Moonlight Mountain Recovery, Inc. v. McCoy
1:24-cv-00012
D. IdahoFeb 3, 2025Background
- Moonlight Mountain Recovery, Inc. (Moonlight) offers behavioral health and substance abuse recovery services in Idaho.
- Plaintiff alleges former employees, including Justin McCoy, Eric Minnig, and Corey Richardson, accessed proprietary information to help form and staff competing businesses, primarily Freedom Recovery.
- Defendants purportedly accessed confidential information using Moonlight's BestNotes electronic records system, both while employed and after separation, to benefit the new competing businesses.
- Procedurally, after initial dismissal, Moonlight filed an Amended Complaint, and defendants Richardson, Minnig, and Hunt renewed their motions to dismiss.
- The court now addresses these motions regarding various claims, including conspiracy, breach of fiduciary duty, CFAA violations, contract breaches, and related tort claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Civil Conspiracy | Defendants agreed to access/use confidential data unlawfully | No agreement or insufficient facts | Sufficiently pled against all—motions denied |
| Aiding & Abetting | Each defendant substantially assisted other's wrongs | Hunt did not substantially assist; others deny knowledge or wrongful assistance | Sufficient for Minnig/Richardson; not for Hunt—claim against Hunt dismissed w/leave to amend |
| CFAA Violation | Defendants caused damages by unauthorized system access | No cognizable CFAA damages, damages solely McCoy's fault | Sufficient factual allegations of qualifying damages—motions denied |
| Breach of Fiduciary Duty | Minnig/Richardson breached duty of loyalty by aiding competitors | No duty as non-employees (Hunt); acts post-employment | Sufficient as to Minnig/Richardson (for actions during employment); not for Hunt |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (plausibility standard for pleading)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading standard—more than conclusory allegations required)
- Wesco Autobody Supply, Inc. v. Ernest, 243 P.3d 1069 (Idaho 2010) (explaining standard for civil conspiracy and breach of fiduciary duty in Idaho)
- Tricore Investments, LLC v. Estate of Warren, 485 P.3d 92 (Idaho 2021) (civil conspiracy requires agreement and limits tort liability to those with standalone duty)