Facts

In 2014, Scott Richards formed Call Delivery Systems, a company that routes misdialed 1-800 numbers to certain buyers, including companies selling cruise vacations, airline tickets, auto insurance, and legal services. In March 2009, Daryl Morgan was hired by Call Delivery as a Telecom Manager. Before Morgan resigned in March 2020, he was Call Delivery's Chief Technology Officer (CTO). On May 22, 2020, Call Delivery Systems filed suit against Morgan and his company, Call Haven Partners, for violations of the Trade Secrets Act and breach of fiduciary duty of loyalty. Morgan and Call Haven then counterclaimed for breach of contract and waiting time penalties.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendant used the confidential information and trade secrets he obtained during his employment--including valuable suppliers, buyers, and numbers--in order to furtively set up a competing business. For example, airline misdials were, prior to the COVID-19 pandemic, one of its most profitable categories. On April 1, 2020, defendant Morgan armed with entrusted information from plaintiff, setup a website with the domain name: www.cheapairlineflighttickets.com. Defendant Morgan also contacted, while still employed with plaintiff, and later employed individuals who had provided plaintiff with potential suppliers. Finally, as to proprietary technical information, as plaintiff's CTO, defendant Morgan conceived and developed Toll-Free Number Algorithm (TFNA), an integral aspect of plaintiff's business, one defendant Morgan replicated for other companies.

DEFENDANTS' CONTENTIONS: Defendant Morgan contended that he was continuously promised compensation for creating TFNA and the millions of dollars of revenue his technology helped bring to the company--a promise never fulfilled. Moreover, when the company was sold, succeeding management enforced a new employment agreement that required employees, including Morgan, to be on call 24 hours a day, 7 days a week, work on weekends, and be in the office at least 5 days a week. The agreement also nullified any prior promises and commitments made by previous management, including those made to defendant Morgan. New management also expressly refused outright any additional salary increases, partnership stake, or any additional suggestions from Morgan. Consequently, Morgan left.

Result

A jury verdict found judgment in favor of defendants Morgan and Call Haven on the misappropriation of trade secrets and breach of fiduciary duty of loyalty, but also in favor of plaintiff Call Delivery on Morgan's counterclaims of breach of contract and waiting time penalties.