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Vizant Technologies, LLC v. Whitchurch

United States District Court, E.D. Pennsylvania

April 1, 2015

VIZANT TECHNOLOGIES, LLC, et al.
v.
JULIE P. WHITCHURCH, et al

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For VIZANT TECHNOLOGIES, JOSEPH BIZZARRO, LLC, Plaintiffs: EDWARD T. KANG, GREGORY H. MATHEWS, JASON POWELL, LEAD ATTORNEYS, KANG HAGGERTY & FETBROYT LLC, PHILADELPHIA, PA.

JULIE P. WHITCHURCH, Defendant, Pro se, WOODSTOCK, GA.

JAMIE DAVIS, INDIVIDUALS, Defendant, Pro se, MARIETTA, GA.

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MEMORANDUM

Harvey Bartle III, J.

Plaintiffs Vizant Technologies, LLC (" Vizant" ) and Joseph Bizzarro (" Bizzarro" ) have filed this action against two former Vizant employees, Julie P. Whitchurch

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(" Whitchurch" ) and Jamie Davis (" Davis" ). In their ten-count complaint, plaintiffs allege two violations of the Racketeer Influenced and Corrupt Organizations Act (" RICO" ), breach of contract, misappropriation of trade secrets in violation of the Delaware Uniform Trade Secrets Act (" DUTSA" ), defamation, tortious interference with existing and prospective relationships, abuse of process, conversion, fraud, and civil conspiracy.[1] Plaintiffs have also moved for a preliminary injunction against defendants.

Before the court is the motion of defendants to dismiss the complaint pursuant to Rules 12(b)(2), 12(b)(6), and 12(b)(7) of the Federal Rules of Civil Procedure.

I.

The following facts are pleaded in the complaint and taken in the light most favorable to the plaintiffs. Plaintiff Vizant is a Delaware limited liability company with its principal place of business in Chadds Ford, Pennsylvania. Vizant is owned in part by Capital Solutions, Inc., which is a Pennsylvania corporation. The Chief Executive Officer of Vizant is Joseph Bizzarro, also a plaintiff in this matter. Both defendants reside in Georgia.

In August 2011, Vizant hired Whitchurch as a Business Development Manager. Davis, who is the sister of Whitchurch, was hired by Vizant in May 2012. Whitchurch was eventually promoted to National Director of Business Development, reporting directly to Bizzarro. She was later demoted to Regional Sales and Business Development Manager.

At the time of their hiring, Whitchurch and Davis entered into signed agreements with Vizant, both of which were entitled " Confidentiality, Non-Competition and Assignment Agreement" (together, the " Vizant agreements" ).[2] In relevant part, these agreements, which appear to be identical aside from the signatories and dates of execution, restricted the defendants in their ability to communicate with customers and employees of Vizant for two years following the end of their employment with the company. The Vizant agreements similarly barred defendants from " engag[ing] in any diversion of good-will" with respect to Vizant's business during that period. The defendants were further limited in their ability to disclose confidential information of Vizant during and after their employment, with " confidential information" defined as follows:

[A]ny of the proprietary or confidential information, technical data, trade secrets or know-how of the Company, in any form or format, including but not limited to product information; financial information; internal procedures and operations; marketing information and strategy; information regarding existing and potential customers; information on suppliers and sources with which the Company does business, including affiliates of suppliers and sources; the Company's manner of operation, strategies and plans; software, including all source and object code, whether completed or in development; inventions, whether or not patented or patentable; discoveries; improvements; processes; and other proprietary and commercial information.

In December 2013, Vizant terminated Whitchurch. It gave as its reasons " inappropriate conduct and insubordination, including repeated misuse of a Vizant credit card . . . use of foul and defamatory language

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against . . . Bizzarro, and . . . attempting to interfere with the business relationship between Vizant's CEO and Vizant's Board of Directors." Vizant fired Davis the next day and stated it was doing so because of her " inappropriate conduct and insubordination, including granting another company employee, Defendant Whitchurch, the use of a Vizant credit card." Each defendant received a letter from the company reminding her of her obligations under the Vizant agreements.

According to the complaint, immediately following their terminations, defendants began a course of conduct which is the basis of this action. Whitchurch purportedly telephoned the cell phone of Bizzarro and left a voicemail in which she threatened to contact Vizant customers and " badmouth" the company, to " make [her] way through the customer list and call people and act like a 'crazy woman,'" and to " slam [Bizzarro] and the company bad." Around the same time, Whitchurch contacted a Vizant employee and " state[d] disparaging information about Vizant and . . . Bizzarro." Whitchurch also sent an email to Bizzarro, Vizant's counsel, and members of the Vizant Board of Directors alleging " gross financial misconduct" by Bizzarro and stating that Bizzarro " has no moral floor, no moral compass, he's a liar, and he's a cheat. There is little doubt in my mind that he has 'enhanced' his reporting to the board so the true financial state of the company is far more positive than the reality." Whitchurch later sent an email to members of Vizant's Board of Directors in which she stated that Bizzarro was " burning the people's money . . . the investor's money" and asserted " GROSS and ILLEGAL financial misconduct" by Bizzarro. In these and subsequent communications, Whitchurch also charged that Bizzarro and Vizant had improperly withheld pay and benefits from their employees. She further announced that she intended to " stop by" Vizant's offices and " shame" the company " into doing the right/legal thing using phone calls, emails, and in person visits."

The complaint asserts that Davis, for her part, also emailed Vizant leadership, board members, counsel, and certain outside investors in early January 2014. In her profanity-filled message, Davis claimed that Bizzarro had " squander[ed] funds" and was a liar. Davis also announced that she and Whitchurch had " TONS AND TONS of incriminating emails" to support their allegations. Davis continued: " I am determined to get this story and these emails out to the general public through whatever news and social media outlet I can...I am going to blog, tweet, Facebook and Instagram this story until this matter gets some attention."

In mid-January 2014, defendants began mailing postcards to: Vizant's office in Chadds Ford, Pennsylvania; Bizzarro's home; and the homes of members of Vizant's Board of Directors. The postcards described Bizzarro as " a liar" and stated that he and the company owed defendants nearly $21,000. The mailings directed recipients to visit a website established by defendants for more information.

The defendants launched the website referenced in the postcards on or about January 17, 2014. That website included a description, apparently written by Whitchurch, of her termination from Vizant and her views regarding the company's handling of its finances. Appended to the website was a copy of an email sent by Bizzarro to certain Vizant employees as well as statements about Bizzarro which plaintiffs consider defamatory. These statements include allegations that Bizzarro withheld pay from Vizant employees, " terminated employees that asked for their money, [and] played the 'float' (in regards to payment) with the employees' health insurance." Defendants also posted to their

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website several cease and desist letters sent to them by Vizant's counsel.

On January 22, 2014, defendants warned on their website that Whitchurch was " coming to town to collect the 16K." Good to her word, Whitchurch traveled to Pennsylvania, where she attempted to enter the Philadelphia offices of Vizant's counsel despite prior warnings that she should not do so. According to the complaint, Whitchurch also entered the property of Vizant's corporate offices, where she placed flyers on the windshields of vehicles parked in the company parking lot.

Defendants also used social media and networking websites, including Facebook and LinkedIn, to disseminate defamatory information about plaintiffs and to contact individuals affiliated with Vizant as well as the family members of said individuals. Specifically, plaintiffs claim that defendants sent Facebook " friend requests" to certain family members of Bizzarro.

Plaintiffs further plead that defendants, after their termination, retained large amounts of material defined by their employment agreements as " confidential information" in violation of the Vizant agreements. In addition, in January 2014 Whitchurch informed Vizant officials that she had secured employment with Sib Development & Consulting, Inc., a competitor of Vizant. Plaintiffs aver that defendants may have distributed to Sib Development & Consulting, Inc. the information possessed by defendants which plaintiffs consider confidential pursuant to the Vizant agreements.

Plaintiffs initially sought to enjoin defendants from continuing their course of conduct by filing an action in the Superior Court of Cobb County, Georgia (the " Georgia action" ). That court issued a temporary restraining order in January 2014 and a preliminary injunction later that year. Specifically, the Georgia court enjoined defendants from initiating certain types of contact and communications with Vizant and with its employees, officers, and directors, and with their family members. The Georgia court also enjoined defendants' " harassing and intimidating communications" on the internet and social media. Finally, it restricted the ability of defendants to retain, use, and publicize plaintiffs' confidential information.

Following the issuance of the Georgia court's preliminary injunction, defendants have continued to contact Bizzarro and other Vizant officers. On September 21, 2014, defendants emailed Bizzarro and other Vizant officers, threatening to file a RICO suit against the company. Defendants also made a posting to their website about plaintiffs on October 2, 2014. Plaintiffs contend that this posting contained " extensive, false and derogatory information." Whitchurch sent an email to a Vizant director in early December 2014 in which she indicated her intention to send a " Christmas card direct mail piece" and stating that she needed " the money you owe me." Through December 2014 and into January 2015, Whitchurch continued to email Vizant directors and officers making references to corporate malfeasance.

On December 8, 2014, Vizant filed a Notice of Voluntary Dismissal without Prejudice in the Georgia action. Pursuant to that notice, the Georgia court dismissed Vizant's action in February 2015.

In opposition to defendants' Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, plaintiffs have submitted to this court a number of supporting documents. They include several excerpts from the transcripts of proceedings in the Georgia action as the exhibits to a motion for preliminary injunction ...


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