United States District Court, M.D. Florida, Tampa Division
VIRGINIA M. HERNANDEZ COVINGON UNITED STATES DISTRICT JUDGE.
cause is before the Court pursuant to Adams Arms, LLC's
Motion to Dismiss or Strike Unified Weapon Systems,
Inc.'s First Amended Counterclaim (Doc. # 119), which was
filed on October 28, 2016. On November 18, 2016, Unified
Weapon Systems, Inc. (“UWSI”) filed a Response in
Opposition to the Motion. (Doc. # 128). Also before the Court
is Adams' Motion to Dismiss Aguieus, LLC's
Counterclaim (Doc. # 123), which was filed on November 2,
2016. Aguieus filed a Response to the Motion on November 28,
2016. (Doc. # 131).
explained below, the Court denies Adams' Motion to
Dismiss UWSI's Counterclaims. The Court grants in part
Adams' Motion to Dismiss Aguieus' Counterclaims to
the extent that Aguieus' Counterclaim for breach of the
Letter of Intent is dismissed without prejudice and with
leave to amend by February 21, 2017.
is a Tampa, Florida, weapons manufacturer specializing in
“small arms, including high-powered military
rifles.” (Doc. # 106 at ¶ 1). UWSI is a Delaware
corporation with its principal place of business in Florida.
(Id. at ¶ 11). UWSI is alleged to be a
subsidiary of Aguieus. (Doc. # 106 at ¶ 11). Aguieus is
a Delaware limited liability corporation. (Id. at
¶ 12). Michael Bingham claims to be the managing member
of Aguieus and the Vice President and Chief Operating Officer
of UWSI. (Id. at ¶ 13). Christian Quintanilla
Aurich, an individual who resides in Peru, is the President
and Chief Executive Officer of UWSI. (Doc. # 106 at ¶
14). General James W. Parker, a resident of Hillsborough
County, is a retired Major General from the United States
Army and serves as a Director and advisor for UWSI.
(Id. at ¶ 15).
The Letter of Intent and Nondisclosure
early 2014, Aguieus approached Adams with a proposal for the
two companies to work together on a bid to supply
high-powered military rifles designed and built by Adams to
the Peruvian military. (Id. at ¶ 18). According
to Bingham, the Ministry of Defense of the Republic of Peru
(the “Peruvian MOD”) contacted UWSI concerning
the opportunity to secure a multi-year contract for the
supply of rifles. (Id. ¶ 19). “The
Peruvian MOD was purportedly funding the purchase through the
Peruvian Factory of Weapons and Ammunition from the Army
S.A.C. (‘FAME').” (Id.). The rifles
would be constructed based on the Peruvian MOD's
specifications “with input by UWSI and its business
partners.” (Id. ¶ 20). Adams alleges that
“Aguieus and UWSI, through Mr. Bingham and Mr. Aurich,
solicited [Adams] to be a business partner in the
project.” (Id.). The project would require
Adams to provide UWSI with products, such as demonstration
rifles, to disclose trade secrets and confidential
information, and allow a tour of Adams' manufacturing
facility. (Id. at ¶ 21).
February 24, 2014, as an “inducement” for Adams
to join the project, Aurich and Bingham, on behalf of
Aguieus, executed a “Mutual Confidentiality and
Nondisclosure Agreement” with Adams “in which
Aguieus agreed not to use [Adams'] confidential
information, including [Adams'] technical data, trade
secrets, and know-how, for its own use or for any purpose
other than the commercial relationship between [Adams] and
Aguieus.” (Id. at ¶ 22). The Mutual
Confidentiality and Nondisclosure Agreement allowed Aguieus
to share Adams' confidential information with others,
such as UWSI, so long as they “acknowledged and agreed
to be bound by the [Mutual Confidentiality and Nondisclosure
on April 29, 2014, Bingham sent Adams a six-page Letter of
Intent, which UWSI and Adams executed. (Id. at
¶ 23). The Letter of Intent describes the “mutual
intentions” between “Unified Weapon
Systems (‘Buyer') and Adams Arms
(‘Seller').” (Doc. # 117-3 at 1)(emphasis in
original). “After signing the [Letter of Intent], on or
about June 25, 2014, Mr. Bingham represented to [Adams] that
there would be an immediate order for 3, 000 units for use by
the Peruvian MOD.” (Doc. # 106 at ¶ 32).
that time, General Parker met with Adams' President and
CEO, Michael Froning, “and represented to Mr. Froning
that General Parker possessed significant expertise and
knowledge regarding foreign and domestic military matters,
which would be helpful to [Adams] in negotiating the rifle
contract with UWS[I].” (Id. at ¶ 33).
According to Adams, General Parker failed to disclose that he
was a Director and advisor for UWSI and “when Mr.
Froning asked General Parker whether he had any conflicts of
interest or ties with UWS[I] that would prevent him from
being loyal to [Adams], General Parker misrepresented to Mr.
Froning that he had no ties to UWS[I].” (Id.
at ¶ 34).
furtherance of General Parker's efforts to gain access to
Adams' trade secrets, on June 24, 2014, General Parker
executed a separate confidentiality agreement vowing to hold
Adams' confidential information and trade secrets
“in strict confidence” and agreeing “not to
use any Confidential Information for any purpose other than
the Business Purpose.” (Doc. # 106-4 at 3). General
Parker also executed a Consulting Services Agreement on July
7, 2014, further agreeing to keep Adams' proprietary
information confidential and to only use such information in
connection with providing services on behalf of Adams. (Doc.
Adams Divulges Trade Secrets
“has spent a number of years and endless
resources” developing “numerous trade secrets
that are crucial and extremely valuable to its
business.” (Doc. # 106 at ¶¶ 29-30). Adams
explains that it “exerts great efforts to ensure that
its trade secrets remain confidential, ” such as
requiring employees and third parties to sign nondisclosure
agreements, maintaining security cameras at its facilities,
and requiring badges for entry into its facilities.
(Id. at ¶ 30).
and in reliance on the Mutual Confidentiality and
Nondisclosure Agreements, General Parker's
confidentiality agreement, the Letter of Intent, and other
assurances, Adams disclosed its trade secrets to UWSI,
Aguieus, Bingham, Aurich, and General Parker. (Id.
at ¶ 28).
the parties formalized their agreements and Adams disclosed
its trade secrets, the rifle project began in earnest.
Between August of 2014, and February of 2015, Adams
manufactured demonstration rifles for examination and testing
by UWSI and the Peruvian MOD. (Id. at ¶¶
38-44). On October 13, 2014, UWSI sent Adams a 2.1 million
dollar purchase order for rifles. (Id. at ¶
On February 8 and 9, 2015, representatives of [Adams]
attended the demonstration of [Adams'] rifles to the
Peruvian MOD. During the demonstration, UWSI leveraged
[Adams'] brand name and weapons-making experience,
identifying [Adams] as one of its lead partners, and UWSI
used [Adams'] trademarks to market the rifles to the
Peruvian MOD. To [Adams'] knowledge, UWSI has no ability
to design or manufacture any rifles. Instead, it was
marketing [Adams'] rifles to the customer.
(Id. at ¶ 44). According to Adams, the
demonstration was a success, and “all parties approved
moving forward with the joint venture with [Adams] as the
manufacturer.” (Id. at ¶ 45).
April of 2015, and September of 2015, Bingham requested
supplier pricing information for the separate components of
Adams' rifles, which Adams provided. (Id. at
¶ 46). Bingham also requested information about
Adams' manufacturing facility and equipment, and Adams
allowed tours of its facility in Florida during which Adams
revealed step-by-step details of its manufacturing processes,
machinery, and tooling. (Id. at ¶¶ 46-48).
the meetings in Florida, Bingham requested additional
confidential and proprietary information, which he
represented was necessary to secure the contract with FAME.
(Id. at ¶ 50). This information included
photographs of Adams' facility, assembly work stations,
and tool boxes; a complete list of parts, parts
configurations, parts suppliers, and prices; a list of all
tooling needed for assembly of Adams' rifles; a breakdown
of the rifle configuration; and proprietary details of
Adams' technician training program. (Id.).
September 25, 2015, Bingham represented to Adams that all
submissions to FAME were completed on time “thanks to
[Adams].” (Id. at ¶ 52). On November 19,
2015, FAME issued its bid solicitation for the rifles.
(Id. at ¶ 53). On December 10, 2015, UWSI
submitted a qualified offer in response to the bid
solicitation using Adams' designs, procedures, and
specifications. (Id. at ¶ 55). On December 18,
2015, FAME announced UWSI as the winning bidder.
(Id. at ¶ 58).
Squeeze-Out of Adams
UWSI obtained the winning bid, UWSI “began taking steps
to squeeze [Adams] out of the final purchase
contract[.]” (Id. at ¶ 61). UWSI and
Bingham refused Adams' requests for documents and
meetings, although UWSI and Bingham “continued to seek
guidance and input” from Adams about the design of the
rifles. (Id. at ¶¶ 62-64). On December 30,
2015, Aurich advised Adams that UWSI would take the entire
project over now that UWSI had all of Adams' technical
and pricing data. (Id. at ¶ 65). In the months
that followed, Adams was excluded from multiple meetings with
FAME, including another meeting in Peru to test Adams'
rifles before final contract execution. (Id. at
Procedural History and Amended
Adams Sets the Stage
initiated this action on June 10, 2016, by filing the
Complaint. (Doc. # 1). At this juncture, the Complaint has
been amended and contains the following counts: breach of
Letter of Intent against UWSI (Count One); breach of Mutual
Confidentiality and Nondisclosure Agreement against all
Defendants (Count Two); breach of Confidentiality Agreement
against General Parker (Count Three); breach of the
Consulting Services Agreement as to General Parker (Count
Four); misappropriation under the Defend Trade Secrets Act as
to all Defendants (Count Five); misappropriation under the
Florida Trade Secrets Act against all Defendants (Count Six);
unfair competition under the Lanham Act against UWSI (Count
Seven); unjust enrichment ...