Collabera, LLC v. Innova Solutions, Inc.

Background

Collabera sued Innova Solutions, Inc., Pamela Reynolds, and John Manley. Collabera alleged that Reynolds and Manley, former Collabera employees, breached confidentiality and employee non-solicitation agreements, that Innova induced those breaches, and that Manley—acting at Innova’s direction or with its approval—misappropriated Collabera trade secrets.

The agreements defined confidential information broadly, including customer and prospect information, marketing and sales plans, pricing information, operational information, and trade secrets. Collabera alleged that the information was kept confidential through restrictive-covenant agreements and password-protected internal networks. It alleged that Reynolds and Manley solicited Collabera employees for Innova, that four of six identified employees joined Innova, and that Manley disclosed information from Collabera’s Strategic Sales Manual during an Innova training session between September and November 2024.

Collabera asserted breach-of-contract claims against Reynolds and Manley, Defend Trade Secrets Act claims against Manley and Innova, and a Minnesota tortious-interference claim against Innova. Defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint alleges enough facts to state a legally plausible claim.

Contract Claims

The court applied Minnesota law because the parties waived the agreements’ New Jersey choice-of-law, forum-selection, and arbitration provisions. Defendants argued that Manley’s agreement lacked consideration—something of legal value exchanged for the agreement—and that the confidentiality and non-solicitation provisions were too broad to enforce.

The court rejected dismissal based on lack of consideration. Collabera alleged that Manley signed the agreement at the beginning of his employment and that he received access to confidential information, authority to represent Collabera with customers, and specialized training in exchange for agreeing to the restrictions. At the motion-to-dismiss stage, those allegations plausibly showed adequate consideration.

The court was skeptical of the non-solicitation provision’s breadth, particularly its language barring the employees from helping another entity evaluate a Collabera employee or helping hire an employee away from Collabera. But the court concluded that enforceability was fact-dependent and better addressed after a more developed factual record. It also noted that the agreement contained a severability provision. The court therefore denied dismissal of the breach-of-contract claims.

Defend Trade Secrets Act Claims

The court held that Collabera adequately alleged the existence of protectable trade secrets. Collabera identified information in the Strategic Sales Manual, customer lists, marketing and sales plans, sales strategies, and pricing information, and alleged that the information helped maintain a competitive advantage because it was not generally known or readily ascertainable. Collabera also alleged reasonable steps to preserve secrecy.

The court further held that Collabera plausibly alleged misappropriation. It alleged that Manley disclosed information from the Manual during an Innova training call despite his confidentiality obligations, and that Innova knew about those obligations and directed Manley to use Collabera’s proprietary information for Innova’s benefit. The court found these allegations more specific than a mere fear that a former employee might someday use confidential information.

Tortious Interference Claim

The court also declined to dismiss Collabera’s claim that Innova intentionally interfered with its contracts with Reynolds and Manley. Collabera alleged that Innova knew about the agreements, directed Reynolds and Manley to solicit former Collabera employees despite their restrictions, acted without lawful justification or a legitimate reason, and caused damages.

Disposition

The court denied Defendants’ Motion to Dismiss Plaintiff’s Amended Complaint in its entirety. The decision means that Collabera’s claims were sufficiently pleaded to continue past the motion-to-dismiss stage. It did not determine that the alleged contract breaches, trade-secret misappropriation, or interference occurred, and it reserved questions about the enforceability of the non-solicitation provision for a later stage.