Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 1 of 10
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF IOWA
`DAVENPORT DIVISION
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`Case No. ____________
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`GRACE TECHNOLOGIES, INC., an Iowa
`corporation,
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` Plaintiff,
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`vs.
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`RICHARD HABERKERN,
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` Defendant.
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`COMPLAINT AND JURY DEMAND
`AND REQUEST FOR INJUNCTIVE RELIEF
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`Plaintiff, Grace Technologies, Inc. (hereinafter “Grace Tech.”), by and through its
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`attorneys, Lane & Waterman LLP, for its Complaint against Defendant, Richard Haberkern
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`(hereinafter “Haberkern”), states as follows:
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`1.
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`Plaintiff, Grace Technologies, Inc. (“Grace Tech.”) is a corporation in the
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`business of designing, manufacturing, and selling various products, including products in the
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`electrical safety industry, personal safety, maintenance solutions, and more.
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`2.
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`Defendant, Richard Haberkern, was employed by Grace Tech. as a Director of
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`Engineering, beginning June 1, 2020, and pursuant to an Employment Agreement signed on May
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`11, 2020, which is attached hereto as Exhibit A.
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`3.
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`This Court has subject matter jurisdiction over this cause of action pursuant to 28
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`U.S.C. § 1331 because this Complaint alleges violations of the Defend Trade Secrets Act, 18
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`U.S.C. § 1833. This Court has supplemental jurisdiction over the remaining claims, arising out
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`of the same facts and circumstances pursuant to 28 U.S.C. § 1367.
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 2 of 10
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`4.
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`Venue in this Court is proper because this action arises out of conduct that took
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`place and was directed at Grace Tech. and its offices in Davenport, Iowa.
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`5.
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`The Employment Agreement provides various Confidentiality and Assignment
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`clauses.
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`6.
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`Over the course of his employment, Grace Tech. and Haberkern discussed various
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`other positions and compensation; none was finalized.
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`7.
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`In the weeks preceding November 9, 2020, Grace Tech. became concerned with
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`conduct by Haberkern and various statements made by Haberkern regarding his role at Grace
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`Tech.
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`8.
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`Simultaneously, Grace Tech. was working towards completion of designs on a
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`project over which Haberkern had provided input and exerted control.
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`9.
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`Grace Tech., with the assistance of Haberkern and others, moved forward with
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`patent consultations and applications involving the project. See Exhibit B, attached hereto.
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`10.
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`On multiple occasions Grace Tech. requested Haberkern to provide patent
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`assignment documentation to finalize the patent application. See Exhibit C, attached hereto.
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`11.
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`Grace Tech. also requested contact information, files, prototypes, and designs for
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`the project.
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`12.
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`Haberkern refused to provide the requested assignment, information, files,
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`designs, or prototypes.
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`13.
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`On or about November 7-8, 2020, Haberkern sent multiple emails to Grace Tech.
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`executives and owners, along with outside individuals, which contained confidential
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`Grace Tech. information. See Exhibit D, attached hereto.
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`2
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 3 of 10
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`14.
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`Grace Tech. requested that Haberkern cease disclosing confidential business
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`information to others and return Grace Tech. property and files to Grace Tech.
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`15.
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`Grace Tech. terminated Haberkern’s employment on November 9, 2020, pursuant
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`to the written Employment Agreement. See Exhibit E, attached hereto.
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`16.
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`Grace Tech. again requested Haberkern provide Grace Tech. the files and
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`business products and cease making statements about Grace Tech. in email or social media posts.
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`17.
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`To date, Haberkern has failed to respond to Grace Tech. requests.
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`18.
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`The Employment Agreement provides:
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`DISCLOSURE PROHIBITED. The Employee, during the term of this
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`agreement, any extensions of this agreement, and during the one (1) year period
`after the Employee’s termination, without the prior written consent of the
`Employer, will not disclose to any person, firm or corporation, or personally make
`use of any confidential information, as defined in Section 6 hereof. Upon leaving
`the Employer, Employee will not take, without prior written consent of the
`Employer, any document, record, transcript or similar writing embodying any
`such confidential information but will deliver to the Employer all such writings
`which are in possession or under control of the Employee.
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`Exhibit A, pg. 2.
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`The Employment Agreement defines Confidential Information as follows:
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`19.
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`CONFIDENTIAL INFORMATION. In this Agreement:
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`A. “Confidential Information” means information, not generally known,
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`and proprietary to GRACE, including trade secret information, about its processes
`and products, including information relating to fee negotiation methodology,
`research, development, manufacture, purchasing, accounting, engineering,
`marketing, merchandising, selling, leasing, servicing, finance and business
`systems and techniques. All information disclosed to Employee, or to which
`Employee obtains access, whether originated by him/her or others, during the
`period of his employment, which he/she has a reasonable basis to believe to be
`Confidential Information, or which is treated by GRACE as being Confidential
`Information, shall be presumed to be Confidential Information.
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`Exhibit A, pg. 2-3.
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`3
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 4 of 10
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`20.
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`The Employment Agreement also provides prohibitions and assignments for
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`inventions as follows:
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`B. “Inventions” means discoveries, improvements and ideas (whether or not
`shown or described in writing or reduced to practice) works of authorship,
`whether or not patentable or copyrightable (1) which related directly to the
`business of GRACE, or (2) which related to their actual or demonstrable
`anticipated research or development, or (3) which result from any work performed
`by Employee for GRACE, or (4) for which equipment, supplies, facility or trade
`secret information of GRACE is used, or (5) which is developed on any GRACE
`time.
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`***
`E. With respect to Inventions made, authored or conceived by Employee, either
`solely or jointly with others, during his/her employment, whether or not during
`normal working hours or whether or not at GRACE’S premises, he/she will:
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`(i)
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`Keep accurate, complete and timely records of such Inventions, which
`records shall be GRACE’S property and be retained on GRACE’S
`premises.
`(ii)
`Promptly and fully disclose and describe such Inventions to GRACE.
`(iii) Assign (and he/she does hereby assign) to GRACE all of his/her rights to
`such inventions, and to applications for letters patent and/or copyright in
`all countries and to letters patent and/or copyrights granted upon such
`inventions in all countries.
`(iv) Acknowledge and deliver promptly to GRACE (without charge to it but at
`its expenses) such written instruments and to such other acts as may be
`necessary in the opinion of GRACE to preserve property rights against
`forfeiture, abandonment or loss and to obtain and maintain letters patent
`and/or copyrights and to vest the entire right and title thereto to GRACE.
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`Exhibit A, pg. 3-4.
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`21.
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`The Employment Agreement also provides for Covenants Not to Compete and
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`other obligations.
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`22.
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`The Employment Agreement provides Grace Tech. is entitled to injunctive relief
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`for breach of the Agreement as follows:
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`INJUNCTIVE RELIEF. The Employee agrees that the Employer would
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`suffer irreparable injury if the Employees violates the covenants set forth herein in
`that the Employer is without adequate remedy at law in the event of the breach of
`the terms.
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`4
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 5 of 10
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`Employee agrees that the Employer either with or without pursuing any potential
`damage remedies shall be entitled to seek and obtain equitable relief, including
`specific enforcement of the covenants set forth herein, together with reasonable
`attorney’s fees and costs and Employee waives any requirement that Employee
`post a bond in the event of such injunction proceeding.
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`Exhibit A, pg. 5.
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`COUNT I
`BREACH OF CONTRACT
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`Plaintiff adopts and re-alleges the allegations contained in Paragraphs 1-22 as if
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`23.
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`fully set forth herein.
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`24.
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`Haberkern and Grace Tech. entered into an Employment Agreement on May 11,
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`2020.
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`25.
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`26.
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`Grace Tech. has performed all requirements pursuant to that contract.
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`On November 9, 2020, Grace Tech. terminated Haberkern’s employment pursuant
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`to the agreement’s terms.
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`27.
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`Both before and after the termination of employment, Grace Tech. has requested
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`that Haberkern provide Grace Tech. property, including passwords, files, and intellectual
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`property. See Exhibit C.
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`28.
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`Haberkern has not responded to these requests to return Grace Tech. property and
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`appears to be refusing to provide Grace Tech. its property.
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`29.
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`In addition, Haberkern has violated and continues to violate the confidentiality
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`requirements of the Employment Agreement by emailing outside contractors and individuals and
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`making social media posts which discloses confidential and proprietary Grace Tech. business
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`information. See Exhibit F, attached hereto.
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`5
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 6 of 10
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`30.
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`Haberkern’s actions of refusing to return Grace Tech. property and disclosing
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`confidential information is a breach of the Employment Agreement.
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`COUNT II
`VIOLATION OF THE DEFEND TRADE SECRETS ACT
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`31.
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`Plaintiff adopts and re-alleges the allegations contained in Paragraphs 1-30 as if
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`fully set forth herein.
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`32.
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`The Defend Trade Secrets Act, 18 U.S.C. § 1833 protects businesses against the
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`theft of trade secrets. The Uniform Trade Secrets Act also protects businesses against the
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`misappropriation of trade secrets.
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`33.
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`Grace Tech. is the owner of various trade secrets, including files for product
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`development, which are intended for use in interstate commerce.
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`34.
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`The Haberkern and Grace Tech. Employment Agreement requires Haberkern to
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`assign all rights to Grace Tech. inventions and intellectual property to Grace Tech. Exhibit A,
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`pg. 3-4.
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`35.
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`After Haberkern’s termination of employment, Haberkern has refused to return to
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`Grace Tech.’s trade secret property, including files and prototypes.
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`36.
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`Haberkern’s actions and communications indicate that he intended to convert
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`Grace Tech. proprietary information to his or other’s economic benefit, rather than to the
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`economic benefit of Grace Tech. See Exhibit G, attached hereto.
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`37.
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`The files and information in Haberkern’s possession include prototypes and
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`intellectual property which is proprietary property and trade secrets of Grace Tech.
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`38.
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`Haberkern has knowingly withheld and appropriated, without Grace Tech.
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`authorization, the trade secret information.
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`6
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 7 of 10
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`39.
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`Haberkern knew that his withholding and misappropriation of Grace Tech.
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`property would injure Grace Tech.
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`40.
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`Grace Tech. has suffered damage from Haberkern’s continuing conduct.
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`COUNT III
`DEFAMATION
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`41.
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`Plaintiff adopts and re-alleges the allegations contained in Paragraphs 1-40 as if
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`fully set forth herein.
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`42.
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`Haberkern has sent email communications or made social media posts which were
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`false and/or contained misleading information that resulted in an untrue representation of the
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`truth.
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`43.
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`The statements were not privileged.
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`44.
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`Haberkern’s statements included material statements which were harmful to
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`Grace Tech.
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`45.
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`Haberkern’s statements were defamatory.
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`46.
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`As a result of Haberkern’s statements, Grace Tech. has sustained damages,
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`including but not limited to, loss of reputation.
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`COUNT IV
`CIVIL CONSPIRACY
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`47.
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`Plaintiff adopts and re-alleges the allegations contained in Paragraphs 1-46 as if
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`fully set forth herein.
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`48.
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`Haberkern entered into a voluntary agreement with a third party for the purpose of
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`misappropriating confidential trade secrets and proprietary information from Grace Tech. in
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`knowing violation of his statutory and common law duties.
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`7
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 8 of 10
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`49.
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`Prior to his termination, Haberkern misappropriated confidential files, records,
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`and prototypes, in violation of his duties.
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`50.
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`Haberkern improperly obtained this information for the express purpose of
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`personal gain in violation of his duties and employment agreement.
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`COUNT V
`TORTIOUS INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE
`AND BUSINESS INTERESTS
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`Plaintiff adopts and re-alleges the allegations contained in Paragraphs 1-50 as if
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`51.
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`fully set forth herein.
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`52.
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`Before and after his termination, Haberkern has emailed suppliers and outside
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`businesses and made public postings on social media in order to inform others, including
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`suppliers, of confidential trade secrets and business information.
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`53.
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`Haberkern knew that Grace Tech. had an ongoing relationship with a supplier,
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`which could impact Grace Tech.’s continued manufacture and sale of products.
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`54.
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`Haberkern purposefully interfered with Grace Tech.’s current and expected
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`economic advantage.
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`55.
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`As a result of Haberkern’s intentional interference, Grace Tech. has suffered
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`damages, including lost business and loss of business reputation.
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`WHEREFORE, Grace Tech. hereby requests that the Court enter an order against
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`Defendant, Haberkern as follows:
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`A.
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`A temporary restraining order and permanent injunction prohibiting Haberkern
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`from disclosing confidential business information and trade secrets to others;
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 9 of 10
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`B.
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`A temporary restraining order and permanent injunction prohibiting Haberkern
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`from making public statements or public social media posts which disclose
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`confidential business information and trade secrets to others;
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`C.
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`A temporary restraining order and permanent injunction prohibiting Haberkern
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`from using, disclosing, or misappropriating Grace Tech.’s trade secrets and
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`confidential information;
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`D.
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`An Order requiring Haberkern to return all confidential and proprietary
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`information, including files, prototypes, or other property, which is the property
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`of Grace Tech.;
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`E.
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`Monetary damages to compensate Grace Tech. for the harm suffered as a direct
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`and proximate result of Haberkern’s violations of the law and his contract;
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`F.
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`An Order requiring Haberkern to permanently remove all social media posts
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`about Grace Tech.;
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`G.
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`An Award of Attorney’s Fees pursuant to the Employment Agreement and the
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`H.
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`I.
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`law, which compensates Grace Tech. for having to file in Court;
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`An Award of Punitive Damages, according to the law; and
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`An Award of such other and further relief as the court deems just and equitable,
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`including costs of this action and interest as provided by law.
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`JURY DEMAND
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`Plaintiff demands a jury trial.
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`Case 3:20-cv-00095-JAJ-CFB Document 1 Filed 11/23/20 Page 10 of 10
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`LANE & WATERMAN LLP
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`By /s/ Mikkie R. Schiltz
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` Mikkie R. Schiltz
`220 North Main Street, Suite 600
`Davenport, Iowa 52801
`Telephone: (563) 324-3246
`Facsimile: (563) 324-1616
`Email: mschiltz@l-wlaw.com
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`ATTORNEYS FOR PLAINTIFF
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