## Facts

- L-3 Communications Corporation and L-3 Services, Inc. provided machinery and services for electromagnetic pulse (EMP) testing of electronic equipment.
- L-3 alleged that employees developed inventions, improvements, testing methods, and business information (including designs, drawings, pricing, customer and proposal data) that L-3 treated as trade secrets.
- Several employees left L-3 to form or join Jaxon Engineering & Maintenance, Inc., a competitor.
- L-3 alleged the former employees misappropriated L-3’s confidential technical and business information and used it to compete for and obtain government EMP-testing work, including Air Force contracts.
- L-3 also alleged defendants made false statements in bids or marketing and engaged in improper conduct associated with winning contracts.
- Defendants moved to dismiss the amended complaint under Rule 12(b)(6), and also objected to a magistrate judge’s protective order governing trade-secret discovery.

## Issues

1. Whether trade-secret and related contract/tort claims were plausibly pleaded under Rule 8 without publicly disclosing the alleged trade secrets.
2. Whether the civil RICO and COCCA counts adequately alleged an enterprise, a pattern of racketeering activity, and predicate acts pleaded with Rule 9(b) particularity.
3. Whether the Lanham Act false advertising/unfair competition claim was adequately pleaded against each defendant, rather than through group allegations.
4. Whether the Sherman Act claim plausibly alleged a relevant market and antitrust injury (harm to competition rather than only to a competitor).
5. Whether tortious interference with prospective economic advantage was sufficiently tied to particular defendants’ conduct.
6. Whether the magistrate judge’s protective order limiting use and access to trade-secret discovery was proper.

## Decision

- The motion to dismiss was granted in part and denied in part.
- The RICO and COCCA claims were dismissed in their entirety.
- The Sherman Act claim was dismissed in its entirety.
- The Lanham Act claim was dismissed as to Charles Rettig, Scott White, James Youngman, Jerry Lubell, Kelly Rice, and John McClure, but allowed to proceed against Jaxon and other defendants sufficiently linked to the alleged statements.
- The tortious interference with prospective economic advantage claim was dismissed as to all defendants except Jaxon, Randall White, and Susan Rettig.
- The common-law unfair competition claim was dismissed as redundant of other surviving claims.
- Defendants’ objections to the protective order were overruled, and the magistrate judge’s protective order was affirmed.

## Legal Principles

- A trade-secret plaintiff need not plead the secret with detail that would effectively disclose it; alleging identifiable categories of confidential information and a plausible narrative of misappropriation can satisfy Rule 8 at the pleading stage.
- Civil RICO/COCCA claims require plausible allegations of a distinct enterprise and a pattern of racketeering activity; predicate acts sounding in fraud must be pleaded with Rule 9(b) particularity, not conclusory generalities.
- Lanham Act false advertising claims require allegations connecting particular defendants to the challenged statements; group pleading is insufficient when individual responsibility is not plausibly alleged.
- Antitrust claims require antitrust injury and a plausible relevant market; wrongful competition that causes only a competitor’s loss, without harm to competition, does not state a Sherman Act claim.
- Tortious interference claims must plausibly allege each defendant’s direct involvement in the alleged interference, not merely association with the competing entity.
- Protective orders are appropriate in trade-secret cases to permit discovery while limiting disclosure and competitive misuse of sensitive information.

## Conclusion

The court treated the dispute primarily as trade-secret and unfair-competition litigation: it permitted the core misappropriation and related contract-based claims to go forward, rejected attempts to convert the allegations into RICO/COCCA and federal antitrust violations, required defendant-specific pleading for misrepresentation and interference theories, and enforced a discovery protective order to safeguard alleged trade secrets.


L-3 Commc'ns Corp. v. Jaxon Eng'g & Maint., Inc., 863 F. Supp. 2d 1066 (D. Colo. 2012)