Lionella Prods., Ltd. v Mironchik

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Lionella Prods., Ltd. v Mironchik 2012 NY Slip Op 31902(U) July 13, 2012 Supr Ct, NY County Docket Number: 108693/08 Judge: Barbara R. Kapnick Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. SCANNED ON 711912012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY PRFSFNT. BARBARA ReKAPNIGK PART I Index Number : IO869312008 LIONELLA PRODUCTIONS, LTD. INDEX NO. vs 31 MOTION DATE MIROPJCHIK, JAMES < Sequence Number : 005 \ ---- SUM MARY J UDGMENT The following papers, numbered 1 to MOTION SEQ. NO. 1 MOTION CAL. NO. were read on this motion to/for Notice of Motion/ Order to Show Cause - Affidavits - Exhibits Answering Affidavits - Exhibits Replying Affidavits Cross-Motion: u Yes No ... I PAPERS NUMBERED Upon the foregoing papers, it is ordered that this motion MOTION I DECIOW IN ACCORDANCE WITH S ACCOMPANYING MEiMORANDUM DECISION Dated: :heck one: fl FINAL DISPOSITION Check if appropriate: ri fl DO NOT POST SUBMIT ORDER/ JUDG. fl REFERENCE SETTLE ORDER/ JUDG. [* 2] SUPREME COURT OF THE STATE OF N E W YORK COUNTY OF N E W YORK: IA PART 39 - - - - - _ l _ l - _ - l - - - - - _ _ - - - - - - - - - _ - _ - - - - - - X LIONELLA PRODUCTIONS, L l D a n d ANDREW RARRET I , DECISION/ORDER I n d e x No. :108693/08 M o t i o n S e q . No. 0 0 5 Plaintiffs, -against- JAMES MTRONCHIK, y [-;~l.-.iirS OH I,j, T h i s a c t i o n arises o u t a Non-Disclosure of Agreement !LE (the A y r e e m c n t ) , s i g n e d on July 6 , 2 0 0 6 , by p l a i n t i - f f Andrew B a r r e t - t ( B a r r e t t ) , a m u s i c s y n t h e s i z e r programmer, c o m p o s e r , orchestrator and Productions, Ltd. ( M i r o r i c h ik ) , an concerned the producer, on behalf 01 plai.ntiff Lionella ( t h e Company ) , a n d d e f e n d a n t James M i r o n c h i k i n d e p e n d e n t contractor. use nf plaintiffs The A g r e e m e n t g e n e r a l l y musi,cal theater synthesizer p r o c e d u r e s a n d m e t h o d o l o g i e s a s u s e d j.n Broadway s h o w s . R a c k q ro und The Agreement p r o v i d e s a s follows: FOR G O O D CONSTDERATION, a n d in c o n s i d e r a t i o n of b e i n g e n g a g e d as an I n d e p e n d e n t C o n t r a c t o r ( C o n t x a c t o r ) from ti.rrie t o t i m e hy 1 , i o n c l l a P r o d u c t i ons L t d . (Company), t h e under:si yned hereby a g r e e s and acknowledges: 1.. arranger, That during the c:(-)i~rse of my engagemerit ( s ) t h c r e may be d i s c l o s e d t:o m e cer-t:ai.n t r a d e s e c r e t s of t . h c Company; s a i d t r a d e secrets c o n 5 : i s t . i . n y b u t not. 1 [* 3] necessarily 1irni.ted to: (a) Technical information: Methods, processes , formulae , composit.ions, i nventi.ons, systems, techniques, machines , comput.er programs and research projects. Prog ramm !rg ii techniques (specifically regard.i.ng the use of PC-based, "Host/Plugiri" programmj.ng), samplc data and programming data. information: C u s tomer data, sources of SUPPlY, L inan c: ia 1 data and c r j marketing, production, merchandising systems or plans. (b) Business lists, pricing 2. I aqrec that I shall not during, or at any time after the termination of my engagement (s) with the Company, use for myself or others, or disclose or divulqe to others including future employees, any t r a d e secrets , corif idential information, or any other proprietary d a t - a of t-hc Company in violation 01 t h i s aqreement. 3. Contractor shall not bid or cornpete I'OL j o b s or contracts with clients or persons introduced to Contractor by Company. 4. PC-ha sed , "Hos t /Plugin" programminq sha 11 not be used by Contractor for live theater proqrarnming jobs without prior written consent from Company. S. Upon termination of my emp1 oyrnent from the Company: (a) I s h a l l rct-urn to the Company all documents arid property of the Company, in :1u t l i 11 g c but not ncccssarily limited t.o: sample d a k a , proqramming methods , drawings , blueprints , report- , s mariua Is, correspondcncc, customer lists, computer, programs, arid a l l other m a t - e r i a l s and all copies thereof 2 [* 4] relating in any way to the Company s business, or l i r i any way provided t.o me by Company. I further aqrce that I shall not retain copies, notcs or a b s t - r a c t s of the foregoing. The Cnrnpany may notify a n y future or prospective employer or third party of the existence of this agreement, and shall be entitled to f u l l injunctive r e l i e f for any breach. ThisAgreement shall be bj.nding upon me and rriy personal representatives and successors in interest, and shall inure to the benefit of the Company, its successors and assigns. This Agreement. shall be governed in accordance w i t h the laws of the State of New York. Mironchik worked a s Rarrett s assistant from July 2006 to February 2007 on two Broadway shows: Sister (California Act Company) and Wicked (Los Angeles Company). On June 29, 2007, almost one year after siqriing the Agreement, Mironchilc wrote the foll.owiriq E-mail to B a r r e tt : Andy : I t r u s t that all is well and t h a t . thinqs are moving forward well for you with Merrndid [ . ] I T ve been asked to w o r k on a project that would include using tihe Olr, en Labs Neko kevboartl. I trust that this would riot violate o u r non-disclosure agreemenb. Could you please confirm this ASAP. l hanky o u . 3 [* 5] On J u n e 3 0 , 2 0 0 7 , R a r r e t t r e s p o n d e d w i t h t h e f o l l o w i n g e - m a i l : H i Jim, P a r a g r a p h 4 of t h e n o n - d i s c l o s u r e a g r e e m e n t you s i . y n e d (7/6/06) says s p e c i f i c a l l y t h a t you a g r e e n o t t:o u s e PC-based h o s t / p l u g i n for l i v e The Open L a b s Neko L h e a t c r programming j o b s . i s b a s i c a 1 l . y a k e y b o a r d w i t h a PC a n d morii tor built in. I f t h e r e s a n y u s e o f p l u q i r i s il: would f a l l u n d e r t.hi.s p a r a g r a p h . Ilowever, i f y o u g i v e m e some d e t a i l s a b o u t t h e s o f t w a r e you i n t e n d t.o u s e a n d t h e d e t a i l s a b o u t t h e p r o d u c t i o n 1 c a n tell you i f t h i s i s s o m e t h i n g t h a t w o u l d r a i s e an i s s u e f o r m e . B e s t Regards , Andy On July 3 , Barrctt, wrote 2007, the Mironchik, in f a l l o w i n g e-mail, response which to states, a call. i n relevant part: H o n e s t l . y , i t seems t h a t w e n e e d t o c l i s c u s s a c h a n g e ho t h e a g r e e m e n t i n t.hat. I c e r t a i n l y do n o t w a n t t o h a v e t o a s k your p e r m i s s i o n e v e r y t i m e I m c o n s i d c r j - n g o r b e i n g c o n s i d e r e d f o r a project w h e r e t h e Neko ( o r some o t h e r s i m i l a r current (:I r future h tl rdw a r e - so f tw a re c o m b i n a t - i o n ) h a s been r e q u e s t e d o r i s b e i n g considered; e i. t h e r by d e sj yne r s , . o r c h e s t r a t o r s , Music: S u p e r v i s o r s , o r anyone i n Lhe m u s i c d e p a r t m e n t o f any g i v e n o r of pr.ocluc(riori, or- f r a n k l y i f I f e e l t h a t a N c k o or Receptor d e v i c e i s worth c o n s i d e r i n g f o r any g i v e n p r o j e c t . A s we a r e t a l k i n g a b o u t c o m m e r c i a l l y a v a i l a b l e hardware and software, t h e r c i s t h e r e f o r c n o t h i n g of a p r o p r i e t a r y n a t u r e o r o t h e r w i s e unique t o your system. Likewi.se, n o t h i n g i n v i o l a t i o n o f a n y c o p y r i q h t . you rniyht own o r t h e us^ o f t r a d e secrets[ . ] T h a v e n o i n t e n t . n o r d e s i r c t-o m i m i c y o u r s e t u p w i t h l a p t o p s , a F i r e b o x , a n d s o f t w a r e , d e s p i he t h e i n d i v i d u a l 4 from [* 6] elements commercial availability. I also long ago realized that it was an Error not t.o include a clause in the agreement yoverni rg commercially available hardware and i s o f t w a r - e (e[ . ] g [ . ] Neko, Receptor, etc) . In retrospect, it. seems that that should have been an obvious exception. I also hope that [.he spiril: of paragraph 1 was to keep a proper control over y o u r r e s e a r c h and development, and that it was riot to bring i i i t o question any future use of an independently developed hardware-software system, however si.mi 1.ar to t.he one that you ve pioneered. Ry e-rnai.1 dated July 5, 2007, Barrett responded to M i . r o r i c h i k , in relevant part, as follows: What you a r e proposing goes to the essence of the contract. You agreed that you w o u l d not use the information or techniques covered by the agreement Lor y o u r s e l f or for others. The contract is specific about this and I urge you not to put yourself in a position where you are in breach. Please be advised that 1 intend to enforce my rights to the full extent of the law. In addition, I will n o t hesitate to contact your employer a n d advise them of the existence of our agreement and their pot-entia1 liability in hirinq you. However, as stated in paragraph 4, I will c o n s i d e r sanctioning j o b s where you want to use this technoloqy on a case by case basis. Under no circumstances wi 1 1 I c o n s icler reneqot.iatiny ouz contract. The Verified Cornplaint, dated May 29, 2008, (the Complaint ) alleyes that Mironchik violated the Agreement. by allegedly disclosing conf identj a 1 proprietary information to Randy Cohcn , ( Cohen ) one of the Company s chief competitors, and by unfairly 5 [* 7] competing for obt-ained. Accordingly, the Complaint sets forth causes of action jobs that the Company should have rightfully breach of t . h e Agreement (first cause o f action) ; an accounting (second cause of action) ; a permanent: injunction enjoining defendant from (a) using plaintiffs trade trade secrets to secrets, (b) divulging third parties; plaintiffs (c) competing with plaintiffs for contracts with plaintiff-s clients, and (d) using PC-based H o s t - P I u g i . n programming ¬or live t - h e a t e r programming jobs without. prior written consent (third cause o f action) ; compensatory and punitive damages for unfair competition i n violation of the Lanham Act (28 USC § 1338) (fourth cause of action); and prospective intentional interference with plaintiffs business opportunities with clients in music, t h e a t e r and entertainment industries, incl u d i ng music programming for Broadway musicals synthesizer (fif t . h cause oE acti.un) . By Decision/Order dated June 7, 2010 (motion s e q . no. 004), this Court granted defendant. m o t . i . o r i for partial surrirnar y j n d g m e n t s to thc cxt-cnt. of d i s m i s s i n g t.he t.hi,r.d c;~use of artion for a . , . [* 8] permanent jr-ijunct.ion. T h a t p o r t i o n of t h e m o L i o n w h i c h s o u g h t t o d i s m i s s t h e first cause o f a c t i o n f o r b r e a c h of t h c A g r e e m e n t was d e n i e d a s prerriaturc! w i . t h l e a v e t o renew, i f deemed a p p r o p r i a t e , a f t e r t h e c o m p l e t i o n o f discovery. Depositioris of both Barrett and Mironchik have now been conducted and t h e p a r t i e s have exchanged a d d ] - t i o n a l documcnts . Mironchilc now moves for a n o r d e r , pursuant to CPLR 3212, g r a n t . i rig h i m summary j u d g m e n t d i s m i s s i n g p l a i n b - i f r s Cornpla i n t i n i t s e n t i r e t y on the grounds t h a t t h e Agreement i s d e f e c t i v e a n d incapable of b e i n g c o r r e c t e d . Discussion A movant s e e k i n g summary j u d g m e n t must make a prj.ma f a c i c showing o f e n t i t l e r n e n t t o judgment a s ; j mat.t.cr o f l a w , tendering s u f f i c i e n l i e v i d e n c e t o e l - i m i n a t e a n y m a t e r i a l i s s u e s of f a c t from the case. W i n e g r a d v . N e w Y o r k U n i v . Med. Ctr., 64 NY2d 851, 853 (1985) (int.erna1 c i t a t i o n omitted). Once t h i s s h o w i n g i s madc, t h e b u r d e n s h i f t s t o the oppu.r;i.rig p 3 r t . y t.o p r o d u c e e v i d e n t : i a r y proof i n T h e C o u r t n o t e s t h a t t h e N o t e 0.f Issue h a s n o t y e t b e e n t i l e d a n d t h a t c o u n s e l f o r p l a i n t i f f a r q u e d on t h e r e c o r d tihat he d i d n o t b e l i e v e d i s c o v e r y was c o m p l e t e b e c a u s e t h e r e a r e s t i l l ou t s t - a r i d i n q document demands a n d b e c a u s e he w a r i t s t o d e p o s e nonp3r:t.y M r . Cohcn, a l t h o u g h i t d o e s no[: a p p e a r t h a t Randy Cohen was eveL subpoenaed. 7 [* 9] a d m i s s i b l e f o r m s u f L i c i e n t t o e s t a b l i s h t h e e x i s t e n c e of t r i a b l e issues o f fact. Mere conclusions, expressions of unsubstantiated allegations are insufficient t o defeat judgment m o t i o n . hope d and summary Zuckerman v . C'ity of N e w Y o r k , 49 N Y 2 d 557, 562 (1980). F i r s t C a u s e o.f Action .- B r e a c h of C o n t r a c t D e f e n d a n t a r g u e s i n t h e f i r s t . i n s t a n c e t h a t t h e Agreemerit. i s per se u n r e a s o n a b l e b e c a u s e it c o n t a i n s a b s o l u t e l y n o t i m e o r geographic l i m i t a t i o n s , e.g., and i s , t h e r e f o r e , u n e n f o r c e a b l e . ' Good C ' n e r g y , L.P. v . See, Kosachuk, 4 9 AD3d 331, 332 (1''' D e p ' t 2008); G a r f i n k l e v . P f i z e r , Inc., 162 A D Z d 1 9 7 (1" Dep'k 1 9 9 0 ) . Plaintiffs, on t h e o t h e r hand, urge t h a t r e a s o n a b l e and e n f o r c e a b l e and o n l y needs t h e Agreement i s this Court t o "blue- pencil" t h e A q r e e m c n t t o i n c l u d e a t i m e r e s t - r i c t i o n . Plaintiffs suggest t h a t a t h r e e ( 3 ) y e a r p e r i o d b e imposed a n d t h a t t h e lack of a y e o q r a p h i c l i m i t i s r e a s o n a b l e b e c a u s e l i v c t h e a t e r spans t h e globe, ,' T h e r e c a n be n o d i s p u t e t h a t . t h e Agreerrient is: s i l e n t as to t h e t i m c a n d g e o g r a p h i c : 1 i m i t a t . i o r i s o f Lhe r e s t r i c t i v e c o v e n a n t ; t h i s was c u n f i rmed b y B a r r e t . t . , who t e s t i f i e d d u r i n g kiis d e p o s i t i o n t h a t tie d i d n o t .specj Fy t-ime or placc r e s t r - i c t - i o n s i n t h e Agreement. ( B a r r e t t Dep. 108:2-9, Aug. 1 2 , 2 0 1 0 . ) Barrett a l s o t e s t i f i e d Lhat h e p r e p a r e d t h e Agreement without.. tihe (Barr-ett Dep. 58:'/-59:16.) a s s i s t a n c e (if c o u n s e l . 8 [* 10] In reply, Court to u s e defendant j.ts argues there is no basis Lhat j u d i c i a l blue p e n c i l t o insert f o r the an a r b i t r a r y t h r e e ( 3 ) year. t i m e r e s t r i c t i o n , or t o u p h o l d t h e p u r p o r t e d g l o b a l r e a c h of t h e Agreement. Generally negative covenants enforceable only t o t h e extent requirement of r e a s o n a b l e n e s s . restricting compe :ition a r e t h a t t h e y s a t i s f y t h e o v e Iz i di ng Reed, R o b e r t s Assoc. v I Strauman, 40 NY2d 303, 30 7 (1976). The m o d e r n , p r e v a i l i n g common-law s t . a n d a r d o f r e a s o n a b l e n e s s f o r empl-oyee a g r e e m e n t s no[. t o compelie a p p l i e s a t h r e e - p r o n q e d t e s t . A r e s t r a i n t i s r e a s o n a b l e only if i t : (1) i s n o g r c a t e r t h a n i s r e q u i r e d for t h e p r o t e c t i . o n o f t h e l e g i t i m a t e interest o f t h e e m p l o y e r , ( 2 ) does not. impose u n d u e h a r d s h i p on tihe cmpl.oyee, and ( 3 ) i s n o t i n j u r i o u s t o t h e public. A violation of any prong renders t h e covenant invalid. BDO S e . i d r r ~ a t ~v. H i r - s h b e r g , supplied) 93 NY2d (int-ernal c i t a t i o n s omitted) New 382, 388 (1999) ( e m p h a s i s . York has adopted t.his p r e v a i l i n g s t . a n d a r d 01 r e a s o n a b l e n e s s i n d e t e r m i n i n y Lhe v a l i c l i - t y of employee agrecment.s not to compete. In t h i s c o n t e x t . a r e s t r i c t i v e c o v e n a n t w i l l . o n l y b e s u b j e c t . t.o s p e c i f i c to the extent t:tiat it is enforcement r e a s o n a b l e i n t i m e arid a r e a , n e c e s s a r y t o p r o t e c t t h e e m p l o y e r s 1.egit.iInate i n t . e r e s t s , n o t h a r m ¬ u l t o t.he g e n e r a l p u b l i c a n d n o L u n r e a s o n a b l y burdensome t o thc! employee I Td. ( q u o t i n g Reed, Ruberts ASSOC., 4 0 N Y 2 d a t 307). 9 [* 11] Here, t h e Court f i n d s t h a t t h e l a c k o f a n y time r e s t r i c t i o n i n the Agreement is unreasonable. See, e . g . , EasthWeb, .Tnc. v. S c l - ] l a c k , 71 FSupp2d 299, 313 (SDNY 1999) ( h o l d i n g t h a t a o n c - y e a r d u r a t - i o n of a r e s t r i c t i v e covenant i s t o o long g i v e n t h e f a s t paced nature of the Internet technology industry and its lack of g e o g r a p h i c a l b o r d e r s ) , aff'd, 2 0 0 0 WL 1093320 (2d Cir-.;2000), T h i s i s e s p e c i a l l y t r u e i n light o f p a r a g r a p h 4 o f t h e A g r e e m e n t , w h i c h purport:^ to p e r m a n e n t l y b u r d e n M i r o n c h i k w i t h t h e t a s k o f s e e k i n g and o b t a i n i n g p r i o r w r i t t e n c o n s e n t from B a r r e t t b e f o r e e v e r u s i r i y a n y PC:-based, h o s t / p l u g i n programming i n l i v e t h e a t e r programming. N e v e r t h e l e s s , t h e Court must s t i l l c o n s i d e r w h e t h e r i t h a s t h e power t o p a r t i a l l y e n f o r c e t . h e o v e r 1 y - b r o a d r e s t - r i c t i v e covenant BDO Seidziiai7, 9 3 N Y 2 d a t 394-95; K a r p i n s k i v . I n g r a s c i , 28 N Y 2 d 4 5 , 51-52 (1971). 'The C o u r t o f A p p e a l s h a s described t h i s j u d i c i a l power a s f o l l o w s : The i s s u e o f w h e t h e r a c o u r t should c u r e the u n r e a s o n a b l e a s p e c t of a n o v e r b r o a d e m p l o y e e restrictive c o v e n a n t t h r o u g h t h e means o f p a r t i a l e n I o r c e m e n t or s c v c r a n c e h a s bccn t h e subject o f some d e b a t e among c o u r t s a n d commen t a t l o r s . A 1egit.irnate c o n s i d e r a t i o n a g a i n s t : t h e e x e r c i s e o f t h i s power i s t h e f e a r w i l l use thcir superi.or that employers b a r g a i n i n g p o s i t i o n t.o impose u n r e a s o n a b l e a n t i - cornpe t i t i v e r e s t ric t i on s , un irill ri b i t e d b y t h e r i s k t . h a t a court w i . 1 1 v o i d t h e e n t i r e a g r e e m e n t , l e a v i n g t h e employee f r e e o f a n y restraint. The prevailing, rnocle r r i view rejects a per :<e r u l e t . h a t irivalidaLes e n t i r e l y a n y o v e r b r o a d empl o y e e aqreernent. ric) t t o compete. I n s t e a d , when, as [ i n BDU 10 [* 12] Seidman], t h e unenforceable p o r t i o n i s not an e s s e n t i a l p a r t of t h e a g r e e d exchange, a court. s h o u l d c o n d u c t a case s p e c i l l i c a n a l y s i s , f o c u s i n g on t h e c o n d u c t o f t h e e m p l o y e r i n Under i m p o s i n g t-he tcrms o f t h e a g r e e m e n t . t h i s a p p r o a c h , i f t.he e m p l o y e r d e m o n s t r a t e s a n absence of o v c r r e a c h i n g , c o e r c i v e u s e o f dominant b a r g a i n i n g power, or other antic o m p e t i t i v c m i s c o n d u c t , b u t h a s i n good f a i t h t o p r o t e c t a 1egit.imate business sought interest, consistent with reasonable standards o f f a i r d e a l i n g , p a r t i a l e n f o r c e m e n t may be justified. BDO S e i d m a n , 93 N Y 2 d at; 394 ( i n t e r n a l c i t a t i o n s o m i t t e d ) . Whether t h e u n e n f o r c e a b l e p o r t i o n i s dn e s s e n t i a l p a r t of t h e a g r e e d excharlye d e p e n d s on i t s r c l a t i v e i m p o r t a n c e i n t h e l i q h t o f t h e e n t i r e agreement between t h e p a r t i e s . A l t a i r Invs. NA, LLC, 5 9 AD3d 9 7 , 106 (1 D e p t 2 0 0 8 ) c i t a t i o n o m i t t e d ) , aff d as m o d i f i e d , 1 4 N Y 3 d 7 7 4 I n Ashland Management, Inc. v. A s h l a r ~ dM g t . (internal (2010). the Court found t h a t \ \ t h e e s s e n t i a l p a r t o f t h e a g r e e m e n t s is n o t t . h e i r d u r a t i o n b u t t h e p r o h i b i t i o n ayain5:t u s i n q , c o p y i n g o r removing c o n f i d e n t i a l i n f o r m a t i o n . a t 106. Here t o o , Id. tihe esseniiai p a r t of t h e Agreement i s n o t i t s d u r a t i o n o r l a c k t h e r e o f , b u t t h e p r o h i b i t i o n a g a i n s t u s i n g a n y PCbased, host/plugin Therefore, programming whi 1e working s i n c e t.he u n e n f o r c e a b l e p o r t i o n of in live theat-er. [.he A g r e e m e n t (the u n l i m i t e d time d u r a t . i o n ) i s n o t e s s e n t i a l . , t h e C o u r t can go on t.o dekermine whether p a r t i a l enforcement i s j u s t - i f i e d h e r e . 3. 1 [* 13] In BDO S e i d m a n , Lhe C o u r t o f Appeals d e s c r i b e d the f a c t o r s t h a t w e i g h i n favor- o f p a r t i a l e n f - o r c e m e n t : Here, t h e undisputed f a c t s a n d c i r c u m s t a n c e s r n i l l i t a t e i n favor of p a r t i a l e n f o r . c e m e n t . The c o v e n a n t was n o t i m p o s e d a s a c o n d i t i o n o f d e f e n d a n t s i n i . t i a l e m p l o y m e n t , or e v e n h i s c o n t i n u e d e m p l o y m e n t , but i n c o n n e c t i o n wi.t.1-1 p r o m o t i o n t o a p o s i t i o n o f r e s p o n s i b i l i t y and t r u s t j u s t o n e s t e p below a d m i t t a n c e t o t h e p a r t n e r s h i p . T h e r e i s no e v i d e n c e 01 c o e r c i o n or t h a t t h e M a n a g e r s Agreement was p a r t . o f somc g e n e r a l p l a n t o f o r e s t a l l c o m p e t i t i o n . M o r e o v e r , no p r o o f was s u b m i t t e d t h d t BDO i m p o s e d t h e c o v e n a n t i n bad f a i t h , knowing ¬ u l l well t h a t i t was o v e r b r o a d . BDO S e i d m a n , 9 3 N Y 2 d a t 395. On t h e o t h e r h a n d , [ f ] a c t o r s weighing a g a i n s t p a r t i a l enforcement are t.he i m p o s i t i o n of the covenant in c o n n e c t i o n w i t h h i r i n y o r c o n t i n u e d employment as o p p o s e d t o , f o r e x a m p l e , i m p c i s i t - i o n i n c o n n e c t i o n wj.tI-1 a p r o m o t i o n t o a p o s i t i o n o f r e s p o n s i b i l . i t y and t r u s t - t h e e x i s t e n c e of c o e r c i o n o r a g e n e r a l p l a n of t h e employer t o f o r e s t a l . 1 compctit-ion, and t h c employer s knowledge t h a t t h e c o v e n a n t was o v e r l y b r o a d . S c o t t , Stackrow ( 3 d Dep t Ciocia, & Cu., C . P . A . s P.C. v. S k a v i n a , 9 AD3d 8 0 5 , 807 2004), Iv. d e n . , 3 N Y 3 d 612 (2004); see a l s o G i l m a n CC v. R a n d e l l o , Inc. 55 AD3d 871, 872 (2d Dep C 2008) ( a f f i r m i n g lower c o u r t s r e f u s a l t o p a r t i a1 1.y e n f o r c e r e s t - r - i c t l i v e covenant where overreac:hing, employer failed to t h e c o e r c i v e use o f rlernonsI_rat:e t h e absence of clominanL b a r g a i n i n g power, or o t h e r a n t i c o r n p e t i . t i v e m i s c o n d u c t ) ; F r i l l m a n v . R&G Brenrier Income 12 [* 14] Tax C o r i s u l t a n t s , 24 M i s c . 3d 1214 (A), at "6 ( S u p Ct, NY Co 2009) (finding a restrictive covenant to be the produck of superior bargaining power when it was a conditi-on of initj-al employment); K a n a n , C o r b i n , Schupak & Aronow, Inc. v. FD InLerriationa.1, Ltd., 8 Misc. 3d 41.2, 418-19 (Sup Ct, NY Co 2005). Ilere, it is undispuked that. t h e Agreement was s i g n e d as a In fact, when a s k e d about the signing of condition of ernployment. the Agreement at deposit-ion, Barrett his testified following Q: You wouldn't have given somebody a nondisclosure agreement unless you h i r e d them, right? A: I wou1.d not. Q: Okay. So if he s i . y n e d the nondisclosure agreement - A: I was contemplating hir-iny him. (2 : You were c o n t e m p l a t i n g ? A: Right. Wc had a separate agreement for the empl oyment. Q: You had a emp 1. ymen t o separat-e contract Ihan : . thc for his IIon c l i sc 1osu re ? A: That's correct. Q: Is it your test-imony that Mr-. Mironchik signed the nondi sclosure cant-ract b e f o r e you actually hired him to do a job'? A: T believe that.'s corrcct . Q: If Mr. Mironctiik nondisclosure hadn't aqrccment, 13 si.yned you the wouldn' t to the [* 15] have h i r e d him; is that correcL? A: That: is absolutely correct. Q: At the meeting A: I want to clarify. -- well, how did you -- I would riot have told him a n y information about what I do if he had not signed nondiscl osure the agrcernen t . Q: Thank you. I understand. The qucstion, though, was, you would not hdve hired him? Which clearly, you would n o t havc, if A: would I riot have spoken to him professionally. Q: You wouldn't have t o l d h i m anything clbout -- A: If I - - Q: Let: sorry. me finish. I ' m have You wouldn't talked with him about: synthesizer programming unless he signed a nondi sclosure agreement? A: 'That' s correct. (Barrett Dep. 71:16-73:10, Aug 12, 2010.) Mironchik also tesLified d u r i n g h i s deposition that he had to s i g n [.he Agreement as a condiI.ion of h i s employment: 12: So you under::tood signed it - that if you hadn' t - Mr. Mars: He's not. done. Q: - - if y o u hadn't s-igned this, t h e n this information w o u l d not h a v e been d i s c l o s e d to y o u ? 14 [* 16] A: I would n o t h a v e worked w i t h y o u r c l i e n t , a n d I n e e d e d work a t t h e time. CT: Right. So'? * * Q: (colloquy) * i , s , when you n e e d e d t h e So t h e q u e s t i o n work; i s t h a t c o r r e c t ? A: Uh-huh. Q: A t the ti.me? A: Yes. a: And you signed this agreement knowing t - h a t my client would n o t h a v e g i v e n you the work if you didn't sign the agreement? A: I t was a c o n d i t i o n of employment. Q: Okay. And you a g r e e d t o the c o n d i t i o n s o f employment i n exchange f o r g e t t i n g t h e employment. ? A: Yes. ( M i r o n c h i k Dep. 148:24-150:13, Aug 1 3 , 2 0 1 0 . ) I t i s a l s o clear t h a t t h e Aqreernent was p a r t o f p l a i n t i f f s ' "cjencral p l a n Q: . . . to forestall c o m p e t i t . i o n : " Would i t be f a i r to s a y t h a t you don't talk t.o anybody programming about unless they synthesizer sign a n nndi s c1o s u r e a g r E:emen t ? Mr. Ben-Zvi: Well, car1 w e have a t i m c f r a m e on [ . h i s ' ? Mr.. Mars: A t t h e p o i n t i n time t h a t he h i r e d M r . Mironc:hi k . [* 17] A: At that point in tire :ri, I was really interested in protecting the methods that I came up with, because 1 knew that, eventually, t . h c y were going to come out. People wou1.d learn just by performi.rig on them and l o o k i n g at the software. They'd be a b l e to eventually figure out or maybe figure out: for later. Rut at that point in time, nobody had -- themselves I h a d no competition. sooner or Nobody had figured out how to compete with me on that level. Q: That's 2006? A: So I -- yeah. So I was very interested in protecting what I knew. Now i t ' s a different story. (Barrett Dep. 73 : 11-'74 : 11.) Here, unlike the case in BL)O Seidman, cir-c:ums t-ancesweigh against partial enforcement the facts antl since the covenant was imposed as a condition of defendant's initial employment, not. in connection with a promotion to a position of responsibiliLy or trust, and t.here i,s evidence that the Agreement was part. of a general plan to f o r e s t a l l competition. Moreover, there is a l s o evi d e n c e that plaintiffs imposcd t.he covenant in bad f a i t - t i , when BarrelI. chose n o k to place a t-irne limitation or1 t.he coveliarit (Barrett Dep. 1 O R : 2-9) , despi t.e knowing that the inforrriaIlion he souqht t.o p r o l - e c l would e v e n L u a l l y become lcnown in the industry. 16 [* 18] ( B a r re t :L Dep . 73 : 1 1- 7 4 : 11 . ) A c c o r d i n g 1 y, defendant s motj.on f-or summary judgment d i s m i s s i n g t h e f i r s t c a u s e of a c t i o n i s g r a n t e d . Second Cause of A c t i o n - Accounting4 T h e e x i s t e n c e of a f i d u c i a r y r e l a t i o n s h i p i s e s s e n t i a l f o r a c a u s e o f a c t i o n i n e q u i t y f o r a n a c c o u n t i n g a r j . . c i n g out. o f c o n t r a c t . between t h e p a r t i c s , the W a 1 d n a n v . Enylishtown S p r t s w c a r , 92 A D 2 d 8 3 3 , 835 (l:3 . Dep t 1 9 8 3 ) . . T h e C o u r t notes t h a t d e r e n d a n t also a r g u e d t h a t e v e n i f t h e Agreement c o u l d be p a r t j . a l l y e n f o r c e d , t h e i n f o r m a t i o n a n d t e c h n i q u e s t h a t p l a i n t i f f s s e e k t o p r o t e c t . from d i s c l o s u r e a r e n o t a c t u a l l y s u b j e c t t o p r o t e c t i o n b e c a u s e t h e y were riot a c t u a l l y secret. S e e Leo S i l f - e n , I n c . v. C r e a m , 29 N Y 2 d 387, 392-93 (1.972) ( h o l d i n g t h a t i n o r d e r f o r m a t e r i a l o r i . n f o r m a t . i o n i m p a r t . e d t o a n e m p l o y e e d u r i n g t h e c o u r s e o f h i s o r her employment t o be e n t i t l e d t o t r a d e s e c r e t p r o t e c t i o n , i t must. not be r e a d j ly a v a i l a b l e t h r o u g h p u b l i c s o u r c e s ) . D e f e n d a n t a l - s o a r g u e s t - h a t e v e n a s s u m i n g t h i s i n f o r m a t - io n was e n t i t l e d t o t r a d e secreL p r o t c c t . j . o n , L h e r c i s no e v i d e n c e that h e s h a r e d or u s e d t h a t i n f o r m a t i o n when h e was e m p l o y e d b y Cohen t.o w o r k on t h e S e a t t - l e a n d Broadway p r o d u c t i o n s o f Y o u n g Franker~stein. Furthermore, d e f e n d a n t a r g u e s t.hat t h e r e i s no e v i d e n c e Lhat h e s h a r e d o r u s e d a n y of t h i s i n f o r m a t i o n w h i l e w o r k i . r i y on a n y i n d e p e n d e n t . p ~ - o j t s . ec T h e Court., h o w e v e r , n e e d riot r e a c h t h e s e i s s u e s s i n c e i t h a s a l r e a d y f o u n d t h a t - t.hc Aqr-eement i s o v e r l y broad a n d c a n n o t . b e p a r t i a l l y enforced. The C o u r t n o t e s t h a t n e i t h c r p a r t y s p e c i f i c a l l y a d d r e s s e d t h i s cause of a c t i o n i n t h e i r b r i e f i n g . 17 [* 19] Here, t.he C o m p l a i n t f a i l s t o e v e n a l l e g e t h e n a t u r e o f r e q u i s i t e f i d u c i a r y relati.onship, the and t h e c a u s e of a c t i o n f o r an a c c o u n t i n g m u s t a l s o f a i l b e c a u s e t h e C o u r t has a l r e a d y held t h a t t h e Agreement b e t w e e n t h e p a r t i e s i s riot e n f o r c e a b l e . Fourtl-1 C d u s e of A c t i o n Plainti ¬fs \ - V i o l a t i o n of t h e Laiiharn A c t in p a r a g r a p h allege [ d l e f e n d a n t has v i o l a t e d Act, 28 U.S.C. Section 77 [ p ]l a i n t i f f s 1338 by of the Complaint r i g h t s under unfairly that t h e Lanham competing with [ p ]l a i n t i f f s . First o ¬ a l l , b o t h t h e C o m p l a i n t and t h e m o t i o n p a p e r s c i t e t o 28 USC 1 3 3 8 w h e n r e f e r r i n g t o t h e Lanham A c t . of the United States Code deals with However, T i t l e 2 8 Judiciary and J u d i c . i a 1 P r o c e d u r e ( i. e . j u r i s d i , c t i o n ) i n c a s e s c o n c e r n i n g p a t e n t s , p l a n t variety protection, and unfair copyrights, competition. mask works, The Lanham designs, Trade-Mark trademarks, Act or Trademark A c t o f 1 9 4 6 , p o p u l a r l y r e f e r r e d t o a s Lhe Lanharn A c t , the is c o d i f i e d b y 1 5 U.S.C. 1051 to 1072, 1091 t.o 1096, 1113. t o 1 1 2 7 , 1 1 4 1 , a n d 1141a t o 1 1 4 1 n . No(: o n l y do p l a i n t - i f f - s f a i l to c i t e t o a s i n g l e sec:t.ion o f tihe Lanham A c t , t h e y also f a i l t o cveri a r g u e I . h a t u n f a i r . corripeLi1:ion i s a c t i o n a b l e u n d e r the Lanham A c t . . 18 A s polint..ed o u t b y t h e C o u r t i n [* 20] G l e n n v. A d v e r t i s i n g P u b 1 i c a t i o n s , I n c . , 251 FSupp 889, 901 (SDNY 1966) : The Lanham Act relates to trade marks. In its concluding sentence it refers to unfair 15 U . S . C . 5 1127 states: The competition. jntent of t h i s chapt-er is t:o regulate commerce within the control. of Congress by making actionab1.e the decepkive and misleading use of marks i.ri such commerce; to protect registered marks u s e d i n such commerce f r o m interference by 2tat.e or territorial legislation; to protect persons engaged in such commerce aqai.rist unfair competition; t o prevent fraud and deception in such commerce by the use of reproductions, copies , counLerfeits , or colorable imitations of registered marks; and to provide rights and remedies stipulated by treaties and conventions respecting t r a d e marks, trade names, and unfair competition entered into between the United States and The phrase to protect foreign nations. persons engaged iri s u c h commerce against unfair competition inserted in the middle of this sentence does n o t , in a n d of itself, create a general federal law of unfair competition in interstate commerce. This general language must be attributed to a p a r t i c u l a r s e c t i o n of the Act. (emphasis added) (intcrnal citations omil:ted) . Here, plaintiffs not only f a i l to de1incat.e which section of the L,tlriham Act. they may be relying on, b u t they also fail to even identify eillher a regist.ered or unrcgistered trademark that plaintiffs may wish to prot.ect f r o m defendant s alleged unfair competition. Accor-(jingly,t.he 1Tourth cause uf action f o r violation of t.he Lanham Act m u s t he di,srriissed. [* 21] F i f t h C a u s e of Action Business R e l a t i o n s recquircd The - Tortious Interference w i t h elements of a cause action of Prospective for t o r t i o u s interference with prospective business r e l a t i o n s arc a s follows: ( 3 . ) t h a t p l a i n t i f f had a b u s i n e s s r e l a t i o n w i t h a t h i r d p a r t y ; that: defendant interfered knew with it; the of relationship ( 3 ) that. t h e defendant (2) intentionally arid acted s o l e l y out of m a l i c e o r u s e d i m p r o p e r means: t o harm t h e p l a i n t i - f f ; a n d ( 4 ) t h a t defendant s relat-ionship. interference caused injury to the business See A m a r a n t h L L C v. 3. P. M o r g a n Chase & C o . , 71 AD3d 40, 47 (1:jt Dep t 2009). D e f e n d a n t a r g u e s t h a t t h i s c a u s e o f a c t j o n m u s t he d i s m i s s e d b e c a u s e w h e n a s k e d i n h i s d e p o s i t i o n a b o u t t h e basis of t h i s c l a i m , B a r r e t t r e s p o n d e d a s follows: 0: Okay. Take a look a t Page 117 of your Veri f i e d C o m p l - a i n t . A: Okay. F i f t h c a u s e o f a c t i o n ? Q: That s correct. Paragraph 83. Defendant has been directly and PlaintifII s b u .5: i n e s s cont.j.riues knowing 1y clients with and to It says, no P 1 i r-i t i II f a t.o encourage longer or do u:; e P l a i n t i f f s services. Other today, than what. what you v e evidence supports t h a t . c l a i m ? do testified here you thah have [* 22] A: T d o n t h a v e knowledge of a n y t h i n g . Q: Paragraph 8 4 . Defendant i s i n t e n t - i o n a l l y interfcring with Plaintiff s business o p p o r t u n i t i e s wit.h s a i d c l i e n t s . O t h c r t h a n w h a t y o u v e t e s t i - f i e d t.o h e r e today, a d d i t i o n a l e v i d e n c e do you what have t h a t s u p p o r t s t h a t content ion? A: I would s a y i t h a s t o be c h a r a c t e r i z e d a s conjecture. ( B a r r e t t n e p . 212:9-213:4.) When q u e s t i o n e d o n t h e same t o p i c b y h i s own a t t o r n e y , B a r r e t t offered t h i s testimony: Q: M r . B a r r e t t , do you r e c a l l t h e s e r i e s o f questions were that askcd of you regarding t h e al.legations of interference on the part the of Defendant i n y o u r contractual relations? A: Yes. Q: D o you r e c a l l y o u r a n s w e r a t t . h c t i m e t o t h c Defendant s a t t o r n e y ? A: Yes. 0: Now, i s t h e r e a n y c l a r i - f i c a t j o n that you w a n t t.o make r e g a r d i n g y o u r a n s w e r ? A: Yes. M r . Mars: I m ohje(:t:iny Lo t h i s l i n e o f t-estimony, b e i n g t h a t h e a l r e a d y answered it, and I t h i n k havinq a c l a r i f i . c a t i o n t o y e t your c l i e n t t o c h a n g e h i s t e s t i m o n y i s impr-oper.. Mr. Ben-Zvi: 21 Not to change his [* 23] test-imony. that you were You battered so e f f e c t i v e into him an i n c o r r e c t answer-. Mr. Mars: asserting Again, Oh, okay. my objection ¬or I m the record. 12: You c a n a n s w e r . A: T h e r e were several o t h e r i n s t a n c e s t h a t your c l i e n t i n t e r f e r e d w i t h my b u s i n e s s , where he violated Lhese involved the use of contract. an And instrument c a l l e d a muse r e c e p t o r . E or i n s t a n c e , on a show c a l l e d I n t h e H c i g h t s , I spoke t o an o r c h e s t r a t o r w h o worked o n t h a t show, a n d h e c o n f i r m e d t h a t t . h i s i n u s e r e c e p t o r was u s e d on t h e show. And a m u s e r e c e p t o r i s a c o m p u t e r as w e l l , just a s we ve b e e n d i s c u s s i n g Windows-based compu t e r s , Macintosh-based computers. . . . Apple, (BarreLt Dep. 2 1 6 : 9-217 : 22. ) It i.s clear that plaintiffs cannot sustain a claim t o r t . i o u s i n t e r f e r e n c e with p r o s p e c t i v e b u s i n e s s r e l a t i o n s . for Aside f r o m a d m i t t i r i g t h a t t h e a l l e y a l . i o n s i n t h e C o m p l a i n t were based on p l a i n t i f Ls o f - f e r no ot.her- e v i d e n c e conjecture, claim. defendant required In any event, act.cd o u t e l ernent of plaintiffs of m a l i c e a claim or fai.led t.o improper for, t o r t i o u : - ; 22 Lo support t h e i r even means, allege which interfcrcnce that is a wit:h [* 24] prospective business relations. Accordingly, the L i f t 1 1 cause of acl:ion must be di.srnj.ssed. Counsel f o r botlh parties shall appear f o r a conference in IA Part 3 3 , 60 Centre St. d i sc:uss how - they want Room 208 on August 8, 2012 at 10:30am to to proceed wi th defendant s defamation counterclaims. \ J. s . c * 23

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