Opinion
HHDCV156059689
10-06-2016
Applied Advertising, Inc. v. Ross Jacobs et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
Nina F. Elgo, J.
Before this court is the defendants' motion to strike the following counts of the plaintiff's revised complaint (#110): counts four, five, and six, alleging tortious interference with business relationships and expectancy claims; counts twelve, thirteen, and fourteen, alleging conversion/trespass to chattel claims; counts fifteen sixteen, and seventeen, alleging statutory theft claims; and count eighteen, alleging a civil conspiracy claim.
The plaintiff, Applied Advertising, Inc. (Applied Advertising), is a privately owned Delaware corporation and provider of graphic installation services. In its lawsuit, the plaintiff sues Ross Jacobs (Jacobs), a former employee, Candid Litho Printing, Ltd. (Candid Litho) and Candid Worldwide, LLC f/k/a/ Blue Ocean Worldwide, LLC (Candid Worldwide) Candid Litho is a provider of print production services and Candid Worldwide is a provider of multi-formal digital print, print management, and media display services. Both Candid Litho and Candid Worldwide (the Candid defendants) are former customers of Applied Advertising. The plaintiff alleges that in the course of Jacobs' employment with Applied Advertising, Jacobs copied, downloaded, and/or otherwise transferred, and/or transmitted to Candid Litho and/or Candid Worldwide approximately eighty-seven gigabytes of data belonging to Applied Advertising, including data containing Applied Advertising trade secrets, such as confidential and proprietary business information about Applied Advertising customers, by using an external hard drive, by downloading and emailing via his personal email address, by downloading remotely through a remote access portal, and/or by downloading same to his personal " Dropbox" account. The plaintiff alleges that Jacobs and the Candid defendants engaged in this activity, notwithstanding Jacobs' agreement to abide by the provisions of Applied Advertising's Employee Handbook, which prohibits the disclosure of customer information and other confidential information belonging to Applied Advertising. The plaintiff further alleges that the Candid defendants, previously customers, became competitors as a result of the improper disclosure of this information.
" A motion to strike shall be used whenever any party wishes to contest . . . the legal sufficiency of the allegations of any complaint, counterclaim or cross claim, or of any one or more counts thereof, to state a claim upon which relief can be granted . . ." Practice Book § 10-39(a). " [A] motion to strike challenges the legal sufficiency of a pleading and, consequently, requires no factual findings by the trial court . . . [The court] construe[s] the complaint in the manner most favorable to sustaining its legal sufficiency . . . Thus, [i]f facts provable in the complaint would support a cause of action, the motion to strike must be denied . . . Moreover, [the court notes] that [w]hat is necessarily implied [in an allegation] need not be expressly alleged . . . It is fundamental that in determining the sufficiency of a complaint challenged by a defendant's motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted. Indeed, pleadings must be construed broadly and realistically, rather than narrowly and technically." (Internal quotation marks omitted.) Geysen v. Securitas Security Services U.S.A., Inc., 322 Conn. 385, 398, 142 A.3d 227 (2016). " If any facts provable under the express and implied allegations in the plaintiff's complaint support a cause of action . . . the complaint is not vulnerable to a motion to strike." Bouchard v. People's Bank, 219 Conn. 465, 471, 594 A.2d 1 (1991). " A motion to strike is properly granted if the complaint alleges mere conclusions of law that are unsupported by the facts alleged." (Internal quotation marks omitted.) Santorso v. Bristol Hospital, 308 Conn. 338, 349, 63 A.3d 940 (2013).
Tortious Interference with Business Expectancy
A successful action for tortious interference with business expectancies requires the satisfaction of three elements: " (1) a business relationship between the plaintiff and another party; (2) the defendant's intentional interference with the business relationship while knowing of the relationship; and (3) as a result of the interference, the plaintiff suffers actual loss." Hi-Ho Tower, Inc. v. Com-Tronics, Inc., 255 Conn. 20, 27, 761 A.2d 1268 (2000). American Diamond Exchange, Inc. v. Alpert, 101 Conn.App. 83, 90, 920 A.2d 357, cert. denied, 284 Conn. 901, 931 A.2d 261 (2007).
" [N]ot every act that disturbs a . . . business expectancy is actionable. " [A] claim is made out [only] when interference resulting in injury to another is wrongful by some measure beyond the fact of the interference itself." (Internal quotation marks omitted.) Downes-Patterson Corp. v. First National Supermarkets, Inc., 64 Conn.App. 417, 429, 780 A.2d 967, cert. granted on other grounds, 258 Conn. 917, 782 A.2d 1242 (2001) (appeal dismissed June 25, 2002). Accordingly, the plaintiff must plead and prove at least some improper motive or improper means. Id. " [F]or a plaintiff successfully to prosecute such an action it must prove that . . . the defendant was guilty of fraud, misrepresentation, intimidation or molestation . . . or that the defendant acted maliciously." (Internal quotation marks omitted.) Id. In the context of a tortious interference claim, the term malice is meant " not in the sense of ill will, but intentional interference without justification . . . In other words, the [plaintiff] bears the burden of alleging and proving lack of justification on the part of the [defendant]." Id.; see also 4 Restatement (Second), Torts § 766B (1979) (test for intentional interference with prospective contractual relation is whether actor's behavior improper). Our Supreme Court has recognized that the legal theory of tortious interference with a business expectancy encompasses a broad range of behavior. See Blake v. Levy, 191 Conn. 257, 261, 464 A.2d 52 (1983).
The defendant argues that the allegations in the complaint are merely conclusory and do not allege sufficient facts from which improper motives or actions may be inferred. The defendant also argues that the plaintiff must identify the customers with whom the defendants interfered. This court disagrees. In considering the allegations in the light most favorable to the plaintiff, this court finds that the plaintiff has sufficiently pled the elements of tortious interference with business relationships and expectancies against all of the defendants and denies the motion to strike counts four, five and six.
Conversion/Trespass to Chattel
The tort of conversion " occurs when one, without authorization, assumes and exercises ownership over property belonging to another, to the exclusion of the owner's rights." Wellington Systems, Inc. v. Redding Group, Inc., 49 Conn.App. 152, 169, 714 A.2d 21, cert. denied, 247 Conn. 905, 720 A.2d 516 (1998). " The term 'owner' is one of general application and includes one having an interest other than the full legal and beneficial title . . . The word owner is one of flexible meaning, and it varies from an absolute proprietary interest to a mere possessory right . . . It is not a technical term and, thus, is not confined to a person who has the absolute right in a chattel, but also applies to a person who has possession and control thereof." Label Systems Corp. v. Aghamohammadi, 270 Conn. 291, 329, 852 A.2d 703 (2004); see also Deming v. Nationwide Mutual Ins. Co., 279 Conn. 745, 770-71, 905 A.2d 623 (2006). Conversion does not need intent, but it " requires the owner to be harmed by a defendant's conduct." Deming v. Nationwide Mutual Ins. Co., supra, 279 Conn. 771, citing Howard v. MacDonald, 270 Conn. 111, 129 n.8, 851 A.2d 1142 (2004).
" A trespass to a chattel may be committed by intentionally (a) dispossessing another of the chattel, or (b) using or intermeddling with a chattel in the possession of another." 1 Restatement (Second), Torts, § 217, p. 417 (1965). " One who commits a trespass to a chattel is subject to liability to the possessor of the chattel if, but only if, (a) he dispossesses the other of the chattel, or (b) the chattel is impaired as to its condition, quality, or value, or (c) the possessor is deprived of the use of the chattel for a substantial time, or (d) bodily harm is caused to the possessor, or harm is caused to some person or thing in which the possessor has a legally protected interest." Id., § 218, p. 420; see also Iovene v. Shree Ram Corp., Superior Court, judicial district of New Haven at Meriden, Docket No. CV-00-0273630-S, (May 9, 2001, Booth, J.).
The defendant argues that because the subject of the conversion/trespass count is intangible property, specifically information relating to customers of the plaintiff, a cause of action in conversion and trespass may not lie. This court agrees. " In Connecticut, intangible property interests have not traditionally been subject to the tort of conversion, except for those intangible property rights evidenced in a document . . . Section 242 of the Restatement (Second) of Torts addresses tort liability for the conversion of a document in which intangible rights are merged. The rule applies to such things as promissory notes, bonds, bills of exchange, share certificates, and warehouse receipts." Subsection (2) of § 242 recognizes potential liability for one who " effectively prevents the exercise of intangible rights of the kind customarily merged in a document." Wentworth, DeAngelis & Kaufman, Inc. v. Nims, Superior Court, judicial district of Hartford, Docket No. CV-13-6042633-S, (February 14, 2014, Huddleston, J.). The plaintiff argues that its trade secrets and the confidential customer information, which is the subject of this count, can be considered " merged" into the electronic documents which were allegedly conveyed to the Candid defendants. It is clear, however, that Wentworth held otherwise. As the Wentworth court observed, " Comment (f) to § 242 provides: 'Thus far the liability stated in Subsection (2) has not been extended beyond the kind of intangible rights which are customarily represented by and merged in a document. It is at present the prevailing view that there can be no conversion of . . . such intangible rights as the goodwill of a business or the names of customers." Id. This court grants the motion to strike counts twelve, thirteen and fourteen.
Statutory Theft
The provisions of General Statutes § 52-564 provide: " [a]ny person who steals any property of another, or knowingly receives and conceals stolen property, shall pay the owner treble his damages." " The elements that [a plaintiff] must prove to obtain treble damages under the civil theft statute, § 52-564, are the same as the elements required to prove larceny, pursuant to General Statutes § 53a-119 . . . A person commits larceny when, with intent to deprive another of property or to appropriate the same to himself or a third person, he wrongfully takes, obtains or withholds such property from an owner . . . It must be shown that (1) there was an intent to do the act complained of; (2) the act was done wrongfully, and (3) the act was committed against an owner . . . The essential cause of action is a wrongful exercise of dominion over personal property of another." (Internal quotation marks omitted.) Kosiorek v. Smigelski, 138 Conn.App. 695, 713, 54 A.3d 564 (2012), cert. denied, 308 Conn. 901, 60 A.3d 287 (2013).
In seeking to strike these counts, the defendants argue that because conversion is a precondition to a finding to statutory theft, this court must also strike the statutory theft claims if it cannot find sufficient facts to support a claim of conversion. This court agrees. News America Marketing In-Store, Inc. v. Marquis, 86 Conn.App. 527, 546, 862 A.2d 837 (2004), aff'd, 276 Conn. 310, 885 A.2d 758 (2005) (" Because liability for conversion is a precondition to a finding of liability for treble damages under § 52-564 and because the plaintiff failed to establish a prima facie case for its claim of conversion, we also conclude that the court properly determined that § 52-564 did not apply in this case). This court strikes counts fifteen, sixteen and seventeen.
Civil Conspiracy
Finally, the defendants argue that the plaintiff cannot maintain a civil action for conspiracy but their argument is rightly premised on this court's inability to find sufficient facts to support the plaintiff's underlying tort claims. While the defendants are correct on the law, in light of this court's decision not to strike the tortious interference with business expectancy counts, their argument nevertheless fails. " [T]here is no such thing as a civil action for conspiracy. The action is for damages caused by acts committed pursuant to a formed conspiracy rather than by the conspiracy itself." (Internal quotation marks omitted.) Marshak v. Marshak, 226 Conn. 652, 669, 628 A.2d 964 (1993), overruled on other grounds by State v. Vakilzaden, 251 Conn. 656, 666, 742 A.2d 767 (1999) (en banc). Under a civil conspiracy theory, the requisite elements are: " (1) a combination between two or more persons, (2) to do a criminal or an unlawful act or a lawful act by criminal or unlawful means, (3) an act done by one or more of the conspirators pursuant to the scheme and in furtherance of the object, (4) which act results in damage to the plaintiff." (Internal quotation marks omitted.) State v. Vakilzaden, supra, 665; see also Charter Oak Lending Group, LLC v. August, 127 Conn.App. 428, 446-47, 14 A.3d 449, cert. denied, 302 Conn. 901, 23 A.3d 1241 (2011). " [T]o state a cause of action, a claim of civil conspiracy must be joined with an allegation of a substantive tort." Anderson v. Gordon, Muir & Foley, LLP, Superior Court, judicial district of Hartford, Docket No. CV-03-0827411-S, (May 12, 2006, Keller, J.), aff'd, 108 Conn.App. 410, 949 A.2d 488, cert. denied, 289 Conn. 927, 958 A.2d 156 (2008).
In denying the defendant's motion to strike the tortious interference with business relationships and expectancy claims in counts four, five and six, the court finds that the plaintiff can maintain an action in civil conspiracy. The court therefore denies the motion to strike count eighteen.
CONCLUSION
In conclusion, this court denies the motion to strike counts four, five and six, grants the motion to strike counts twelve, thirteen and fourteen, fifteen sixteen and seventeen, and denies the motion to strike count eighteen.