FAIVELEY TRANSPORT USA, INC. v. Wabtec Corp., 758 F. Supp. 2d 211

Faiveley plaintiffs allege Wabtec misappropriated Malmö's trade secrets related to Brake Friction Cylinder, PB actuator, and PBA actuator, which Malmö licensed to Faiveley affiliates since 2004.
Malmö obtained ICC arbitration against Wabtec; Tribunal awarded damages and injunctive relief, finding misappropriation and tainted reverse engineering.
Tribunal determined Malmö could not recover damages on behalf of Faiveley affiliates; Tribunal suggested Faiveley plaintiffs could pursue damages in a separate action.
In this action, Faiveley plaintiffs seek misappropriation, unfair competition, tortious interference with business relations and prospective economic advantage, and unjust enrichment.
Wabtec moved to dismiss on waiver, res judicata, collateral attack, and failure to join Malmö; the Court denied the motions in full.
Key issues include whether Faiveley plaintiffs waived rights, whether res judicata or judicial estoppel bars the claims, whether the action is a collateral attack on the Tribunal's award, and whether Malmö is a necessary party under Rule 19.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Waiver via de Lavallade letter	Letter purportedly confirms res judicata effect against Faiveley plaintiffs.	Letter shows waiver of rights to pursue claims in this action.	Waiver not properly considered; letter not a general relinquishment and not integrated.
Res judicata/judicial estoppel	Faiveley plaintiffs should not be barred; Tribunal allowed separate action for damages.	Res judicata bars claims or at least warrants estoppel.	Res judicata does not bar; judicial estoppel applies to preclude the contrary position.
Collateral attack on Tribunal's award	Claims seek damages consistent with Tribunal's award; not an improper collateral attack.	Relief could impermissibly undermine Tribunal.	Issue unripe; court can tailor relief to avoid inconsistency and will reserve judgment.
Rule 19 nonjoinder of Malmö	Malmö should not be indispensable; complete relief can be afforded otherwise.	Malmö is necessary to vindicate trade secrets and avoid prejudice.	Malmö is not a necessary party; if necessary, Rule 19(b) factors weigh against dismissal.
Standing and merits of misappropriation/unfair competition	Faiveley plaintiffs have standing as exclusive rights holders to the products in NA; misappropriation and confusion harmed them.	Standing may be limited to original owner.	Faiveley plaintiffs have standing; unfair competition claim survives as colorable interest is shown.

Roth v. Jennings, 489 F.3d 499 (2d Cir. 2007) (motion to dismiss relies on face-of-pleadings standard; judge may exclude extrinsic evidence)
New Hampshire v. Maine, 532 U.S. 742 (U.S. 2001) (judicial estoppel criteria; inconsistent positions and unearned advantage)
Monahan v. NYC Dept. of Corr., 214 F.3d 275 (2d Cir. 2000) (privity and res judicata analysis in preclusion context)
Berni v. Int'l Gourmet Restaurants of Am., Inc., 838 F.2d 642 (2d Cir. 1988) (colorable pecuniary interest suffices for unfair competition standing)
Roy Export Co. Establishment v. CBS, Inc., 672 F.2d 1095 (2d Cir. 1982) (unfair competition breadth and misappropriation principles)
G.H. Mumm Champagne v. Eastern Wine Corp., 142 F.2d 499 (2d Cir. 1944) (standing to sue for misappropriation by licensee)
Piccoli A/S v. Calvin Klein Jeanswear Co., 19 F. Supp. 2d 157 (S.D.N.Y. 1998) (unfair competition and misappropriation considerations in NY law)
LinkCo v. Fujitsu Ltd., 230 F. Supp. 2d 492 (S.D.N.Y. 2002) (central principle: misappropriation of labor and expenditures)
Fried v. Brevel Motors, Inc., 666 F. Supp. 28 (E.D.N.Y. 1987) (distinction between arbitration and district court vehicles)
Bus. Trends Analysts v. Freedonia Group, Inc., 650 F. Supp. 1452 (S.D.N.Y. 1987) (standing of licensee to sue for misappropriation under trade secret regime)
Roode v. Michaelian, 373 F. Supp. 53 (S.D.N.Y. 1974) (res judicata/privity discussion in preclusion context)