Bretta Pollara v. Radiant Logistics, Inc. ( 2016 )

FILED
NOT FOR PUBLICATION
MAY 17 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
BRETTA SANTINI POLLARA, No. 14-56025
Plaintiff - Counter-defendant D.C. No. 2:12-cv-00344-GAF-
- Appellee, JEM
And
MEMORANDUM*
SANTINI PRODUCTIONS, a Nevada
Corporation; OCEANAIR, INC., a
Massachusetts Corporation,
Counter-defendants -
Appellees,
v.
RADIANT LOGISTICS, INC., a Delaware
Corporation,
Defendant - Counter-claimant
- Appellant,
And
DBA DISTRIBUTION SERVICES, INC.,
a New Jersey Corporation,
Intervenor - Appellant.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
BRETTA SANTINI POLLARA, No. 14-56318
Plaintiff-counter-defendant, D.C. No. 2:12-cv-00344-GAF-
JEM
And
RADIANT LOGISTICS, INC., a Delaware
Corporation,
Defendant-counter-claimant -
Appellee,
And
DBA DISTRIBUTION SERVICES, INC.,
a New Jersey Corporation,
Intervenor - Appellee,
v.
OCEANAIR, INC., a Massachusetts
Corporation,
Counter-defendant -
Appellant.
Appeal from the United States District Court
for the Central District of California
Gary A. Feess, District Judge, Presiding
Argued and Submitted May 2, 2016
Pasadena, California
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Before: PREGERSON, BYBEE, and N.R. SMITH, Circuit Judges.
These two appeals arise from a dispute between an employer and its former
employee who quit her job and started a competing freight forwarding business.
The employer is DBA Distribution Services, Inc., and its parent company Radiant
Logistics, Inc. (collectively, “Counterclaimants”). The employee is Bretta Santini
Pollara (“Santini”).
Santini sought a declaratory judgment in Los Angeles Superior Court against
Counterclaimants, stating that she was not bound by a non-compete agreement
between her husband, Paul Pollara (“Pollara”) and Counterclaimants.
Counterclaimants then removed this action to U.S. District Court in the Central
District of California under diversity jurisdiction and brought a counterclaim
against Santini, her company Santini Productions, Inc., and competitor Oceanair,
Inc. (collectively, “Counterdefendants”) for misappropriation of trade secrets in
customer information. Counterclaimants also brought a claim against Oceanair for
inducing Pollara to breach the non-compete agreement.
At a jury trial, after Counterclaimants completed their case in chief, the
district court granted Oceanair’s Rule 50(a) motion for judgment as a matter of law
with respect to the inducement to breach claim, and the trial proceeded.
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After the jury found for Counterclaimants on the trade secrets claim, the
district court granted Counterdefendants’ Rule 50(b) renewed motion for judgment
as a matter of law, thereby vacating the trade secrets portion of the jury verdict.
Counterclaimants appeal both Rule 50 judgments (14-56025), and Oceanair
appeals the district court’s order denying its motion for attorneys’ fees (14-56318).
We have jurisdiction under 28 U.S.C. § 1291, and we affirm.
1. We review the district court’s grant of Rule 50 motions for judgment as a
matter of law de novo. Harper v. City of Los Angeles, 533 F.3d 1010, 1021 (9th
Cir. 2008). At the time Oceanair allegedly caused Pollara to breach the Merger
Agreement, Pollara had already violated the agreement at least once. Further,
Counterclaimants have not established that Oceanair induced Pollara’s breach in
September of 2011. Hahn v. Diaz-Barba, 125 Cal. Rptr. 3d 242, 258 (Cal. Ct.
App. 2011) (listing causation as an element of the tort of inducement to breach a
contract). Thus, the district court did not err in granting Oceanair’s Rule 50(a)
motion on the inducement claim.
2. Under the California Uniform Trade Secrets Act, Cal. Civ. Code § 3426,
et seq., a customer list may constitute a protected trade secret if it includes non-
public information that provides a “substantial business advantage” to competitors.
See Morlife, Inc. v. Perry, 66 Cal. Rptr. 2d 731, 736 (Cal. Ct. App. 1997).
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Counterclaimants failed to prove a prima facie case of trade secrets
misappropriation because the evidence at trial established that the customer lists
included only contact information that was widely known or available on industry
websites. The lists did not include non-public information like the customer’s
“particular needs or characteristics.” Id. at 735. That Santini had specialized
expertise and good relationships with Counterclaimants’ customers does not
convert the otherwise unprotected customer lists into protected trade secrets.
Therefore, no evidence supported Counterclaimants’ contention that they
possessed a trade secret in the customer lists, and the district court did not err in
granting Counterdefendants’ Rule 50(b) renewed motion on the trade secrets claim.
3. We review the district court’s denial of attorneys’ fees for abuse of
discretion. Sea Coast Foods, Inc. v. Lu-Mar Lobster & Shrimp, Inc., 260 F.3d
1054, 1058 (9th Cir. 2001). An award of attorneys’ fees is proper where the court
finds both objective speciousness and subjective bad faith. Gemini Aluminum
Corp. v. Cal. Custom Shapes, Inc., 116 Cal. Rptr. 2d 358, 368 (Cal. Ct. App. 2002)
(citing Cal. Civ. Code § 3426.4). The district court found that Counterclaimants
did not act in subjective bad faith. Because Counterdefendants have not shown
that the district court abused its discretion in so finding, we need not decide
whether Counterdefendants showed that the Counterclaimants’ actions were
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objectively specious.
AFFIRMED.
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