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Executive Consulting Group, LLC v. Baggot

United States District Court, D. Colorado

March 21, 2018

EXECUTIVE CONSULTING GROUP, LLC, d/b/a ECG Management Consultants, Plaintiff,



         This matter is before the Court on Defendant Deirdre Baggot's Motion to Correct, in which Defendant seeks to “correct the record” made by Defendant and/or Defendant's counsel at a motions hearing before this Court on March 1, 2018. (Doc. # 53.) For the reasons that follow, Defendant's Motion to Correct is denied.

         I. BACKGROUND

         Plaintiff Executive Consulting Group, LLC, d/b/a ECG Management Consultants (“ECG”), is a strategic consulting firm serving the healthcare industry. (Doc. # 1 at 2.) Defendant began working as a Principal for ECG on January 11, 2016. (Id. at 3.) Two weeks prior, Defendant signed an offer letter from ECG that provided she would lead ECG's bundled payment practice and outlined her compensation. (Id. at 3-4.) The offer letter also stated that Defendant, as an ECG employee, was “bound to hold [corporate] information in strictest confidence and not to disclose confidential information or allow it to be disclosed, during or after [her] employment.” (Id. at 4.) Defendant executed an Employment Agreement with ECG at the same time. See (Doc. # 1-1.) Relevant here, the Employment Agreement included a Non-Competition Provision, a Non-Solicitation Provision, and a Confidentiality Provision. (Id. at 4-9.) In the event Defendant violated these or other provisions, the Employment Agreement allowed ECG to “apply for a temporary restraining order, preliminary injunction, specific performance, or other interim or equitable relief.” (Id. at 11.)

         On January 19, 2018, some two years into her employment with ECG, Defendant informed her supervisor in a phone call and a letter that she was resigning from ECG effective 30 days thereafter. (Doc. # 1 at 9.) On January 23, 2018, Defendant informed her supervisor that she was accepting a new position with ECG's direct competitor, The Chartis Group (“Chartis”). (Id.)

         On January 29, 2018, ECG filed a complaint for injunctive relief against Baggot. See generally (id.) The Complaint alleges that Baggot sent numerous emails containing ECG's confidential, proprietary, and trade secret information, from her ECG account to her personal email address three days before she submitted notification of her resignation. (Id.) It also alleges that Baggot was scheduled to speak at a conference on ECG's behalf and using its material the following day, January 30, 2018. (Id.) ECG raises five claims for relief: (1) breach of contract; (2) misappropriation of trade secrets under federal law; (3) misappropriation of trade secrets under Colorado state law; (4) misappropriation of trade secrets under Delaware state law; and (5) unjust enrichment. (Id. at 14-17.) ECG simultaneously filed an Emergency Motion for a Temporary Restraining Order (“TRO”) (Doc. # 2) and a Motion for a Preliminary Injunction (Doc. # 3).

         The following day, January 30, 2018, the Court issued ECG's requested TRO after a brief hearing on ECG's emergency motion. See (Doc. ## 12, 13.) The TRO ordered Defendant to “immediately return to ECG all confidential, proprietary, and/or trade secret information and property obtained from ECG” and to “preserve, in their original state, all documents and information in [Defendant's] possession, custody, or control, or otherwise available to [Defendant], related to the issues” set forth in ECG's Complaint. (Doc. # 13 at 2.) The Court set a hearing on ECG's Motion for a Preliminary Injunction for March 1, 2018. (Doc. # 12.)

         An exhibit introduced at the preliminary injunction hearing on March 1, 2018 (Exhibit 17), suggests that on January 31, 2018, Chartis's Chief Information Officer searched Chartis's network and Defendant's newly-issued, Chartis-owned computer and concluded that “a removable drive . . . [was] being used on the laptop, and there [was] a folder named ‘ECG' on it” (the “ECG Folder”). See (Doc. # 59-1 at 3.) Chartis's information officer also reported that Defendant had recently opened files concerning two of ECG's clients on Chartis's laptop. (Id.) For purposes of this Order and subsequent proceedings, the Court will identify this removable jump drive as the “Original Jump Drive.”

         On February 1, 2018, Defendant's counsel informed ECG's counsel that they “ha[d] confirmed that [Defendant] possesse[d] no other documents from her employment with ECG aside from the emails sent to her personal account, and [they had] engaged a vendor to extract, delete and return those documents to ECG.” (Doc. # 59-2 at 1.)

         On February 14, 2018, Defendant served her sworn responses to discovery requests from ECG that she identify and produce ECG documents and data and any computers and external storage drives that contained such document and data. (Doc. # 59 at 3, 9, 10.) In her response, Defendant did not identify or produce the Original Jump Drive, nor did she identify or produce the ECG Folder or its contents. (Id.)

         On February 22, 2018, Defendant's counsel notified ECG's counsel via email that upon returning from an overseas trip, Defendant “located a flash drive containing PowerPoint presentations . . ., though none of these appear to contain ECG information, ” and “a handful of printed documents that were used and dated in 2016.” (Doc. # 59-4 at 1.) Defendant's counsel produced that jump drive (the “February 27 Jump Drive”) to ECG on February 27, 2018. (Doc. # 59 at 4.) On February 28, 2018, Defendant served supplemental discovery responses, stating that “additional items were produced to opposing counsel on February 27, 2018.” (Doc. # 59-5 at 3.)

         At 6:48 PM on February 28, 2018, the evening before the preliminary injunction hearing, Defendant's counsel emailed ECG counsel:

[Plaintiff] today located an additional flash drive in her possession that contains ECG materials. We have had the flash drive imaged by our vendor, and the vendor generated a summary report of the metadata, attached hereto. At this time we cannot turn over the flash drive as it contains items covered by the attorney client privilege . . . as well as confidential items from The Chartis Group.

(Doc. # 59-6 at 1-2.) Defendant did not consent to ECG's request to continue the preliminary injunction ...

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