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Filing # 61974223 E-Filed 09/25/2017 09:36:57 PM
17TH JUDICIAL CIRCUIT COURT
BROWARD COUNTY, FLORIDA
Case No.: CACE-14-001087
PLANET T UNIFORMS, INC.,
Plaintiff,
vs.
FLORIDA CHARTER FOUNDATION, INC.
D/B/A FRANKLIN ACADEMY CHARTER
SCHOOL, DISCOVERY SCHOOLS, _ INC.,
iUNIFORMS, INC., RICHARD SHELLOW, JON
THOMAS ROGERS, AND SCOTT SZNITKEN,
Defendants.
/
DEFENDANTS IUNIFORMS INC. AND RICHARD SHELLOW’S MOTION TO
DISMISS COUNTS 19-20 OF THE THIRD AMENDED COMPLAINT
Plaintiff filed a Third Amended Complaint containing counts for misappropriation of
trade secrets against Defendants iUniforms, Inc. and Richard Shellow. These counts persist in all
of the deficiencies that plagued Plaintiff's first two attempts to plead misappropriation against
iUniforms and Shellow.
They also do something new: for the first time Plaintiff added a new allegation specifying
that it gave only an oral instruction to Defendant Franklin to maintain the confidentiality of
Plaintiff's alleged trade secrets. As a matter of Florida law, this allegation is fatal to Plaintiff's
claims for misappropriation.
1. Standard on Motion to Dismiss
“A motion to dismiss tests whether the plaintiff has stated a cause of action.” Beil v.
Indian River Mem’l Hosp., 778 So. 2d 1030, 1032 (Fla. 4th DCA 2001). “When determining the
merits of a motion to dismiss, the trial court’s consideration is limited to the four corners of the
*** FILED: BROWARD COUNTY, FL BRENDA D. FORMAN, CLERK 9/25/2017 9:36:57 PM.****CASE NO.: CACE-14-001087
complaint, the allegations of which must be accepted as true and considered in the light most
favorable to the nonmoving party.” Jd.
“In order to state a cause of action, a complaint must allege sufficient ultimate facts to
show that the pleader is entitled to relief.” Edwards v. Landsman, 51 So. 3d 1208, 1213 (Fla. 4th
DCA 2011). Bare conclusions, unsupported by facts, “serve no useful purpose.” Ellison v. City of
Fort Lauderdale, 175 So. 2d 198, 200 (Fla. 1965). Allegations that constitute “naked conclusions
of law” are “not sufficient.” Coral Ridge Golf Course, Inc. v. Fort Lauderdale, 253 So. 2d 485,
487 (Fla. 4th DCA 1971).
2. Counts 19 and 20 for Misappropriation of Trade Secrets Should Be Dismissed
A. Counts 19 and 20 Should Be Dismissed Because Plaintiff’s Alleged Oral
Instruction to Maintain Confidentiality Is Insufficient to Plead Trade Secret
Protection as a Matter of Law.
Under Plaintiff's own allegations, all trade secrets that iUniforms and Shellow allegedly
misappropriated were first disclosed by Plaintiff to Franklin—‘a private charter school located in
Broward County, Florida.” 3d Am. Complt. at J 12.
As a private charter school in Florida, Franklin is subject to Florida’s Public Records
Law. See Fla. Stat. § 1002.33(16)(b)2 (“a charter school shall be in compliance with . . . Chapter
119, relating to public records”).!
Under the Public Records Law, public records are defined as “all documents, papers,
letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or
other material, regardless of the physical form, characteristics, or means of transmission, made
' This statutory provision was in effect prior to the events alleged in the Third Amended
Complaint. See EDUCATION—FLORIDA K-20 EDUCATION CODE CREATED—
GENERAL AMENDMENTS, 2002 Fla. Sess. Law Serv. Ch. 2002-387 (S.B. 20-E) (WEST)
(effective January 7, 2003).CASE NO.: CACE-14-001087
or received pursuant to law or ordinance or in connection with the transaction of official
business by any agency.” Fla. Stat. § 119.011(12) (emphasis added).
As a matter of law, Plaintiffs alleged “trade secrets” became “public records” once
Plaintiff disclosed them to Franklin, absent some affirmative effort to maintain their
confidentiality by having them timely declared protected trade secrets despite the voluntary
disclosure. Once these alleged “trade secrets” became “public records,” they became “public” by
definition: they may now be obtained by any person “desiring to do so.” See Fla. Stat.
§ 119.07(1)(a) (“Every person who has custody of a public record shall permit the record to be
inspected and copied by any person desiring to do so, at any reasonable time, under reasonable
conditions, and under supervision by the custodian of the public records.”).*
2 This statutory provision was in effect prior to the events alleged in the Third Amended
Complaint. See PUBLIC RECORDS—ACCESS BY REMOTE ELECTRONIC MEANS, 1995
Fla. Sess. Law Serv. Ch. 95-296 (C.S.H.B. 1149) (WEST) (effective July 1, 1995).
3 This statutory provision was in effect prior to the events alleged in the Third Amended
Complaint. According to the statute’s Amendment Notes (West.), “[a]s it appeared in Fla.St.1984
Supp., § 119.07 read:
“(1)(a) Every person who has custody of a public record shall permit the record to
be inspected and examined by any person desiring to do so, at any reasonable
time, under reasonable conditions, and under supervision by the custodian of the
public record or his designee. The custodian shall furnish a copy or a certified
copy of the record upon payment of the fee prescribed by law or, if a fee is not
prescribed by law, upon payment of the actual cost of duplication of the record.’”
That statutory text remained the same until the following minor changes were made in 2004
(underlines indicate additions; strikethroughs indicate deletions):
(1)(a) Every person who has custody of a public record shall permit the record to
be inspected and copied examined by any person desiring to do so, at any
reasonable time, under reasonable conditions, and under supervision by the
custodian of the public records reeerd-or the-eustedian’s-designee.
PUBLIC OFFICERS AND EMPLOYEES—PUBLIC RECORDS, 2004 Fla. Sess. Law Serv.
Ch. 2004-335 (C.S.S.B. 1678) (WEST) (effective October 1, 2004).
3CASE NO.: CACE-14-001087
As relevant here, from the Second Amended Complaint to the Third Amended
Complaint, Plaintiff added a new allegation regarding Plaintiff's alleged trade secrets: For the
first time, the Third Amended Complaint specifies that when Plaintiff voluntarily handed its
alleged “trade secrets” to Franklin—a charter school subject to Florida’s Public Records Law—
Plaintiff “advised FRANKLIN via telephone correspondence that the records provided to
FRANKLIN were to be kept confidential.” 3d Amen. Complt. at {32 (emphasis added).
As a matter of law, Plaintiffs allegation, of only an oral communication to Franklin to
maintain the confidentiality of its alleged trade secrets, conclusively states an absence of any
trade secret protection. Under Florida law, “[t]he trade secret owner who fails to label a trade
secret as such, or otherwise to specify in writing upon delivery to a state agency that
information which it contends is confidential and exempt under the public records law is not to
be disclosed, has not taken measures or made efforts that are reasonable under the circumstances
to maintain the information’s secrecy.” Sepro Corp. v. Florida Dep't of Envtl. Prot., 839 So. 2d
781, 784 (Fla. lst DCA Feb. 12, 2003) (emphasis added).
In Sepro, the company named Sepro Corp. (“Sepro”) sued the Department of
Environmental Protection (“DEP”) to block the disclosure of alleged trade secrets, which Sepro
had furnished to DEP in connection with a contract between them. At an evidentiary hearing, a
DEP employee testified the alleged trade secrets were not marked confidential, but he was orally
“asked to use the information like the information that was ... marked confidential.” /d. at 783.
The appellate court affirmed the trial court’s denial of Sepro’s requested relief,
concluding “the failure to identify information furnished to a state agency as putatively
exempt from public disclosure effectively destroys any confidential character it might
otherwise have enjoyed as a trade secret”—notwithstanding the DEP employee’s oral
representation. /d. at 783 (emphasis added). “As a practical-and therefore as a legal-matter, aCASE NO.: CACE-14-001087
conversation with a state employee is not enough to prevent the information’s being made
available to anybody who makes a public records request.” /d. at 784. Cf James, Hoyer,
Newcomer, Smiljanich, & Yanchunis, P.A. v. Rodale, Inc., 41 So. 3d 386, 387 (Fla. Ist DCA
2010) (protecting from disclosure documents furnished by Rodale to the Office of the Attorney
General where, “all of which Rodale marked confidential before furnishing to the AG.”); see
also Cubic Transp. Sys., Inc. v. Miami-Dade Cty., 899 So. 2d 453, 454 (Fla. 3d DCA 2005) (trial
court’s determination that company “failed adequately to protect an alleged trade secrets claim
from the effect of the Public Records Act by taking ‘efforts that are reasonable under the
circumstances to maintain its secrecy[,]’...is well supported by the evidence” where the
company “failed to mark the documents now in question as ‘confidential,’ and continued to
supply them, without asserting even a (legally ineffectual) post-delivery claim to confidentiality
for some thirty days after it had once attempted to do so by so informing County staff.)
(emphasis added).
Thus, as a matter of law, Plaintiffs allegation of only an oral communication to Franklin
to maintain the confidentiality of its alleged trade secrets is insufficient to allege that its trade
secrets were “the subject of efforts that are reasonable under the circumstances to maintain
[their] secrecy”’—a necessary element of “trade secret” under FUTSA. Fla. Stat. § 688.002(4)(b).
Therefore, Plaintiff's Counts 19 and 20 for misappropriation of trade secrets should be
dismissed.
B. Plaintiff's Persistence in Failing to Reference the Governing Statute
Warrants Dismissal of Counts 19 and 20.
Plaintiff can plead causes of action for misappropriation of trade secrets only if traveling
under Florida’s Uniform Trade Secrets Act, Fla. Stat. § 668.001 et seg. (“FUTSA”). See Fla.
Stat. § 688.008 (FUTSA “displace[s] conflicting tort, restitutory, and other law of this stateCASE NO.: CACE-14-001087
providing civil remedies for misappropriation of a trade secret.”); A/l Pro Sports Camp, Inc. v.
Walt Disney Co., 727 So. 2d 363, 367 (Fla. 5th DCA 1999) (“The misappropriation claim . . . is
statutory, and Florida’s Uniform Trade Secrets Act displaces tort law regarding trade secret
misappropriation.”).
Although Plaintiff (1) stipulated to amend its complaint to “Plead any cause of action for
misappropriation of trade secrets under Florida’s Uniform Trade Secrets Act, rather than as a
common-law cause of action;”* and (2) acknowledged to the Court—in oral argument on
Defendants’ prior motions to dismiss—that it’s causes of action for misappropriation are
governed by FUTSA, Plaintiff's Third Amended Complaint persists in failing to reference
FUTSA. This is unaccountable, in light of the clear statutory displacement—and troubling, in
light of Plaintiffs previous stipulation and acknowledgment that its misappropriation claims
should be governed by FUTSA.
This is no inconsequential technicality. Section 688.005, Florida Statutes, allows a
prevailing FUTSA defendant to seek an award of reasonable attorneys’ fees if the claims of
misappropriation were made in bad faith. iUniforms and Shellow intend to seek attorneys’ fees
under this section of FUTSA, and should not later be subjected to an argument by Plaintiff that
the provision is inapplicable because Plaintiff's claim was not really brought pursuant to
FUTSA. After all, despite Plaintiff's stipulation to plead this cause of action under the statute,
the statute is mentioned nowhere in the Third Amended Complaint.
Plaintiff's Counts 19 and 20 should be dismissed, because without any reference to being
pled pursuant to FUTSA they facially plead invalid and displaced common-law causes of action
for misappropriation of trade secrets.
* See Stipulation at §[ 3.A. (e-filed 02/10/2017).CASE NO.: CACE-14-001087
C. Counts 19 and 20 Should Be Dismissed for Failing to Allege Ultimate Facts
Supporting Required Elements Under FUTSA
Under FUTSA, a trade secret must be “not... generally known to,” or “not . . . readily
ascertainable by proper means by, other persons who can obtain economic value from its
disclosure or use,” and each of the alleged trade secrets must “derive[] independent economic
value” from not being so generally known or ascertainable. Fla. Stat. § 688.002(4)(a).°
Moreover, for misappropriation of trade secrets to be actionable under FUTSA, the
alleged trade secrets must have been “the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.” Fla. Stat. § 688.002(4)(b).
In moving to dismiss Plaintiffs previous complaint (its Second Amended Complaint),
iUniforms and Shellow pointed out that, with respect to the aforementioned required elements
under FUTSA, “Plaintiff pleads naked legal conclusions that track this language in its Counts
against Rogers and Sznitken—but it does not plead these elements, much less ultimate facts in
support, against iUniforms and Shellow.” See iUniforms and Shellow’s Mot. Dismiss Counts 7—
10 and 19-20 of the 2d Am. Complt. at p. 7 nn. 1 & 3 (e-filed 04/03/2017).
In response, Plaintiff acknowledged that “Plaintiff mistakenly did not add this in for the
Counts relating to” iUniforms and Shellow. See Pl. ’s Response to iUniforms’ and Shellow’s Mot.
Dismiss, at J 13 (e-filed 08/09/2017).
This Court granted iUniforms’ and Shellow’s Motion to Dismiss Plaintiffs Second
Amended Complaint with respect to Plaintiff's trade secrets counts. See Order on Defendants
iUniforms, Inc. and Richard Shellow’s Mot. to Dismiss Counts 7-10 and 19-20 of the 2d Am.
Complit. (08/10/2017). Nevertheless, in Plaintiff's Third Amended Complaint, Plaintiff merely
> Plaintiff pleads naked legal conclusions that track this language in its Counts against Rogers
and Sznitken—but it does not plead these elements, much less ultimate facts in support, against
iUniforms and Shellow.CASE NO.: CACE-14-001087
added allegations that track the language of the statute, without any additional ultimate facts to
support them. Specifically, Plaintiff added paragraphs 204 and 212, which both say (as to
iUniforms and Shellow):
The documents [the alleged trade secrets] contain information that derives
independent economic value, actual or potential, from not being generally known
to, and not being readily ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use; and is the subject of efforts that
are reasonable under the circumstances to maintain its secrecy.
3d Am. Complt. {§ 204 & 212. As is clear from a comparison of this allegation and the statutory
provisions quoted above, Plaintiff's attempt to plead FUTSA’s required elements constitutes
nothing more than a bare pleading of the text of the statute° without any supporting allegations of
ultimate fact.
This is exactly the type of bare-bones pleading the Fourth District Court of Appeal has
rejected as insufficient to state a cause of action: “[a] party does not properly allege a cause of
action by alleging in conclusive form, which tracks the language of the statute, acts which lack
factual allegations and merely state bare legal conclusions.” Eagletech Comme’ns, Inc. v. Bryn
Mawr Inv. Grp., Inc., 79 So. 3d 855, 864 (Fla. 4th DCA 2012) (alteration in original) (quoting
Ginsberg v. Lennar Florida Holdings, Inc., 645 So. 2d 490, 501 (Fla. 3d DCA 1994)).
By failing to plead all the statutory elements of a “trade secret” under FUTSA, and failing
to plead sufficient ultimate facts rather than bare legal conclusions, Plaintiff has failed to allege
the existence of a trade secret under Florida law. For failing to plead this claim three tries in a
row against iUniforms and Shellow, Plaintiffs claim should be dismissed with prejudice.
° Albeit without ever referencing the statute by name or citation.
8CASE NO.: CACE-14-001087
D. Counts 19 and 20 Should Be Dismissed for Failing to Allege
Misappropriation by iUniforms or Shellow
Plaintiff also alleges only the naked legal conclusions that iUniforms and Shellow “knew
or should have known the trade secrets were acquired by improper means” and that they
“misappropriated the trade secrets.” 3d Am. Complt. at J] 206 & 214.
The Third Amended Complaint, however, states no ultimate facts that would support
iUniforms’ or Shellow’s knowledge. In fact, the only allegation of knowledge of any kind,
relevant to iUniforms and Shellow, is that Shellow knew “there was a previous uniform vendor
with FRANKLIN.” /d. at § 59.i. Allegations of Shellow’s knowledge in particular are so lacking,
that Plaintiff takes pains to paint Shellow as a know-nothing “pawn” of certain other defendants.
Id. at 459.
Additionally, the Third Amended Complaint contains no factual allegations that
iUniforms or Shellow took or did anything to “misappropriate.” Because the Third Amended
Complaint fails to allege ultimate facts constituting an act of misappropriation by these specific
Defendants, Plaintiffs Counts 19 and 20 for misappropriation of trade secrets should be
dismissed. Again, having had three opportunities to plead these counts, the dismissal should
be with prejudice.
3. Conclusion
After three tries, Plaintiff has been unable to muster factual allegations to support causes
of action for misappropriation of trade secrets against Defendants iUniforms, Inc. or Richard
Shellow. After Plaintiff confessed the deficiency in its previous pleadings, and after Plaintiff
could muster only a mere quotation of the statute to support its claim in the Third Amended
Complaint, the Court can conclude Plaintiff is unable to plead causes of action for
misappropriation against iUniforms and Shellow.CASE NO.: CACE-14-001087
Plaintiff has removed all doubt in this respect, by specifying in its Third Amended
Complaint that its only instruction to the charter school (subject to Florida’s Public Records
Law) to whom it handed over its alleged trade secrets was an oral instruction—which destroys
the character of the alleged “trade secrets” as such as a matter of law. Accordingly, Plaintiff's
Counts 19 and 20 against iUniforms and Shellow should be dismissed, this time with prejudice.
WHEREFORE, Defendants iUniforms and Shellow respectfully move this Court to
dismiss Counts 19-20 of Plaintiff's Third Amended Complaint with prejudice; to reserve
jurisdiction to award iUniforms and Shellow their reasonable attorneys’ fees incurred in
defending against Counts 19 and 20 of the Third Amended Complaint, pursuant to Fla. Stat.
§ 688.005; and to award any further relief that this Court deems just and proper.
Respectfully Submitted,
GREENBERG TRAURIG, P.A.
Attorneys for Defendant iUniforms, Inc.
401 East Las Olas Boulevard
Suite 2000
Fort Lauderdale, Florida 33301
Telephone: (954) 765-0500
Telefax: (954) 765-1477
By: __/s/Richard Rosengarten
KENNETH A. HORKY
Florida Bar Number 691194
HorkyK @gtlaw.com
muehlfeldern@gtlaw.com
FLService@gtlaw.com
RICHARD ROSENGARTEN
Florida Bar Number 0106169
RosengartenRich@gtlaw.com
rosr@gtlaw.com
FLServic tlaw.comCASE NO.: CACE-14-001087
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true and correct copy of the foregoing was electronically
filed in this action on September 25, 2017, through the Florida Courts E-Filing Portal, and that
the Portal was used as a means to serve the e-filed document upon all counsel and parties on the
e-service list associated with this action.
By: __/s/Richard Rosengarten
RICHARD ROSENGARTEN
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Filing # 61974223 E-Filed 09/25/2017 09:36:57 PM 17TH JUDICIAL CIRCUIT COURT BROWARD COUNTY, FLORIDA Case No.: CACE-14-001087 PLANET T UNIFORMS, INC., Plaintiff, vs. FLORIDA CHARTER FOUNDATION, INC. D/B/A FRANKLIN ACADEMY CHARTER SCHOOL, DISCOVERY SCHOOLS, _ INC., iUNIFORMS, INC., RICHARD SHELLOW, JON THOMAS ROGERS, AND SCOTT SZNITKEN, Defendants. / DEFENDANTS IUNIFORMS INC. AND RICHARD SHELLOW’S MOTION TO DISMISS COUNTS 19-20 OF THE THIRD AMENDED COMPLAINT Plaintiff filed a Third Amended Complaint containing counts for misappropriation of trade secrets against Defendants iUniforms, Inc. and Richard Shellow. These counts persist in all of the deficiencies that plagued Plaintiff's first two attempts to plead misappropriation against iUniforms and Shellow. They also do something new: for the first time Plaintiff added a new allegation specifying that it gave only an oral instruction to Defendant Franklin to maintain the confidentiality of Plaintiff's alleged trade secrets. As a matter of Florida law, this allegation is fatal to Plaintiff's claims for misappropriation. 1. Standard on Motion to Dismiss “A motion to dismiss tests whether the plaintiff has stated a cause of action.” Beil v. Indian River Mem’l Hosp., 778 So. 2d 1030, 1032 (Fla. 4th DCA 2001). “When determining the merits of a motion to dismiss, the trial court’s consideration is limited to the four corners of the *** FILED: BROWARD COUNTY, FL BRENDA D. FORMAN, CLERK 9/25/2017 9:36:57 PM.****CASE NO.: CACE-14-001087 complaint, the allegations of which must be accepted as true and considered in the light most favorable to the nonmoving party.” Jd. “In order to state a cause of action, a complaint must allege sufficient ultimate facts to show that the pleader is entitled to relief.” Edwards v. Landsman, 51 So. 3d 1208, 1213 (Fla. 4th DCA 2011). Bare conclusions, unsupported by facts, “serve no useful purpose.” Ellison v. City of Fort Lauderdale, 175 So. 2d 198, 200 (Fla. 1965). Allegations that constitute “naked conclusions of law” are “not sufficient.” Coral Ridge Golf Course, Inc. v. Fort Lauderdale, 253 So. 2d 485, 487 (Fla. 4th DCA 1971). 2. Counts 19 and 20 for Misappropriation of Trade Secrets Should Be Dismissed A. Counts 19 and 20 Should Be Dismissed Because Plaintiff’s Alleged Oral Instruction to Maintain Confidentiality Is Insufficient to Plead Trade Secret Protection as a Matter of Law. Under Plaintiff's own allegations, all trade secrets that iUniforms and Shellow allegedly misappropriated were first disclosed by Plaintiff to Franklin—‘a private charter school located in Broward County, Florida.” 3d Am. Complt. at J 12. As a private charter school in Florida, Franklin is subject to Florida’s Public Records Law. See Fla. Stat. § 1002.33(16)(b)2 (“a charter school shall be in compliance with . . . Chapter 119, relating to public records”).! Under the Public Records Law, public records are defined as “all documents, papers, letters, maps, books, tapes, photographs, films, sound recordings, data processing software, or other material, regardless of the physical form, characteristics, or means of transmission, made ' This statutory provision was in effect prior to the events alleged in the Third Amended Complaint. See EDUCATION—FLORIDA K-20 EDUCATION CODE CREATED— GENERAL AMENDMENTS, 2002 Fla. Sess. Law Serv. Ch. 2002-387 (S.B. 20-E) (WEST) (effective January 7, 2003).CASE NO.: CACE-14-001087 or received pursuant to law or ordinance or in connection with the transaction of official business by any agency.” Fla. Stat. § 119.011(12) (emphasis added). As a matter of law, Plaintiffs alleged “trade secrets” became “public records” once Plaintiff disclosed them to Franklin, absent some affirmative effort to maintain their confidentiality by having them timely declared protected trade secrets despite the voluntary disclosure. Once these alleged “trade secrets” became “public records,” they became “public” by definition: they may now be obtained by any person “desiring to do so.” See Fla. Stat. § 119.07(1)(a) (“Every person who has custody of a public record shall permit the record to be inspected and copied by any person desiring to do so, at any reasonable time, under reasonable conditions, and under supervision by the custodian of the public records.”).* 2 This statutory provision was in effect prior to the events alleged in the Third Amended Complaint. See PUBLIC RECORDS—ACCESS BY REMOTE ELECTRONIC MEANS, 1995 Fla. Sess. Law Serv. Ch. 95-296 (C.S.H.B. 1149) (WEST) (effective July 1, 1995). 3 This statutory provision was in effect prior to the events alleged in the Third Amended Complaint. According to the statute’s Amendment Notes (West.), “[a]s it appeared in Fla.St.1984 Supp., § 119.07 read: “(1)(a) Every person who has custody of a public record shall permit the record to be inspected and examined by any person desiring to do so, at any reasonable time, under reasonable conditions, and under supervision by the custodian of the public record or his designee. The custodian shall furnish a copy or a certified copy of the record upon payment of the fee prescribed by law or, if a fee is not prescribed by law, upon payment of the actual cost of duplication of the record.’” That statutory text remained the same until the following minor changes were made in 2004 (underlines indicate additions; strikethroughs indicate deletions): (1)(a) Every person who has custody of a public record shall permit the record to be inspected and copied examined by any person desiring to do so, at any reasonable time, under reasonable conditions, and under supervision by the custodian of the public records reeerd-or the-eustedian’s-designee. PUBLIC OFFICERS AND EMPLOYEES—PUBLIC RECORDS, 2004 Fla. Sess. Law Serv. Ch. 2004-335 (C.S.S.B. 1678) (WEST) (effective October 1, 2004). 3CASE NO.: CACE-14-001087 As relevant here, from the Second Amended Complaint to the Third Amended Complaint, Plaintiff added a new allegation regarding Plaintiff's alleged trade secrets: For the first time, the Third Amended Complaint specifies that when Plaintiff voluntarily handed its alleged “trade secrets” to Franklin—a charter school subject to Florida’s Public Records Law— Plaintiff “advised FRANKLIN via telephone correspondence that the records provided to FRANKLIN were to be kept confidential.” 3d Amen. Complt. at {32 (emphasis added). As a matter of law, Plaintiffs allegation, of only an oral communication to Franklin to maintain the confidentiality of its alleged trade secrets, conclusively states an absence of any trade secret protection. Under Florida law, “[t]he trade secret owner who fails to label a trade secret as such, or otherwise to specify in writing upon delivery to a state agency that information which it contends is confidential and exempt under the public records law is not to be disclosed, has not taken measures or made efforts that are reasonable under the circumstances to maintain the information’s secrecy.” Sepro Corp. v. Florida Dep't of Envtl. Prot., 839 So. 2d 781, 784 (Fla. lst DCA Feb. 12, 2003) (emphasis added). In Sepro, the company named Sepro Corp. (“Sepro”) sued the Department of Environmental Protection (“DEP”) to block the disclosure of alleged trade secrets, which Sepro had furnished to DEP in connection with a contract between them. At an evidentiary hearing, a DEP employee testified the alleged trade secrets were not marked confidential, but he was orally “asked to use the information like the information that was ... marked confidential.” /d. at 783. The appellate court affirmed the trial court’s denial of Sepro’s requested relief, concluding “the failure to identify information furnished to a state agency as putatively exempt from public disclosure effectively destroys any confidential character it might otherwise have enjoyed as a trade secret”—notwithstanding the DEP employee’s oral representation. /d. at 783 (emphasis added). “As a practical-and therefore as a legal-matter, aCASE NO.: CACE-14-001087 conversation with a state employee is not enough to prevent the information’s being made available to anybody who makes a public records request.” /d. at 784. Cf James, Hoyer, Newcomer, Smiljanich, & Yanchunis, P.A. v. Rodale, Inc., 41 So. 3d 386, 387 (Fla. Ist DCA 2010) (protecting from disclosure documents furnished by Rodale to the Office of the Attorney General where, “all of which Rodale marked confidential before furnishing to the AG.”); see also Cubic Transp. Sys., Inc. v. Miami-Dade Cty., 899 So. 2d 453, 454 (Fla. 3d DCA 2005) (trial court’s determination that company “failed adequately to protect an alleged trade secrets claim from the effect of the Public Records Act by taking ‘efforts that are reasonable under the circumstances to maintain its secrecy[,]’...is well supported by the evidence” where the company “failed to mark the documents now in question as ‘confidential,’ and continued to supply them, without asserting even a (legally ineffectual) post-delivery claim to confidentiality for some thirty days after it had once attempted to do so by so informing County staff.) (emphasis added). Thus, as a matter of law, Plaintiffs allegation of only an oral communication to Franklin to maintain the confidentiality of its alleged trade secrets is insufficient to allege that its trade secrets were “the subject of efforts that are reasonable under the circumstances to maintain [their] secrecy”’—a necessary element of “trade secret” under FUTSA. Fla. Stat. § 688.002(4)(b). Therefore, Plaintiff's Counts 19 and 20 for misappropriation of trade secrets should be dismissed. B. Plaintiff's Persistence in Failing to Reference the Governing Statute Warrants Dismissal of Counts 19 and 20. Plaintiff can plead causes of action for misappropriation of trade secrets only if traveling under Florida’s Uniform Trade Secrets Act, Fla. Stat. § 668.001 et seg. (“FUTSA”). See Fla. Stat. § 688.008 (FUTSA “displace[s] conflicting tort, restitutory, and other law of this stateCASE NO.: CACE-14-001087 providing civil remedies for misappropriation of a trade secret.”); A/l Pro Sports Camp, Inc. v. Walt Disney Co., 727 So. 2d 363, 367 (Fla. 5th DCA 1999) (“The misappropriation claim . . . is statutory, and Florida’s Uniform Trade Secrets Act displaces tort law regarding trade secret misappropriation.”). Although Plaintiff (1) stipulated to amend its complaint to “Plead any cause of action for misappropriation of trade secrets under Florida’s Uniform Trade Secrets Act, rather than as a common-law cause of action;”* and (2) acknowledged to the Court—in oral argument on Defendants’ prior motions to dismiss—that it’s causes of action for misappropriation are governed by FUTSA, Plaintiff's Third Amended Complaint persists in failing to reference FUTSA. This is unaccountable, in light of the clear statutory displacement—and troubling, in light of Plaintiffs previous stipulation and acknowledgment that its misappropriation claims should be governed by FUTSA. This is no inconsequential technicality. Section 688.005, Florida Statutes, allows a prevailing FUTSA defendant to seek an award of reasonable attorneys’ fees if the claims of misappropriation were made in bad faith. iUniforms and Shellow intend to seek attorneys’ fees under this section of FUTSA, and should not later be subjected to an argument by Plaintiff that the provision is inapplicable because Plaintiff's claim was not really brought pursuant to FUTSA. After all, despite Plaintiff's stipulation to plead this cause of action under the statute, the statute is mentioned nowhere in the Third Amended Complaint. Plaintiff's Counts 19 and 20 should be dismissed, because without any reference to being pled pursuant to FUTSA they facially plead invalid and displaced common-law causes of action for misappropriation of trade secrets. * See Stipulation at §[ 3.A. (e-filed 02/10/2017).CASE NO.: CACE-14-001087 C. Counts 19 and 20 Should Be Dismissed for Failing to Allege Ultimate Facts Supporting Required Elements Under FUTSA Under FUTSA, a trade secret must be “not... generally known to,” or “not . . . readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use,” and each of the alleged trade secrets must “derive[] independent economic value” from not being so generally known or ascertainable. Fla. Stat. § 688.002(4)(a).° Moreover, for misappropriation of trade secrets to be actionable under FUTSA, the alleged trade secrets must have been “the subject of efforts that are reasonable under the circumstances to maintain its secrecy.” Fla. Stat. § 688.002(4)(b). In moving to dismiss Plaintiffs previous complaint (its Second Amended Complaint), iUniforms and Shellow pointed out that, with respect to the aforementioned required elements under FUTSA, “Plaintiff pleads naked legal conclusions that track this language in its Counts against Rogers and Sznitken—but it does not plead these elements, much less ultimate facts in support, against iUniforms and Shellow.” See iUniforms and Shellow’s Mot. Dismiss Counts 7— 10 and 19-20 of the 2d Am. Complt. at p. 7 nn. 1 & 3 (e-filed 04/03/2017). In response, Plaintiff acknowledged that “Plaintiff mistakenly did not add this in for the Counts relating to” iUniforms and Shellow. See Pl. ’s Response to iUniforms’ and Shellow’s Mot. Dismiss, at J 13 (e-filed 08/09/2017). This Court granted iUniforms’ and Shellow’s Motion to Dismiss Plaintiffs Second Amended Complaint with respect to Plaintiff's trade secrets counts. See Order on Defendants iUniforms, Inc. and Richard Shellow’s Mot. to Dismiss Counts 7-10 and 19-20 of the 2d Am. Complit. (08/10/2017). Nevertheless, in Plaintiff's Third Amended Complaint, Plaintiff merely > Plaintiff pleads naked legal conclusions that track this language in its Counts against Rogers and Sznitken—but it does not plead these elements, much less ultimate facts in support, against iUniforms and Shellow.CASE NO.: CACE-14-001087 added allegations that track the language of the statute, without any additional ultimate facts to support them. Specifically, Plaintiff added paragraphs 204 and 212, which both say (as to iUniforms and Shellow): The documents [the alleged trade secrets] contain information that derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. 3d Am. Complt. {§ 204 & 212. As is clear from a comparison of this allegation and the statutory provisions quoted above, Plaintiff's attempt to plead FUTSA’s required elements constitutes nothing more than a bare pleading of the text of the statute° without any supporting allegations of ultimate fact. This is exactly the type of bare-bones pleading the Fourth District Court of Appeal has rejected as insufficient to state a cause of action: “[a] party does not properly allege a cause of action by alleging in conclusive form, which tracks the language of the statute, acts which lack factual allegations and merely state bare legal conclusions.” Eagletech Comme’ns, Inc. v. Bryn Mawr Inv. Grp., Inc., 79 So. 3d 855, 864 (Fla. 4th DCA 2012) (alteration in original) (quoting Ginsberg v. Lennar Florida Holdings, Inc., 645 So. 2d 490, 501 (Fla. 3d DCA 1994)). By failing to plead all the statutory elements of a “trade secret” under FUTSA, and failing to plead sufficient ultimate facts rather than bare legal conclusions, Plaintiff has failed to allege the existence of a trade secret under Florida law. For failing to plead this claim three tries in a row against iUniforms and Shellow, Plaintiffs claim should be dismissed with prejudice. ° Albeit without ever referencing the statute by name or citation. 8CASE NO.: CACE-14-001087 D. Counts 19 and 20 Should Be Dismissed for Failing to Allege Misappropriation by iUniforms or Shellow Plaintiff also alleges only the naked legal conclusions that iUniforms and Shellow “knew or should have known the trade secrets were acquired by improper means” and that they “misappropriated the trade secrets.” 3d Am. Complt. at J] 206 & 214. The Third Amended Complaint, however, states no ultimate facts that would support iUniforms’ or Shellow’s knowledge. In fact, the only allegation of knowledge of any kind, relevant to iUniforms and Shellow, is that Shellow knew “there was a previous uniform vendor with FRANKLIN.” /d. at § 59.i. Allegations of Shellow’s knowledge in particular are so lacking, that Plaintiff takes pains to paint Shellow as a know-nothing “pawn” of certain other defendants. Id. at 459. Additionally, the Third Amended Complaint contains no factual allegations that iUniforms or Shellow took or did anything to “misappropriate.” Because the Third Amended Complaint fails to allege ultimate facts constituting an act of misappropriation by these specific Defendants, Plaintiffs Counts 19 and 20 for misappropriation of trade secrets should be dismissed. Again, having had three opportunities to plead these counts, the dismissal should be with prejudice. 3. Conclusion After three tries, Plaintiff has been unable to muster factual allegations to support causes of action for misappropriation of trade secrets against Defendants iUniforms, Inc. or Richard Shellow. After Plaintiff confessed the deficiency in its previous pleadings, and after Plaintiff could muster only a mere quotation of the statute to support its claim in the Third Amended Complaint, the Court can conclude Plaintiff is unable to plead causes of action for misappropriation against iUniforms and Shellow.CASE NO.: CACE-14-001087 Plaintiff has removed all doubt in this respect, by specifying in its Third Amended Complaint that its only instruction to the charter school (subject to Florida’s Public Records Law) to whom it handed over its alleged trade secrets was an oral instruction—which destroys the character of the alleged “trade secrets” as such as a matter of law. Accordingly, Plaintiff's Counts 19 and 20 against iUniforms and Shellow should be dismissed, this time with prejudice. WHEREFORE, Defendants iUniforms and Shellow respectfully move this Court to dismiss Counts 19-20 of Plaintiff's Third Amended Complaint with prejudice; to reserve jurisdiction to award iUniforms and Shellow their reasonable attorneys’ fees incurred in defending against Counts 19 and 20 of the Third Amended Complaint, pursuant to Fla. Stat. § 688.005; and to award any further relief that this Court deems just and proper. Respectfully Submitted, GREENBERG TRAURIG, P.A. Attorneys for Defendant iUniforms, Inc. 401 East Las Olas Boulevard Suite 2000 Fort Lauderdale, Florida 33301 Telephone: (954) 765-0500 Telefax: (954) 765-1477 By: __/s/Richard Rosengarten KENNETH A. HORKY Florida Bar Number 691194 HorkyK @gtlaw.com muehlfeldern@gtlaw.com FLService@gtlaw.com RICHARD ROSENGARTEN Florida Bar Number 0106169 RosengartenRich@gtlaw.com rosr@gtlaw.com FLServic tlaw.comCASE NO.: CACE-14-001087 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was electronically filed in this action on September 25, 2017, through the Florida Courts E-Filing Portal, and that the Portal was used as a means to serve the e-filed document upon all counsel and parties on the e-service list associated with this action. By: __/s/Richard Rosengarten RICHARD ROSENGARTEN