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MicroBilt Corporation v., 14-1139 (2014)

Court: Court of Appeals for the Third Circuit Number: 14-1139 Visitors: 27
Filed: Dec. 10, 2014
Latest Update: Mar. 02, 2020
Summary: NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 14-1139 _ IN RE: MICROBILT CORPORATION, ET AL., Debtors _ MICROBILT CORPORATION, Appellant v. CHEX SYSTEMS, INC.; GUNSTER, YOAKLEY & STEWART, P.A.; DAVID M. WELLS _ On Appeal from the United States District Court for the District of New Jersey (Civil Action No. 13-cv-04752) District Judge: Honorable Anne E. Thompson _ Submitted Under Third Circuit LAR 34.1(a) October 30, 2014 Before: MCKEE, Chief Judge, GREENAWAY, JR., a
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                                                                 NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT
                                 _____________

                                      No. 14-1139
                                     _____________

                    IN RE: MICROBILT CORPORATION, ET AL.,
                                         Debtors
                                _____________

                             MICROBILT CORPORATION,
                                          Appellant

                                             v.

                            CHEX SYSTEMS, INC.;
                      GUNSTER, YOAKLEY & STEWART, P.A.;
                               DAVID M. WELLS

                                     _____________

                     On Appeal from the United States District Court
              for the District of New Jersey (Civil Action No. 13-cv-04752)
                      District Judge: Honorable Anne E. Thompson
                                    _______________

                       Submitted Under Third Circuit LAR 34.1(a)
                                   October 30, 2014

    Before: MCKEE, Chief Judge, GREENAWAY, JR., and KRAUSE, Circuit Judges.

                               (Filed: December 10, 2014)

                                    _______________

                                       OPINION
                                    _______________


       This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does
not constitute binding precedent.
KRAUSE, Circuit Judge.

       The Microbilt Corporation (“Microbilt”) filed an adversary complaint in

Bankruptcy Court against Chex Systems, Inc. (“Chex”), Gunster, Yoakley, & Stewart,

P.A., and David Wells (collectively, “Gunster”), asserting claims for tortious interference

and for violation of the Florida Uniform Trade Secrets Act (“FUTSA”).1 The Bankruptcy

Court granted Chex’s motion compelling arbitration on most of the counts and granted

Gunster’s motion for summary judgment on those that remained. The District Court

affirmed, and Microbilt now raises two issues on appeal.2

       First, Microbilt argues that the District and Bankruptcy Courts erred in holding

that Florida’s absolute litigation privilege applies to the disclosure of trade secrets

allegedly in violation of FUTSA, or, in the alternative, that we should certify this

question to the Florida Supreme Court pursuant to 3d Cir. LAR 110.1.3 Florida’s

litigation privilege provides legal immunity for “any [tortious] act occurring during the

course of a judicial proceeding . . . so long as the act has some relation to the

proceeding,” regardless of the nature of the underlying dispute.4



1
       F.S.A. §§ 688.001-688.009.
2
       The District Court had appellate jurisdiction over the final order of the Bankruptcy
Court under 28 U.S.C. § 158(a)(1). We have jurisdiction to hear this appeal under 28
U.S.C. § 158(d) and 28 U.S.C. § 1291.
3
       We may certify a question to a state court “[w]hen the procedures of the highest
court of a state provide for certification to that court by a federal court of questions
arising under the laws of that state which will control the outcome of a case pending in
the federal court . . . .” 3d Cir. LAR 110.1.
4
       Echevarria, McCalla, Raymer, Barrett & Frappier v. Cole, 
950 So. 2d 380
, 384
(Fla. 2007) (quoting Levin, Middlebrooks, Mabie, Thomas, Mayes & Mitchell, P.A. v.
United States Fire Ins. Co., 
639 So. 2d 606
, 608 (Fla. 1994)).
                                               2
       Microbilt relies on several recent cases carving out exceptions from the privilege

for certain acts that occur before, after, or outside of a judicial proceeding, but these

exceptions have no relevance to the present case. 5 Here, Gunster attached copies of a

Microbilt subsidiary’s invoices to customers as an exhibit to a complaint filed for breach

of contract in the Middle District of Florida, allegedly disclosing Microbilt’s trade secrets

in violation of FUTSA. It is well-settled under Florida law that the absolute litigation

privilege applies to statements in pleadings filed with the court.6 We reject the

contention that decisions from other states applying foreign law are relevant here. For

these reasons, we agree with the District and Bankruptcy Courts that Gunster’s conduct

was privileged and that any amendment to the complaint would be futile.7 We also

decline to certify a settled question of law to the Florida Supreme Court.8

       Second, Microbilt argues that the District and Bankruptcy Courts erred in

dismissing and referring to arbitration its claims for tortious interference with contract

and tortious interference with prospective economic advantage. If a valid arbitration

clause exists and the dispute falls within the substantive scope of that clause, we must



5
        See, e.g., DelMonico v. Traynor, 
116 So. 3d 1205
, 1208, 1211-14 (Fla. 2013)
(confirming the vitality of the absolute litigation privilege for acts that have some relation
to a judicial proceeding, but holding absolute privilege does not extend to alleged
defamatory ex-parte, out-of-court statement to potential nonparty witnesses in the course
of investigating a pending lawsuit); Fridovich v. Fridovich, 
598 So. 2d 65
, 69 (Fla. 1992)
(holding absolute litigation privilege does not extend to defamatory statements made to
authorities prior to initiation of a criminal proceeding).
6
        
DelMonico, 116 So. 3d at 1217
; see also Fla. R. Civ. P. 1.130(b) (“Any exhibit
attached to a pleading shall be considered a part thereof for all purposes.”).
7
        See Oran v. Stafford, 
226 F.3d 275
, 291 (3d Cir. 2000).
8
        See Francisco v. United States, 
267 F.3d 303
, 308 n.5 (3d Cir. 2001).
                                               3
compel the parties to arbitrate the dispute.9 The Resale Agreement between Chex and

Microbilt contemplates that “[a]ny dispute, difference, controversy or claim arising out of

or relating to this Agreement shall be settled by binding arbitration . . . .”10 Microbilt

alleged that Chex committed tortious interference by disclosing information defined

under the terms of the Resale Agreement as “confidential” to Gunster and the general

public.11 Though nominally framed as tort claims, these claims relate to the parties’

obligations under their contract, and as such, they are arbitrable under the broad scope of

the arbitration clause in the Resale Agreement.12

       For the foregoing reasons, we affirm the District Court’s decision upholding the

decision of the Bankruptcy Court.




9
       Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth Inc., 
473 U.S. 614
, 626
(1985); CardioNet, Inc. v. Cigna Health Corp., 
751 F.3d 165
, 172 (3d Cir. 2014).
10
       Resale Agreement at ¶ 29.
11
       Each of the relevant claims cites the Resale Agreement’s definition of
“Confidential Information.” (Compl. at ¶ 63; 72; 81; 88.)
12
       See 
Mitsubishi, 473 U.S. at 622
n.9; Southland Corp. v. Keating, 
465 U.S. 1
, 15
n.7 (1984); Collins & Aikman Prods. Co. v. Bldg. Sys., Inc., 
58 F.3d 16
, 20-21 (2d Cir.
1995).
                                              4

Source:  CourtListener

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