AVANTOR, INC., and VWR
`INTERNATIONAL, LLCs,
`
`
`Plaintiffs,
`
`IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`
`
`v.
`
`
`MELISSA ERTL and ILC DOVER
`LP,
`
`
`Defendants.
`
`C.A. No. 2023-0641-LWW
`
`
`DEFENDANT MELISSA ERTL’S OPENING BRIEF IN SUPPORT
`OF HER MOTION TO DISMISS COUNTS IV AND V OF PLAINTIFFS’
`FIRST AMENDED COMPLAINT, AND JOINDER TO DEFENDANT ILC
`DOVER LP’S OPENING BRIEF IN SUPPORT OF ITS PARTIAL RULE
`12(B)(6) MOTION TO DISMISS COUNTS IV AND V OF PLAINTIFFS’
`FIRST AMENDED COMPLAINT
`
`
`
`
`
`
`
`
`Date: November 8, 2023
`
`POTTER ANDERSON & CORROON LLP
`Lauren E.M. Russell, Esq. (No. 5366)
`1313 North Market Street
`Wilmington, Delaware 19801
`Telephone: 302-984-6003
`Email: lrussell@potteranderson.com
`-and-
`WILLIAMS MULLEN
`Michael Lord, Esquire (admitted pro hac vice)
`301 Fayetteville Street, Suite 1700
`Raleigh, NC 27601
`Telephone: (919) 981-4000
`Email: MLord@williamsmullen.com
`Counsel for Defendant Melissa Ertl
`
`
`
`
`
`
`EFiled: Nov 15 2023 03:18PM EST
`Transaction ID 71411043
`Case No. 2023-0641-LWW
`
`
`INTERNATIONAL, LLCs,
`
`
`Plaintiffs,
`
`IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`
`
`v.
`
`
`MELISSA ERTL and ILC DOVER
`LP,
`
`
`Defendants.
`
`C.A. No. 2023-0641-LWW
`
`
`DEFENDANT MELISSA ERTL’S OPENING BRIEF IN SUPPORT
`OF HER MOTION TO DISMISS COUNTS IV AND V OF PLAINTIFFS’
`FIRST AMENDED COMPLAINT, AND JOINDER TO DEFENDANT ILC
`DOVER LP’S OPENING BRIEF IN SUPPORT OF ITS PARTIAL RULE
`12(B)(6) MOTION TO DISMISS COUNTS IV AND V OF PLAINTIFFS’
`FIRST AMENDED COMPLAINT
`
`
`
`
`
`
`
`
`Date: November 8, 2023
`
`POTTER ANDERSON & CORROON LLP
`Lauren E.M. Russell, Esq. (No. 5366)
`1313 North Market Street
`Wilmington, Delaware 19801
`Telephone: 302-984-6003
`Email: lrussell@potteranderson.com
`-and-
`WILLIAMS MULLEN
`Michael Lord, Esquire (admitted pro hac vice)
`301 Fayetteville Street, Suite 1700
`Raleigh, NC 27601
`Telephone: (919) 981-4000
`Email: MLord@williamsmullen.com
`Counsel for Defendant Melissa Ertl
`
`
`
`
`
`
`EFiled: Nov 15 2023 03:18PM EST
`Transaction ID 71411043
`Case No. 2023-0641-LWW
`
`
`
`
`
`TABLE OF CONTENTS
`
`Page
`
`
`Table of Authorities .................................................................................................. ii
`Introduction ................................................................................................................ 1
`Statement of Facts ...................................................................................................... 2
`Argument.................................................................................................................... 4
`I. Standard of Review ....................................................................................................... 4
`II. Defend Trade Secrets Act Immunity ......................................................................... 5
`Conclusion ...............................................................................................................11
`
`
`
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`
`
`TABLE OF AUTHORITIES
`
`Cases
`
`Cognizant Tech. Sols. Corp. v. Franchitti,
` No. 21-cv-16937, 2023 WL 7221244 (D.N.J. Nov. 2, 2023) ..............................10
`
`FirstEnergy Corp. v. Pircio,
` 524 F. Supp. 3d 732 (N.D. Ohio 2021). .............................................................6, 9
`
`Gatti v. Granger Med. Clinic, P.C.,
` 529 F. Supp. 3d 1242 (D. Utah 2021) .................................................................... 5
`
`Jimenez v. Palacios,
` 250 A.3d 814 (Del. Ch. 2019) ........................................................................... 4, 5
`
`McMillan v. Intercargo Corp.,
` 768 A.2d 492 (Del. Ch. 2000) ................................................................................ 4
`Rules
`Court of Chancery Rule 12(c) .................................................................................... 1
`
`
`ii
`
`
`
`
`
`
`
`INTRODUCTION
`Defendant Melissa Ertl (“Ertl”), by and through her undersigned
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`counsel, hereby joins in Defendant ILC Dover LP’s (“ILC Dover”) Opening Brief
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`in Support of its Partial Rule 12(b)(6) Motion to Dismiss Counts IV and V of
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`Plaintiffs’ First Amended Complaint (Dkt. 79), for all of the reasons set forth therein.
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`Specifically, Ertl adopts the argument made by ILC Dover with respect to Plaintiffs’
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`allegations that she disclosed Plaintiffs’ alleged trade secrets to ILC Dover.
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`Plaintiffs’ allegations in support of Counts IV and V of their First Amended
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`Complaint—that Ertl misappropriated Plaintiffs’ “trade secrets”—are conclusory,
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`fail to meet this Court’s pleading standard, and should therefore be dismissed. An
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`award in ILC Dover’s favor on its Partial Rule 12(b)(6) Motion to Dismiss Counts
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`IV and V of Plaintiffs’ First Amended Complaint would render Ertl’s motion
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`pursuant to Court of Chancery Rule 12(c) moot.
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`In the event that the Court does not rule in ILC Dover’s favor, Ertl seeks
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`relief similar to that sought by ILC Dover, through a request for judgment on the
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`pleadings, filed pursuant to Rule 12(c) (the “Motion”).1 (Dkt. 80.) The grounds for
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`Ertl’s Motion are set forth herein.
`
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`1 Defendant Ertl’s Motion is styled as a Motion to Dismiss Counts IV and V of
`Plaintiffs’ First Amended Complaint. For the avoidance of doubt, Plaintiff seeks
`judgment on the pleadings pursuant to Rule 12(c).
`
`
`
`
`
`
`
`STATEMENT OF FACTS
`On December 2, 2019, Avantor hired Ertl as Director of Quality
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`overseeing chemical manufacturing facilities. (First Am. Compl., Dkt. 72 ¶ 43).
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`Until June 2022, Ertl reported to VP of Quality and Regulatory Jamie Ethier. (Id.
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`¶ 45). In January 2021, Ethier promoted Ertl to Senior Director of Quality
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`Operations, at which point Ertl was responsible for manufacturing and clinical sites,
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`quality organizations, and between 200 and 250 direct and indirect reports. (Id.
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`¶¶ 43-44).
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`Avantor hired Rick Campins as SVP of Quality Assurance &
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`Regulatory Affairs to replace Ethier. (Id. ¶ 45).
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`Avantor operates in a highly regulated industry. (Id. ¶ 39). The sites
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`under Ert’s purview manufacture active pharmaceutical ingredients for sale to
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`pharmaceutical companies that produce end-user medications into the marketplace.
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`(Id. ¶¶ 36-39 & 47). A failure by Avantor in its quality and compliance programs
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`could potentially affect the efficacy of the end-product medications. (Id. ¶¶ 40 &
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`52).
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` Accordingly, both Avantor and
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`the end-customer pharmaceutical
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`manufacturers are governed by the FDA. (See, e.g., Dkt. 78, Ex. 6 & Dkt. 72 ¶¶ 52
`
`& 102). In addition, Avantor is subject to federal label standards that are also
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`governed by the FDA. (See, e.g., Dkt. 78, Ex. 1 & Dkt. 72 ¶¶ 90 & 110).
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`2
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`Ertl resigned from Avantor effective May 5, 2023. (Dkt. 72 ¶ 131).
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`Following her resignation, Ertl has retained copies of certain Avantor documents.
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`(Id. ¶¶ 87-118). The specific documents identified by Plaintiffs consist of
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`approximately 119 pages. (Dkt. 72 ¶ 87-118 & Dkt. 78, Exs. 2-16).3
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`Ertl has filed both an EEOC Charge of Discrimination against
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`Plaintiffs and a Sarbanes-Oxley Act (SOX) whistleblower complaint against
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`Plaintiffs with the United States Department of Labor, OSHA. (Dkt. 78, Ninth
`
`Affirmative Defense).4
`
`
`2 Plaintiffs repeatedly cite Ertl’s affidavit in their First Amended Complaint, and her
`testimony is central to their misappropriation claims. (Dkt. 72, ¶¶ 18-20 & 130).
`3 Because Ertl does not have the “Labor Harmonization” email or the Excel
`attachment alleged in Paragraph 87 of Plaintiffs’ First Amended Complaint, she may
`only give an estimate.
`is being
`the Whistleblower Complaint
`4 A
`true and accurate copy of
`contemporaneously filed under seal, as Exhibit A. To be clear, Ertl is not asking the
`Court to accept the truthfulness of the allegations Ertl makes in the Whistleblower
`Complaint for purposes of her Motion; Plaintiffs presumably deny them. Rather,
`3
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`I.
`
`ARGUMENT
`STANDARD OF REVIEW
`Rule 12(c) governs motions for judgment on the pleadings and
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`provides that “[a]fter the pleadings are closed but within such time as not to delay
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`the trial, any party may move for judgment on the pleadings.” Ch. Ct. R. 12(c).
`
`When ruling on a motion for judgment on the pleadings, the trial court is to
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`consider only the pleadings and any attached exhibits, which become part of the
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`pleadings. Jimenez v. Palacios, 250 A.3d 814, 827 (Del. Ch. 2019), as revised
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`(Aug. 12, 2019), aff’d, 237 A.3d 68 (Del. 2020) (“The pleadings to which this
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`Court may look are not limited to complaints or counterclaims, but also include
`
`answers and affirmative defenses. On a Rule 12(c) motion, the Court may consider
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`documents integral to the pleadings, including documents incorporated by
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`reference and exhibits attached to the pleadings, and facts subject to judicial
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`notice.”) The trial court must take the facts alleged by Plaintiffs as true and draw
`
`all reasonable factual inferences in their favor. McMillan v. Intercargo Corp., 768
`
`A.2d 492, 499-500 (Del. Ch. 2000) (“When considering a Rule 12(c) motion, the
`
`court must assume the truthfulness of all well-pled allegations of fact in the
`
`complaint and draw all reasonable inferences in favor of the plaintiff.”)
`
`
`Ertl asks the Court to acknowledge the existence of the complaint and the nature of
`the allegations.
`
`4
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`A motion for judgment on the pleadings will be granted once the
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`movant establishes that no material issue of fact remains to be resolved and that
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`movant is entitled to judgment as a matter of law. Jimenez, 250 A.3d at 827. In
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`operation, Ertl’s Motion is one for summary judgment with a record confined to
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`the pleadings and their exhibits.
`
`II.
`
`DEFEND TRADE SECRETS ACT IMMUNITY
`The Defend Trade Secrets Act (“DTSA”) contains a safe harbor
`
`provision that bars an employer from asserting any civil claim for misappropriation
`
`of trade secrets against its whistleblower employee (or former employee):
`
`(1) Immunity. An individual shall not be held
`criminally or civilly liable under any Federal or State
`trade secret law for the disclosure of a trade secret that –
`(A) is made –
`(i) in in confidence to a Federal, State, or
`local government official, either directly or indirectly, or
`to an attorney; and
`(ii) solely for the purpose of reporting or
`investigating a suspected violation of law.
`18 U.S.C. § 1833(b)(1).
`
`This immunity provision applies to civil liability under any federal or
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`state trade secret law. See Gatti v. Granger Med. Clinic, P.C., 529 F. Supp. 3d 1242,
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`1266-67 (D. Utah 2021) (holding that immunity provision applies to shield
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`individuals from liability under “any federal or state trade secret law”). The safe
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`5
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`harbor immunizes not only permitted disclosures of trade secret information but also
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`the acquisition of it. FirstEnergy Corp. v. Pircio, 524 F. Supp. 3d 732, 740 (N.D.
`
`Ohio 2021). Therefore, Plaintiffs’ claims against Ertl under the Delaware Uniform
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`Trade Secrets Act (“DUTSA”) and the DTSA are covered by the immunity
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`provision. Immunity is an affirmative defense. Id. at 741.
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`All the elements of immunity are reflected in the pleadings in this
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`matter. Consequently, Ertl is entitled to judgment on at least the wrongful
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`acquisition theory of liability.5 A comparison between the documents specifically
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`identified in the Amended Complaint and the allegations of Ertl’s whistleblower
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`complaint shows, as a matter of law, that the documents retained by Ertl relate
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`directly to her protected activities. Compare First Am. Compl., Dkt. 72 ¶¶ 87-118,
`
`with Ertl’s Answer and Affirmative Defenses, Dkt. 78 Exs. 1-16 and Exhibit A
`
`hereto, Ertl’s Whistleblower Complaint.
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`In her Whistleblower Complaint, Ertl alleges in relevant part:
`
`
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`
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`5 Ertl recognizes that Plaintiffs have not plead that she wrongfully disclosed their
`“trade secrets” to either her counsel or government agents. Rather, Plaintiffs’
`allegations of wrongful disclosure are limited to Watson and other unnamed agents
`of ILC Dover. As explained in ILC Dover’s Opening Brief in support of its Partial
`Rule 12(b)(6) Motion to Dismiss Counts IV and V of Plaintiffs’ First Amended
`Complaint (Dkt. 79), those allegations of wrongful disclosure are insufficient as a
`matter of law because they are wholly conclusory and lack any factual support.
`6
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`7
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`In sum, the import of Ertl’s complaint is that
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`. There is complete symmetry between the allegations of Ertl’s
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`Whistleblower Complaint and the Avantor documents that she had retained.
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`For example, the “Labor [sic] Harmonization” email involves
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`. (First Am. Compl., Dkt. 72 ¶¶ 87-90). Avantor
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`commands premium prices on its products due to their “quality, characterization, and
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`purity.” (Id. ¶ 40).
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`).
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` (Id. ¶ 90
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`(Whistleblower Compl., Ex. A ¶ 10).
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`Ertl’s retention of the documents attached to her Answer—Exhibits 1
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`(Label Harmonization), Exhibit 2 (
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`8
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`), Exhibit 3 (
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`), Exhibit 4 (
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`
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`), Exhibits 5 and 6
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`(
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`), Exhibits 7 and 8 (
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`), Exhibit 10 (
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`), Exhibit 11 (
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`), Exhibit 12 (
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`), Exhibit 13 (
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`), and Exhibit 16 (
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`, see Dkt. 78, ¶119-120)—all relate to
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`.6
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`The substance of the documents cited by Plaintiffs in their First
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`Amended Complaint also defeat the conclusory allegations that the documents contain
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`trade secrets within the meaning of the DUTSA and the DTSA.
`
`
`6 The remaining exhibits to Ertl’s Answer and Affirmative Defenses address
`related aspects of her claims, or are not confidential in nature. Exhibit 9 is
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`. Exhibit 14 is merely a cover email with no substantive
`information. Exhibit 15 is a PowerPoint presentation with employee names and
`areas of responsibility, and does not reflect confidential information.
`9
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`By introducing these documents in their First Amended Complaint,
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`Plaintiffs have effectively plead themselves out of a viable misappropriation claim
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`and into establishing Ertl’s immunity defense. Pircio, 524 F. Supp. 3d at 741-42
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`(granting Rule 12(b)(6) motion to dismiss on immunity defense).
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`In conclusion, the thinness of Plaintiffs’ allegations does not
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`camouflage Plaintiffs’ intention in prosecuting the misappropriation claims at this
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`late stage of the action. When expedited discovery did not support their contract-
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`based claims, Plaintiffs switched to an alternative theory on facts already well known
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`to them. Once Defendants educated Plaintiffs about the deficiency of their first draft
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`of their proposed Amended Complaint, Plaintiffs revised the pleading with
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`allegations designed to avoid dismissal on the grounds of DTSA immunity. The
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`machinations surrounding Plaintiffs’ evolving but relentless effort to punish Ertl
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`through the legal system shows that this lawsuit is yet another act of actionable
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`retaliation. Cognizant Tech. Sols. Corp. v. Franchitti, No. 21-cv-16937, 2023 WL
`
`7221244 (D.N.J. Nov. 2, 2023) (former employees’ counterclaims arising out of
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`employer’s retaliatory institution of litigation states a claim for relief).
`
`10
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`CONCLUSION
`For the foregoing reasons, Defendant Melissa Ertl respectfully
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`requests that the Court grant judgment on the pleadings with respect to Counts VI
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`and V of Plaintiffs’ First Amended Complaint.
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`Date: November 8, 2023
`
`
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`
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`Respectfully Submitted,
`POTTER ANDERSON & CORROON LLP
`/s/ Lauren E.M. Russell
`Lauren E.M. Russell, Esq. (No. 5366)
`1313 North Market Street
`Wilmington, Delaware 19801
`Telephone: 302-984-6003
`Email: lrussell@potteranderson.com
`-and-
`WILLIAMS MULLEN
`Michael Lord, Esquire (admitted pro hac vice)
`301 Fayetteville Street
`Suite 1700
`Raleigh, NC 27601
`Telephone: (919) 981-4000
`Email: MLord@williamsmullen.com
`Counsel for Defendant Melissa Ertl
`
`
`11
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`
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`
`
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