Facts

Peter Kovedsy formed a professional tax company called Humex Income Tax Inc. In 1997, Peter married Hedy Kovedsy who became a certified tax professional and prepared income taxes for Humex from 2003 to 2009.

Following Peter's death, Hedy alleged that his will incorrectly favored Peter's son, Eric. Based on a request by the special administrator of Peter's estate, Eric took over Humex until the probate dispute's resolution. He did so between May 10, 2009 and Oct. 31, 2009.

In Nov., Hedy entered into an agreement with the special administrator, which stated that Humex belonged to Peter as separate property and that Hedy had the right to challenge the estate's potential sale of Humex to Peter's son. Hedy declined to object after she was notified that the estate would be selling Humex to Eric. On Dec. 1, sale of Humex to Eric was approved, and he subsequently closed the business.

Meanwhile, Hedy and Suzanne Nagy opened Humex Income Tax Inc., another tax preparation company. Eric then sued Hedy, Humex Income Tax Inc., and Nagy, alleging intentional interference with contractual relationship, intentional interference with prospective economic advantage, conversion, trademark infringement, misappropriation of trade secrets under the California Uniform Trade Secrets Act (UTSA) and unfair competition.

PLAINTIFF'S CONTENTIONS:
Plaintiff argued that defendants illegally obtained Humex's customer information via its computers, and began asking customers to utilize their company instead. Further, plaintiff argued that defendant told his clients to terminate their appointments with him, and stated that he was not professional.

DEFENDANT'S CONTENTIONS:
Defendant Hedy Kovedsy alleged that Eric ran another income tax business, named Kovedsy Income Tax, and started to redirect Humex clients to his own company. Defendants contended that they had solicited customers in a legal manner by distributing fliers. In addition, they rejected plaintiff's allegations that they sought particular customers that belonged to plaintiff. Last, defendants argued that the UTSA preempted plaintiff's claims.

Result

The court denied plaintiff's motion for preliminary injunction. Subsequent matters and claims were resolved confidentially.

Other Information

FILING DATE: May 10, 2010.