Suit alleges former employee left company with secret notebooks

Kelly Holleran Feb. 13, 2012, 7:59am

A Nederland company alleges one of its former employees is utilizing stolen information in an illegal attempt to recruit its customers to a new company.

ATM Machine Works alleges it faces the loss of customers and a substantial decrease in its profits if its former employee, defendant Jason Cloyd, is allowed to continue to recruit customers for defendant Echo Constructors.

According to the complaint filed Feb. 3 in Jefferson County District Court, Cloyd is using two stolen notebooks full of ATM Machine Works's customer information and trade secrets to persuade ATM's customers to utilize Echo's services.

Before he defected to Echo, Cloyd had worked for ATM Machine Works for 15 years. ATM engages in a "specialty machine shop business," the suit states.

Echo is a water/jet machine operation, but recently began dabbling in the specialty machine shop business, the complaint states. In 2010, it approached ATM to ask for pricing and proprietary information in relation to the specialty machines, ATM claims. However, ATM refused to provide the company with the requested data, according to the complaint.

Not deterred, Echo's owners attempted to sell its business to ATM. Again, ATM declined the request, the suit states.

Subsequently, Echo recruited Cloyd to work for it, the complaint says.

"At the time of his departure, only Cloyd, the shop's foreman and ATM Machine's ownership were privy to the written materials containing trade secrets," the suit states. "Much of this information was contained in two large notebooks in Cloyd's possession which he has failed to return to ATM Machine to date. On information and belief, Defendants have used and intend to use ATM Machine's proprietary information for financial gain."

In addition to Cloyd and Echo, ATM names Blind Specialist and Gulf Coast Fabricators as defendants. Both Blind Specialist and Gulf Coast also ran the Echo company, according to the complaint.

ATM alleges misappropriation of trade secrets, theft of trade secrets, aiding and abetting in the misappropriation of trade secrets and conspiracy to violate the Theft Liability Act against the defendants.

It seeks a permanent and temporary injunction, ordering Cloyd and the other defendants to refrain from using ATM's proprietary information and to return all secrets to ATM. ATM also seeks general, exemplary and special damages, pre- and post-judgment interest at the legal rate, costs, attorney's fees and other relief the court deems just.

Jason M. Byrd and Thomas C. Mayo of The Byrd Law Firm in Beaumont will be representing him.

The case has been assigned to Judge Gary Sanderson, 60th District Court.

Case No. B191-872

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