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BladeRoom Group Ltd. v. Facebook, Inc.

United States District Court, N.D. California, San Jose Division

February 10, 2017

BLADEROOM GROUP LIMITED, et al., Plaintiffs,
v.
FACEBOOK, INC., et al., Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS RE: DKT. NO. 128

          EDWARD J. DAVILA United States District Judge.

         I. INTRODUCTION

         As detailed in a companion order filed this same date, [1] Plaintiffs BladeRoom Group Limited (“BRG”) and Bripco (UK) Limited (“Bripco”) (collectively, “Plaintiffs”) allege that Defendants Facebook, Inc. (“Facebook”), Emerson Electric Co., Emerson Network Power Solutions, Inc. and Liebert Corporation[2] enticed them to reveal their data center designs and construction methods with promises of acquisition and partnership, only to then copy those designs and methods and pass them off as their own.

         Federal jurisdiction arises pursuant to 28 U.S.C. §§ 1331 and 1332. Presently before the court is the Emerson Defendants' effort under Federal Rule of Civil Procedure 12(b)(6) to dismiss Plaintiffs' Second Amended Complaint (“SAC”). Dkt. No. 128. Plaintiffs oppose the motion. Because some of the Emerson Defendants' arguments are similar to unsuccessful ones made by Facebook, they fail for the same reasons. As for those arguments not previously addressed, only one succeeds. The Emerson Defendants' motion will therefore be granted in part and denied in part for the reasons explained below.

         II. LEGAL STANDARD

         Federal Rule of Civil Procedure 8(a) requires a plaintiff to plead each claim with sufficient specificity to “give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations omitted). The factual allegations in the complaint “must be enough to raise a right to relief above the speculative level” such that the claim “is plausible on its face.” Id. at 556-57. A complaint that falls short of the Rule 8(a) standard may be dismissed if it fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008).

         When deciding whether to grant a motion to dismiss, the court must generally accept as true all “well-pleaded factual allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 664 (2009). The court must also construe the alleged facts in the light most favorable to the plaintiff. See Retail Prop. Trust v. United Bhd. of Carpenters & Joiners of Am., 768 F.3d 938, 945 (9th Cir. 2014) (providing the court must “draw all reasonable inferences in favor of the nonmoving party” for a Rule 12(b)(6) motion). However, “courts are not bound to accept as true a legal conclusion couched as a factual allegation.” Iqbal, 556 U.S. at 678.

         Also, the court usually does not consider any material beyond the pleadings for a Rule 12(b)(6) analysis. Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n. 19 (9th Cir. 1990). Exceptions to this rule include material submitted as part of the complaint or relied upon in the complaint, and material subject to judicial notice. See Lee v. City of Los Angeles, 250 F.3d 668, 688-69 (9th Cir. 2001).

         III. DISCUSSION

         In the SAC, Plaintiffs assert claims against the Emerson Defendants for: (1) misappropriation of trade secrets in violation of the California Uniform Trade Secrets Act (“CUTSA”), California Civil Code § 3426.1; (2) violation of the Unfair Competition Law (“UCL”), California Business and Professions Code § 17200 et seq., and (3) breach of contract. The Emerson Defendants' arguments against these claims are discussed below.

         A. Sufficiency of Allegations Against the Emerson Defendants

         The Emerson Defendants argue the SAC is generally defective because it does not separately specify the alleged conduct Plaintiffs attribute to each Emerson-affiliated defendant. The court disagrees the SAC fails for that reason.

         Since none of Plaintiffs' claims are subject to the heightened standard mandated by Federal Rule of Civil Procedure 9(b), the SAC is governed by Rule 8(a)(2)'s notice pleading requirement. Thus, the pleading must only contain “a short and plain statement” of the claims showing that Plaintiffs are “entitled to relief.” Fed.R.Civ.P. 8(a)(2). This liberal pleading rule simply requires “that the averments of the complaint sufficiently establish a basis for judgment against the defendant.” Yamaguchi v. United States Dep't of the Air Force, 109 F.3d 1475, 1481 (9th Cir. 1997).

         The SAC's detailed allegations satisfy Rule 8(a)(2). As they explain in their opposition to this motion, Plaintiffs have pled two categories of allegations against the Emerson Defendants: those for which they believe those defendants are jointly responsible, and those for which an individual defendant is separately responsible. Those allegations are sufficient to place the Emerson Defendants on notice of all of the conduct forming the basis of Plaintiffs' claims against them, whether the conduct was collectively ...


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