Catalinbread LLC V Gee Et Al Ordce-18-01795 0028.0

Case 3:18-cv-01795-HZ Document 28 Filed 04/23/19 Page 1 of 29
Aaron Cronan, OSB 082964

[email protected]
Cronan Law LLC
4207 Woodstock Blvd #440
Portland, OR 97206
Tel: (503) 482-9210
Attorney for Plaintiff
UNITED STATES DISTRICT COURT
DISTRICT OF OREGON
PORTLAND DIVISION
CATALINBREAD LLC, Case No. 3:18-cv-1795-HZ
Plaintiff,
v. SECOND AMENDED COMPLAINT FOR

INJUNCTIVE RELIEF
SCOTT MILLER, AND DAMAGES
HOWARD GEE,
BORIS LUTSKOVSKY, and Violations of Defend Trade Secrets Act (18
MICHAEL ERICKSON U.S.C. § 1836); Oregon Uniform Trade Secrets
Act (O.R.S. § 646.461 et seq.); Fraud and Con-
Defendants. spiracy to Commit Fraud; Intentional Interfer-
ence with Business Relations; Breach of Con-
tract; Trespass to Chattels; Breach of Fiduci-
ary Duty
DEMAND FOR JURY TRIAL

__________________________________
SECOND AMENDED COMPLAINT – 1 Cronan Law LLC

Portland, OR 97206
Tel: (503) 482-9210
Plaintiff Catalinbread, by and through its counsel, for its complaint against
Defendants Scott Miller, Howard Gee, Boris Lutskovsky and Michael Erickson,
hereby alleges as follows:
INTRODUCTION
1. This case concerns a calculated and deliberate effort of Defendants,
former employees of Plaintiff, to cause economic harm to the company,
misappropriate Plaintiff’s intellectual property, tangible property, and protected
trade secrets, for Defendants’ own use and adverse to Plaintiff’s interests.
Defendants, while still working for Plaintiff, conspired to enter into competition
with Plaintiff, using trade secrets and intellectual property rightfully owned by
Plaintiff, with the ultimate objective of running Plaintiff out of business and taking
all of Plaintiff’s business. After Plaintiff became aware of Defendants’ actions and
demanded that Defendants cease their unlawful activities, Defendants took
Plaintiff’s physical and electronic property with the intent to permanently deprive
Plaintiff. Defendants communicated plans, took steps and actually succeeded in
deleting electronic files containing Plaintiff’s trade secrets, intellectual property and
information critical for the operations of the business. Plaintiff has already suffered
injuries and is certain to suffer further injury as the proximate result of Defendants’
unlawful conduct.
PARTIES
2. Plaintiff Catalinbread LLC is a limited liability company, organized
and existing under Oregon law, with its principal place of business in Portland,

Portland, OR 97206
Tel: (503) 482-9210
Oregon (hereinafter “Catalinbread”). Plaintiff creates a variety of guitar pedals
using innovative engineering and design techniques, which it sells across the
United States and internationally.
3. Defendant Scott Miller (“Miller”) was Catalinbread’s Sales
Representative and assigned the role of temporary manager of Catalinbread
following the untimely passing of the founder and owner, Nicholas Harris
(“Harris”). Miller held this role until on or about October 20, 2017 when he resigned
after becoming aware that Catalinbread’s new owner, Mary Burkett (“Burkett”),
mother and heir of Harris’ business, had discovered the conspiracy to harm the
company.
4. Defendant Howard Gee (“Gee”) was paid to design guitar pedals for
Catalinbread until on or about October 20, 2017 when he resigned after becoming
aware that Burkett had discovered the conspiracy to harm the company.
5. Defendant Boris Lutskovsky (“Lutskovsky”) was employed as
Plaintiff’s IT administrator and was responsible for providing information
technology and computer support until he was terminated for cause on or about
October 26, 2017.
6. Defendant Michael Erickson (“Erickson”) was employed to provide
customer service and artist relations until he resigned on or about October 23, 2017.
JURISDICTION
7. This Court has subject matter jurisdiction over federal question claims
under the Defend Trade Secrets Act, 18 U.S.C. § 1836, pursuant to 28 U.S.C. §

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1331. Additionally, this Court has supplemental jurisdiction over all other claims
herein asserted pursuant to 28 U.S.C. § 1367 because all claims rise from the same
controversy.
8. This Court has personal jurisdiction over all parties because they
reside in or have their principal place of business or employment in the District of
Oregon.
9. Venue is proper in this Court because the transactions giving rise to
this action occurred in the District of Oregon and all parties reside in or have their
principal place of business in the District of Oregon. Venue is proper in the Portland
Division because the events giving rise to the claim occurred in the counties over
which the Portland Division presides.
FACTS OF THE CASE
10. Catalinbread was founded in 2003 by Harris as a producer of
specialized guitar effects and distortion pedals.
11. Defendants were employees of Catalinbread prior to the events in this
action.
12. Since its founding, Catalinbread developed a national reputation for
producing unusual and innovative pedals, which were used by numerous prominent
musicians and are sold across the United States and internationally.
13. Catalinbread developed and continues to maintain proprietary and
confidential information, plans, designs, schematics, programs, lists, and knowhow
related to the design, manufacture, sales of its products, as well as valuable and

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confidential information regarding the operations of the business. The confidential
information includes but is not limited to: build of material (“BOM”), specifying
exactly which parts are required for each pedal manufactured; cost of goods
(“COG”), the proprietary list of wholesale costs for each component of the pedals,
since Catalinbread’s costs necessarily vary from other manufactures because the
sources and purchase prices are negotiated confidentially; schematics, describing
the circuit structure and signal flow of the pedals, which are confidential and
protected information, especially for new or unreleased pedals, because a competitor
would require significant time and effort to reverse engineer them; product
structures defining the exact measurements and methods for building the pedals;
project files, including the application or program specific files that allow
Catalinbread to design and test schematics, product structures, printed circuit
boards, program microchips and even the images printed on the pedal itself; and
data files, which are the final exported versions of the project files, used primarily
to cut circuit boards, shape enclosures, flash machine code onto microchips, and
print graphics on the pedals.
14. Collectively, all of this information constitutes Catalinbread’s valuable
trade secrets, its “secret sauce.” With this information, a competitor could clone
pedals, use pricing information for competitive advantage, build off of
Catalinbread’s efforts and create derivative products, or take a variety of other
harmful actions. Without the trade secrets, a competitor would need to spend
significant time and resources to reverse engineer the parts list, the circuit boards,

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the signal flow, and the measurements of the enclosures. The machine code on the
microchips cannot be deciphered from the programmed chips, forcing the competitor
to recreate its own code in an attempt to emulate the functions of the chips on the
boards. However, should the competitor have possession the proprietary files, it
could simply begin building Catalinbread pedals.
15. The trade secrets are so important and valuable to Catalinbread that
prior to finalizing Harris’ probate, Defendant Miller, as acting manager, did not
want to share that information with Burkett. In a communication to Harris’ probate
attorney Miller wrote, “Mary is asking for costed bills-of-material and schematics
for all of our pedals. Than information is proprietary as hell, and the fact that she is
asking for it is extremely worrisome to me. That data would be of tremendous value
to someone like Josh from JHS Pedals . . .” (one of Plaintiff’s competitors).
16. Catalinbread took reasonable and appropriate steps to secure and
protect the trade secrets, including but not limited to: adopting confidentiality
policies and procedures in its employee handbook; maintaining a secure computer
network, protected by passwords and limiting user accounts to employees with
password requirements; and deprovisioning employees who left employment.
17. Harris died unexpectedly on March 9, 2016, when his vehicle was
struck by a tree felled in a windstorm. Melissa Palmer, Nicholas’ sister, was
appointed to administer his estate. Ownership then passed after probate to
Nicholas’ mother, Mary Burkett. Burkett is currently the sole owner of
Catalinbread and remains active in its administration. Probate closed in or around

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June 2017.
18. After Burkett assumed control of the company in June 2017,
production suddenly and without explanation fell significantly below prior levels.
19. Because Scott Miller was the acting manager, Burkett sought
explanations from Miller regarding the drop in production. Burkett requested
updates and detailed reports from Miller. Miller ignored or outright refused to
comply with the requests.
20. During this same time period, Defendants were using Catalinbread
laptops to communicate privately on the online messaging service Slack.
Defendants used Slack to communicate plans to compel Burkett to sell them the
company by making it difficult if not impossible to continue operations if she
refused.
21. Also during this same time period, Defendants conspired to delete and
successfully deleted entire threads of the Slack conversations to prevent discovery
by Burkett. Upon information and belief, the communications were deleted after
notice of Plaintiff’s investigation and their full knowledge of likely litigation.
22. In or around August 2017, Miller and Gee started insisting that
Burkett sell them the company and that Burkett provide financing for the sale.
23. In or around September 2017, Defendants started taking overt steps
towards founding a new company to compete directly against Catalinbread,
including removing components for building product, proprietary development parts

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and breadboards1 from Catalinbread with the specific intent of recasting
proprietary and unreleased Catalinbread prototypes as competing pedals.
Defendants also started making plans to raise funds for their new competing
venture. Around this time, Defendants purchased domain names for use with the
planned competing company.
24. Defendants continued to work for Catalinbread as they planned their
new competing company, and repeatedly reminded each other to do the “bare
minimum” yet “play poker face” while working at Catalinbread so as not to arouse
suspicion. While being paid for company work, Miller scheduled and held meetings
with the staff to plan for the new company.
25. In or around October 2017, as Defendants demonstrated concern that
Catalinbread would discover their plans, Defendants accessed Catalinbread’s Slack
account and Catalinbread’s on-site computers and, without authorization, deleted
company-owned information that could reveal their plans for their new company.
Defendants deleted their own Slack conversations and “channels” created on
Catalinbread’s Slack account. They deactivated or deleted accounts of current and
former employees, including Harris’ own legacy account and that of Harris’ sister,
Melissa Palmer, who were not cooperating and posed a threat of discovery of the
conspiracy plans.
26. In or around October 2017, Gee, going by his known nickname
1A breadboard is a construction base for guitar pedals and other electronics,

generally used for creating prototypes.

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Kittycaster, and Lutskovsky, created a second Slack channel that allowed
Defendants to communicate outside of Catalinbread’s system.
27. In or around September and October 2017, Defendants planned a trip
to the annual National Association of Music Merchants conference (“NAMM show”),
using Catalinbread’s funds and resources, in order to raise funds and awareness of
their new competing venture. Defendants represented this trip to Catalinbread as a
networking trip for Catalinbread’s benefit. Defendants expressly planned to buy
non-refundable tickets so they would still be able to use arrangements paid for by
Catalinbread even if they left the company and went into competition against
Catalinbread.
28. In or around October 2017, Defendants conspired to use and began
using Catalinbread’s proprietary engineering to develop a line of competing
products, while purporting to work on Catalinbread’s time and using Catalinbread’s
resources. Defendants discussed getting the work done “on [Catalinbread]
paychecks” so they would not be “burning this money on salaries” of their competing
venture. Defendants Gee and Lutskovsky made efforts to work from home as much
as possible so they would not be discovered working on their own projects where
they would be seen by Catalinbread management or other employees.
29. On or around October 13, 2017, Defendants conspired to coerce
Burkett to sell Catalinbread to them or they would cause the company to self-
destruct. Defendants expressed through Slack their dual hopes that this plan would
lead to them having their own venture, while having Catalinbread as a venture

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“end badly” for Burkett.
30. On or around October 14, 2017, Defendants took steps to download
NAMM show badges and purchase non-refundable tickets using Catalinbread
resources for use under their new venture.
31. On or around October 14, 2017, Defendants resolved to stop producing,
but still collect wages from Catalinbread, in order to coerce Catalinbread to either
fire them, in which case they would seek unemployment, or sell them the business.
32. On or around October 16, 2017, Defendants took overt steps to cause
Catalinbread to self-destruct, including falsely and without authorization marking
supplies as out of stock and downloading protected BOM, COG, schematics, project
files, programs, source code, complied code and other data critical from
Catalinbread computers, making copies for later appropriation and deleting the
files as they went.
33. On or around October 16, 2017, Defendants expressly discussed their
progress on Slack towards obtaining the proprietary and protected trade secrets:
Lutskovsky: “what would help is getting a list of what info we have and
where it is. i don’t know where all the schematics are”
Later that day Erickson confirmed they had obtained many of the critical files:
Erickson: “To recap: We have Slack, Email, Docs, All BOMs, schematics,
measurements, programs, etc What else do we need?”
plans on Slack to cause significant harm to Catalinbread’s reputation with the

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intent to lower the company’s value. Gee wrote, “Once the world finds out, no dealer
would order from cbread anymore, should she be able to resuscitate it. Scott would
get the word out. Then the name Catalinbread will be worthless and if we want
we’ll be able to buy it for $20.”
plans on Slack to destroy or render inaccessible critical and proprietary information:
Miller: “Might be a good idea to wipe my old MacBook clean. That’s got
the Deluxe and Pre files as well as all the old shit. The iMac has the
old shit on it but not deluxe and pre. Change the passwords too. Make
that asshole really have to work to get any of that info.”
Erickson: “Is that the laptop on your desk?”
Miller: Yup. I did a reset, but I’m not sure it completed. It wanted me
to sign into the App Store with my Apple ID but I didn’t do that.”
Later that day:
Erickson: “@baldo [Miller] can you snag and wipe Bryan’s MacBook?”
36. As to Erickson’s second statement, Plaintiff believes he is referring to
the computer that Plaintiff had provided to one of its former employees, Bryan
Lundstrom. Lundstrom left Plaintiff’s employment on or about September 2017.
37. On or around October 16, 2017, Defendants had physically removed
and taken possession of Catalinbread property used to develop new products.
Defendants’ Slack conversations that day describe some of the property they had
already removed: breadboards, development parts and other “stuff”. Defendants

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also expressly describe their intent to use the company’s own property they had
taken, development parts, physical property and the intellectual property embedded
within, to create their own competing pedals:
Gee: “I have all of the breadboards for stuff I developed. Matthew
grabbed a bunch of random dev parts and stuff.”
Lutskovsky: “Good”
Gee: “The Belle Dix breadboard will come in handy when we recast it
as a new even better pedal.”
Lutskovsky: “yep”
38. On or around October 18, 2017, Burkett made a good faith effort to
engage Defendants and offered a way forward that would foster cooperation and
protect Catalinbread from further injury.
39. On or around October 18, 2018, at the same time Burkett was meeting
with Catalinbread employees and again immediately following the end of business,
Defendants escalated their efforts to pull as much proprietary and secret
information from Catalinbread computers as they could, and accelerated work on
establishing the competing venture, using Catalinbread resources before access
could be fully denied.
40. On or around October 18, 2017 and shortly thereafter, upon realizing
that their plans had been discovered by Catalinbread, Defendants expressly
misrepresented and lied about their actions and the intentions, with the hope of
“stringing [Burkett] along” in order to buy more time to convert Catalinbread

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resources and develop competing products while still being paid by Catalinbread.
Defendants falsely informed Burkett that they did not use Slack so that she would
not find their plans. Making good on the plans discussed in Slack, Defendants
purged their company phones, deleted information from Catalinbread computers,
changed and deleted online passwords, purged Catalinbread laptops, and took
Catalinbread property before Miller, Gee and Erickson quit. Lutskovsky was
terminated for cause a few days later.
41. At least as early as October 2017 and ongoing, Defendants continued
to design their new competing line of products, built directly off of Catalinbread
information and property, while simultaneously initiating a smear campaign
against Catalinbread with the express intention that Catalinbread would no longer
be able to sell to distributors “should [Burkett] be able to resuscitate” the company.
As if to broadcast their intent, Defendants renamed their Slack channel
“Catalindead.”
42. After Defendants’ employment with Catalinbread ended, Plaintiff
performed a systematic search of all Catalinbread computers and was unable to
locate missing critical files necessary to continue its operations. The missing files
included files used to design and print the circuit boards, the source code and some
of the compiled code used to program multiple microchip processors, electronic
versions of BOMs, project files required for updating or improving existing pedals.
In particular, these files were also missing from Lundstrom’s computer, where they
should have remained unaltered after Lundstrom left employment. The fact that

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Defendant Erickson stated, “can you snag and wipe Bryan’s MacBook?” (supra at
Paragraph 35), aligns with the discovery that proprietary information was
subsequently missing from Lundstrom’s computer and other company computers.
Accordingly, upon information and belief, at least one of Defendants, Erickson,
Miller, and/or Gee, working in concert with the others, accessed Lundstrom’s
computer without authorization and destroyed Plaintiff’s proprietary information—
as they said they would.2
43. As a result of Defendants’ destructive efforts, Plaintiff was forced to
reconstruct some of these missing files from information it had previously sent to its
vendors. Other files were simply destroyed and could not be replicated, including
files necessary to construct and update certain pedals. This information remains
missing.
44. These recovery efforts were time-consuming, expensive, and ultimately
yielded mixed results. The damage Defendants inflicted on Plaintiff, both before
and after their employment ended, was widespread and nearly catastrophic. The
2 Based upon the targeted nature of the actions and the express plans discussed
among the Defendants, along with the disappearance of critical operational files
and unusual network and computer traffic following Defendants’ employment,
Plaintiff believes Defendants, in concert, using Defendant Lutskovsky’s thorough
knowledge of Plaintiff’s IT infrastructure, accessed company-protected systems after
they were terminated for the purpose of obtaining critical files. One of the primary
targets was the main shop computer the Defendants discussed in the Slack threads
as a target for deletion. If during discovery Plaintiff uncovers evidence that
indicates the unusual post-employment activity is attributable to any of the
Defendants, Plaintiff will request leave of court to further amend its complaint to
bring additional claims against Defendants in connection with those findings.

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value of the lost information and prototypes, coupled with the cost of recovery
efforts and other damages, exceed $200,000.
45. Through Plaintiff’s communications with retailers, suppliers and
competitors, Plaintiff believes Defendants took substantial steps to form a
competing business and use some of the trade secrets they copied and then deleted
from Catalinbread computers, as well as the physical prototypes.
46. As the direct and proximate result of the intentional, planned and
systematic deletion, removal and destruction of company assets, Burkett and
Catalinbread were forced to expend significant time and money to restore business
operations; the business incurred substantial and near terminal losses in revenue,
sales, production, and suffered irreparable damage to its reputation.
CLAIMS FOR RELIEF
FIRST CLAIM FOR RELIEF

(Misappropriation of Trade Secrets Under the Defend Trade Secrets Act
(18 U.S.C. § 1836)
47. Plaintiff incorporates by reference the allegations contained in
paragraphs 1 through 46 above, as though set forth fully herein.
48. Plaintiff owns and possesses aforementioned confidential and
proprietary trade secret information, which is financial, scientific, business,
economic, technical, or engineering in nature.
49. Plaintiff has taken reasonable measures to keep said information

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secret and confidential.
50. Plaintiff’s said information derives independent economic value from
not being generally known to, and not being readily ascertainable through proper
means by, another person who can obtain economic value from the disclosure or use
of the information.
51. Plaintiff’s said information relates to the products and services now
and in the future used, sold, shipped, and ordered in interstate and foreign
commerce.
52. Upon information and belief, Defendants, individually and in concert,
acquired said trade secrets by improper means.
53. Upon information and belief, Defendants knew or had reason to know
that said trade secrets were obtained by improper means.
54. Upon information and belief, Defendants disclosed or used, or intended
to disclose or use, said Plaintiff’s trade secrets without the consent of Plaintiff or
any other person authorized to consent to use at the time of disclosure or use.
55. Upon information and belief, Defendant obtained said trade secrets
through theft, misrepresentation, breach of duty to maintain secrecy, and
inducement of breach of duty to maintain secrecy.
56. Upon information and belief, Defendant did not obtain said trade
secrets through reverse engineering, independent derivation, or any other lawful
means of acquisition.
57. As a direct and proximate result of Defendants’ willful and malicious

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misappropriation, Plaintiff has been damaged in an amount to be determined at
trial, and therefore Plaintiff is entitled to an award of exemplary damages and
reasonable attorney’s fees and costs incurred herein pursuant to 18 U.S.C. §
1836(b)(3)(C)-(D).
SECOND CLAIM FOR RELIEF

(Misappropriation under Oregon Uniform Trade Secrets Act)
(O.R.S. § 646.461 et seq.)
59. The Oregon Uniform Trade Secrets Act, O.R.S. § 646.461 et seq.
(“OUTSA”), allows a party to recover compensatory damages in the form of actual
losses stemming from the misappropriation of a trade secret and the unjust
enrichment experienced by the party liable for misappropriation. In addition, upon
a showing of willful or malicious misappropriation, punitive damages may be
awarded in an amount not exceeding twice any compensatory damages.
60. The OUTSA also allows for the temporary, preliminary and permanent
enjoinment of actual or threatened misappropriation.
61. The OUTSA further allows the award of attorney fees and punitive
damages upon a finding of willful or malicious misappropriation of a trade secret.
62. Under the OUTSA, “trade secret” is defined broadly to mean
“[i]nformation, including a drawing, cost data, customer list, formula, pattern,
compilation, program, device, method, technique or process that:

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(a) Derives independent economic value, actual or potential, from not
being generally known to the public or to other persons who can
obtain economic value from its disclosure or use; and
(b) Is the subject of efforts that are reasonable under the circumstances
to maintain its secrecy.”
63. Under the OUTSA, “misappropriation” is defined as:
(a) “Acquisition of a trade secret of another by a person who knows or
has reason to know that the trade secret was acquired by improper
means;
(b) or use of a trade secret of another without express or implied
consent by a person who used improper means to acquire
knowledge of the trade secret;
(c) Disclosure or use of a trade secret of another without express or
implied consent by a person who, before a material change of
position, knew or had reason to know that it was a trade secret and
that knowledge of it had been acquired by accident or mistake; or
(d) Disclosure or use of a trade secret of another without express or
implied consent by a person, who at the time of disclosure or use,
knew or had reason to know that the knowledge of the trade secret
was:
(A) Derived from or through a person who had utilized
improper means to acquire it;

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(B) Acquired under circumstances giving rise to a duty to
maintain its secrecy or limit its use; or
(C) Derived from or through a person who owed a duty to the
person seeking relief to maintain its secrecy or limit its use.” O.R.S. §
646.461(2).
64. Under the OUTSA, “improper means” is defined to include: “theft,
bribery, misrepresentation, breach or inducement of a breach of a duty to maintain
secrecy or espionage through electronic or other means.” O.R.S. § 646.461(1).
65. Plaintiff owns and possesses the aforementioned confidential and
proprietary trade secret information.
66. Plaintiff has taken reasonable efforts under the circumstances to
maintain the secrecy of said information.
67. Plaintiff’s said information derives independent economic value from
not being generally known to the public or to other persons who can obtain economic
value from its disclosure or use.
acquired said trade secrets by improper means.
69. Upon information and belief, Defendants knew or had reason to know
that said trade secrets were obtained by improper means.
70. Upon information and belief, Defendants disclosed or used, or intended
to disclose or use, Plaintiff’s trade secrets without the consent of Plaintiff or any
other person authorized to consent to use at the time of disclosure or use.

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71. Upon information and belief, Defendant obtained said trade secrets
through theft, misrepresentation, breach of duty to maintain secrecy, and
inducement of breach of duty to maintain secrecy, through electronic or other
means.
72. Upon information and belief, Defendant did not obtain said trade
secrets through reverse engineering or independent development alone.
73. Defendants willfully and maliciously acquired and used that
information knowing that they were doing so by improper means.
74. As a results of Defendants’ willful and malicious misappropriation of
its trade secrets, Plaintiff has suffered damages in an amount to be proven at trial
and is entitled to compensatory and punitive damages, pursuant to O.R.S. §
646.465.
75. Plaintiff also requests that the Court grant permanent injunctive relief
against each and every Defendant under O.R.S. § 646.463: (a) enjoining Defendants
from further access to, or use of, Plaintiff’s data, files, records, information and
accounts, including all proprietary prototypes and other forms of intellectual
property embodied therein, and the computers on which such items are stored
(collectively, “Plaintiff’s Protected Information”); (b) ordering the return of all
company property, including all copies of Plaintiff’s Protected Information; (c)
enjoining Defendants from soliciting or initiating contact with any distributors or
retailers engaged in the sale or distribution of guitar pedals; and (d) enjoining
Defendants from owning, managing or being employed by any business engaged in

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the sale or distribution of guitar pedals.
76. Plaintiff has and will continue to suffer irreparable harm unless
Defendants are so enjoined. Plaintiff lacks an adequate remedy at law to protect it
from this harm and to compensate it for the damages and loss suffered and that it
will continue to suffer from Defendants’ misappropriation of its trade secrets. In
addition to the irreparable harm that will occur to Plaintiff’s ability to effectively
compete in the marketplace if its trade secrets and confidential and proprietary
information are used by Defendants to compete against it, or otherwise
disseminated to Plaintiff’s competitors or the general public, Plaintiff will suffer
irreparable harm to its ability to maintain the secrecy and confidentiality of its
trade secrets and confidential information, and thereby suffer a loss of the right to
protect such information as a trade secret and as confidential. If the
misappropriated and wrongfully obtained information are not returned, Plaintiff’s
ability to maintain and protect its secrecy and confidentiality will be compromised if
not wholly eviscerated.
77. Plaintiff is entitled to an award of reasonable attorney’s fees and costs
incurred herein pursuant to O.R.S. § 646.467.
THIRD CLAIM FOR RELIEF

(Fraud and Conspiracy to Commit Fraud)

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knowingly made false representations of material facts to Plaintiff, including, but
not limited to their assertions that Defendants were continuing to work on behalf of
Catalinbread, when in fact they were actively planning to compete against
Catalinbread and destroy its value.
80. Upon information and belief, Defendants intended that Plaintiff act on
false representations in a manner reasonably contemplated.
81. Plaintiff was not aware of the falsity of Defendant’s representation.
82. Plaintiff rightfully and reasonably relied on the truth of Defendant’s
representation by continuing to employ each of them until Plaintiff ultimately
uncovered the truth about their plans.
83. Plaintiff suffered injuries as the actual and proximate result of
Defendant’s false representation.
84. Upon information and belief, Defendants had a meeting of the minds
on the object and course of action in one or more unlawful overt acts in furtherance
of said fraud.
85. As a direct and proximate result of Defendants’ actions, Plaintiff has
been damaged in an amount to be determined at trial.
FOURTH CLAIM FOR RELIEF

(Intentional Interference with Business Relations)
87. Plaintiff has a valid business relationship with distributors, retailers

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and consumers.
intentionally interfered with said relationship.
89. At the time of interference, Defendants were no longer associated with
Plaintiff and were therefore a third party.
90. Upon information and belief, Defendants’ interference was
accomplished through improper means and for an improper purpose.
91. Upon information and belief, Plaintiff suffered damage to economic
relations with distributors, retailers and consumers as an actual and proximate
result of Defendants’ interference in an amount to be determined at trial.
92. Plaintiff requests that the Court grant injunctive relief against each
and every Defendant: (a) enjoining Defendants from further access to, or use of,
Plaintiff’s Protected Information; (b) ordering the return of all company property,
including all copies of Plaintiff’s Protected Information; (c) enjoining Defendants
from soliciting or initiating contact with any distributors or retailers engaged in the
sale or distribution of guitar pedals; and (d) enjoining Defendants from owning,
managing or being employed by any business engaged in the sale or distribution of
guitar pedals.
FIFTH CLAIM FOR RELIEF

(Breach of Contract)

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94. Defendants were paid for contracted services pursuant to written and
oral agreements effective through resignation or termination in or about October
2017.
95. Defendants breached the agreement by failing to perform the
contracted services.
96. As a direct and proximate result of Defendants’ breach, Plaintiff has
been damaged in an amount to be determined at trial.
SIXTH CLAIM FOR RELIEF

(Trespass to Chattels)
98. Upon information and belief, Defendants, individually, and in concert,
intentionally exercised dominion and control of Plaintiff’s tangible and intangible
property, including intellectual property.
99. In exercising dominion and control of Plaintiff’s property, Defendants
dispossessed Plaintiff of property’s value.
100. Plaintiffs suffered actual injury as the actual and proximate result of
Defendants’ dominion and control of Plaintiff’s property in an amount to be
determined at trial.
SEVENTH CLAIM FOR RELIEF

(Breach of Fiduciary Duty)

Portland, OR 97206
Tel: (503) 482-9210
102. Each Defendant, while they were Plaintiff’s employees, trusted with
access to confidential and proprietary information, owed to Plaintiff fiduciary
duties, including, but not limited to the duties of undivided loyalty, utmost good
faith, full, fair and frank disclosure, and fair dealing.
103. Each Defendant breached his fiduciary duties to Plaintiff as
specifically set forth in the above-stated allegations, and including, but not limited
to:
(a) Accessing and downloading the company’s confidential and proprietary
information, data, files, trade secrets, records, and accounts;
(b) Deleting the company’s confidential and proprietary information, data,
files, trade secrets, records, and accounts from company systems;
(c) Preparing to use confidential information and trade secrets to solicit
Plaintiff’s clients, solicit the company’s employees, and otherwise compete
with Plaintiff after they separated from the company;
(d) Developing competing products with company trade secrets and planning
a creating a competing company while on paid company time and with
company computer and internet assets; and
(e) Committing other acts, as detailed herein, to the detriment of the
company.
104. As a result of Defendants’ breach of their fiduciary duties, Plaintiff has
been damaged in an amount to be proven at trial, and is entitled to compensatory

Portland, OR 97206
Tel: (503) 482-9210
and punitive damages.
DEMAND FOR JURY TRIAL

105. Plaintiff demands trial by jury on all appropriate claims.
PRAYER FOR RELIEF

WHEREFORE, Plaintiff prays for relief against Defendants and each of them as
follows:
a. On Plaintiff’s First Claim for Relief (Misappropriation of Trade Secrets,
Federal), in an amount to be determined at trial, but for not less than
$200,000;
b. On Plaintiff’s Second Claim for Relief (Misappropriation of Trade
Secrets, State):
1. Damages in an amount to be determined at trial, but for not
less than $200,000; and
2. Injunctive relief pursuant to O.R.S. § 646.463: (a) enjoining
Defendants from further access to, or use of, Plaintiff’s
Protected Information; (b) ordering the return of all company
property, including all copies of Plaintiff’s Protected
Information; (c) enjoining Defendants from soliciting or
initiating contact with any distributors or retailers engaged
in the sale or distribution of guitar pedals; and (d) enjoining
Defendants from owning, managing or being employed by

Portland, OR 97206
Tel: (503) 482-9210
any business engaged in the sale or distribution of guitar
pedals.
c. On Plaintiff’s Third Claim for Relief (Fraud and Conspiracy to Commit
Fraud), damages in an amount to be determined at trial, but for not less
than $200,000;
d. On Plaintiff’s Forth Claim for Relief (Intentional Interference with
Business Relations):
2. Injunctive relief: (a) enjoining Defendants from further ac-
cess to, or use of, Plaintiff’s Protected Information; (b) order-
ing the return of all company property, including all copies of
Plaintiff’s Protected Information; (c) enjoining Defendants
from soliciting or initiating contact with any distributors or
retailers engaged in the sale or distribution of guitar pedals;
and (d) enjoining Defendants from owning, managing or be-
ing employed by any business engaged in the sale or distribu-
tion of guitar pedals.
e. On Plaintiff’s Fifth Claim for Relief (Breach of Contract), damages in an
amount to be determined at trial, but for not less than $200,000;
f. On Plaintiff’s Sixth Claim for Relief (Trespass to Chattels):

Portland, OR 97206
Tel: (503) 482-9210
2. An order requiring Defendants to return all company
property, including all copies of Plaintiff’s Protected
Information.
g. On Plaintiff’s Seventh Claim for Relief (Breach of Fiduciary Duty),
damages in an amount to be determined at trial, but for not less than
$200,000;
h. Plaintiff’s reasonable attorneys’ fees, costs, and disbursements incurred
herein; and
i. Such other and further relief as the Court deems just and proper.
Dated: April 23, 2019 /s/ Aaron J. Cronan

Aaron J. Cronan, OSB 082964
Attorney for Plaintiff Catalinbread

Portland, OR 97206
Tel: (503) 482-9210
CERTIFICATE OF SERVICE
I hereby certify that on April 23, 2019, I have made service of the foregoing Second
Amended Complaint for Injunctive Relief and Damages on the party/ies listed below
in the manner indicated:
Christopher Lundberg
Haglund Kelley LLP
200 SW Market St., Suite 1777
Portland, OR 97201-5771
[email protected]
Attorneys for the Defendants: Miller, Gee and Lutskovsky
Jon Strided
Meg Houlihan
Tonkon Torp LLP
Legal Assistant
888 SW Fifth Ave., Suite 1600
Portland, OR 97204
[email protected]
[email protected]
Attorneys for Defendant: Michael Erickson
Email
Electronically via USDC CM/ECF system
Dated: April 23, 2019 /s/ Aaron J. Cronan

Aaron J. Cronan, OSB082964
Attorney for Plaintiff
SECOND AMENDED COMPLAINT – CERTIFICATE OF SERVICE Cronan Law LLC

Portland, OR 97206
Tel: (503) 482-9210

Catalinbread LLC V Gee Et Al Ordce-18-01795 0028.0

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Case 3:18-cv-01795-HZ Document 28 Filed 04/23/19 Page 1 of 29

Aaron Cronan, OSB 082964

UNITED STATES DISTRICT COURT

CATALINBREAD LLC, Case No. 3:18-cv-1795-HZ

v. SECOND AMENDED COMPLAINT FOR

DEMAND FOR JURY TRIAL

SECOND AMENDED COMPLAINT – 1 Cronan Law LLC

hereby alleges as follows:

1. This case concerns a calculated and deliberate effort of Defendants,

former employees of Plaintiff, to cause economic harm to the company,

misappropriate Plaintiff’s intellectual property, tangible property, and protected

demanded that Defendants cease their unlawful activities, Defendants took

Plaintiff. Defendants communicated plans, took steps and actually succeeded in

2. Plaintiff Catalinbread LLC is a limited liability company, organized

SECOND AMENDED COMPLAINT – 2 Cronan Law LLC

Oregon (hereinafter “Catalinbread”). Plaintiff creates a variety of guitar pedals

United States and internationally.

3. Defendant Scott Miller (“Miller”) was Catalinbread’s Sales

Representative and assigned the role of temporary manager of Catalinbread

5. Defendant Boris Lutskovsky (“Lutskovsky”) was employed as

Plaintiff’s IT administrator and was responsible for providing information

October 26, 2017.

6. Defendant Michael Erickson (“Erickson”) was employed to provide

SECOND AMENDED COMPLAINT – 3 Cronan Law LLC

reside in or have their principal place of business or employment in the District of

9. Venue is proper in this Court because the transactions giving rise to

which the Portland Division presides.

FACTS OF THE CASE

10. Catalinbread was founded in 2003 by Harris as a producer of

specialized guitar effects and distortion pedals.

11. Defendants were employees of Catalinbread prior to the events in this

12. Since its founding, Catalinbread developed a national reputation for

13. Catalinbread developed and continues to maintain proprietary and

confidential information, plans, designs, schematics, programs, lists, and knowhow

SECOND AMENDED COMPLAINT – 4 Cronan Law LLC

confidential information regarding the operations of the business. The confidential

sources and purchase prices are negotiated confidentially; schematics, describing

protected information, especially for new or unreleased pedals, because a competitor

Catalinbread to design and test schematics, product structures, printed circuit

print graphics on the pedals.

14. Collectively, all of this information constitutes Catalinbread’s valuable

pedals, use pricing information for competitive advantage, build off of

Catalinbread’s efforts and create derivative products, or take a variety of other

SECOND AMENDED COMPLAINT – 5 Cronan Law LLC

could simply begin building Catalinbread pedals.

want to share that information with Burkett. In a communication to Harris’ probate

to someone like Josh from JHS Pedals . . .” (one of Plaintiff’s competitors).

16. Catalinbread took reasonable and appropriate steps to secure and

policies and procedures in its employee handbook; maintaining a secure computer

network, protected by passwords and limiting user accounts to employees with

password requirements; and deprovisioning employees who left employment.

struck by a tree felled in a windstorm. Melissa Palmer, Nicholas’ sister, was

appointed to administer his estate. Ownership then passed after probate to

Nicholas’ mother, Mary Burkett. Burkett is currently the sole owner of

Catalinbread and remains active in its administration. Probate closed in or around

SECOND AMENDED COMPLAINT – 6 Cronan Law LLC

18. After Burkett assumed control of the company in June 2017,

explanations from Miller regarding the drop in production. Burkett requested