IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN ... · Complaint, no response is required....
Transcript of IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN ... · Complaint, no response is required....
IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
VERITIV OPERATING COMPANY,
Plaintiff,
v. F. JASON BERMAN and MELISSA PAYNE,
Defendants.
CASE NO.: 1:18-cv-03005-TCB JURY TRIAL DEMANDED
DEFENDANT MELISSA PAYNE’S ANSWER AND DEFENSES TO
PLAINTIFF’S COMPLAINT FOR INJUNCTIVE RELIEF AND DAMAGES AND COUNTERCLAIMS AGAINST PLAINTIFF
Defendant Melissa Payne (“Payne”) responds to and answers the Complaint
for Injunctive Relief and Damages (“Complaint”) filed by Plaintiff Veritiv
Operating Company (“Veritiv” or “Plaintiff”) with the following Answer and
Affirmative Defenses. Payne also pleads the counterclaims set forth below against
Plaintiff Veritiv.
ANSWER AND AFFIRMATIVE AND OTHER DEFENSES
Payne responds to the numbered paragraphs of Plaintiff’s Complaint as
follows. Except as expressly admitted herein, Payne denies each and every
allegation contained in the Complaint.
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1. To the extent Paragraph 1 merely describes the nature of Plaintiff’s
Complaint, no response is required. Payne admits that the Complaint asserts claims
for injunctive and legal relief for misappropriation of trade secrets and breach of
contract. She denies, however, that she has individually or in concert with any
other person misappropriated confidential or trade secret information of Veritiv.
Payne denies that Veritiv is entitled to any of the relief it seeks. Payne denies each
of the remaining allegations contained in Paragraph 1 of the Complaint.
2. The allegations contained in Paragraph 2 are directed at a defendant
other than Payne, and do not require a response from Payne. To the extent a
response is required, she denies that she conspired with Berman to violate any
federal or state laws, and otherwise states that she is without sufficient information
or knowledge to admit or deny the allegations contained in Paragraph 2.
3. Payne denies the allegations contained in Paragraph 3 of the
Complaint.
4. Payne denies the allegations contained in Paragraph 4 of the
Complaint. Payne denies that Veritiv has suffered or will suffer any harm as a
result of any action or inaction by Payne, and denies that Veritiv is entitled any of
the relief it seeks in the Complaint.
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THE PARTIES
5. Payne is without knowledge or information sufficient to form a belief
as to the truth of the allegations contained in Paragraph 5. For purposes of this
action, Payne does not dispute that Veritiv is a Delaware corporation doing
business in Georgia with its principal offices at the address alleged in Paragraph 5.
6. The allegations contained in Paragraph 6 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent a
response is required, Payne states that she is without sufficient information or
knowledge to admit or deny the allegations contained in Paragraph 6.
7. Payne admits that she resides at 400 West Peachtree Street, N.W.
Atlanta, GA 30308. She admits that Exhibit B to Plaintiff’s Complaint contains a
copy of an agreement signed by Payne on October 31, 2016. Payne states that the
agreement bears no countersignature by Veritiv.
JURISDICTION AND VENUE
8. The allegations in Paragraph 8 contain legal conclusions that do not
require a response from Payne. To the extent a response is required, Payne admits
that the Complaint purports to assert claims under certain federal statutes,
including the Defend Trade Secrets Act (“DTSA”), 18 U.S.C. § 1836, et seq., and
the Computer Fraud and Abuse Act, 18 U.S.C. § 1030, et seq., but denies that the
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Complaint gives rise to any liability against Payne or that Plaintiff is entitled to any
of the relief it seeks.
9. The allegations in Paragraph 9 contain legal conclusions that do not
require a response from Payne. To the extent a response is required, Payne does
not dispute that this Court may exercise jurisdiction over all claims in Plaintiff’s
Complaint. Payne denies that she has taken any improper or illegal action with
respect to Veritiv, and otherwise denies any implication or inference contained in
Paragraph 9 of the Complaint.
10. The allegations in Paragraph 10 contain legal conclusions and are
directed at a defendant other than Payne. Therefore, the allegations in Paragraph 10
do not require a response from Payne. To the extent a response is required, Payne
denies that she conspired with Berman to violate any federal or state laws, and
otherwise states that she is without sufficient information or knowledge, including
as regards Berman’s activities, to admit or deny the allegations contained in
Paragraph 10 or to form any belief as to the existence of any “nexus between
[Berman] and the State of Georgia.”
11. The allegations in Paragraph 11 contain legal conclusions that do not
require a response from Payne. To the extent a response is required, Payne does
not deny that she is an individual domiciled in Georgia.
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12. The allegations in Paragraph 12 contain legal conclusions that do not
require a response from Payne. To the extent a response is required, Payne admits
that venue is proper in this District and Division for Plaintiff’s claims against her.
FACTUAL ALLEGATIONS
A. Veritiv’s Business, Trade Secrets, and Confidential Information1
13. Payne admits that Veritiv markets, sells, and distributes packaging,
facility solutions, print and publishing products and services, and logistics and
supply chain management solutions throughout North America. Payne denies any
remaining allegations contained in Paragraph 13 of the Complaint.
14. To the extent the allegations in Paragraph 14 pertain to industries
other than packaging, Payne is without sufficient knowledge on which to form a
belief as to the truth of the allegations. Payne denies that Veritiv’s viability in the
packaging industry depends on trade secrets, confidential information, or
proprietary systems, and states that the information she used in the ordinary course
of her job was well-known in the packaging and/or corrugated box industry. Payne
denies the remaining allegations contained in Paragraph 14 of the Complaint.
15. Payne admits that she worked with customers to develop products and
1 Payne denies any allegations or characterizations contained in the headings or
sub-headings of Veritiv’s Complaint. Payne denies that any information alleged in the Complaint constituted confidential or trade secret information of Veritiv.
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provide operational support. Payne is without sufficient knowledge of the steps
Veritiv took to develop its packaging business to form a belief as to the truth of the
allegations in the second sentence of Paragraph 15. Payne denies the remaining
allegations contained in Paragraph 15 of the Complaint.
16. Payne admits that she had access to certain information about
Veritiv’s customers during the ordinary course of her employment at Veritiv, but
states that Veritiv’s customers made such information generally known and denies
that any such information was proprietary to Veritiv. Payne denies the remaining
allegations in Paragraph 16 of the Complaint.
17. Payne is without sufficient knowledge to form a belief as to the truth
of the allegations in the first clause of Paragraph 17. Payne denies that any of the
general categories of information alleged in Paragraph 17 constitute confidential or
trade secret information of Veritiv, and states that such information was either
publicly shared by Veritiv or already well-known in the packaging and/or
corrugated box industry.
18. Payne denies that Paragraph 18 identifies or describes any specific
confidential information or trade secrets of Veritiv. Payne denies that Veritiv
protected the alleged secrecy of work product she created for Veritiv, and states
that Veritiv voluntarily shared or released that information to third parties. Payne is
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without sufficient knowledge to form a belief as to the truth of the remaining
allegations contained in Paragraph 18 of the Complaint.
19. Payne denies the allegations contained in Paragraph 19 of the
Complaint.
20. Payne admits that Veritiv’s business contains a service component
and that she provided attention and service to certain customers, but denies that
such attention or service constitutes the protectable property or trade secrets of
Veritiv, and denies that the identity of any customer or customer representative
with whom she worked while employed at Veritiv was confidential, proprietary, or
trade secret information of Veritiv. Payne is without sufficient knowledge to form
a belief as to the amount of time or money Veritiv spent in cultivating customer
relationships, how customers perceived Veritiv or its brand, or to what extent
Veritiv depends on repeat business with established customers. To the extent not
specifically admitted herein, Payne denies the allegations contained in
Paragraph 20.
21. Payne admits that any new or customized products that she designed,
created, or prototyped during her employment with Veritiv were developed “to
meet [Veritiv’s] customer’s particular specifications,” and denies that any such
designs, products, or prototypes were confidential, proprietary, or trade secret
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information of Veritiv. Except as specifically admitted or denied herein, Payne is
without sufficient knowledge to form a belief as to the truth of the remaining
allegations contained in Paragraph 21 of the Complaint.
22. Payne denies that the Complaint identifies or describes any
confidential or trade secret information belonging to Veritiv, and denies that she
misappropriated any confidential or trade secret information related to pricing
plans or strategies. Payne is without sufficient knowledge to form a belief as to the
truth of the remaining allegations contained in Paragraph 22 of the Complaint.
23. Payne denies the allegations contained in Paragraph 23 of the
Complaint.
B. Berman’s Employment and Agreement
24. The allegations in Paragraph 24 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne admits that Veritiv terminated Mr. Berman’s
employment on June 4, 2018, but states that she is without sufficient information
or knowledge to admit or deny the remaining allegations contained in Paragraph
24.
25. The allegations in Paragraph 25 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
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response is required, Payne states that she is without sufficient information or
knowledge to admit or deny the allegations contained in Paragraph 25.
26. The allegations in Paragraph 26 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne states that she is without sufficient information or
knowledge to admit or deny the allegations contained in Paragraph 26.
27. The allegations in Paragraph 27 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne admits that the contract attached to the Complaint as
Exhibit A contains the referenced provisions, but is without sufficient information
or knowledge to admit or deny the remaining allegations contained in Paragraph
27.
28. The allegations in Paragraph 28 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne admits that the contract attached to the Complaint as
Exhibit A contains the referenced provisions, but is without sufficient information
or knowledge to admit or deny the remaining allegations contained in Paragraph
28.
29. The allegations in Paragraph 29 contain legal conclusions and are
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directed at a defendant other than Payne, and therefore do not require a response
from Payne. To the extent a response is required, Payne states that she is without
sufficient information or knowledge to admit or deny the allegations contained in
Paragraph 29, except that Payne denies that the Complaint identifies any
confidential or trade secret information.
30. The allegations in Paragraph 30 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne admits that the contract attached to the Complaint as
Exhibit A contains the referenced provisions, but is without sufficient information
or knowledge to admit or deny the remaining allegations contained in Paragraph
30.
31. The allegations in Paragraph 31 are directed at a defendant other than
Payne, and therefore do not require a response from Payne. To the extent a
response is required, Payne admits that the contract attached to the Complaint as
Exhibit A contains the referenced provisions, but is without sufficient information
or knowledge to admit or deny the remaining allegations contained in Paragraph
31.
C. Payne’s Employment and Agreement
32. Payne admits that she was employed by Veritiv as a Customer
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Program Manager II from 2013 through and including June 8, 2018. Payne admits
that Veritiv assigned her to work on several accounts generated and managed by
Berman. Payne denies any remaining allegations contained in Paragraph 32 of the
Complaint.
33. Payne admits that during the course of her employment she may have
had access to information constituting confidential or trade secret information of
Veritiv. Payne denies that the Complaint identifies or describes any specific
confidential or trade secret information of Veritiv, and denies that she has
misappropriated any confidential or trade secret information.
34. Payne admits that she executed an agreement with Veritiv on
October 31, 2016, and that the agreement purports to contain restrictive covenants
and non-disclosure obligations.
35. The allegations in Paragraph 35 of the Complaint refer to a document
attached to the Complaint. Payne admits that the Payne Agreement contains
language similar (but not identical) to the quoted language, but denies that the
language defines any cognizable geographic area.
36. The allegations in Paragraph 36 of the Complaint refer to a document
attached to the Complaint. Payne admits that the Payne Agreement contains the
quoted language.
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37. The allegations in Paragraph 37 of the Complaint refer to a document
attached to the Complaint. Payne admits that the Payne Agreement contains the
quoted language.
38. The allegations in Paragraph 38 of the Complaint refer to a document
attached to the Complaint. Payne admits that the Payne Agreement contains the
quoted language. Payne denies that Veritiv has identified or described any
confidential or trade secret information that she failed to return following her
termination on June 8, 2018.
39. The allegations in Paragraph 39 of the Complaint refer to a document
attached to the Complaint. Payne admits that the Payne Agreement contains
language similar (but not identical) to the quoted language, but states that the quote
contained in Paragraph 39 of the Complaint is incomplete. Payne denies that
Veritiv is entitled to injunctive relief, costs, or expenses. Payne denies any
remaining allegations contained in Paragraph 39 of the Complaint.
D. Berman and Payne’s Separation from Veritiv and Wrongful Conduct2
40. The allegations contained in Paragraph 40 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne admits that Veritiv terminated Berman on June 4,
2 Payne denies wrongful conduct.
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2018.
41. Payne denies the allegations contained in Paragraph 41 of the
Complaint.
42. Payne denies the allegations contained in Paragraph 42 of the
Complaint.
43. Payne denies the allegations contained in Paragraph 43 of the
Complaint.
44. Payne admits that Berman asked to be patched into a customer call,
but denies that that occurred. Payne denies the remaining allegations contained in
Paragraph 44 of the Complaint.
45. Payne admits that she spoke with Berman at some point after the
customer call, but denies that she disclosed any confidential or trade secret
information related to Veritiv or its customers.
46. Payne denies the allegations in Paragraph 46, except Payne admits
that she sent telephone numbers and email addresses from her Outlook contacts list
for certain customer representatives to Berman. Payne denies that she obtained the
information from any source created or maintained by Veritiv and denies that the
information she sent to Berman was confidential, proprietary, or a trade secret of
Veritiv.
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47. Payne denies the allegations in Paragraph 47, except Payne admits
that she forwarded a Veritiv email to Berman, but denies that the email contained
any confidential, proprietary, or trade secret information.
48. The allegations contained in Paragraph 48 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies having knowledge of any efforts by Berman to
solicit Veritiv employees.
49. Payne admits that Veritiv terminated her on June 8, 2018. Payne
denies the remaining allegations contained in Paragraph 49 of the Complaint.
50. Payne denies the allegations contained in Paragraph 50 of the
Complaint.
51. Payne denies that Veritiv has suffered or stands to suffer any harm as
a result of any action or inaction by Payne. Payne denies the remaining allegations
contained in Paragraph 51 of the Complaint.
FIRST CAUSE OF ACTION
(Breach of Contract)
(Against Berman)
52. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
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53. The allegations contained in Paragraph 53 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 53 of the
Complaint.
54. The allegations contained in Paragraph 54 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 54 of the
Complaint.
55. The allegations contained in Paragraph 55 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 55 of the
Complaint.
56. The allegations contained in Paragraph 56 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 56 of the
Complaint.
57. The allegations contained in Paragraph 57 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 57 of the
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Complaint.
SECOND CAUSE OF ACTION
(Breach of Contract)
(Against Payne)
58. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
59. Payne admits that she executed an agreement with Veritiv on
October 31, 2016. The allegations as to the enforceability of the agreement are
legal conclusions, and to the extent any response is required, they are denied.
Payne denies that the covenants contained in the agreement, the terms of which are
vague and ambiguous, are reasonable or necessary to protect any interest of
Veritiv.
60. Payne denies the allegations contained in Paragraph 60 of the
Complaint.
61. Payne denies the allegations contained in Paragraph 61 of the
Complaint.
62. Payne denies the allegations contained in Paragraph 62 of the
Complaint.
63. Payne denies the allegations contained in Paragraph 63 of the
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Complaint, including that Veritiv has suffered any harm as a result of any action or
inaction by Payne.
64. Payne denies the allegations contained in Paragraph 64 of the
Complaint, including that Veritiv has suffered any harm or stands to suffer any
harm, irreparable or otherwise, as a result of any action or inaction by Payne.
THIRD CAUSE OF ACTION
(Breach of Fiduciary Duty/Duty of Loyalty)
(Against Payne)
65. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
66. Payne denies the allegations contained in Paragraph 66 of the
Complaint.
67. Payne denies the allegations contained in Paragraph 67 of the
Complaint.
68. Payne denies the allegations contained in Paragraph 68 of the
Complaint.
69. Payne denies that Veritiv has suffered any harm as a result of any
action or inaction by Payne. Payne denies the remaining allegations contained in
Paragraph 69 of the Complaint.
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70. Payne denies that Veritiv is entitled to recover exemplary or punitive
damages against her. Payne denies any remaining allegations contained in
Paragraph 70 of the Complaint.
FOURTH CAUSE OF ACTION
(Aiding and Abetting Breach of Fiduciary Duty/Duty of Loyalty)
(Against Berman)
71. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
72. Payne denies the allegations contained in Paragraph 72 of the
Complaint.
73. The allegations contained in Paragraph 73 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 73 of the
Complaint.
74. The allegations contained in Paragraph 74 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 74 of the
Complaint.
75. The allegations contained in Paragraph 75 are directed at a defendant
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other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies that she breached any fiduciary duty to Veritiv.
Payne denies the remaining allegations contained in Paragraph 75 of the
Complaint.
76. Payne denies that she breached any fiduciary duty to Veritiv and
denies that Veritiv has suffered any harm as a result of any action or inaction by
Payne. Payne denies the remaining allegations contained in Paragraph 76 of the
Complaint.
77. Payne denies that Veritiv is entitled to recover exemplary or punitive
damages against her. Payne denies any remaining allegations contained in
Paragraph 77 of the Complaint.
FIFTH CAUSE OF ACTION
(Defend Trade Secrets Act, 18 U.S.C. § 1832)
78. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
79. Paragraph 79 of the Complaint purports to describe an Act of
Congress and as such requires no response from Payne. To the extent any response
is required, Payne admits that the allegations in Paragraph 79 describe a federal
law.
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80. Payne denies the allegations contained in Paragraph 80 of the
Complaint.
81. Payne denies the allegations contained in Paragraph 81 of the
Complaint.
82. Payne denies the allegations contained in Paragraph 82 of the
Complaint.
83. Payne denies the allegations contained in Paragraph 83 of the
Complaint.
84. Payne denies the allegations contained in Paragraph 84 of the
Complaint.
85. Payne denies the allegations contained in Paragraph 85 of the
Complaint.
86. Payne denies the allegations contained in Paragraph 86 of the
Complaint.
87. Payne denies that the Complaint identifies or describes any
information meeting the characteristics alleged in Paragraph 87 of the Complaint.
Payne denies the remaining allegations contained in Paragraph 87.
88. Payne denies the allegations contained in Paragraph 88 of the
Complaint.
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89. Payne denies the allegations contained in Paragraph 89 of the
Complaint.
90. Payne denies the allegations contained in Paragraph 90 of the
Complaint.
91. Payne denies that the Complaint identifies or describes any specific
trade secrets or confidential information belonging to Veritiv. Payne denies that
Veritiv has suffered any harm or stands to suffer any harm, irreparable or
otherwise, as a result of any action or action by Payne. Payne denies that Veritiv is
entitled to recover preliminary or permanent injunctive relief against her. Payne
denies the remaining allegations contained in Paragraph 91.
92. Payne denies that Veritiv is entitled to recovery any of the relief
alleged in Paragraph 92 of the Complaint. Payne denies any remaining allegations
contained in Paragraph 92 of the Complaint.
93. The allegations in Paragraph 93 of the Complaint refer to documents
attached to the Complaint. Payne admits that Paragraph 9 of the Payne Agreement
purports to contain a “Notice of Immunity under the Defend Trade Secrets Act,”
but is without knowledge sufficient to admit or deny the sufficiency of that Notice.
94. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or inaction by Payne.
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Payne denies any remaining allegations contained in Paragraph 94 of the
Complaint.
95. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or inaction by Payne.
Payne denies any remaining allegations contained in Paragraph 95 of the
Complaint.
SIXTH CAUSE OF ACTION
(Georgia Trade Secrets Act, O.C.G.A. § 10-1-760)
96. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
97. Paragraph 97 of the Complaint purports to describe an Act of the
General Assembly and as such requires no response from Payne. To the extent any
response is required, Payne admits that the allegations in Paragraph 97 describe a
Georgia law.
98. Paragraph 98 of the Complaint purports to describe an Act of the
General Assembly and as such requires no response from Payne. To the extent any
response is required, Payne admits that the allegations in Paragraph 98 describe a
Georgia law.
99. Payne denies the allegations contained in Paragraph 99 of the
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Complaint.
100. Payne denies the allegations contained in Paragraph 100 of the
Complaint.
101. Payne denies the allegations contained in Paragraph 101 of the
Complaint.
102. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or inaction by Payne.
Payne denies any remaining allegations contained in Paragraph 102 of the
Complaint.
103. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or action by Payne.
Payne denies that Veritiv is entitled to recover preliminary or permanent injunctive
relief against her. Payne denies any remaining allegations contained in Paragraph
103 of the Complaint.
SEVENTH CAUSE OF ACTION
(Tortious Interference with Contractual Relations)
104. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
105. The allegations in Paragraph 105 of the Complaint refer to documents
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attached to the Complaint. Payne admits that the Payne Agreement certain terms
regarding her use or disclosure of Veritiv trade secrets and confidential information
and the solicitation of Veritiv employees, but denies any wrongdoing or violation
of those terms.
106. Payne denies the allegations contained in Paragraph 106 of the
Complaint. Payne is without sufficient knowledge or information to form a belief
as to Berman’s knowledge of the Payne Agreement or as to the specifics of
Berman’s contract with Veritiv.
107. The allegations contained in Paragraph 107 are directed at a defendant
other than Payne and do not require a response from Payne. To the extent any
response is required, Payne denies the allegations contained in Paragraph 107 of
the Complaint.
108. Payne denies the allegations contained in Paragraph 108 of the
Complaint.
109. Payne denies the allegations contained in Paragraph 109 of the
Complaint.
110. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or action by Payne.
Payne denies any remaining allegations contained in Paragraph 110 of the
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Complaint.
111. Payne denies that Veritiv has suffered any harm or stands to suffer
any harm, irreparable or otherwise, as a result of any action or inaction by Payne.
Payne denies that Veritiv is entitled to recover preliminary or permanent injunctive
relief against her. Payne denies any remaining allegations contained in Paragraph
111 of the Complaint.
112. Payne denies that Veritiv is entitled to recover exemplary or punitive
damages against her. Payne denies any remaining allegations contained in
Paragraph 112 of the Complaint.
EIGHTH CAUSE OF ACTION
(18 U.S.C. § 1030)
113. Payne incorporates her responses to the allegations contained in
Paragraphs 1 through 51 of the Complaint by reference as if fully set forth herein.
114. Paragraph 114 of the Complaint states a legal conclusion that does not
require a response from Payne. To the extent any response is required, Payne
denies the allegations contained in Paragraph 114 of the Complaint.
115. Payne denies the allegations contained in Paragraph 115 of the
Complaint.
116. Payne denies the allegations contained in Paragraph 116 of the
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Complaint.
117. Payne denies the allegations contained in Paragraph 117 of the
Complaint. Payne specifically denies that she is liable to Veritiv in any amount and
denies that Veritiv is entitled to recover any fees or costs from her.
118. Payne denies the allegations contained in Paragraph 118 of the
Complaint.
PRAYER FOR RELIEF
In response to the Complaint’s Prayer for Relief, Payne denies that Veritiv is
entitled to any of the relief sought or any other relief in this action. Payne denies all
factual allegations, if any, contained in the Prayer for Relief and denies any
wrongdoing.
JURY DEMAND
Defendant Payne demands a jury trial on all claims so triable.
* * *
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PAYNE’S AFFIRMATIVE AND OTHER DEFENSES
Without shifting the burden of proof where it otherwise rests with Veritiv,
Payne asserts the following Affirmative and Other Defenses:
FIRST DEFENSE
Veritiv’s Complaint fails to state claims against Payne upon which relief can
be granted with respect to some or all of the claims in the Complaint.
SECOND DEFENSE
Veritiv’s claims against Payne fail, in whole or in part, because Payne
possesses no property belonging to Veritiv.
THIRD DEFENSE
Veritiv’s claims against Payne based on alleged misappropriation of trade
secrets fail because Veritiv has failed to identify any specific legally protected
trade secrets or confidential information.
FOURTH DEFENSE
Veritiv’s claims against Payne fail, in whole or in part, because any
information accessed, viewed, used, or transferred by her contained no
confidential, proprietary, or trade secret information belonging to Veritiv.
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FIFTH DEFENSE
Veritiv’s claims against Payne fail, in whole or in part, because any
information accessed, viewed, used, or transferred by her was well known in the
packaging and/or corrugated box industry.
SIXTH DEFENSE
Veritiv’s claims against Payne fail, in whole or in party, because Veritiv has
not exercised reasonable or sufficient efforts to maintain the secrecy of any
information alleged in the Complaint.
SEVENTH DEFENSE
Veritiv’s tort claims against Payne fail because they are preempted by the
Georgia Trade Secrets Act.
EIGHTH DEFENSE
Veritiv’s claims against Payne are barred or subject to reduction to the
extent that Veritiv has failed or in the future fails to satisfy its duty to mitigate its
alleged damages.
NINTH DEFENSE
Some or all of Veritiv’s claims against Payne are barred because the
contractual provisions at issue are unenforceable or subject to limitation by the
Court. Specifically, certain of the restrictive covenants at issue contain vague and
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ambiguous terms, are overbroad, and fail to reasonably define the geographical
scope of the restriction, and therefore improperly restrain Payne’s right and ability
to work and conduct business. In addition, Veritiv has failed to plead and prove the
existence of a legitimate business interest as required by O.C.G.A. § 13-8-55. The
restrictive covenants are also unreasonable given the undue hardship they impose
on Payne in that they improperly restrain Payne’s right and ability to work in
violation of Georgia law and public policy. See O.C.G.A. § 13-8-58(d).
TENTH DEFENSE
Veritiv is not entitled to damages, costs, or attorneys’ fees.
ELEVENTH DEFENSE
Veritiv’s claims against Payne are barred, in whole or part, because any
conduct by Payne is privileged competition, and the Complaint constitutes an
improper effort to restrain competition and employee mobility in violation of
Georgia public policy.
TWELFTH DEFENSE
Veritiv’s claims against Payne are barred because Veritiv has suffered no
harm, irreparable or otherwise, and because Veritiv cannot establish any damages.
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THIRTEENTH DEFENSE
Veritiv’s claim request for injunctive relief against Payne is barred because
Veritiv has not demonstrated a need or met the legal criteria for injunctive relief,
including a likelihood of success on the merits, a risk of irreparable harm, or that
the interests of justice or balance of harms favor injunctive relief.
FOURTEENTH DEFENSE
Veritiv’s requests for injunctive relief against Payne are barred based on the
existence of an adequate remedy at law.
FIFTEENTH DEFENSE
To the extent Veritiv’s claims are based on the "inevitable disclosure
doctrine," such claims fail because that doctrine is not legally cognizable or
applicable.
SIXTEENTH DEFENSE
Veritiv’s claims against Payne are barred by the doctrines of in pari delicto,
unclean hands, waiver, laches, and estoppel.
SEVENTEENTH DEFENSE
Some or all of Veritiv’s claims against Payne have been mooted following
the return to Veritiv of all documents, drives, and/or information relating in any
way to Payne’s substantive work for Veritiv.
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EIGHTEENTH DEFENSE
Payne acted in good faith and did not directly or indirectly perform any acts
that would constitute a violation of any rights of Veritiv or any duty owed to
Veritiv.
NINETEENTH DEFENSE
Payne reserves the right to plead other affirmative defenses as they become
known.
WHEREFORE, Payne prays that:
(a) Veritiv’s Complaint be dismissed with prejudice and judgment on all
of Veritiv’s claims be entered in favor of Payne and against Veritiv;
(b) Payne be awarded against Veritiv her attorneys’ fees and costs in
defending this action, including under 18 U.S.C. § 1836(b)(3)(D) and
O.C.G.A. § 10-1-764; and
(c) Payne receive such other and further relief as is just and proper.
* * * *
COUNTERCLAIMS
Melissa Payne asserts the following counterclaims against Veritiv for
attorneys’ fees due to Veritiv’s unjustified and bad-faith assertion of trade secret
misappropriation claims against Payne, without evidence of misappropriation, and
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merely as a means to disgrace Payne in the packaging design community, destroy
her good reputation, and preclude her from obtaining any gainful employment,
thereby unfairly restricting competition in violation of Georgia public policy.
THE PARTIES
1. Payne is an individual and a resident of Fulton County, Georgia.
2. As alleged in Veritiv’s Complaint, Veritiv is a Delaware corporation
with its principal office located in Atlanta, Georgia. Veritiv is a party to this action.
JURISDICTION AND VENUE
3. This Court has subject matter jurisdiction over these counterclaims
pursuant to 28 U.S.C. §§ 1331 and 1367.
4. Veritiv has submitted to the Court’s jurisdiction by initiating and
continuing to prosecute this action and by virtue of the facts and circumstances set
forth herein.
5. Veritiv has submitted to venue in this Court with regards to these
counterclaims by initiating and continuing to prosecute this action, including its
unsupported trade secret misappropriation claims.
GENERAL ALLEGATIONS
6. Prior to working for Veritiv, Payne received a Bachelor’s of Science
degree in Industrial Design from the Georgia Institute of Technology.
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7. After receiving her undergraduate degree, Payne worked as a full-time
packaging designer for MeadWestVaco in Richmond, Virginia, where she
specialized in designing and prototyping custom, sustainable packaging solutions
based on customers’ initial concepts.
8. Payne began working for Veritiv in May 2013 as a Packaging Design
Engineer. She developed particular expertise in designing custom packaging
solutions in the telecommunications industry. Veritiv later assigned her to
telecommunications customer accounts managed by Jason Berman.
9. In her work for Veritiv’s customers, Payne created technical drawings
to allow for prototyping of new packaging concepts.
10. The technical drawings, designs, and prototypes belonged to Veritiv’s
customers, and not to Veritiv.
11. Veritiv’s customers sometimes exercised their right to take the
designs created by Payne to Veritiv’s competitors to obtain competing bids on the
fabrication of the final packaging product.
12. Veritiv does not manufacture the packaging solutions created by its
design team. Instead, in her work for Veritiv’s customers, Payne requested quotes
from third-party vendors on the customer’s behalf. Veritiv did not generate, create,
or control the quotes submitted by third-party manufacturers.
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13. Veritiv customers made their pricing preferences well known, not
only to Veritiv, but to third-party manufacturers. Payne had little involvement in
calculating or establishing financial margins for customer accounts.
A. Payne used a Lexar USB drive in connection with her work for Veritiv.
14. In order to create technical drawings, Payne used a software that saves
CAD manufacturing and design data as a .ACM file type. The .ACM file format
can only be read, viewed, or otherwise understood by the Kongsberg CAD cutting
machine (a “CAD table”).
15. Designers at Veritiv were generally able to upload .ACM design files
directly from their Veritiv-issued laptops to Veritiv’s CAD table to perform their
work. For the majority of Payne’s tenure at Veritiv, however, her Veritiv-issued
laptop was unable to connect to the CAD table as necessary to upload design files.
Rather, she was forced to upload .ACM files to an external drive, and load the files
from the external drive to the CAD table in order to perform her work. Uploading
.ACM files to the CAD table was an ordinary and necessary function of her job.
16. From June 4, 2018, through June 8, 2018, Payne used a Lexar USB
Thumb Drive to transfer .ACM files to Veritiv’s CAD table.
17. Veritiv was aware that Payne’s work computer could not connect to
the CAD table. Veritiv was also aware that uploading .ACM files was a normal
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part of her job and necessary to accomplish her duties and responsibilities. Veritiv
was aware that she used an external drive to transfer .ACM files to the CAD table.
B. Veritiv inexplicably fired Payne’s new partner, Jason Berman.
18. In or around April 2018, Veritiv offered Payne a lateral promotion
from Packaging Design Engineer to Customer Program Manager II, which was
more commonly known to customers as a Packaging Design Specialist. In the later
capacity, Veritiv expected that Payne would provide both design and sales services
and would grow into a partnership with Berman.
19. On June 4, 2018, however, Veritiv terminated Berman’s employment.
On that day, during a pre-arranged meeting on a different topic, Vice President of
Sales Kim Seeberg suddenly disclosed to Payne that Veritiv had fired Berman.
Seeberg refused to explain the reason for the termination.
20. Following her meeting with Seeberg, Berman called Payne from his
work phone to let her know that he had just been fired. Payne and Berman
thereafter discussed the topic of his termination in several phone calls.
21. Veritiv’s sudden termination of Berman disrupted Payne’s path for
growth at Veritiv, since her position was dependent on a partnership with Berman.
C. Veritiv fired Payne when she refused to sign a two-year commitment.
22. Also on June 4, 2018, Veritiv presented Payne with a two-year
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retention agreement, whereby Veritiv agreed to provide a bonus to Payne if Payne
agreed to commit to Veritiv for two years. Particularly following Veritiv’s loss of
Berman’s institutional knowledge, Veritiv seemed eager to retain Payne to service
his old accounts.
23. Veritiv did not condition Payne’s continued employment upon her
execution of the retention bonus agreement. Veritiv indicated, however, that she
should sign or not sign by Wednesday, June 6, 2018.
24. Payne ultimately decided not to execute the retention agreement due
to mixed messages from Veritiv, including from Seeberg, as to Veritiv’s
willingness to invest in her growth with the company.
25. On Friday, June 8, 2018, Veritiv fired Payne. Veritiv gave no
explanation, except that she had failed to execute the retention bonus agreement.
26. Upon her termination, Payne returned her Veritiv-issued laptop,
Veritiv-issued iPhone, Veritiv-issued USB drive, and all hard copies of documents
related to her substantive work for Veritiv.
D. Veritiv filed baseless claims for misappropriation of trade secrets and use of confidential information.
27. On June 20, 2018, Veritiv filed this lawsuit in the Northern District of
Georgia alleging misappropriation of trade secrets and/or confidential information
allegedly belonging to Veritiv.
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28. The lawsuit does not describe what trade secrets or confidential
information that it contends Payne has used, disclosed, or otherwise
misappropriated.
29. The lawsuit claims trade secret protection in packaging designs that
Payne created for Veritiv’s customers, when Veritiv is aware that Payne’s work-
product was often distributed to third parties and not maintained in secrecy.
30. The lawsuit claims that Payne misappropriated information regarding
customer pricing, pricing strategies, discounts, and sales and margin data, when
Veritiv is aware that strategic pricing and financial decisions were outside Payne’s
duties and responsibilities.
31. The lawsuit uses false and inflammatory language, theorizing the
Payne served as a “spy” for Berman and that Berman, through Payne, listened in
on customer conference calls.
32. On July 6, 2018, Payne returned the Lexar USB Thumb Drive, which
Veritiv knew Payne had used in the course of her work for Veritiv. Payne also
returned a My Passport device, which contained certain files related to her Veritiv
work, but which she had not used or accessed since her termination.
33. Payne has explained under oath that she has not improperly used or
disclosed any Veritiv information since June 4, 2018.
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34. Payne has explained under oath that Berman at no point listened in to
a customer conference call while Payne remained employed with Veritiv.
35. Payne has explained under oath that she did not send confidential
Veritiv customer strategy information to Berman following his termination from
Veritiv.
36. Veritiv continues to pursue its baseless misappropriation theories
against Payne.
E. Veritiv’s lawsuit is wrongfully impeding Payne from finding new employment.
37. Payne, who is thirty years old, must find gainful employment
following her departure from Veritiv.
38. Upon information and belief, Veritiv is using this lawsuit to restrict
Payne’s employability.
39. Upon information and belief, Veritiv believes that the presence of the
lawsuit will deter its customers from hiring Payne directly, although Payne is under
no obligation to forego employment with entities, like Veritiv’s customers, that do
not compete with Veritiv.
40. The presence of the lawsuit and Veritiv’s inflammatory allegations
serves only to demean and disgrace Payne in the public eye and to restrict her
employability, and are, in fact, doing so.
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41. Veritiv has failed to allege or identify any harm that it has incurred or
expects to incur as a result of allegations contained in the Complaint
COUNT I
(Attorneys’ Fees under 18 U.S.C. § 1836(b)(3)(D))
42. Payne repeats and re-alleges each and every allegation contained in
Paragraphs 1 through 41 of the Counterclaim Complaint as if fully set forth herein.
43. The DTSA provides that if a claim of misappropriation thereunder is
made in bad faith, the court may award reasonable attorneys’ fees to the prevailing
party. Bad faith may be established by circumstantial evidence.
44. Veritiv’s Complaint asserts a claim against Payne for
misappropriation of trade secrets under the DTSA.
45. Based on the facts and circumstances outlined above, Veritiv’s
misappropriation claim has been brought in bad faith.
46. Payne has incurred and continues to incur attorneys’ fees in
responding to the lawsuit.
47. Payne is entitled to recover an award of attorneys’ fees under the
DTSA due to Veritiv’s bad-faith misappropriation claim against her.
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COUNT II
(Attorneys’ Fees under O.C.G.A. § 10-1-764)
48. Payne repeats and re-alleges each and every allegation contained in
Paragraphs 1 through 47 of the Counterclaim Complaint as if fully set forth herein.
49. The GTSA provides that if a claim of misappropriation thereunder is
made in bad faith, the court may award reasonable attorneys’ fees to the prevailing
party.
50. Veritiv’s Complaint asserts a claim against Payne for
misappropriation of trade secrets under the GTSA.
51. Based on the facts and circumstances outlined above, Veritiv’s
misappropriation claim has been brought in bad faith.
52. Payne has incurred and continues to incur attorneys’ fees in
responding to the lawsuit.
53. Payne is entitled to recover an award of attorneys’ fees under the
GTSA due to Veritiv’s bad-faith misappropriation claim against her.
WHEREFORE, Counterclaim Plaintiff Payne requests the following relief in
connection with Counts I and II, above:
(a) that the Court award Payne her reasonable attorney’s fees under the
DSTA in an amount to be proven, because Veritiv has asserted misappropriation
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claim against Payne in bad faith;
(b) that the Court award Payne her attorneys’ fees under the GTSA in an
amount to be proven, because Veritiv has asserted misappropriation claim against
Payne in bad faith;
(c) that the Court otherwise award Payne her reasonable attorneys’ fees
and expenses of litigation; and
(d) that the Court award any such other and further relief in law or equity
that the Court deems just and proper.
JURY TRIAL DEMAND
Pursuant to Federal Rule of Civil Procedure 38(b), Payne demands a jury
trial for any counterclaims or fact disputes as to which it is entitled to a jury trial.
Respectfully submitted this 6th day of August, 2018.
PARKER, HUDSON, RAINER & DOBBS LLP
/s/ Anne Horn Baroody Ronald T. Coleman, Jr. Georgia Bar No. 177655 Jared C. Miller Georgia Bar No. 142219 Anne Horn Baroody
303 Peachtree Street, NE Georgia Bar No. 475569 Suite 3600 Atlanta, Georgia 30308 Telephone: 404-523-5300 E-mail: [email protected] E-mail: [email protected]
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E-mail: [email protected] Attorneys for Defendant Melissa Payne
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CERTIFICATE OF SERVICE
I hereby certify that on this 6th of August, 2018, I filed a copy of the foregoing DEFENDANT MELISSA PAYNE’S ANSWER AND DEFENSES TO PLAINTIFF’S COMPLAINT FOR INJUNCTIVE RELIEF AND DAMAGES AND COUNTERCLAIMS AGAINST PLAINTIFF with the Clerk of Court using the CM/ECF system, which automatically sent e-mail notification of such filing to the following counsel of record, who are registered participants in the Court's electronic notice and filing system:
Robert C. Stevens, Esq. Eric F. Barton, Esq. Alex C. Meier, Esq. Seyfarth Shaw LLP 1075 Peachtree Street, N.E. Suite 2500 Atlanta, GA 30309-3962 Matthew W. Clarke, Esq. William F. Long, III, Esq. Sasha N. Greenberg, Esq. Smith, Gambrell & Russell, LLP 1230 Peachtree Street, NE Suite 3100 – Promenade II Atlanta, Georgia 30309-3592
/s/ Anne Horn Baroody
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