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DESIGN STRATEGIES, INC. v. DAVIS

United States District Court, S.D. New York


June 22, 2004.

DESIGN STRATEGIES, INC., Plaintiff,
v.
MARC E. DAVIS, INFOTECHNOLOGIES, INC., INFOTECHNOLOGIES WEB SOLUTIONS, INC., and JOHN GOULLET, Defendants.

The opinion of the court was delivered by: VICTOR MARRERO, District Judge

DECISION AND ORDER

Plaintiff Design Strategies, Inc. ("Design") brings this action under the Court's diversity jurisdiction against its former employee, Marc E. Davis ("Davis"); two corporate entities, Info Technologies, Inc., ("Infotech") and Info Technologies Web Solutions ("ITWB"); and John Goullet ("Goullet"), Chief Executive Officer of both InfoTech and ITWB (collectively the "IT Defendants," and together with Davis, "Defendants"). Design alleges that Davis wrongfully diverted a lucrative business opportunity from Design to the IT Defendants while still employed at Design. Design further alleges that the IT Defendants were aware of Davis's actions and colluded with Davis to divert this business opportunity away from Design and to ultimately hire Davis. Defendants deny Design's salient allegations. All the parties have moved for summary judgment. For the reasons discussed below, the Court denies Design's motion and grants-in-part and denies-inpart Defendants' motions.

I. BACKGROUND*fn1

  Design is a corporation in the business of providing highly trained personnel to large companies for technical services on specific industrial and business projects requiring complex computer applications. Design hired Davis in 1987 as a senior marketing representative at an annual salary of $35,000 plus commissions. Davis was hired with no written agreement governing his employment. Davis worked with Design for approximately 13 years and was earning an annual salary of over $500,000 at the time of his departure from Design.

  The crux of Design's causes of action lies with the alleged diversion of a contract with Microsoft, Inc. ("Microsoft"), worth approximately $1 to $2 million, for a project known as Contentville.com ("Contentville"). Contentville entailed establishing a major high-profile website for an electronic bookseller that would use Microsoft's software and compete directly with well-known websites such as amazon.com and barnesandnoble.com. According to John Gomez ("Gomez"), a Microsoft managing consultant who was the contact person at Microsoft for Contentville, the company to be awarded the Contentville project would have to have previous experience in providing web solutions and maintain a pre-existing development lab.

  Design alleges that sometime between October and December 1999, Davis actively solicited and procured the Contentville contract for the IT Defendants while still an employee of Design and without giving Design an opportunity to compete for the contract. More specifically, Design alleges that Davis colluded with Goullet; Michael Largey ("Largey"), President of ITWB; and John Kalli ("Kalli"), the Executive Vice-President of InfoTech, to secure Contentville for the IT Defendants.

  Design also contends that the diversion of Contentville thwarted the impending sale of Design to a third-party for approximately $37.5 to $50 million. Davis resigned from Design shortly before the alleged sale was supposed to occur and was hired by ITWB as a marketing representative shortly thereafter. Davis offers a different explanation regarding his involvement with Contentville. Microsoft was an existing client of Design to whom Design provided staffing services. According to Davis, he came to learn of Contentville only when he approached Microsoft to better assess its current needs as one of Design's clients. Davis contends that although he knew that Design did not have the required infrastructure in place to meet the requirements of Contentville, he nevertheless spoke with Marsh Newark ("Newmark"), the President of Design, to inquire whether Design would be interested in the project because it was Davis's practice to discuss such matters with Newmark. (See Davis Dep. at 96.) Davis asserts that in earlier discussions, Newmark repeatedly refused to make the investment necessary to expand into and compete for an E-commerce solutions type of business that Contentville would require, even for Design's biggest client, Merrill Lynch. Thus, Davis alleges that when he subsequently presented Contentville to Newmark, Newmark declined the project again on the same basis, namely, because Newmark wanted an executed contract up front before committing resources to establishing the required infrastructure to undertake Contentville. (See Davis Dep. at 69.) Davis asserts that this impasse essentially was a rejection by Design of the Contentville project. Design counters these allegations by asserting that Davis never formally presented Contentville to Newmark, but rather, he spoke to him merely in generalities.*fn2 With regard to meeting the requirements of the Contentville project, Newmark maintains that Design did in fact have previous website development experience from several sites Design developed for another client, Goldman Sachs. Although Newmark does not contest that at the time Microsoft was seeking to begin Contentville in late 1999 or early 2000, Design did not have the existing development lab that Microsoft was seeking for the project, he asserts that if Davis had approached him specifically about Contentville, including its particular specifications, Design would have fulfilled the requirements. According to Newmark, Design could have established the necessary technical infrastructure for Contentville in approximately two weeks.

  Davis responds that Design's two-week lead time took Design out of contention for Contentville as evidenced by Gomez's statements that the project had not been awarded to another company due to a five-day lead-time that the other company required to get the proper infrastructure in place. (See Gomez Dep. at 140.) According to Davis, after Design rejected Contentville, he was frustrated and felt that if Design would not take on the project, then at least Davis, acting on behalf of Design, could help its client Microsoft achieve its objectives. Davis states with regard to Contentville that "the next best option [after the alleged rejection by Newmark] was to have somebody do it who at least I would have some relationship with or Design would have some relationship with, rather than having Microsoft go to somebody we didn't know, award the project to some other company that we had no influence in or part in."*fn3 (Davis Dep. at 104.) Davis thus contacted Goullet and Largey regarding the project, explaining its requirements and adding that he (Davis) had already offered Contentville to Design and that it was declined. Davis also contacted Gomez to inform him that ITWB could meet Contentville's requirements.

  Davis alleges that based upon the conversation he had with Newmark regarding Microsoft, and his (Davis's) familiarity with Contentville, it was evident that Design could not have been awarded the project because Contentville was to require more complex web solution services beyond the mere staffing support that Design had been providing. According to Davis, "Design was then incapable of providing the required services and did not (and, more importantly, chose not to try to) meet the technical requirements that Contentville itself had established for its E-commerce provider." (Davis Motion at 4.)

  The IT Defendants argue that although Davis did in fact refer Contentville to ITWB,*fn4 it was ultimately awarded the project solely through its own efforts and with no assistance from Davis. The IT Defendants further argue that it did not collude with Davis to obtain Contentville and that it hired Davis only after it was awarded the contract. In fact, the IT Defendants disavow any role in Davis's resignation from Design. The IT Defendants agree with Davis that Design was not considered qualified for the Contentville contract because Design was not in the business of website development or solutions and did not have the required offsite development facility, equipment, expertise or experience for the project, although it is not clear from the record how the IT Defendants are in a position to make such an assessment.

  In its complaint, Design sets forth nine causes of action all related to Design's allegations that Davis wrongfully diverted Contentville and that the IT Defendants colluded with Davis in the process, among them, breach of employment agreement; breach of fiduciary duty; unfair competition; civil conspiracy; and aiding and abetting the breach of fiduciary duties. As remedies, Design seeks a forfeiture of Davis's salary from Design during the alleged collusion with the IT Defendants; an award against the Defendants for the losses sustained by Design, including the profits lost from the Contentville project and the alleged aborted sale of Design; and punitive damages. All the parties have moved for summary judgment, claiming that the record fails to raise any genuine issues of material fact on Design's various causes of action.

  II. DISCUSSION

  A. STANDARD FOR SUMMARY JUDGMENT

  The Court may grant summary judgment only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The Court must first look to the substantive law of the action to determine which facts are material; "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Even if the parties dispute material facts, summary judgment will be granted unless the dispute is "genuine," i.e., "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Id. at 249.

  The moving party bears the initial burden of demonstrating that the evidence contained in the record fails to raise a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). After such a showing, the non-moving party must respond with "specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). To this end, "[t]he non-moving party may not rely on mere conclusory allegations nor speculation, but instead must offer some hard evidence showing that its version of the events is not wholly fanciful." D'Amico v. City of New York, 132 F.3d 145, 149 (2d Cir. 1998). In other words, "[w]hen the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).

  Throughout this inquiry, the Court must view the evidence in the light most favorable to the non-moving party and draw all reasonable inferences in favor of that party. See Schneider v. Feinberg, 345 F.3d 135, 144 (2d Cir. 2003). For purposes of summary judgment, the Court's role is to determine whether triable issues of fact exist based on the entire record the parties have presented to the Court, and not to resolve such disputed matters. See Anderson, 477 U.S. at 249; Gibson v. American Broad. Cos., 892 F.2d 1128, 1132 (2d Cir. 1989).

  C. APPLICATION*fn5

  1. Breach of Fiduciary Duty

  Count two of Design's complaint alleges that Davis breached his fiduciary duty to Design by his actions related to Contentville. (See Compl. at ¶ 35.) It is well established under New York law that an employee owes a duty of good faith and loyalty to his employer. See Western Elec. Co. v. Brenner, 360 N.E.2d 1091, 1094 (N.Y. 1977); Maritime Fish Prods., Inc. v. World-Wide Fish Prods., Inc., 474 N.Y.S.2d 281, 285 (App. Div. 1st Dep't 1984). As the New York Court of Appeals has explained:

The employer-employee relationship is one of contract, express or implied. . . . Fundamental to that relationship is the proposition that an employee is to be loyal to his employer and is prohibited from acting in any manner inconsistent with his agency or trust and is at all times bound to exercise the utmost good faith and loyalty in the performance of his duties.
Brenner, 360 N.E.2d at 1094 (internal quotations and citations omitted). Consistent with this duty, an employee is not permitted to solicit his employer's clients until the employment relationship terminates. See Catalogue Serv. of Westchester, Inc. v. Wise, 405 N.Y.S.2d 723, 724 (App. Div. 1st Dep't 1978).

  Moreover, even if an employer rejects a business opportunity, an employee is not free to take the business or direct it to a competitor for his profit without the express consent and approval of his employer. See Foley v. D'Agostino, 248 N.Y.S.2d 121, 129 (App. Div. 1st Dep't 1964) (citation omitted). In these circumstances, an employee is obligated, at a minimum, to attempt to secure the business for his employer before diverting it elsewhere. Maritime, 474 N.Y.S.2d at 286. Thus, an employee breaches his fiduciary duty of loyalty to his employer when he diverts a business opportunity to himself or to another for his own gain or that of another without first attempting to secure the opportunity for the employer or obtaining the employer's express consent for the diversion. See id. (citing Beatty v. Guggenheim Exploration Co., 122 N.E. 378, 386 (N.Y. 1919)).

  Under the doctrine of corporate opportunity, "corporate fiduciaries and employees cannot, without consent, divert and exploit for their own benefit any opportunity that should be deemed an asset of the corporation." Alexander & Alexander of New York, Inc. v. Fritzen, 542 N.Y.S.2d 530, 533 (App. Div. 1st Dep't 1989) (citations omitted). Corporate opportunity can be applied with two different tests. The first test asks whether the corporation had an interest or "tangible expectancy" in the opportunity. Burg v. Horn, 380 F.2d 897, 899 (2d Cir. 1967) (citing Blaustein v. Pan Am. Petroleum & Transp. Co., 56 N.E.2d 705, 713-14 (1944)). Tangible expectancy has been defined as "something much less tenable than ownership, but, on the other hand more certain than a desire or a hope." Alexander, 542 N.Y.S.2d at 534 (internal quotations and citation omitted).

  The second test asks whether an opportunity is the same as or is "necessary" for, or "essential" to, the line of business of the corporation, and whether "the consequences of deprivation are so severe as to threaten the viability of the enterprise, [that] the . . . employee is deemed to have violated his fiduciary responsibility." Id. at 534-35; see also Nassau Soda Fountain Equip. Corp. v. Mason, 500 N.Y.S.2d 154, 155-56 (App. Div.2d Dep't 1986) (concluding that the plaintiff demonstrated that the defendant may have breached his fiduciary duty by establishing and engaging in a business in direct competition that might have significantly diminished the amount of business conducted by the plaintiff).

  The Court finds that the record in this case raises genuine issues of material fact as to the nature of Davis's involvement with the IT Defendants' during the procurement of Contentville, which will necessarily determine whether Davis breached his fiduciary duty to Design during his employment. Davis does not contest that he owed Design a fiduciary duty, but rather, he argues that Contentville was not a "corporate opportunity" of Design, i.e., that Contentville was not an opportunity that could be deemed an asset of the corporation. Design denies that it was unable to compete for Contentville. The Court finds that because there is little in the record on this issue other than the parties' opposing contentions, there are genuine issues of material fact that ultimately must be determined by a trier of fact.

  For example, whether Design had an "interest" or "tangible expectancy" in Contentville or whether the project was essential to Design's line of business turns in large part primarily on the credibility of Davis and Newmark, whose respective accounts of their conversation on the material issue of Design's interest in Contentville vary substantially. Likewise, a proper assessment of Davis's actions in light of applicable law necessarily involves a finding regarding Davis's true motives with regard to Contentville. These matters raise genuine issues of material fact that are properly left for a trier of fact. Although the record demonstrates that Design indeed did not have the infrastructure for Contentville in place at the time these events occurred, a reasonable factfinder could conclude that sufficient time elapsed between the time Davis presented (or should have presented) Contentville to Newmark and the time that Contentville was ultimately awarded to ITWB such that Design could, as Newmark argues here, have established the necessary infrastructure to become a serious contender for the contract.*fn6 This circumstance, together with the issues of credibility and motive discussed above, militates against the grant of summary judgment on the issue of whether Davis breached his fiduciary duty to Design by bringing Microsoft and ITWB together for Contentville. While the record supports a finding that Design was in the business of providing highly trained specialists, and that Contentville did not involve this type of service, the Court finds that there are triable issues of fact as to whether Contentville was sufficiently related to Design's line of business to the extent that the loss of the project threatened Design's continued viability.

  Moreover, the Court finds that there are triable issues of fact with regard to whether, and to what extent, Davis in fact presented Contentville to Newmark with sufficient particularity such that Newmark could have made an adequately informed decision whether to accept the project. There is nothing in the record on this question other than the parties' conflicting accounts as to what transpired between Davis and Newmark. Because these facts are material and not readily determinable from the record before the Court, the Court denies the parties' motions for summary judgment on Design's claim for breach of fiduciary duty.

  2. Unfair Competition and Unjust Enrichment

  Counts four and five of Design's complaint allege causes of action against Davis for unfair competition and unjust enrichment/restitution respectively. (See Compl. at ¶¶ 38-42.) Under New York law, unfair competition occurs when "employees, during the period of their employment, . . ., engage in and carry out a conspiracy to compete with the employer in violation of the duties of loyalty owing by the employees. . . ." Foley, 248 N.Y.S.2d at 130. A claim for unjust enrichment requires that the plaintiff demonstrate that the defendant was enriched at the plaintiff's expense and that equity and good conscience require the defendant to make restitution as compensation. See Weiner v. Lazard Freres & Co., 672 N.Y.S.2d 8, 12 (App. Div. 1st Dep't 1998); accord Golden Pac. Bancorp v. FDIC, 273 F.3d 509, 519 (2d Cir. 2001) (applying New York law), Ainbinder v. Potter, 282 F. Supp.2d 180, 189 (S.D.N.Y. 2003) (applying New York law).

  As these elements make clear, Design's claims for unfair competition and unjust enrichment/restitution, like Design's claim for breach of fiduciary duty, necessarily implicate considerations of the Defendants' subjective intent and motives with regard to their actions at issue in this case. Simply put, summary judgment is not warranted on these claims because the record raises genuine issues of material fact with regard to whether Defendants did in fact conspire to wrongly divert Contentville from Design and whether the Defendants were thereby unjustly enriched at Design's expense. Accordingly, the parties' motions for summary judgment with respect to counts four and five are denied.

  3. Breach of Employment Agreement

  With regard to Design's breach of employment agreement claims against Davis as alleged in counts one and three of the complaint, the Court finds that Design has failed to demonstrate that there are genuine issues of material fact. In order to establish a cause of action for breach of an employment contract under New York law, a plaintiff must demonstrate the existence of a valid contract; performance by the plaintiff; a breach of the agreement by the defendant; and damages stemming from the breach. See Terwilliger v. Terwilliger, 206 F.3d 240, 245-46 (2d Cir. 2000); Palmer v. A. & L. Seamon, Inc., No. 94 Civ. 2968, 1995 WL 2131 (S.D.N.Y. Jan. 3, 1995); Stratton Group, Ltd. v. Sprayregen, 458 F. Supp. 1216, 1217 (S.D.N.Y. 1978).

  Despite Design's claims that there were "expressly stipulated and agreed" terms between Design and Davis, (Compl. at ¶ 13), it is clear from the record that there was no written agreement governing Davis's employment. Indeed, Newmark so attested during his deposition. (See Newmark Dep. at 44-45.) Although the record does contain a copy of Design's original employment offer letter to Davis from 1987, this one-page letter merely sets forth Davis's starting annual salary and rate of commission and does not create any express contractual duty of loyalty beyond the implied common-law duty discussed above. (See Defendants' Joint Exhibits Binder at Ex. 15.) Thus, there is no support in the record for Design's contention that Davis was bound by any express agreement with Design governing his employment, nor is there any support for a finding that there was an oral agreement between Design and Davis governing Davis's employment. Accordingly, because Design concedes that Davis was not bound by a restrictive covenant or non-compete agreement during his employment with Design, the Court concludes that no reasonable trier of fact could find in Design's favor on its breach of contract claim. The Court thus grants Davis's motion for summary judgment as to counts one and three of the complaint. As discussed above, Design may pursue its claims against Davis under the theories of breach of fiduciary duty, unfair competition, and/or unjust enrichment.

  4. Aiding and Abetting

  Count seven of Design's complaint alleges that the IT Defendants aided and abetted Davis's alleged breach of fiduciary duty. To establish a claim of aiding and abetting a breach of fiduciary duty, a plaintiff must demonstrate: "(1) the existence of a . . . violation by the primary (as opposed to the aiding and abetting) party; (2) `knowledge' of this violation on the part of the aider and abettor; and (3) `substantial assistance' by the aider and abettor in the achievement of the primary violation." Samuel M. Feinberg Testamentary Trust v. Carter, 652 F. Supp. 1066, 1082 (S.D.N.Y. 1987) (citing ITT v. Cornfeld, 619 F.2d 909, 922 (2d Cir. 1980) (interpreting New York law)). In some circumstances, even if it can be established that the aider/abettor did not know of the primary breach, "a third party can become obligated to investigate an agent's actions where there are indications that the agent's actions are suspicious in nature. A failure to investigate under such circumstances may result in the third party's liability for aiding and abetting the agent's breach of his fiduciary duty." Lehman Bros. Commercial Corp. v. Minmetals Int'l Non-Ferrous Metals Trading Co., 179 F. Supp.2d 118, 153 (S.D.N.Y. 2000) (citing Whitney v. Citibank, N.A., 782 F.2d 1106, 1115-16 (2d Cir. 1986)). In these cases, there may be sufficient "red flags" to create an issue of material fact as to whether the accused aider and abettor should have known of the breach. Id.*fn7

  Because the record in this cases raises genuine issues of material fact with respect to whether Davis breached a duty he owed to Design, there are also genuine issues of fact with respect to whether the IT Defendants are liable for aiding and abetting Davis's alleged breach. Even assuming that Davis breached a fiduciary duty to Design, the Court finds that there are genuine issues of material fact as to whether the IT Defendants knew of the breach, or substantially assisted in the achievement of the breach. Based upon the record, a reasonable fact-finder could conclude that there were sufficient "red flags" in this case such that the IT Defendants should have investigated Davis's actions in the absence of actual knowledge.

  For example, it is uncontested that the IT Defendants knew that Davis worked for Design when Davis informed them of Contentville and the IT Defendants even asked Davis whether he had any contractual obligation to Design. Also, the record reflects that the IT Defendants gave Davis fifty percent of the total profits from Contentville for the first phase of the project and thirty-five percent of the profits for all subsequent phases, suggesting that Davis's subsequent hiring and compensation by the IT Defendants was a reward for his work in procuring Contentville. Largey and Goullet explain that the compensation paid to Davis from Contentville's profits merely enabled ITWB to meet Davis's compensation demands and were not payment for any assistance on the acquisition of Contentville. (See Largey Aff. at 7; Goullet Dep. at 77-78.) Nevertheless, a rational fact-finder could infer from these promised payments, and the other surrounding circumstances, in particular, the significant amount of time that Davis spent in bringing ITWB and Microsoft together, that the IT Defendants knew or should have known that Davis was breaching his duty to Design.

  Accordingly, the Court denies the parties' motions for summary judgment with respect to Design's claim for aiding and abetting against the IT Defendants, as alleged in count seven of the complaint.

  5. Wrongful Inducement

  Count eight of Design's complaint alleges that the IT Defendants wrongfully induced Davis to breach a fiduciary duty. (See Compl. at ¶ 51.) The grant of summary judgment on this cause of action is precluded for the same reason as Design's aiding and abetting claim, namely, the claim presumes an underlying breach of a fiduciary duty by Davis, which for the reasons discussed above, raises genuine issues of material fact. Accordingly, the parties' motions for summary judgment on Design's claim against the IT Defendants for wrongful inducement is denied.

  6. Conspiracy to Breach a Fiduciary Duty

  Design alleges in count six of the complaint that the Defendants conspired to breach Davis's fiduciary duty to Design. (See Compl. at ¶¶ 44-45.) Under New York law, an action for civil conspiracy is generally not cognizable unless the claim links the defendants to an otherwise actionable tort, i.e., there is an underlying substantive tort that is common to all the defendants. See Alexander & Alexander of New York, Inc. v. Fritzen, 503 N.E.2d 102, 103 (N.Y. 1986). More particularly, in order to prevail on a claim for conspiracy to breach a fiduciary duty, a plaintiff must demonstrate that all members of the alleged conspiracy independently owed a fiduciary duty to the plaintiff. See Official Comm. of Unsecured Creditors v. Donaldson, Lufkin & Jenerette Sec. Corp., No. 00 Civ. 8688, 2002 WL 362794, at *13-14 (S.D.N.Y. March 6, 2002) (dismissing the plaintiff's action for civil conspiracy to breach a fiduciary duty under Federal Rule of Civil Procedure 12(b)(6) because it was not established that all the members of the alleged conspiracy independently owed such a duty to the plaintiff).

  In this case, Design alleges that the Defendants conspired to have Davis breach his fiduciary duty to Design. It is clear, however, that the IT Defendants owed no duty to Design (nor does Design so allege), and thus, Design cannot avail itself of a conspiracy theory against the Defendants. Accordingly, because there is no underlying tort common to all the alleged co-conspirators, Design's claim for civil conspiracy to breach fiduciary duty fails as a matter of law. Moreover, the Court agrees with the IT Defendants that this claim is duplicative of Design's aiding and abetting claim, see id., for which the Court denies summary judgment. Accordingly, the Court grants the Defendants' motions for summary judgement on this claim.

  7. Interference with Employment

  Finally, count nine of the complaint alleges that the IT Defendants materially interfered with Davis's "performance of the terms, conditions and covenants of his employment obligations. . . ." (Compl. at § 54.)*fn8 Such a claim requires that the plaintiff show that: (1) there was a valid contract; (2) the defendant knew of the contract; (3) the defendant intentionally procured its breach; and (4) damages resulted therefrom. See Kronos, Inc. v. AVX Corp., 612 N.E.2d 289, 292 (N.Y. 1993). As discussed above, there is no support in the record for a finding that Davis owed any contractual obligation to Design relating to his employment beyond the implied fiduciary duty discussed above. Thus, the Court finds that there are no genuine issues of material fact with respect to this claim because no reasonable trier of fact could find that, on the present record, Design has demonstrated all the elements of this claim. Accordingly, the Court grants the IT Defendants' motion for summary judgment on this claim. Design may pursue its claims against the IT Defendants for any alleged improper actions in relation to Contentville on the theories of aiding and abetting and inducement to breach a fiduciary duty. III. CONCLUSION

  For the foregoing reasons, the Court concludes that the record in this case raises issues of material fact with regard to whether Contentville was a corporate opportunity for Design, whether Davis breached his fiduciary duty to Design, and whether the IT Defendants knew or should have known about Davis's alleged breach. Accordingly, as discussed above the Court denies Design's motion for summary judgment and denies-and-part and grants-in-part the Defendants' motions for summary judgment.

  IV. ORDER

  For the reasons set forth above, it is hereby

  ORDERED that the motion of plaintiff Design Strategies, Inc. for summary judgment is DENIED in its entirety; and it is further

  ORDERED that the motion of defendant Marc E. Davis for partial summary judgment is GRANTED-in-part and DENIED-in-part. The motion is GRANTED with respect to counts one, three, and six of the complaint in this action for breach of employment agreement and conspiracy to breach a fiduciary duty; and the motion is DENIED with respect to counts two, four, and five for breach of fiduciary duty, unfair competition, and unjust enrichment; and it is further ORDERED that the motion of defendants Info Technologies, Inc., Info Technologies Web Solutions, Inc., and John Goullet for summary judgement is GRANTED-in-part and DENIED-in-part. The motion is GRANTED with respect to counts six and nine of the complaint in this action for conspiracy to breach a fiduciary duty and interference with employment; and the motion is DENIED with respect to the counts seven and eight for aiding and abetting breach of fiduciary duties, and for wrongful inducement to breach fiduciary duties; and it is hereby

  ORDERED that the parties are directed to appear before the Court on June 30, 2004 at 3:00 p.m. for a conference to discuss matters pertaining to the surviving counts in the complaint.

  SO ORDERED.


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