Compass Marketing, Inc. v. Flywheel Digital LLC, 23-1324

Compass Marketing, Inc. (Compass) filed suit against Flywheel Digital LLC, its former employees (James DiPaula Jr. and Patrick Miller), and Ascential PLC (collectively, the Flywheel Defendants), asserting federal trade secret (DTSA) and civil RICO claims, and related state-law claims.
The federal district court dismissed Compass's federal claims as untimely and declined to exercise supplemental jurisdiction over the state-law claims.
The Flywheel Defendants argued that Compass's claims were barred by the statutory limitations periods, as Compass should have discovered the alleged conduct by 2016.
Key events included the resignation of senior Compass employees in 2014, subsequent alleged use of Compass's trade secrets by those employees in 2015, and further employee departures after the expiration of non-solicitation agreements in 2016.
Ascential PLC, the parent company of Flywheel, was sued not for direct misappropriation but based solely on its 2018 acquisition of Flywheel.
The Fourth Circuit Court of Appeals affirmed the district court's dismissal, holding oral argument unnecessary.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Statute of Limitations—DTSA and RICO Claims	Claims were timely or subject to tolling	Claims are time-barred under limitations statutes	Claims barred; Compass should have discovered by 2016
Ascential PLC liability as successor	Successor can be liable for predecessor conduct	No authority for imposing liability for time-barred conduct	No liability; Compass cites no supportive precedent
Fraudulent Concealment Doctrine	Limitations tolled by defendants' concealment	Compass failed to exercise due diligence	Doctrine does not apply without due diligence
New RICO theory raised on appeal	Association-in-fact enterprise pled	Argument not raised below; improper on appeal	New theory not considered; no exceptional circumstances
Leave to Amend Complaint	Should be allowed to amend	No motion to amend was filed	No abuse of discretion; no motion to amend was made

Rockville Cars, LLC v. City of Rockville, 891 F.3d 141 (4th Cir. 2018) (sets standard for reviewing motion to dismiss under Rule 12(b)(6))
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (sets out plausibility standard for pleading a claim)
Goldfarb v. Mayor & City Council of Balt., 791 F.3d 500 (4th Cir. 2015) (complaint need only show a more-than-conceivable chance of success)
Epcon Homestead, LLC v. Town of Chapel Hill, 62 F.4th 882 (4th Cir. 2023) (can dismiss on limitations grounds if the facts are clear from the complaint)
Potomac Elec. Power Co. v. Elec. Motor & Supply, Inc., 262 F.3d 260 (4th Cir. 2001) (four-year RICO statute of limitations runs when injury is or should have been discovered)
United States v. Carolina Transformer Co., 978 F.2d 832 (4th Cir. 1992) (discusses successor liability)
Edmonson v. Eagle Nat’l Bank, 922 F.3d 535 (4th Cir. 2019) (fraudulent concealment requires due diligence)
Hicks v. Ferreyra, 965 F.3d 302 (4th Cir. 2020) (issues not raised below are not considered on appeal except in exceptional cases)
Drager v. PLIVA, USA, Inc., 741 F.3d 470 (4th Cir. 2014) (leave to amend is at the court’s discretion)