Fortune sues former employee alleging misuse of trade secrets
Bensenville, Illinois, U.S.A.-based seafood distributor Fortune International is suing a former sales associate, claiming he is using the company’s vendor network and trade secrets to sell seafood to Fortune customers from his new business while still actively working for Fortune.
According to the complaint, filed in the U.S. District Court for the Northern District of Illinois, Timothy MacDonald, a former Fortune sales rep in Minneapolis, Minnesota, U.S.A., established a new business and sold competing seafood products to the same Minneapolis-area customers he was servicing at Fortune.
The complaint alleges MacDonald resigned on 11 March, claiming he was moving to an area outside of Fortune’s territory. However, he instead established the new business – Maine Fresh Seafood – and used proprietary information from Fortune International to sell competing products.
The value of Fortune’s trade secret information alone is worth well over USD 75,000 (EUR 71,000), the distributor said in the complaint.
In his role as an outside sales associate, MacDonald was given access to “highly confidential information” regarding Fortune’s business plans, price points, marketing and sales strategies, and vendor relationships – including which vendors were most effective at reliably delivering refrigerated seafood from the coasts to the middle of the country, the lawsuit contends.
“During the time that MacDonald was collecting a salary from Fortune to serve as its sales representative, [he] was competing against it for the same customers and concealing this ongoing fiduciary breach from Fortune,” Fortune claims.
At least one customer informed Fortune that MacDonald was selling competing products to it through Maine Fresh Seafood, and had been doing so without Fortune’s knowledge for months.
In addition, a longstanding Fortune service provider recently informed Fortune that it shipped hundreds of pounds of fresh seafood to a cold-storage warehouse in Minnesota, where MacDonald received the products.
MacDonald also promoted a competing farmed salmon product to former Fortune customers he serviced in Minneapolis, according to Fortune.
“MacDonald is specifically promoting that product as an alternative to the farmed salmon offered by Fortune, at a price designed to just barely undercut what Fortune is offering,” the complaint said.
The actions, taken together, have damaged Fortune, the company alleged.
“MacDonald’s actions are irreparably harming Fortune through the erosion of its customer goodwill and misuse of its confidential and trade secret information,” the company said.
Neither MacDonald nor Fortune responded to requests for comment from SeafoodSource.