United States District Court, E.D. Virginia, Richmond Division
MEMORANDUM OPINION (DENYING DEFENDANT'S MOTION TO
E. Hudson United States District Judge.
MATTER is before the Court on Defendant Marcelo S.
Cuellar's Motion to Dismiss Pursuant to Federal Rule of
Civil Procedure 12(b)(6), filed on December 29, 2016. (ECF
No. 8.) Both parties have filed memoranda supporting their
respective positions. Oral argument followed on February 8,
reasons stated herein, the Court will deny the Motion.
required by Rule 12(b)(6) of the Federal Rules of Civil
Procedure, the Court assumes Plaintiffs well-pleaded
allegations to be true and views all facts in the light most
favorable to him. T.G. Slater & Son v. Donald P.
& Patricia A. Brennan LLC, 385 F.3d 836, 841 (4th
Cir. 2004) (citing Mylan Labs, Inc. v. Matkari, 7
F.3d 1130, 1134 (4th Cir. 1993)). At this stage, the
Court's analysis is both informed and constrained by the
four corners of Plaintiff s Complaint. Viewed through this
lens, the facts are as follows.
Estes Forwarding Worldwide LLC ("EFW"), a Virginia
citizen, is a transportation logistics company. (Compl.
¶¶ 3, 5, ECF No. 1.) For many of its shipments, EFW
relies on "at least three different vendors: a vendor to
pick up the shipment from the customer and deliver it to the
airport, a vendor to transport the shipment from airport to
airport, and a vendor to transport the shipment from the
airport to the delivery address." (Id. ¶
7.) EFW has "invested significant time and expense, and
years' worth of trial, error, and experience into its
decision-making processes for determining the best
transportation solution for any particular shipment, "
which constitutes trade secrets. (Id. ¶ 10.)
These trade secrets "are memorialized at EFW in
spreadsheets and other computer information that reflect the
decisions EFW has made when choosing transportation solutions
for shipments, which information includes shipment
information, type of freight and freight dimensions, routing
decisions, vendor selection, vendor costs, and transit
times." (Id. ¶ 11.)
early 2010, EFW hired Cuellar to work in its new operations
unit in the San Francisco area. (Id. ¶ 18.) In
connection with his hiring, EFW required Cuellar to sign a
Confidentiality Agreement wherein he "agreed to protect
EFW's confidential information, which included
information regarding EFW's suppliers, the details of the
manner in which EFW conducts its business, pricing and
billing information, work in process, computer data, and
financial information." (Id; see also Id. Ex.
certain restrictions placed upon EFW by a customer, EFW was
not permitted to install its own IT infrastructure on-site at
its customer's location in San Francisco. (See
Id. ¶ 20.) Therefore, EFW "needed an alternate
way for [its] representatives to share information about
shipments from the location." (Id.) Filling
this void would serve two purposes: (1) it would allow
"EFW representatives to communicate regarding each and
every shipment, thereby ensuring the shipment would be
delivered in accordance with the customer's
requirements"; and (2) it would facilitate
"recording shipment details, routing decisions, vendor
selection, costs, and other shipment information further
developed EFW's trade secrets." (Id. ¶
"[a]cting on behalf of EFW and in furtherance of its
business, [Cuellar] created a Google Drive account [(the
"account")] to further these purposes."
(Id. ¶ 22 (emphasis added).) This account
"was to be used by EFW's on-site representatives,
each of whom had signed confidentiality agreements similar to
the" one signed by Cuellar. (Id.) "These
employees accessed the [a]ccount by logging into
email@example.com." (Id. ¶ 23.) "Each
day, [Cuellar] and other EFW employees on site used the
[a]ccount to record information such as the shipments being
handled, the routing decisions being made, the selection of
vendors, and cost information." (Id. ¶
24.) Cuellar and others "recorded this information in a
spreadsheet, one for each day" from 2009 to 2016, when
EFW ceased doing work out of its San Francisco
operation. (Id. ¶¶ 24, 30.)
fired Cuellar on February 10, 2015, after which he moved to
the State of Washington, where he now resides. (Id.
¶ 27.) In April 2015, Cuellar began working for AES
Logistics, one of EFW's competitors. (Id. ¶
29.) On May 19, 2016-over one year after his termination from
EFW-Cuellar accessed the account from his home in Washington
at approximately 2:25 a.m. local time. (Id. ¶
31.) When accessing the account without having received prior
authorization to do so, Cuellar removed both a recovery phone
number associated with the account and a secondary email
address on file "that went directly to EFW."
(Id. ¶ 33.) Cuellar also changed the password
for the account and created an archive of the spreadsheets
that it contained. (Id. ¶¶ 34-35.)
that day, after Cuellar arrived at his job at AES Logistics,
he once again accessed the account at 6:28 a.m. (Id.
¶ 37.) He downloaded the entire archive that he created
earlier that morning-containing more than 1, 900 spreadsheets
generated by EFW employees in the San Francisco area-deleted
the account, and logged off. (Id. ¶¶
37-40.) "The following month, [Cuellar] went to work at
CTE Logistics, also a competitor of EFW." (Id.
¶ 41.) Cuellar "is still in possession of the
information from the [a]ccount." (Id. ¶
officials received notice from Google about the unauthorized
access, but that notice "only provided EFW with IP
addresses for the devices or networks from which the access
came, as well as approximate location information."
(Id. ¶ 48.) Using that information, EFW was
able to ascertain that the person who had accessed the
account was a Comcast subscriber. (Id. ¶ 49.)
In June 2016, EFW filed an action against Comcast in order to
determine that subscriber's identity. (Id.
¶ 50.) Comcast sent Cuellar notice of EFW's attempt
to identify the person who accessed the account in late June
2016. (Id. ¶ 53.) However, Cuellar's
counsel made no attempt to offer any explanation to EFW for
his client's unauthorized access until July 29, 2016.
(Id. ¶ 54.)
filed the present action on October 21, 2016 (ECF No. 1),
alleging: (Count 1) breach of contract; (Count 2) violation
of the Computer Fraud and Abuse Act ("CFAA"), 18
U.S.C. § 1030; (Count 3) violation of the Defend Trade
Secrets Act of 2016, 18 U.S.C. §1836; (Count 4) unlawful
access to stored communications, in violation of the Stored
Communications Act ("SCA"), 18 U.S.C. § 2701;
(Count 5) misappropriation of trade secrets pursuant to Va.
Code Ann. §§ 59.1-336, et seq.; (Count 6)
violation of the Virginia Computer Crimes Act, Va. Code Ann.
§§ 18.2-152.1, etseq.; and (Counts 7 and
8) seeking a preliminary and permanent injunction.
Court finds that it has subject-matter jurisdiction over this
matter pursuant to 28 U.S.C. §§ 1331, 1332, and
filed this Motion to Dismiss Pursuant to Federal Rule of
Civil Procedure 12(b)(6) (ECF No. 8) on December 29, 2016,
specifically challenging the sufficiency of Counts 2 and 4 of
motion to dismiss under Rule 12(b)(6) tests the sufficiency
of a complaint; importantly, it does not resolve contests
surrounding the facts, the merits of a claim, or the
applicability of defenses." Republican Party of N.C.
v. Martin, 980 F.2d 943, 952 (4th Cir. 1992) (citation
omitted). The Federal Rules of Civil Procedure
"require only 'a short and plain statement of the
claim showing that the pleader is entitled to relief, '
in order 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)
(quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).
A complaint need not assert "detailed factual
allegations, " but must contain "more than labels
and conclusions" or a "formulaic recitation of the
elements of a cause of action." Twombly, 550
U.S. at 555 (citations omitted). Thus, the "[f]actual
allegations must be enough to raise a right to relief above
the speculative level" to one that is "plausible on
its face, " rather than merely "conceivable."
Id. at 555, 570.
considering such a motion, a plaintiffs well-pleaded
allegations are taken as true and the complaint is viewed in
the light most favorable to the plaintiff. T.G.
Slater, 385 F.3d at 841 (citation omitted). Legal
conclusions enjoy no such deference. Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009).
Cuellar does not appear to challenge Counts 1, 3, 5, 6, 7, or
8, the Court will deny his Motion as to those claims and will
limit its analysis only to Counts 2 and 4.
Count Two: Violation of the Computer Fraud and Abuse
effort to deter computer crime, Congress passed the
Counterfeit Access Device and Computer Fraud and Abuse Act of
1984. Pub. L. No. 98-473, 98 Stat. 2190. Two years later, it
expanded the Act with a revised version, the CFAA, Pub. L.
No. 99-474, 100 Stat. 1213, which remains in effect today.
While the CFAA is primarily a criminal statute designed to
combat hacking, see A. V. ex rel Vanderhye v. (Paradigms,
LLC,562 F.3d 630, 645 (4th Cir. 2009), it grants
"[a]ny person who suffers damage or loss by reason of a
violation of this section" the ability to bring a civil
action "to obtain compensatory damages and injunctive
relief or other equitable relief." 18 U.S.C. §
1030(g). "Notably, although proof of at least one of
five additional factors is necessary to maintain a civil
action,  ...