## Facts

- Marisa Pawelko, an inventor of arts-and-crafts products, developed a concept she called “Liquid Mosaic,” involving a craft gun with interchangeable tips and removable cartridges containing a surface-adhering compound.
- On November 15, 2010, Pawelko executed Hasbro’s standard non-disclosure agreement (NDA) and then pitched Liquid Mosaic to Hasbro, including a conference call, a slide deck, and sample projects made with a prototype compound.
- In December 2010, Hasbro declined to pursue the idea, while indicating it might consider the concept later.
- In May 2011, Hasbro returned the samples to Pawelko.
- Pawelko alleged Hasbro used her confidential submission to develop and market products in its Play-Doh Plus and DohVinci lines; Hasbro denied misappropriation and disputed that the submission was a protectable trade secret.
- In a third amended complaint, Pawelko asserted claims for breach of the NDA, breach of the implied covenant of good faith and fair dealing, breach of an implied-in-fact contract, misappropriation under Rhode Island trade-secret law, unfair competition, misappropriation under the federal trade-secret statute, and unjust enrichment.
- Pawelko conceded dismissal of the unfair-competition claim and acknowledged unjust enrichment was unavailable where an express contract governed the same subject matter.

## Issues

1. Whether claims for breach of the implied covenant of good faith and fair dealing and breach of an implied-in-fact contract could proceed when an express NDA governed confidentiality and use of the submitted idea.
2. Whether unfair competition and unjust enrichment were viable given plaintiff’s concessions and the existence of an express contract.
3. Whether the case should proceed on the breach-of-NDA claim and the state and federal trade-secret misappropriation claims.

## Decision

- The court recommended granting summary judgment for Hasbro on the implied-covenant claim because it was duplicative of the breach-of-NDA claim.
- The court recommended granting summary judgment for Hasbro on the implied-in-fact contract claim because an express NDA governed the same subject matter.
- The court recommended dismissing the unfair-competition and unjust-enrichment claims based on plaintiff’s concessions and the rule that quasi-contract relief is unavailable when an express contract controls.
- The court recommended denying summary judgment as to the breach-of-NDA claim and allowing the state and federal trade-secret misappropriation claims to proceed.
- The district judge later adopted the recommendation in part and dismissed the implied-covenant, implied-in-fact, unfair-competition, federal trade-secret, and unjust-enrichment counts, while permitting the breach-of-NDA and state trade-secret claims to continue.

## Legal Principles

- When an express NDA governs confidentiality and use of submitted information, duplicative claims for breach of the implied covenant of good faith and fair dealing are dismissed if they rest on the same alleged misconduct as the contract claim.
- An implied-in-fact contract claim is barred where an express contract covers the same subject matter.
- Unjust enrichment (a quasi-contract theory) is generally unavailable when an express contract governs the parties’ relationship regarding the same subject matter.
- On summary judgment, a defendant may seek targeted dismissal of legally barred or duplicative theories without resolving disputed factual questions central to remaining contract or trade-secret claims.

## Conclusion

The court narrowed the case at summary judgment by dismissing claims that were duplicative of, or barred by, an express NDA and by plaintiff’s concessions, while preserving the core dispute over alleged misuse of confidential information through a breach-of-NDA theory and a state trade-secret misappropriation claim.


Pawelko v. Hasbro, Inc., No. 16-00201-JJM, 2018 WL 6050618 (D.R.I. Nov. 19, 2018)