Redapt Attunix, Inc. v. BaseCap Analytics Inc.

Background

Redapt Attunix, Inc. brought claims against BaseCap Analytics Inc. for misappropriation of trade secrets under federal and state law, breach of contract, tortious interference with contract, and conversion. A separate arbitration was pending between Redapt and Peter Parker, a former Redapt employee. That arbitration addresses whether Parker misappropriated Redapt’s trade secrets when he left Redapt to work for BaseCap and whether he transferred or would transfer those trade secrets to BaseCap.

Parties’ Positions

BaseCap requested an extension of time to respond to the complaint until the Parker arbitration was decided. BaseCap argued that the arbitration panel’s decision about Parker’s alleged conduct would resolve an important issue in the lawsuit. BaseCap predicted that the arbitration would be resolved in eight to ten months. Redapt opposed the request.

Court’s Analysis

The court explained that a party seeking a stay—a temporary pause in the court case—must show that the arbitration and court case share issues that the arbitration will finally decide. The party must also show that the non-arbitrating party will not hinder the arbitration, that the arbitration can be resolved within a reasonable time, and that the delay will not cause hardship to the opposing parties.

The court found that a stay was appropriate, particularly because Redapt’s trade-secret claims against BaseCap relied on allegations concerning Parker’s own alleged misappropriation. The court therefore stayed the case pending resolution of the Parker arbitration.

Order

The court adjourned the upcoming deadlines, including the January 14, 2022 conference, without setting a new date. The parties must provide the court with a letter updating it on the arbitration’s status and the continued need for a stay either within one week after the arbitrator’s decision or by September 2, 2022, whichever occurs sooner.