Each of Averon’s Trade Secret Claims Has ‘Fatal Pleading Deficiency’: AT&T

Averon’s first amended complaint alleging AT&T misappropriated its trade secrets should be dismissed in its entirety because all its claims are barred by the economic loss doctrine, preempted by the California Uniform Trade Secrets Act, or are “insufficiently pleaded,” said the public redacted version Tuesday of AT&T’s motion to dismiss. The motion (docket 1:22-cv-01341) in U.S. District Court for Delaware was filed Feb. 21 under seal (see 2302220021). AT&T is alleged to have courted Averon as a business partner for its passwordless authentication technology, only to use that technology to form the ZenKey joint venture with T-Mobile and Verizon as an Averon competitor. “Averon attempts to transform its short-lived tenure as a contractual recipient of AT&T’s signaling services into a sprawling sundry of claims,” said AT&T. Those claims are “factually unsupported” because AT&T “lawfully terminated the parties’ contracts,” it said. “More importantly at this stage, the claims fail to plead viable causes of action,” it said. The economic loss doctrine bars Averon’s claims for fraud and misrepresentation and intentional interference with prospective economic relations “because each is premised on alleged economic losses stemming from AT&T’s purported breach of contract,” it said. Each of Averon’s nine claims has “a fatal pleading deficiency,” said AT&T. Some counts “fail to state a claim because Averon admits its alleged trade secrets are unrelated to the parties’ most recent contract, which is the only plausible source of any confidentiality obligation of AT&T,” it said. Other counts don’t state claims “because Averon admits its alleged trade secrets are unrelated to the purportedly breached contracts, and the contract claims are barred by an expired two-year contractual limitations period,” it said. Averon’s claim for deceptive advertising fails because Averon doesn’t establish “statutory standing, fails to identify an actual advertisement, and the pleading is devoid of an actionable misstatement,” it said.