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Mastercraft Decorators Inc. v. Orlando

Trade Secret Theft, Tortious Interference Action Dismissed for Failure to State Claim

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DECISION AND ORDERINTRODUCTION This case involves a dispute between a company, its former employee, and a competing company that hired the former employee. Plaintiff Mastercraft Decorators, Inc., brought this complaint against the former employee, Randy Orlando, and the competing company, Grandstand Glassware and Apparel, alleging eight claims for (1) tortious interference with contract; (2) tortious interference with prospective economic advantage; (3) breach of covenant not to compete; (4) breach of covenant not to solicit; (5) unfair competition; (6) misappropriation of trade secrets and confidential information; (7) defamation and brand tarnishment; and (8) breach of fiduciary duty. ECF No. 1.Defendant Orlando filed a motion to dismiss for failure to state a claim. ECF No. 3. Defendant Grandstand filed a motion to dismiss for lack of jurisdiction and adopted the arguments in Orlando’s motion. ECF No. 7. This order addresses both motions. For the reasons that follow, Mastercraft’s complaint is DISMISSED without prejudice.BACKGROUND1Mastercraft is a custom glassware distributor that is based in New York and does business throughout the United States. ECF No. 1 at 10. Mastercraft employed Orlando as a salesperson for over five years. Id. at 13. At some point during his employment, Orlando moved to Tennessee, but Mastercraft encouraged him to stay on. Id. at 40. Nevertheless, Orlando eventually resigned from Mastercraft and Grandstand hired him as a salesperson. Id. at 13. Grandstand is a Kansas company that is also in the glassware distribution business. Id. at 12. It is a direct competitor of Mastercraft. Id. at 13.Mastercraft alleges that, when Orlando left Mastercraft, he misappropriated its confidential information and trade secrets, including customer lists, and used that information to solicit Mastercraft’s customers to Grandstand. Id. at

14, 17, 32-38. It also alleges that Orlando breached the non-compete and non-solicitation covenants included in Mastercraft’s Employee Handbook, Id. at

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