Tension Envelope Corporation v. JBM Envelope Company , 876 F.3d 1112 ( 2017 )


Menu:
  •                    United States Court of Appeals
    For the Eighth Circuit
    ___________________________
    No. 16-3728
    ___________________________
    Tension Envelope Corporation
    lllllllllllllllllllll Plaintiff - Appellant
    v.
    JBM Envelope Company; Marcus G. Sheanshang; Daniel J. Puthoff
    lllllllllllllllllllll Defendants - Appellees
    ____________
    Appeal from United States District Court
    for the Western District of Missouri - Kansas City
    ____________
    Submitted: September 20, 2017
    Filed: December 8, 2017
    ____________
    Before WOLLMAN, MELLOY, and GRUENDER, Circuit Judges.
    ____________
    GRUENDER, Circuit Judge.
    Tension Envelope Corporation sued a former supplier, JBM Corporation, for
    selling directly to its customers after promising not to do so. The district court1
    1
    The Honorable Fernando J. Gaitan, Jr., United States District Judge for the
    Western District of Missouri.
    rejected one claim on the pleadings and the others on summary judgment. We affirm
    the district court’s rulings.
    I.
    Tension and JBM manufacture and sell envelopes. In late 2000 or 2001,
    Tension began buying from JBM a special type of envelope—small, open-end
    envelopes2 —to resell to customers. Three of Tension’s customers accounted for a
    significant percentage of the sales.
    According to Tension, JBM offered assurances that it would not sell directly
    to Tension’s customers. On three separate occasions, however, JBM refused to sign
    a non-compete agreement. After these refusals, Tension continued to order envelopes
    from JBM with individual purchase orders. Tension even leased its manufacturing
    equipment to JBM to produce the envelopes.
    Although JBM had sold some envelopes to end users since at least 2001,
    JBM’s new management in 2011 decided to increase direct sales. By 2014, JBM
    2
    In Tension’s opening brief, it describes the different varieties of envelopes
    as follows:
    Envelopes can be divided into one of two types: open side or open end.
    A traditional mailing envelope used, for example, to pay bills—and
    which closes with a flap on the long side of the envelope—is known as
    an “open side” envelope. Contrast this with the typical interoffice
    envelope, which closes with a flap on the short end of the envelope, and
    which is known as an “open end” envelope. Within the category of open
    end envelopes there is a type of sub-specialty envelope known as small,
    open end envelopes. Examples of small, open end envelopes include
    coin envelopes and hotel key card envelopes.
    Opening Br. 4-5 (citations omitted).
    -2-
    decided to sell directly to Tension’s customers. JBM hired a communications
    consultant to help with the strategy. The strategy worked, and by June 2014, JBM
    reached agreements with two of Tension’s three large customers. JBM later tried to
    sell to the third large customer’s customers.           Tension learned of the
    agreements—though it earlier had suspected something was afoot—and struggled to
    find a new supplier.
    Tension filed its complaint in June 2014. It later filed three amended
    complaints and named JBM and two of JBM’s corporate officers (collectively
    “JBM”) as defendants. The district court dismissed under Federal Rule of Civil
    Procedure 12(b)(6) a claim for misappropriation of trade secrets. After discovery, the
    district court granted JBM’s summary judgment motion on every remaining claim.
    Tension appealed.3
    II.
    On appeal, Tension advances seven arguments. Six relate to the district court’s
    summary judgment grant. Tension argues that the district court erred in granting
    summary judgment on its claim for (1) breach of contract, (2) promissory estoppel,
    (3) fraudulent misrepresentation, (4) fraudulent nondisclosure, (5) tortious
    interference, and (6) unfair competition. Tension’s final argument relates to the
    district court’s dismissal under Rule 12(b)(6) of its misappropriation of trade secrets
    claim.
    We will address each claim in turn and review de novo the district court’s
    rulings. See Turner v. Holbrook, 
    278 F.3d 754
    , 757 (8th Cir. 2002). In reviewing the
    3
    The parties filed their briefs and appendix under seal. A number of filings in
    the district court are sealed as well. “We conclude that it is unnecessary to seal this
    opinion, however, as it contains no information that we deem confidential.” Rakes
    v. Life Inv’rs Ins. Co. of Am., 
    582 F.3d 886
    , 892 n.6 (8th Cir. 2009).
    -3-
    motion to dismiss, we accept “well-pleaded allegations in the complaint as true” and
    draw “all reasonable inferences in favor” of Tension. See Schriener v. Quicken
    Loans, Inc., 
    774 F.3d 442
    , 444 (8th Cir. 2014). In reviewing the grant of summary
    judgment, we ask whether “there is no genuine issue of material fact, and the moving
    party is entitled to judgment as a matter of law.” 
    Turner, 278 F.3d at 757
    (citing Fed.
    R. Civ. P. 56(c)). The parties agree that the substantive law of Missouri governs the
    dispute. See Dannix Painting, LLC v. Sherwin-Williams Co., 
    732 F.3d 902
    , 904 n.2
    (8th Cir. 2013).
    A. Breach of Contract
    Tension first argues that JBM breached a requirements contract in selling
    directly to its customers. Under Missouri law, a requirements contract is “one in
    which one party promises to supply all the specific goods or services which the other
    party may need during a certain period at an agreed price, and the other party
    promises that he will obtain his required goods or services from the first party
    exclusively.” Essco Geometric v. Harvard Indus., 
    46 F.3d 718
    , 728 (8th Cir. 1995)
    (emphasis omitted) (quoting Kirkwood–Easton Tire Co. v. St. Louis Cty., 
    568 S.W.2d 267
    , 268 (Mo. 1978) (en banc)). Tension contends that the purported contract
    required JBM “to use its best efforts to supply the envelopes” to Tension and provide
    “reasonable notice” before terminating the agreement. According to Tension, JBM
    breached both provisions when it started selling directly to Tension’s customers.
    The district court concluded that no enforceable requirements contract existed
    between the two companies, see Tension Envelope Corp. v. JBM Envelope Co., No.
    14-567-CV-W-FJG, at 19 (W.D. Mo. Aug. 22, 2016), and we agree. Under the
    Missouri statute of frauds, and with exceptions not relevant here,
    a contract for the sale of goods for the price of five hundred dollars or
    more is not enforceable by way of action or defense unless there is some
    -4-
    writing sufficient to indicate that a contract for sale has been made
    between the parties and signed by the party against whom enforcement
    is sought or by his authorized agent or broker.
    Mo. Ann. Stat. § 400.2-201. Tension concedes that the purported contract involves
    a sale of goods for more than five hundred dollars. So Tension must proffer some
    writing “sufficient to indicate” that an agreement was reached. See 
    id. Tension attempts
    to do so with two documents. The first is a letter from JBM’s
    president to a Tension representative stating that “Tension and JBM have a
    partnership in which Tension has shared machinery and knowledge with JBM.” The
    second document is a promotional piece noting that “[o]ver the years, the relationship
    and trust between Tension and JBM has grown into a partnership.”
    These documents do not satisfy the statute of frauds. Recall that a
    requirements contract is “one in which one party promises to supply all the specific
    goods or services which the other party may need during a certain period at an agreed
    price, and the other party promises that he will obtain his required goods or services
    from the first party exclusively.” Essco 
    Geometric, 46 F.3d at 728
    (emphasis
    omitted). Tension’s proffered documents do “not contain any terms” referencing
    those elements. See Howard Const. Co. v. Jeff-Cole Quarries, Inc., 
    669 S.W.2d 221
    ,
    230 (Mo. Ct. App. 1983). Tension points to testimony supporting its favored
    interpretation of the word “partnership,” but we cannot consider oral evidence in
    determining “whether the statute of frauds requirements have been met.” See 
    id. at 229.
    Without that evidence and without any documents beyond those containing bare
    references to “partnership,”4 we cannot conclude that Tension has satisfied the statute
    4
    In a footnote and without elaboration, Tension argues that the individual
    purchase orders satisfy the statute of frauds. But Tension has not identified any
    purchase order—in the record or elsewhere—sufficient to indicate a requirements
    contract. Tension also argues that a district court decision supports its statute-of-
    frauds contentions. See Upsher-Smith Labs., Inc. v. Mylan Labs., Inc., 944 F. Supp.
    -5-
    of frauds. As a result, Tension and JBM have no enforceable requirements contract
    as a matter of law.
    B. Promissory Estoppel
    Tension next seeks relief under the doctrine of promissory estoppel, but the
    Missouri statute of frauds bars this claim as well. When the statute of frauds bars a
    contract claim, allowing recovery based on Missouri’s promissory estoppel “would
    abrogate the purpose and intent of the legislature in enacting the statute of frauds and
    would nullify its fundamental requirements.” Sales Serv., Inc. v. Daewoo Int’l Corp.,
    
    770 S.W.2d 453
    , 457 (Mo. Ct. App. 1989). “In fact,” one district court concluded,
    “no Missouri Court has revived a claim barred by the Statute of Frauds using the
    doctrine of promissory estoppel.” Essco Geometric, Inc. v. Harvard Indus., Inc., No.
    90-1354C(6), 
    1993 WL 766952
    , at *4 (E.D. Mo. Sept. 30, 1993), aff’d sub nom.
    Essco Geometric v. Harvard Indus., 
    46 F.3d 718
    (8th Cir. 1995). An “extraordinary”
    circumstance could warrant an exception to this general rule, see Geisinger v. A & B
    Farms, Inc., 
    820 S.W.2d 96
    , 99 (Mo. Ct. App. 1991), but these facts are not
    extraordinary. Tension voluntary outsourced its manufacturing to a company that
    repeatedly refused to sign a non-compete agreement.
    C. Fraudulent Misrepresentation
    Tension also brings a claim for fraudulent misrepresentation. That claim has
    nine elements under Missouri law:
    1411, 1425-26 (D. Minn. 1996). But the writing there expressly attempted to
    “summarize what ha[d] been agreed upon” and “detail[ed] the material terms of the
    parties’ purported agreement.” 
    Id. Tension has
    pointed to no similar document here.
    -6-
    (1) a representation; (2) its falsity; (3) its materiality; (4) the speaker’s
    knowledge of its falsity or ignorance of its truth; (5) the speaker’s intent
    that it should be acted on by the person in the manner reasonably
    contemplated; (6) the hearer’s ignorance of the falsity of the
    representation; (7) the hearer’s reliance on the representation being true;
    (8) the hearer’s right to rely thereon; and (9) the hearer’s consequent and
    proximately caused injury.
    Freitas v. Wells Fargo Home Mortg., Inc., 
    703 F.3d 436
    , 438-39 (8th Cir. 2013). “A
    plaintiff’s failure to establish any one of the essential elements of fraud is fatal to
    recovery.” Renaissance Leasing, LLC v. Vermeer Mfg. Co., 
    322 S.W.3d 112
    , 132
    (Mo. 2010) (en banc).
    Tension focuses on three alleged misrepresentations. The first concerns JBM’s
    2012 statement that it would be a good partner because it was a “trade only
    manufacturer.” Whether this statement qualifies as a misrepresentation depends on
    its meaning—about which some dispute exists. In its opening brief, Tension writes
    that “references to selling to the ‘trade’ refer to selling to ‘other envelope
    companies.’” If Tension sold “only” to the trade, then presumably it would sell
    “only” to other envelope companies. Tension knew from the beginning of the
    relationship, however, that JBM sold directly to some end users. Tension’s chief
    operating officer acknowledged that he “knew continuously from 2001 to 2014 that
    [JBM] sold to direct end users.” So if “trade only manufacturer” has the meaning
    Tension apparently ascribed to it in the briefs, then Tension cannot claim “ignorance
    of the falsity of the representation.” See 
    Freitas, 703 F.3d at 438-39
    .
    If we instead look to the record, “trade only manufacturer” appears to have a
    different meaning. Both Tension and JBM state there that “trade-only envelope
    manufacturers also have direct accounts.” According to Tension, JBM’s statement
    that it qualified as a “trade only manufacturer” was a misrepresentation, because JBM
    possessed a “present intent” in 2012 to cease operating as a trade-only manufacturer.
    -7-
    See Sofka v. Thal, 
    662 S.W.2d 502
    , 507 (Mo. 1983) (en banc) (noting that a “promise
    accompanied by a present intent not to perform is . . . sufficient to constitute
    actionable fraud” (emphasis omitted)). The record does suggest that as far back as
    2011, JBM planned to increase direct sales. But if a “trade only manufacturer” need
    not sell only to the trade, then it is unclear—at least from Tension’s briefs—at what
    point increasing direct sales renders the trade-only designation false. Without a
    definite meaning for the term, Tension has failed to sufficiently show “falsity.” See
    
    Freitas, 703 F.3d at 438-39
    ; see also Fed. R. Civ. P. 56(c)(1). Because no
    “reasonable jury could return a verdict” for Tension on this claim, the district court
    did not err in granting summary judgment. See Anderson v. Liberty Lobby, Inc., 
    477 U.S. 242
    , 248 (1986); see also Celotex Corp. v. Catrett, 
    477 U.S. 317
    , 323 (1986)
    (“The moving party is ‘entitled to a judgment as a matter of law’ because the
    nonmoving party has failed to make a sufficient showing on an essential element of
    her case with respect to which she has the burden of proof.”).
    Even if Tension did sufficiently show falsity, Tension would have lacked the
    “right to rely” on the statement. See 
    Freitas, 703 F.3d at 438-39
    . A “mutual
    recognition of the uncertainty of a given fact” renders reliance on the asserted fact
    unjustified. See Empire Gas Corp. v. Small’s LP Gas Co., 
    637 S.W.2d 239
    , 243 (Mo.
    Ct. App. 1982). That was the conclusion of the Missouri Court of Appeals in Empire
    Gas Corp. v. Small’s LP Gas Co., where a seller had reached a written agreement
    with a buyer delineating their respective rights in the event a particular representation
    by the seller proved false. See 
    id. at 243-44.
    If the buyer “did indeed rely upon that
    particular representation,” the court asked, then “why did it insist upon” the separate
    agreement? 
    Id. The same
    logic applies here. Tension repeatedly asked that JBM
    sign a non-compete agreement, and JBM repeatedly refused. If Tension did indeed
    rely upon the trade-only manufacturer designation, then why repeatedly insist on a
    -8-
    non-compete agreement? These repeated attempts to reach an agreement, and
    repeated refusals, rendered any reliance unjustified as a matter of law. See id.5
    The second alleged misrepresentation involved a response to a question. In
    March 2014, after a Tension representative asked what he could do for JBM, JBM’s
    president responded: “Bring us more business.” We cannot see how this constitutes
    a misrepresentation at all. Nothing supports the proposition that JBM necessarily
    would have rejected additional business from Tension. Tension emphasizes that a
    statement conveying a “false impression” can qualify as a misrepresentation under
    Missouri law. See Wion v. Carl I. Brown & Co., 
    808 S.W.2d 950
    , 954-55 (Mo. Ct.
    App. 1991); see also United Indus. Syndicate, Inc. v. W. Auto Supply Co., 
    686 F.2d 1312
    , 1318 (8th Cir. 1982). But even if JBM’s answer created a false
    impression—which we doubt—the false impression was that JBM would not compete
    with Tension. For the reasons already described, Tension had no right to rely on such
    a representation given JBM’s repeated refusal to sign a non-compete agreement. See
    Empire 
    Gas, 637 S.W.2d at 243-44
    .
    The third alleged misrepresentation also involved a response to a question. In
    June 2014, shortly before JBM approached Tension’s customers, Tension asked JBM
    to copy it on all future communications with its customers. JBM’s president
    agreed—though he did not follow through. Summary judgment was proper on this
    claim for a now-familiar reason. By June 2014, Tension suspected that JBM would
    approach its customers, and especially at this late date, it had no right to rely on a
    statement suggesting otherwise. See id.; see also Children’s Broad. Corp. v. Walt
    Disney Co., 
    245 F.3d 1008
    , 1020-21 (8th Cir. 2001) (reaching a similar conclusion
    5
    Tension also implies that JBM’s assertion that it would be a “good partner”
    could constitute a distinct misrepresentation. To the extent Tension makes that
    argument, the alleged falsity would flow from JBM’s selling directly to Tension’s
    customers. This misrepresentation claim fails for the reasons described above.
    -9-
    under Minnesota law). JBM therefore was entitled to summary judgment on the
    fraudulent misrepresentation claim. See 
    Anderson, 477 U.S. at 248
    .
    D. Fraudulent Nondisclosure
    Tension’s claim for fraudulent nondisclosure fares no better. A fraudulent
    nondisclosure claim involves the same nine elements as a claim for fraudulent
    misrepresentation, except “a party’s silence amounts to a representation where the law
    imposes a duty to speak.” Hess v. Chase Manhattan Bank, 
    220 S.W.3d 758
    , 765 (Mo.
    2007) (en banc). Tension claims that JBM’s failure to disclose its plans to increase
    direct sales amounted to fraud.
    In the most analogous Missouri case, however, the court rejected a similar
    claim. In Blaine v. J.E. Jones Const. Co., home purchasers filed suit against a
    developer for failing to disclose its plans to build a nearby apartment complex. 
    841 S.W.2d 703
    , 704 (Mo. Ct. App. 1992). The Missouri Court of Appeals overturned
    the jury verdict in favor of the purchasers. 
    Id. In doing
    so, the court focused on the
    market effect of a contrary ruling. A “developer’s decision about developing is not
    absolute but can and probably will change depending on the marketplace,” it wrote.
    
    Id. at 709.
    “To saddle a developer with an affirmative duty to disclose these decisions
    as they vary would act as a straight jacket that the marketplace does not need.” Id.;
    see also Lakeside Feeders, Inc. v. Producers Livestock Mktg. Ass’n, 
    666 F.3d 1099
    ,
    1108-09 (8th Cir. 2012) (reaching a similar conclusion under Iowa law). That same
    logic applies here.
    In support of a disclosure duty, Tension invokes certain provisions of the
    Restatement (Second) of Torts § 551. See 
    id. § 551(2)(b)
    & (c) (describing certain
    disclosure requirements). By their own terms, however, those provisions apply only
    “before the transaction is consummated.” 
    Id. § 551(2);
    see also Hennepin Cty. v.
    AFG Indus., Inc., 
    726 F.2d 149
    , 153 (8th Cir. 1984). Tension claims that because
    -10-
    consummation “may be equated with substantial performance in the contract context,”
    see Hennepin 
    Cty., 726 F.2d at 153
    , and because JBM has not “substantially
    performed” under the purported requirements contract, JBM had a continuing
    disclosure duty. Yet we have already found that no enforceable requirements contract
    existed, and Tension has not argued that the purchase orders triggered the
    Restatement duty. As a result, Tension has not sufficiently demonstrated a duty under
    the Restatement.
    Tension’s other arguments are similarly unpersuasive. It argues that the
    fraudulent nondisclosure claim presents a fact issue that is “simply part of the
    ultimate jury question.” See United Indus. Syndicate, Inc. v. W. Auto Supply Co., 
    686 F.2d 1312
    , 1319 (8th Cir. 1982). But its sole authority for that proposition predates
    not only Blaine, but also the trilogy of 1986 Supreme Court cases “which requires
    courts to treat motions for summary judgment more hospitably.” Chicago Ins. Co.
    v. Farm Bureau Mut. Ins. Co. of Ark., Inc., 
    929 F.2d 372
    , 373 n.4 (8th Cir. 1991).
    Tension has not raised a fact issue that “might affect the outcome of the suit,” so
    granting summary judgment was not erroneous. See 
    Anderson, 477 U.S. at 248
    . In
    its reply brief, Tension pivots and argues for a disclosure duty on other bases, but
    those arguments come too late. See Neb. State Legislative Bd., United Transp. Union
    v. Slater, 
    245 F.3d 656
    , 658 n.3 (8th Cir. 2001).
    One final reason also supports summary judgment on this claim. Recall that
    for the fraudulent nondisclosure claim, Tension must establish the same nine
    misrepresentation elements, except “a party’s silence amounts to a representation
    where the law imposes a duty to speak.” See 
    Hess, 220 S.W.3d at 765
    . In this case,
    Empire Gas provides an independent reason for granting summary judgment. Given
    JBM’s repeated refusals to sign a non-compete agreement, Tension had no right to
    equate JBM’s silence with a commitment not to compete. See Empire 
    Gas, 637 S.W.2d at 243-44
    .
    -11-
    E. Tortious Interference
    Tension also claims that JBM committed tortious interference in its attempts
    to sell directly to Tension’s customers. “Tortious interference with a contract or
    business expectancy requires proof of: (1) a contract or valid business expectancy;
    (2) defendant’s knowledge of the contract or relationship; (3) a breach induced or
    caused by defendant’s intentional interference; (4) absence of justification; and (5)
    damages.” Nazeri v. Mo. Valley Coll., 
    860 S.W.2d 303
    , 316 (Mo. 1993) (en banc).
    So long as the defendant does not employ improper means—such as threats, violence,
    trespass, defamation, restraint of trade, or misrepresentation of fact—economic
    interest provides sufficient justification for an alleged interference. See 
    id. at 316-17;
    see also Others First, Inc. v. Better Bus. Bureau of Greater St. Louis, Inc., 
    829 F.3d 576
    , 579 (8th Cir. 2016).
    Tension does not argue that JBM lacked sufficient economic interest. It instead
    claims that JBM employed improper means. In particular, Tension says that in JBM’s
    meetings with its customers, JBM improperly stated that Tension was a dishonest
    company. Tension’s sole piece of evidence for this claim, though, is the “Mooney
    Memorandum”: a document prepared by JBM’s communications consultant before
    the meetings took place. Tension emphasizes that JBM reviewed the Mooney
    Memorandum in preparation for the meetings.
    Yet every piece of evidence from individuals at the meetings indicates that
    JBM representatives did not say the alleged falsehoods suggested in the
    memorandum. The record contains multiple declarations from non-JMB individuals
    at the meetings, for example, who affirm that JBM did not disparage Tension.
    Tension attacks the credibility of these witnesses, but it has offered nothing to support
    its allegation of dishonesty. See Fed. R. Civ. P. 56(c)(1). Indeed, an internal
    document from one of the large customers shows that the customer agreed to work
    with JBM because of cost savings, not distrust of Tension. Tension cites United
    -12-
    States v. Corps. for Character, L.C., which found a genuine dispute whether
    telemarketers used certain scripts in their calls, but the evidence in that case was
    conflicting. 
    116 F. Supp. 3d 1258
    , 1270-71 (D. Utah 2015). It is not here. Given the
    evidence, no “reasonable jury could return a verdict for” Tension. See 
    Anderson, 477 U.S. at 248
    .6
    F. Unfair Competition
    The final claim rejected on summary judgment concerns the tort of unfair
    competition. Missouri courts have described the tort as a “reaffirmation of the rule
    of fair play” and a protection against companies deceiving the public. See Cushman
    v. Mutton Hollow Land Dev., Inc., 
    782 S.W.2d 150
    , 157-59 (Mo. Ct. App. 1990); see
    also Am. Equity Mortg., Inc. v. Vinson, 
    371 S.W.3d 62
    , 64–65 (Mo. Ct. App. 2012)
    (describing the doctrine). They have remarked at the doctrine’s “elusive” nature.
    See, e.g., 
    Cushman, 782 S.W.2d at 157
    . Tension argues that JBM committed this tort
    in “plotting to steal Tension’s customers.”
    We need not delineate the precise contours of the doctrine to reject the claim.
    Tension simply has not supported its assertion of unfairness. JBM acted with sharp
    elbows—as businesses often do. But nothing required them to affirmatively disclose
    their strategic plans. Tension cites to the Restatement (Third) of Unfair Competition
    to support its claim, but even this purportedly helpful authority makes clear that
    “neither new entrants nor existing competitors will be subject to liability for harm
    resulting solely from the fact of their participation in the market.” 
    Id. § 1
    cmt. a
    (1995). Tension cites no case finding liability in circumstances similar to this case.
    We therefore conclude that the district court did not err in granting summary
    judgment on this claim.
    6
    In a footnote in its reply brief, Tension argues that JBM’s use of information
    derived from shipping releases issued by Tension constitutes improper means. We
    decline to address this new issue. See Neb. State Legislative 
    Bd., 245 F.3d at 658
    n.3.
    -13-
    G. Misappropriation of Trade Secrets
    In its First Amended Complaint, Tension alleged that JBM misappropriated
    two trade secrets: the “identity of its customers and their unique requirements.” See
    Mo. Ann. Stat. § 417.453 (Missouri Uniform Trade Secrets Act). After concluding
    that neither qualified as a trade secret under Missouri law, the district court dismissed
    the claim under Rule 12(b)(6). See Tension Envelope Corp. v. JBM Envelope Co.,
    No. 14-567-CV-W-FJG, 
    2015 WL 893242
    , at *8 (W.D. Mo. Mar. 3, 2015).
    The district court did not err in doing so. In Western Blue Print Co. v. Roberts,
    the Missouri Supreme Court concluded that while the “customers contacts” in that
    case were “protectable, they are not protectable under a theory of . . . trade secret.”
    
    367 S.W.3d 7
    , 18 (Mo. 2012) (en banc). Tension offers no persuasive reason why
    Western Blue should not apply here. It invokes a Missouri Court of Appeals case for
    arguably a contrary proposition, see Brown v. Rollet Bros. Trucking Co., 
    291 S.W.3d 766
    , 777 (Mo. Ct. App. 2009), but to the extent the decisions conflict, we follow the
    law as interpreted by the Missouri Supreme Court, see United Fire & Cas. Ins. Co.
    v. Garvey, 
    328 F.3d 411
    , 413 (8th Cir. 2003). Based on Western Blue, the identity of
    Tension’s customers is not protectable as a trade secret.
    For Tension’s claim related to its customers’ requirements, no Missouri
    Supreme Court decision speaks directly to the issue. But the intermediate appellate
    decision on which Western Blue relied does address the question. In Walter E.
    Zemitzsch, Inc. v. Harrison, the court noted that information related “to the
    customers’ individual requirements” was not a trade secret, because it was
    “information obtainable without recourse to misappropriation.” 
    712 S.W.2d 418
    , 421
    (Mo. Ct. App. 1986) (alteration omitted) (quoting Metal Lubricants Co. v. Engineered
    Lubricants Co., 
    284 F. Supp. 483
    , 488 (E.D. Mo. 1968), aff’d., 
    411 F.2d 426
    (8th Cir.
    1969)). The same is true here. According to the amended complaint, Tension’s
    envelopes complied with technical specifications generated not by Tension, but by
    -14-
    the customers themselves. The requirements are “their”—the customers’—
    requirements. Tension emphasizes that the amended complaint contains references
    to manufacturing processes, which could qualify as trade secrets. See Nat’l Rejectors,
    Inc. v. Trieman, 
    409 S.W.2d 1
    , 18 (Mo. 1966) (en banc). But the amended complaint
    repeatedly states that the relevant trade secret is the customers’ requirements, and
    Tension cites no case for the proposition that the customer can generate the
    protectable information. See, e.g., Conseco Fin. Servicing Corp. v. N. Am. Mortg.
    Co., 
    381 F.3d 811
    , 819 (8th Cir. 2004) (discussing information generated by a seller’s
    “proprietary computer program”). Because the requirements are “information which
    JBM could have acquired from the customers themselves,” see Tension Envelope
    Corp., 
    2015 WL 893242
    , at *8, the district court did not err in concluding that
    Tension failed to state a claim for misappropriation of trade secrets.
    III.
    For the foregoing reasons, we affirm.
    ______________________________
    -15-
    

Document Info

Docket Number: 16-3728

Citation Numbers: 876 F.3d 1112

Filed Date: 12/8/2017

Precedential Status: Precedential

Modified Date: 1/12/2023

Authorities (27)

United Industrial Syndicate, Inc. v. Western Auto Supply ... , 686 F.2d 1312 ( 1982 )

metal-lubricants-co-an-illinois-corporation-v-engineered-lubricants-co , 411 F.2d 426 ( 1969 )

Lakeside Feeders, Inc. v. Producers Livestock Marketing Ass'... , 666 F.3d 1099 ( 2012 )

nebraska-state-legislative-board-united-transportation-union-v-rodney , 245 F.3d 656 ( 2001 )

childrens-broadcasting-corporation-a-minnesota-corporation-v-the-walt , 245 F.3d 1008 ( 2001 )

ginger-turner-v-jeri-holbrook-individually-steve-hofheins-individually , 278 F.3d 754 ( 2002 )

Nazeri v. Missouri Valley College , 860 S.W.2d 303 ( 1993 )

Renaissance Leasing, LLC v. Vermeer Manufacturing Co. , 322 S.W.3d 112 ( 2010 )

conseco-finance-servicing-corp-formerly-known-as-green-tree-financial , 381 F.3d 811 ( 2004 )

UNITED FIRE & CASUALTY INSURANCE COMPANY v. PAUL GARVEY — ... , 328 F.3d 411 ( 2003 )

Rakes v. Life Investors Insurance Co. of America , 582 F.3d 886 ( 2009 )

essco-geometric-doing-business-as-diversified-foam-products-inc-a , 46 F.3d 718 ( 1995 )

chicago-insurance-company-v-farm-bureau-mutual-insurance-company-of , 929 F.2d 372 ( 1991 )

the-county-of-hennepin-a-body-politic-and-corporate-in-the-state-of , 726 F.2d 149 ( 1984 )

Cushman v. Mutton Hollow Land Development, Inc. , 782 S.W.2d 150 ( 1990 )

Geisinger v. a & B FARMS, INC. , 820 S.W.2d 96 ( 1991 )

Empire Gas Corp. v. Small's LP Gas Co. , 637 S.W.2d 239 ( 1982 )

National Rejectors, Inc. v. Trieman , 409 S.W.2d 1 ( 1966 )

Sofka v. Thal , 662 S.W.2d 502 ( 1983 )

Hess v. Chase Manhattan Bank, USA, N.A. , 220 S.W.3d 758 ( 2007 )

View All Authorities »