Motion StrikeCal. Super. - 6th Dist.November 5, 202010 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 200V3731 38 Santa Clara - Civil LEWIS & LLEWELLYN LLP Marc R. Lewis (Bar N0. 233306) mlewis@lewisllewellyn.com Daniel Jordan (Bar N0. 3 13543) dj0rdan@lewisllewellyn.com 601 Montgomery Street, Suite 2000 San Francisco, California 941 11 Telephone: (415) 800-0590 Facsimile: (415) 390-2127 Attorneys for Defendant APPLE INC. Electronically Filed by Superior Court of CA, County of Santa Clara, on 3/30/2021 1:09 PM Reviewed By: F. Miller Case #20CV373138 Envelope: 6138575 SUPERIOR COURT FOR THE STATE OF CALIFORNIA FOR THE COUNTY OF SANTA CLARA UNLIMITED JURISDICTION ENVIRODIGM, INC., a Delaware C0rp., Plaintiff, V. APPLE INC.; and DOES 1 through 10, Defendants. Case N0. 20CV373 1 38 DEFENDANT APPLE INC.’S NOTICE OF MOTION AND MOTION TO STRIKE PORTIONS OF PLAINTIFF’S FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF DECLARATION OF DANIEL JORDAN STATING COMPLIANCE WITH C.C.P. § 435.5 Hearing Date: May 6, 2021 Hearing Time: 9:00 am. Department: 2 Judge: Honorable Drew Takaichi Action Filed: November 5, 2020 Trial Date: Not Set NOTICE OF INTENT TO APPEAR BY TELEPHONE DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOTICE OF MOTION AND MOTION TO STRIKE TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE THAT 0n May 6, 2021, at 9:00 a.m. in Department 2 of the Superior Court of the County of Santa Clara, Defendant Apple Inc. (“Apple”) will and hereby does move the Court, pursuant t0 California Code of Civil Procedure sections 431.10(b)(3), 435, and 436, t0 strike the portions of Plaintiff Envirodigm, Inc.’s (“Envirodigm”) First Amended Complaint (“FAC”) seeking relief after August 14, 2018. Specifically, the Court should strike the following portions of the FAC to the extent they seek relief after August 14, 201 8: Paragraph 42: request for “damages, including a reasonable royalty for use of Plaintiff” s confidential information by Apple t0 the exclusion 0f Plaintiff and unjust enrichment, disgorgement of profits 0r other benefits derived by Apple;” Paragraph 52: request for “restitution, disgorgement, and/or imposition 0f a constructive trust t0 recover the amounts of Defendant’s ill-gotten gains, and/or other sums;” Paragraph 56: request for “restitution and restitutionary disgorgement;” 99 ‘6 Paragraph 63: request for “damages for actual loss, unjust enrichment . . . , including disgorgement of profits 0r other benefits,” and/or “a reasonable royaltyg” Paragraph 71: request for “damages as a result of Apple’s fraud, including benefit of the bargain damages measured by royalties, licensing fees and other compensation based on Apple’s subsequent use 0f the confidential information,” and “unjust enrichment, disgorgement of profits and other benefits derived by Apple;” Paragraph 75: request for “damages, including unjust enrichment, disgorgement 0f any profits or benefits derived by Apple;” and Prayer for Relief: Envirodigm’s request for injunctive relief. This motion is made 0n the ground that the FAC contains an irrelevant matter under Code of Civil Procedure § 436(a) because a demand for judgment requesting relief after August 14, 2018 is not supported by the allegations in the FAC (Code 0f Civil Procedure § 43 1 .10(b)(3)). Apple’s motion is based 0n this notice, the following memorandum of points and authorities, Apple’s demurrer t0 the FAC, declaration of Daniel Jordan, and request for judicial 1 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 notice, all filed concurrently herewith, and all pleadings and documents 0n file in this matter, and such oral 0r written evidence and argument as may be submitted to the Court in connection With this motion. Dated: March 30, 2021 LEWIS & LLEWELLYN LLP By: /s/Marc R. Lewis Marc R. Lewis Attorneys for Defendant APPLE INC. 2 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DECLARATION OF DANIEL JORDAN PER C.C.P. 8 435.5 I, Daniel Jordan, declare as follows: 1. I am an attorney licensed t0 practice before all courts in the State of California and am an associate at the law firm Lewis & Llewellyn LLP, counsel for Apple Inc. (“Apple”) in this matter. Ihave personal knowledge of the facts set forth below and, if called upon, could and would competently testify thereto. 2. I submit this declaration in support 0f Apple’s Motion t0 Strike Portions 0f Plaintiff s First Amended Complaint (“FAC”). 3. Pursuant to California Code of Civil Procedure section 435.5(a)(3), 0n March 23, 2021, I emailed counsel for Envirodigm, Inc. (“Envirodigm”) seeking to meet and confer regarding the objectionable portions 0f Envirodigm’s FAC. 4. On March 25, 2021, counsel for both parties met and conferred Via telephone conference to discuss the deficiencies in the FAC, and the parties did not reach an agreement resolving the objections raised in this motion t0 strike. I declare under penalty of perjury under the laws of the State 0f California that the forgoing is true and correct. Executed on March 30, 2021, at San Francisco, California. By: /S/Daniel Jordan Daniel Jordan Attorney for Defendant APPLE INC. 3 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION AND FACTUAL BACKGROUND Envirodigm, Inc. (“Envirodigm”) is suing Apple Inc. (“Apple”) for allegedly stealing Envirodigm’s secret “anodization” process, Which Envirodigm allegedly disclosed t0 Apple during an August 14, 2013 meeting pursuant t0 a non-disclosure agreement (“NDA”). According t0 Envirodigm, Apple used this process t0 manufacture iPhone devices sold in 2016 and beyond. Apple summarizes Envirodigm’s allegations in its demurrer t0 the First Amended Complaint (“FAC”) and incorporates the factual allegations included in its demurrer by reference. The Court need 100k no further than Apple’s demurrer t0 resolve this dispute: the FAC is meritless as a matter of law and should be dismissed Without leave t0 amend. If the Court for some reason disagrees, it should, at a minimum, strike Envirodigm’s request for any relief after August 14, 2018 for one uncomplicated reason: pursuant to the explicit terms 0f the NDA on which all of Envirodigm’s allegations rely, Envirodigm is not entitled t0 it. II. LEGAL STANDARD Within the time allowed to respond to a pleading, a defendant may move t0 strike some 0r part of the pleadings. Cal. Code CiV. Proc. § 435. Motions t0 strike are properly brought against “irrelevant, false, or improper matter inserted in any pleading.” Id. § 436. Irrelevant matter includes “a demand for judgment that requests relief not supported by the allegations of the complaint or cross-complaint.” Id. §431.10(b)(3). III. ENVIRODIGM’S REQUEST FOR POST-AUGUST 14, 2018 RELIEF IS DISALLOWED BY THE EXPRESS TERMS OF THE PURPORTED NDA Envirodigm’s request for relief, both economic and injunctive, after August 14, 2018 must be stricken from the FAC because, pursuant to the explicit terms of the purported NDA between Apple and Envirodigm that Envirodigm relies upon in its FAC, Apple was free t0 use Envirodigm’s alleged “confidential” information after that date. As a result, Apple’s use 0f Envirodigm’s confidential information, if any, after August 14, 2018 cannot support “a demand for judgment” pursuant t0 Envirodigm’s own allegations and must be stricken from the FAC. Cal. Code Civ. Proc. §431.10(b)(3). 4 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Envirodigm’s causes 0f action are all based on the allegation that Apple allegedly used Envirodigm’s confidential anodization process, which it disclosed during an August 14, 2013 meeting, in Violation 0f an NDA between itself and Apple. FAC 1H 23-24; see also id. 1] 41 (breach of contract cause 0f action based 0n allegation that “Apple breached the non-disclosure agreement by failing to comply with its obligations under the non-disclosure agreement”); id. 11 46 (Apple was allegedly unjustly enriched because “[t]he information disclosed t0 Apple pursuant t0 the NDAs, the value of that information, and the attendant revenue earned by Apple, were monetary benefits conferred upon Defendant by Plaintiff”); id. fl 55 (unfair competition cause of action based 0n allegation that “Apple deceptively and unfairly induced Plaintiff t0 disclose ‘know-how’ and other information related to Plaintiff s anodization processes, including the color anodization process disclosed pursuant to the non-disclosure agreement”); id. 1] 60 (Apple allegedly misappropriated trade secrets by using “Plaintiff” s processes . . . disclosed t0 Apple pursuant t0 a non-disclosure agreement”); id. 11 68 (Apple allegedly committed fraud when it “represented it would maintain the confidentiality of information disclosed by Plaintiff pursuant to the non-disclosure agreement”); id. 1] 75 (breach of implied covenant cause of action based 0n the “implied promise 0f good faith and fair dealing” in “[t]he non-disclosure agreement”). Envirodigm attached the purported NDA at the center of this litigation to the FAC as Exhibit A. The explicit terms 0f that NDA, however, limit Apple’s “duty t0 protect [Envirodigm’s] Confidential Information” t0 “five (5) years from the date 0n which that Confidential Information was disclosed to [Apple],” 0r, five years after the disclosure on August 14, 2013-12a, August 14, 2018. FAC, EX. A § 8. Because the NDA’s confidentiality provisions expired on August 14, 2018, after that date Envirodigm n0 longer had a reasonable expectation in the secrecy 0f its alleged anodization process, and Apple could rightfully use the process without penalty. Nonetheless, in direct contravention 0f the NDA, the FAC seeks injunctive and economic relief in perpetuity because Apple allegedly “continues to employ the process first disclosed by Plaintiff pursuant t0 the non-disclosure agreement.” Id. fl 35. But the law is clear: “When a plaintiff attaches a written agreement t0 his complaint,” like the purported NDA, “and incorporates it by reference into his cause[s] 0f action, the terms 0f that written agreement take precedence over any 5 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 contradictory allegations in the body of the complaint.” Kim v. Westmoore Partners, Ina, 201 Cal. App. 4th 267, 282 (201 1); Vallejo Dev. C0. v. Beck Dev. C0., 24 Cal. App. 4th 929, 946 (1994) (“[A]s a matter of law, allegations in a complaint must yield t0 contrary allegations contained in exhibits to a complaint”). Given that the FAC’s allegations cannot support Envirodigm’s request for injunctive and economic relief after August 14, 2018, this Court should strike such relief from the FAC. See Cal. CiV. Code § 431.10(b)(3). IV. CONCLUSION For the foregoing reasons, Apple respectfully requests that, should it not sustain Apple’s demurrer and dismiss the FAC in its entirety, the Court strike the following portions from the FAC t0 the extent they seek post-August 14, 2018 relief: o Paragraph 42: request for “damages, including a reasonable royalty for use of Plaintiff s confidential information by Apple t0 the exclusion 0f Plaintiff and unjust enrichment, disgorgement of profits or other benefits derived by Apple;” o Paragraph 52: request for “restitution, disgorgement, and/or imposition 0f a constructive trust t0 recover the amounts 0f Defendant’s ill-gotten gains, and/or other sums;” o Paragraph 56: request for “restitution and restitutionary disgorgementg” 79 6‘o Paragraph 63: request for “damages for actual loss, unjust enrichment . . . that is not taken into account in computing damages for actual loss, including disgorgement of profits or other benefits,” and/or “a reasonable r0ya1ty;” o Paragraph 71: request for “damages as a result of Apple’s fraud, including benefit of the bargain damages measured by royalties, licensing fees and other compensation based on Apple’s subsequent use 0f the confidential information,” and “unjust enrichment, disgorgement of profits and other benefits derived by Apple;” 0 Paragraph 75: request for “damages, including unjust enrichment, disgorgement 0f any profits or benefits derived by Apple;” and o Prayer for Relief: Envirodigm’s request for injunctive relief. 6 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: March 30, 2021 LEWIS & LLEWELLYN LLP By: /S/Marc R. Lewis Marc R. Lewis Attorneys for Defendant APPLE INC. 7 DEFENDANT APPLE INC.’S MOTION TO STRIKE CASE NO. 20CV373 1 3 8