeBon alleges were developed by him), the
inference that the relationships would continue become highly plausible. At the very least,
Securitas has alleged facts that, if proved, would satisfy the “reasonable expectation” test.
DeBon’s motion to dismiss the Fifth Cause of Action is denied.
E. The Sixth Cause of Action Can Be Pleaded in the Alternative
Finally, Securitas has asserted a claim for unjust enrichment, on the ground that DeBon
benefitted financially from his improper use of Securitas’ resources, confidential client
information, proprietary information and intellectual property. It seeks, inter alia, disgorgement of
the salary and benefits that Securitas paid to DeBon in the period of his employment that followed
the Securitas acquisition of DSSI, as well as any compensation or benefits that DeBon has received

8

Case 1:20-cv-05323-CM-KNF Document 41 Filed 03/15/21 Page 9 of 9

as a result of his inducing ATCO, JMS and Vornado to cancel their contracts with Securitas/DSSI
and to contract instead with Croker, the entity with which DeBon is now affiliated.
While an unjust enrichment claim is not viable if “it simply duplicates, or replaces, a
conventional contract or tort claim,” it remains viable when “the defendant, though guilty of no
wrongdoing, has received money to which he or she is not entitled.” Haraden Motorcar Corp. v.
Bonarrigo, 19-cv-1079 (BKS/DJS), 2020 WL 1915125, at *10 (N.D.N.Y. April 20, 2020) (quoting
Corsello v. Verizon N.Y., Inc., 944 N.Y.S. 2d 732, 790 (2012)). The facts pleaded assert a plausible
claim of unjust enrichment. While Securitas cannot recover for both its fiduciary and corporate
opportunity diversion claims and unjust enrichment – that would give it double recovery – it is
premature to dismiss the unjust-enrichment claim as duplicative.
DeBon’s motion to dismiss the Sixth Cause of Action is denied.
Conclusion
DeBon obviously did not take well to Securitas’ acquisition of his long-time employer,
DSSI. But he remained in the newly-acquired corporation’s employ, and so owed it a duty of
undivided loyalty. The facts pleaded in the complaint, if proven, suggest that he breached that duty
in multiple ways, to the detriment of Securitas. His motion to dismiss the complaint is denied.
The Clerk is directed to remove the motion at Docket #34 from the court’s list of open
motions.

Dated: March 15, 2021
_________________________________________
Chief Judge
BY ECF TO ALL COUNSEL

9