VIKEN DETECTION CORPORATION v. VIDERAY TECHNOLOGIES INC.
1:19-cv-10614
D. Mass.Jan 7, 2020Background
- Viken Detection Corp. developed the HBI-120 hand‑held x‑ray backscatter device; Paul Bradshaw was Viken’s Director of Engineering and intermittently served as IT administrator.
- Bradshaw had access to proprietary design, performance, strategic plans, and potential modifications for the HBI‑120; some of those files were stored on his personal Dropbox in a folder labeled “Hbi120.”
- Bradshaw signed an NDA requiring confidentiality, return of proprietary information at termination, and one‑year restrictions on solicitation/interference; Viken alleges he retained and used confidential materials after leaving.
- While employed, Bradshaw allegedly solicited investors, recruited co‑workers (using confidential salary/equity data), collected customer data and withheld product feedback—then was terminated in mid‑2017; he soon formed Videray and developed the PX1, which Viken says closely resembles the HBI‑120.
- Viken sued asserting DTSA, CFAA, Massachusetts trade‑secret law, breach of contract, breach of duty of loyalty, and tortious interference; defendants moved to dismiss and the court DENIED the motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| CFAA (Count II) | Bradshaw accessed Viken’s protected computers and/or exceeded authorization to acquire info for competing venture. | Employer‑authorized access cannot constitute CFAA violation; access while employee was authorized. | Denied dismissal: complaint plausibly alleges access in excess of authorization or without authorization under First Circuit precedent. |
| DTSA & Mass trade‑secret (Counts I & III) | Viken’s undisclosed design files, alloy composition, development process and strategic plans are trade secrets misappropriated by Bradshaw/Videray. | Defendants say features are publicly ascertainable and not secret. | Denied dismissal: plaintiff plausibly alleged trade secrets, reasonable protective measures, and misappropriation. |
| Breach of Contract (Counts IV & V) | Bradshaw breached the NDA by retaining/using proprietary info and soliciting employees. | Defendants dispute misuse/retention and contend allegations are insufficient. | Denied dismissal: allegations suffice to state breach claims at pleading stage. |
| Duty of Loyalty (Count VI) | Bradshaw actively competed during employment (investor meetings, solicitations, data collection), breaching loyalty. | Bradshaw only made preparatory/logistical arrangements, not active competition. | Denied dismissal: allegations support claim he actively competed and breached loyalty. |
| Tortious Interference (Count VII) | Videray induced breaches of Bradshaw’s contractual obligations to Viken. | Bradshaw is essentially synonymous with Videray, so company cannot be a third party. | Denied dismissal: factual inquiry required; complaint adequately pleads interference. |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plausibility standard for pleadings)
- Ashcroft v. Iqbal, 556 U.S. 662 (conclusory allegations insufficient)
- EF Cultural Travel BV v. Explorica, Inc., 274 F.3d 577 (employee access can be "without authorization" under CFAA)
- International Airport Centers, LLC v. Citrin, 440 F.3d 418 (employee acting for adverse interest may be unauthorized)
- Wec Carolina Energy Sols., LLC v. Miller, 687 F.3d 199 (narrower CFAA interpretation argued by defendants)
- Optos, Inc. v. Topcon Med. Sys., Inc., 777 F. Supp. 2d 217 (trade‑secret claim elements)
- J.T. Healy & Son, Inc. v. James A. Murphy & Son, Inc., 260 N.E.2d 723 (trade‑secret definition under Massachusetts law)
- Ruckelshaus v. Monsanto Co., 467 U.S. 986 (limits on trade‑secret protection for public knowledge)
- Bulwer v. Mount Auburn Hosp., 46 N.E.3d 24 (elements of breach of contract under Massachusetts law)
- Chelsea Indus., Inc. v. Gaffney, 449 N.E.2d 320 (employee duty of loyalty in Massachusetts)
- United Truck Leasing Corp. v. Geltman, 551 N.E.2d 20 (elements of tortious interference under Massachusetts law)
- Schinkel v. Maxi‑Holding, Inc., 565 N.E.2d 1219 (when principal is synonymous with corporation)
- Guest‑Tek Interactive Entm’t, Inc. v. Pullen, 665 F. Supp. 2d 42 (D. Mass. discussion of CFAA employee access)
- Nollet v. Justices of Trial Court of Mass., 83 F. Supp. 2d 204 (pleading and consideration of exhibits)
- Langadinos v. Am. Airlines, Inc., 199 F.3d 68 (doctrine on accepting factual allegations at pleadings stage)