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Monday, September 23, 2019

Court dismisses several counts against Japanese company in dispute regarding irrigation products system

Lawsuits

By Charmaine Little | May 31, 2019

TAMPA – The U.S. District Court for the Middle District of Florida recently granted in part a foreign chemical corporation’s motion to dismiss a complaint and motion to strike the plaintiff’s demands for injunctive relief in a dispute regarding talks over the possible purchase of an irrigation products system. 

In the April 15 ruling, U.S. District Judge James D. Whittemore dismissed several counts against Japan-based Mitsui Chemicals Inc.(MCI) and its Delaware-based subsidiary, Mitsui Chemicals America Inc. (MCA), in the lawsuit filed by research company Developmental Technologies LLC.   

Developmental Technologies also filed its own motion for an extension of time to serve process and extend case management and scheduling order, which the court granted in part.

Developmental Technologies filed suit against the defendants after they were in talks regarding MCI buying the plaintiff’s irrigation product system, Eco-Ag, court filings said. Both MCI and MCA entered into a non-disclosure and non-use Agreement (NDA) with Developmental Technologies that “established guidelines for the use and disclosure of confidential and proprietary information that would be disclosed…,” according to the opinion.

The relationship soured after the plaintiff sued with claims that MCI never bought the system but is advertising two crop irrigation products that “use the confidential information disclosed to (defendants) while under the NDA,” court filings said. Developmental Technologies sued for 17 counts including breach of contract, conspiracy to commit fraudulent inducement, violations of the Florida Deceptive and Unfair Trade Practices Act (FDUTP) and the misappropriation of trade secrets in violation of the Florida Uniform Trade Secrets Act (FUTSA).

MCA asked the court to dismiss all of the counts. MCA argued that regarding the counts related to the misappropriation of trade secrets claim, Developmental Technologies didn’t state a claim via the Florida Uniform Trade Secrets Act. 

While the defendant said the plaintiff’s alleged trade secrets aren’t actually a secret since the plaintiff has a patent that publicly details its irrigation technology, the court said, “This argument does not alter the conclusion that a claim for misappropriation has been properly pled.”

Regarding the counts related to the misappropriation of idea and Federal Deceptive and Unfair Trade Practices Act, MCA said the court should dismiss them because the FUTSA bars them as each one depends on the same type of behavior. 

The court determined, “FUTSA does not preempt contractual remedies (whether or not they are based upon misappropriation of a trade secret) or civil remedies that are ‘not based upon misappropriation of a trade secret.’” It added that in a situation where there are actual differences between the allegations that include more torts, the torts aren’t preempted either.

The court also dismissed claims of unfair competition violations, saying that the plaintiff failed to give MCA a fair notice of the claims as it relates to the Lanham Act. Still, the court said it wouldn’t dismiss the breach of contract claim since plaintiff properly stated a claim when it said MCA breached its NDA when it sold products after the talks of an acquisition were complete.

The fraudulent inducement claim was dismissed as the plaintiff didn’t state an independent claim.

As for MCA’s motion to strike the plaintiff’s demand for injunctive relief (under the notion the plaintiff failed to show it would experience injury in the future), the court said the plaintiff only challenged the ones concerning claims under the FUTSA. The ones left unopposed were stricken.

Regarding the plaintiff’s motion for extension of time to serve process on MCI, the court said, “The interest of justice warrants a reasonable extension of time for service to be effected on MCI.” Still, the plaintiff’s motion for a six-month extension was too much, so the court granted it four months instead.

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