Core Laboratories v. Spectrum Tracer Services LLC et al

Filing 493

ORDER granting in part and denying in part 465 Defendants' Motion to Strike Certain Newly Identified Claims from the Amended Final Pretrial Report, striking plaintiff's claim of breach of contract by defendant Steve Faurot in the Amended Final Pretrial Report and denying 480 Defendants' Motion for Leave to File Reply to Core's Response to Defendants' Motion to Strike Certain Newly Identified Claims from the Amended Final Pretrial Report (as more fully set out). Signed by Honorable Vicki Miles-LaGrange on 2/19/2016. (ks)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA
CORE LABORATORIES LP,
Plaintiff,
v.
SPECTRUM TRACER SERVICES,
L.L.C., STEVE FAUROT, and
KELLY BRYSON,
Defendants.

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Case No. CIV-11-1157-M

ORDER
Before the Court is Defendants Spectrum Tracer Services, L.L.C. and Steve
Faurot’s (collectively “Defendants”) Motion to Strike Certain Newly Identified Claims
from the Amended Final Pretrial Report, filed January 8, 2016. On January 19, 2016,
plaintiff responded. Also before the Court is Defendants’ Motion for Leave to File Reply
to Core’s Response to Defendant’s Motion to Strike Certain Newly Identified Claims
from the Amended Final Pretrial Report, filed January 25, 2016. On January 26, 2016,
plaintiff responded in opposition to Defendants’ motion to reply. Based on the parties’
submissions, the Court makes its determination.
Defendants move the Court to strike newly identified claims of breach of contract
against defendant Steve Faurot and unfair competition by misappropriation against both
Defendants in the Amended Final Pretrial Report. 1 Defendants contend that while

1

On this same date, the Court entered an Order denying plaintiff’s Motion for Leave to
File Fifth Amended Complaint [docket no. 452], therefore, the Court finds that plaintiff’s claim
for breach of contract against defendant Steve Faurot should be struck from all pretrial

plaintiff did allege a claim of unfair competition, plaintiff failed to allege the distinct tort
of unfair competition by misappropriation. Specifically, Defendants contend that (1)
Texas does not recognize a cause of action for unfair competition by misappropriation;
(2) to the extent the cause of action of unfair competition by misappropriation is
recognized by Texas, it is preempted by federal patent and copyright laws; (3) plaintiff
failed to properly plead its cause of action for unfair competition by misappropriation;
and (4) plaintiff should not be able to assert a claim of unfair competition by
misappropriation since it prevented discovery regarding an essential element of its claim.
The law of unfair competition is the umbrella for all
statutory and nonstatutory causes of action arising out of
business conduct which is contrary to honest practice in
industrial or commercial matters. American Heritage Life Ins.
Co. v. Heritage Life Ins. Co., 494 F.2d 3, 14 (5th Cir.1974).
Misappropriation is a branch of the tort of unfair competition
which involves the appropriation and use by the defendant, in
competition with the plaintiff, of a unique pecuniary interest
created by the plaintiff through the expenditure of labor, skill
and money.
Seatrax, Inc. v. Sonbeck Int'l, Inc., 200 F.3d 358, 367-68 (5th Cir. 2000). In its Fourth
Amended Complaint, plaintiff alleges:
Defendants are unlawfully competing against Core by
Defendants’ misappropriation, disclosure, and use of Core’s
confidential, proprietary and trade secret Software
Applications, information, and/or Core’s proprietary
products.

submissions as well. The Court will only address Defendants’ contention that plaintiff’s claim of
unfair competition by misappropriation should be struck from the Amended Final Pretrial
Report.
2

Defendants’ conduct demonstrates their intent to promote
Defendants’ own interests at Core’s expense and to Core’s
detriment. Core has a unique and pecuniary interest in the
confidential and trade secret Software Applications,
information, and proprietary products that Defendants
unlawfully misappropriated and used. Core created this
confidential and trade secret information through the
expenditure of labor, skill, time and money.
Plf.’s Fourth Am. Compl. ¶¶ 58 & 59.
Having reviewed the parties’ submissions, as well as plaintiff’s Fourth Amended
Complaint, the Court finds that Count Three – Unfair Competition of plaintiff’s Fourth
Amended Complaint sufficiently put Defendants on notice that plaintiff was alleging an
unfair competition by misappropriation claim. 2 Specifically, the Court finds that while
Count Three of plaintiff’s Fourth Amended Complaint generally alleges unfair
competition in the title, plaintiff includes, in the subsequent paragraphs, qualifying
language to identify that it was alleging unfair competition by misappropriation. See
Seatrax, 200 F.3d at 368 (“Seatrax’s general allegation of unfair competition without
additional qualifying language to identify a specific cause of action under unfair
competition did not provide adequate notice of its claim.”). Therefore, the Court finds
that plaintiff’s unfair competition by misappropriation claim should not be struck from
the Amended Final Pretrial Report.
Accordingly, for the reasons set forth above, the Court GRANTS IN PART AND
DENIES IN PART Defendants’ Motion to Strike Certain Newly Identified Claims from
2

Defendants’ assertions, other than plaintiff failed to properly plead its cause of action
for unfair competition by misappropriation, will not be addressed by the Court in this Order, as a
motion to strike is not the proper motion to dispose of assertions. These assertions should have
been raised in a dispositive motion.
3

the Amended Final Pretrial Report [docket no. 465] and STRIKES plaintiff’s claim of
breach of contract by defendant Steve Faurot in the Amended Final Pretrial Report
[docket no. 360]. Further, since the Court struck plaintiff’s breach of contract claim
against defendant Steve Faurot and found that plaintiff gave adequate notice to
Defendants of its unfair competition by misappropriation claim in its Fourth Amended
Complaint, the Court finds no further briefing is necessary on these issues and DENIES
Defendants’ Motion for Leave to File Reply to Core’s Response to Defendants’ Motion
to Strike Certain Newly Identified Claims from the Amended Final Pretrial Report
[docket no. 480].
IT IS SO ORDERED this 19th day of February, 2016.

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