Hawke Media, LLC v. Stable Group Holdings, LLC, The

Background

Hawke Media and The Stable Group Holdings, LLC signed a mutual nondisclosure agreement in May 2020 to facilitate discussions about the possibility of Stable acquiring Hawke. Hawke then shared confidential information, including financial, employee, compensation, and client information, as well as client lists and detailed salary information.

Hawke alleged that Stable used this information to recruit Hawke’s key employees and customers, in violation of the nondisclosure agreement. Hawke asserted four claims, but Stable moved to dismiss Count 2, tortious interference with prospective economic advantage; Count 3, tortious interference with contract; and Count 4, unjust enrichment. The opinion addressed Stable’s motion under Rule 12(b)(6), which allows dismissal when a complaint does not plausibly state a claim for relief.

Tortious-Interference Claims

The court applied Minnesota’s independent-duty rule. That rule generally limits a plaintiff seeking damages for an alleged contract breach to damages arising from the breach, unless the defendant also violated a legal duty that exists independently of the contract.

The court held that the tortious-interference allegations merely repeated Hawke’s breach-of-contract theory. Hawke alleged that Stable misused confidential information received under the nondisclosure agreement, but did not plausibly allege that Stable owed Hawke an independent duty beyond the agreement. The court therefore ruled that the independent-duty rule barred both tortious-interference claims.

The court also stated that the claims could be dismissed because the allegations were too conclusory. For the prospective-economic-advantage claim, Hawke did not identify specific customers or business relationships that it lost or might lose because of Stable’s conduct. For the tortious-interference-with-contract claim, Hawke referred generally to contracts and customers without identifying the contracts, customers, or specific conduct that caused a breach.

The court rejected Hawke’s argument that it could plead the tort claims as alternatives to the contract claim. Although alternative claims are permitted, each alternative claim must still be plausible. Hawke did not allege a plausible scenario in which Stable’s conduct was independent of the nondisclosure agreement or involved information and relationships outside that agreement. The court also rejected Hawke’s suggestion that further discovery might support the claims, explaining that discovery could not cure claims that were inadequately pleaded.

Unjust-Enrichment Claim

The court explained that unjust enrichment is an equitable remedy that generally does not apply when an enforceable contract governs the parties’ relationship. Hawke pleaded unjust enrichment as an alternative to its breach-of-contract claim, but did not allege facts showing that the nondisclosure agreement was invalid, unenforceable, or did not cover the conduct at issue.

The court noted that Stable had admitted the nondisclosure agreement was a binding contract and concluded that the agreement covered the complained-of conduct. Because Hawke had not pleaded a plausible alternative factual scenario, its unjust-enrichment claim could not proceed.

Disposition

The court granted Defendant Stable’s Motion to Dismiss Hawke’s Tortious Interference and Unjust Enrichment Claims. The order did not state that the dismissal was with or without prejudice.