Glynn v. IMPACT SCIENCE & TECHNOLOGY, INC.
807 F. Supp. 2d 391
D. Maryland2011Background
- Glynn worked for IST (and its successor EDO) as a Principal Engineer in the IW Group on C‑IED devices; IST acquired DEI, of which Glynn had an ownership stake; Glynn and Saltwhistle Technology (SWT) were formed after his termination to compete in C‑IED space; prior to termination, Glynn raised temperature-performance concerns about MMBJ devices and informed government authorities; IST terminated Glynn in December 2006 and asserted misconduct; SWT partnered with FMI on NAVSEA contracts after Glynn formed SWT; IST sought to recover confidential IST materials and asserted counterclaims including breach of contract and misappropriation; Glynn and SWT moved for summary judgment on various FCA and contract counterclaims, while IST cross‑moved on others; the court held primarily for IST on several FCA counts and for Glynn on several counterclaims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Glynn engaged in protected FCA activity | Glynn asserts he investigated IST's product defects and informed government investigators | IST argues Glynn did not engage in protected activity or raise a distinct FCA action | Glynn failed to show protected activity raised a distinct FCA action under §3730(h) |
| Whether IST had knowledge of Glynn's protected activity | IST knew of Glynn's government disclosures and actions | IST did not have knowledge of protected activity at time of retaliation | IST lacked knowledge tying protected activity to the adverse action; elements not satisfied |
| Causation: whether retaliation was the result of protected activity | Direct and circumstantial evidence shows retaliation linked to protected activity | Glynn's termination due to overall poor performance and conduct, not retaliation | IST’s retaliation claim denied for lack of causation; IST won summary judgment on Counts I, V, VI, VII of Glynn and on IST’s counterclaims I, II, VII; Glynn prevailed on several counterclaims (II, IV, V, VII, IX, XI) against IST) |
| Declaratory judgment regarding enforceability of noncompete/nondisclosure | Glynn contends NH law voids covenants given security concerns | IST argues covenants are valid and enforceable under NH law | Restrictive covenants upheld; declaratory judgment granted in IST's favor (Count VI) family of restrictions enforceable |
| Whether IST's counterclaims for breach of contract and related remedies survive | Glynn contends no breach or damages shown; seeks dismissal | IST demonstrates breaches, damages, and remedies for confidential information recovery; some claims dismissed, others survive | Glynn liable for breach of nondisclosure and non-solicitation; no breach of noncompete; damages limited to computer-forensics costs ($87,983) for confidential information recovery; other counterclaims resolved with partial grants to Glynn and IST |
Key Cases Cited
- Mann v. Heckler & Koch Def., Inc., 630 F.3d 338 (4th Cir. 2010) (three elements of § 3730(h) retaliation action)
- Zahodnick v. Int'l Bus. Mach. Corp., 135 F.3d 911 (4th Cir. 1997) (distinct possibility standard for protected activity)
- Eberhardt v. Integrated Design & Constr., Inc., 167 F.3d 861 (4th Cir. 1999) (protected activity requires more than mere reporting; must relate to FCA action)
- Yesudian v. Howard Univ., 153 F.3d 731 (D.C. Cir. 1998) (recognizes protected activity includes investigation and creation of a basis for FCA)
- McKenzie v. BellSouth Telecomms., Inc., 123 F.3d 935 (6th Cir. 1997) (requires objective reasonable basis for belief of fraud; distinct possibility standard)
- O'Connor v. Consol. Coin Caterers Corp., 56 F.3d 542 (4th Cir. 1995) (protection depends on protected activity tied to government fraud)
- Learning Curve Toys, Inc. v. PlayWood Toys, Inc., 342 F.3d 714 (7th Cir. 2003) (trade secrets value can be potential value under NHUTSA)