United States District Court, E.D. Virginia, Richmond Division
MEMORANDUM OPINION (GRANTING IN PART DEFENDANT'S
MOTION TO DISMISS)
E. HUDSON SENIOR, UNITED STATES DISTRICT JUDGE
case involves a business-process consultant suing a
government contractor for the alleged infringement of
copyrighted software. According to Plaintiff Neil Zaccari
("Plaintiff), Defendant Discover Technologies, LLC's
("Defendant") infringement occurred in
collaboration with the United States government. (Compl.
¶ 23, ECF No. 1.) Plaintiff alleges that Defendant
engaged in copyright infringement, statutory business
conspiracy under Virginia law, and misappropriation of a
trade secret. (Id. ¶¶ 39-59.)
matter is presently before the Court on Defendant's
Motion to Dismiss (ECF No. 9). Both parties have filed
memoranda supporting their respective positions, and the
Court heard argument on November 26, 2018. Upon due
consideration of the parties' arguments, and for the
reasons that follow, the Court will dismiss Count I for lack
of subject-matter jurisdiction and grant in part
Defendant's Motion to Dismiss with respect to Count II.
Count III survives Defendant's challenge.
to the Complaint, Plaintiff contracted his consulting
services with the United States government through his former
employer, Apprio. (Id. ¶ 13.) Plaintiff was
tasked with improving the Defense Contract Management
Agency's ("DCMA") business processes.
(Id.) DCMA is an arm of the Department of Defense
("DoD") that works with defense contractors and
suppliers to manage compliance with contractual and federal
requirements for services and supplies delivered to DoD.
(Id. ¶ 11.)
Plaintiff was contracted to work on certain DCMA business
processes, a separate effort was underway by a DCMA project
team called "BPR 1" to address inefficiencies in
DCMA's contract review processes. (Id. ¶
14.) Plaintiff was not assigned to that project team.
(Id.) Nevertheless, independent of his contracted
responsibilities, Plaintiff alleges that he developed
computer software (the "Software") that automated
government defense contract reviews that were performed
manually by DCMA at the time. (Id. ¶ 16.) The
Software was designed to streamline review of Federal
Acquisitions Requirements, potentially saving the government
millions of dollars. (Id. ¶¶ 16, 24.)
31, 2016, Plaintiff alleges that he demonstrated the Software
to Apprio Vice President, Michelle Coelho, and another Apprio
employee. (Id. ¶ 17.) Coelho then allegedly
directed Plaintiff to do a similar demonstration of the
Software for the BPR 1 team. (Id.) Plaintiff did so
and sent a copy of the Software to the team for evaluation.
After doing so, he requested that the team "not make any
further modifications to the software code or his [Software]
without his express, prior permission." (Id.
demonstrating the capabilities of the Software to Apprio and
DCMA employees, Plaintiff alleges that a program lead within
DCMA, Antoine McNeil, informed an Apprio executive that the
Software was beyond the scope of Plaintiff s contracted
services for DCMA. (Id. ¶¶ 19-20.) McNeil
then demanded a copy of the Software. (Id. ¶
20.) In response, the Complaint alleges that Apprio directed
Plaintiff to provide copies of the Software and its source
code to DCMA. (Id.)
the Complaint alleges that the BPR 1 team "removed
[Plaintiffs] name as author on the  Software and renamed
the application ConCISE." (Id. ¶ 22.)
Further, Plaintiff alleges that McNeil "subsequently
collaborated with [Defendant] to copy [the Software] and
prepare a derivative work that uses some or all of the source
code in [the Software] to automate the contract receipt and
review process ...." (Id. ¶ 23.) ConCISE
was later allegedly deployed to thousands of government
employees, as well as shared with other DoD agencies.
(Id. ¶¶ 25-26, 36.)
April 23, 2018, Plaintiff filed an application for Copyright
Registration of his software with the U.S. Copyright Office,
which was subsequently accepted. (Id. ¶ 10.)
raises three claims against Defendant. Count I alleges
copyright infringement under 17 U.S.C. §§ 504-05,
seeking treble damages and attorney's fees for direct and
indirect infringement of Plaintiff s copyright. (Id.
¶¶ 39-47.) Count II alleges statutory business
conspiracy in violation of Va. Code § 18.2-499(A).
(Id. ¶¶ 48-52.) Count III alleges
misappropriation of trade secret under 18 U.S.C. §
1836(b)(1). (Id. ¶¶ 53-59.) Plaintiff
seeks $63, 000, 000 in actual damages, statutory treble
damages and attorney's fees, and injunctive relief.
(Id. at 12-13.) Defendant's Motion to Dismiss
seeks dismissal of Counts II and III in their entirety, as
well as Plaintiffs request for statutory damages under Count
STANDARD OF REVIEW
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," id. (citation omitted),
to one that is "plausible on its face,"
id. at 570, rather than merely
"conceivable." Id. In 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
the district court does not consider extrinsic materials when
evaluating a complaint under Rule 12(b)(6). The court may,
however, consider "documents incorporated into the
complaint by reference." Tellabs, Inc. v. Makor
Issues & Rights,Ltd.,551 U.S. 308, 322
(2007); see ...