Montel Aetnastak, Inc. v. Miessen
998 F. Supp. 2d 694
N.D. Ill.2014Background
- Plaintiffs Montel (Canadian parent) and MAI (U.S. subsidiary) design and sell customized high-density shelving; MAI employed Kristine Miessen as regional sales manager under an employment agreement containing a two‑year non‑compete.
- Plaintiffs developed a customized shelving product for an unnamed department‑store chain (U.S. & Canada rollout); access to design/pricing was limited to MAI/Montel personnel and select store employees.
- While still employed by MAI, Miessen negotiated with Bradford (Illinois distributor), accepted Bradford’s offer, and later worked on a test/installation for the chain in Aventura, Florida; Plaintiffs allege she disclosed confidential/product and pricing information to Bradford/SpaceSaver.
- Plaintiffs sued Miessen, Bradford, and SpaceSaver alleging breach of the non‑compete, tortious interference, interference with prospective economic advantage, misappropriation of trade secrets/common‑law confidential information (and ITSA claims), breach of fiduciary duty/duty of loyalty, and civil conspiracy; they seek damages and injunctive relief.
- Defendants moved to dismiss (motions under Rules 12(b)(1), 12(b)(2), and 12(b)(6)); the Court applied Illinois choice‑of‑law rules and evaluated standing, personal jurisdiction, and pleading sufficiency, including ITSA preemption issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Montel's standing to sue (all counts) | Montel is injured directly and as undisclosed principal of MAI (agency) | Montel is not party/beneficiary of employment contract and lacks Article III injury | Montel has standing on all counts — agency adequately pled and Article III injury shown |
| Personal jurisdiction over Miessen | Illinois has specific/general jurisdiction due to Miessen's sales activity and negotiations with Bradford | Miessen lacks sufficient contacts with Illinois; dismiss for lack of personal jurisdiction | Specific jurisdiction sustained for Counts I, IV, V, VI; general jurisdiction denied; Count III dismissed for lack of personal jurisdiction |
| Enforceability of non‑compete (Count I) | Continued employment (~15 months) supplied consideration; broad geographic scope necessary to protect Montel/MAI | Consideration inadequate and covenant overbroad (activity and geographic scope) | Non‑compete unenforceable (overbroad activity/geographic restrictions); Count I dismissed |
| Tortious interference with contract (Count II) | Defendants induced breach of Miessen’s non‑compete | No valid contract if non‑compete unenforceable; SpaceSaver argues no inducement | Count II dismissed because the underlying non‑compete contract is unenforceable |
| Wrongful interference / trade‑secret claims & ITSA preemption (Counts III–IV, VI) | Plaintiffs allege misappropriation of confidential Product/pricing information causing loss of business expectancy | ITSA preempts common‑law claims based on misappropriation of trade secrets; some tort/non‑secret theories survive | Common‑law misappropriation and Count III (to extent based on secret info) preempted by ITSA; ITSA claim (Count IV) survives; conspiracy claim split — conspiracy to misappropriate dismissed as preempted, conspiracy to interfere survives |
| Breach of fiduciary duty / duty of loyalty (Count V) | Miessen breached loyalty by soliciting/employing while still employed and disclosing information | Defendants contend ITSA preempts or facts insufficient | Claim survives: fiduciary/duty‑of‑loyalty theory not wholly preempted when based on competitive acts beyond mere use of secrets |
Key Cases Cited
- Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (choice‑of‑law governs application of forum state rules)
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts standard for personal jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (purposeful availment and specific jurisdiction analysis)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (Article III standing requirements)
- Rawoof v. Texor Petroleum Co., 521 F.3d 750 (undisclosed principal/agency and standing issues)
- Tamburo v. Dworkin, 601 F.3d 693 (intentional‑tort personal jurisdiction analysis in the Seventh Circuit)
- Felland v. Clifton, 682 F.3d 665 (factors for reasonableness of jurisdiction; effects test for intentional torts)
- Hecny Transp., Inc. v. Chu, 430 F.3d 402 (ITSA preemption: non‑secret theories survive, secret‑based common‑law claims preempted)
- Composite Marine Propellers, Inc. v. Van Der Woude, 962 F.2d 1263 (passage of ITSA preempts common‑law misuse‑of‑secret claims)