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McFreen v. Alcatel-Lucent USA Inc.

United States District Court, S.D. Indiana, Indianapolis Division

March 23, 2017



          Hon. William T. Lawrence, United States District Judge

         This cause is before the Court on the motion of Defendant Alcatel-Lucent USA Inc. (“ALU”) for partial summary judgment (Dkt. No. 35). The motion is fully briefed and the Court has heard oral argument regarding it. The Court, being duly advised, GRANTS the Defendant's motion for the reasons set forth below.


         Federal Rule of Civil Procedure 56(a) provides that summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” In ruling on a motion for summary judgment, the admissible evidence presented by the non-moving party must be believed, and all reasonable inferences must be drawn in the non-movant's favor. Zerante v. DeLuca, 555 F.3d 582, 584 (7th Cir. 2009) (“We view the record in the light most favorable to the nonmoving party and draw all reasonable inferences in that party's favor.”). However, a party who bears the burden of proof on a particular issue may not rest on its pleadings, but must show what evidence it has that there is a genuine issue of material fact that requires trial. Johnson v. Cambridge Indus., Inc., 325 F.3d 892, 901 (7th Cir. 2003). Finally, the non-moving party bears the burden of specifically identifying the relevant evidence of record, and “the court is not required to scour the record in search of evidence to defeat a motion for summary judgment.” Ritchie v. Glidden Co., 242 F.3d 713, 723 (7th Cir. 2001).

         II. FACTS

         In a nutshell, Plaintiff Padraic McFreen alleges in this case that Lucent Technologies, Inc. (“LTI”)[1] used for its own benefit confidential information and trade secrets that he revealed to LTI and that in so doing LTI violated the parties' mutual nondisclosure agreement and the California Uniform Trade Secrets Act. While McFreen asserts numerous ways in which he alleges LTI misappropriated his confidential information, the instant motion involves just one: McFreen's allegation that his confidential information made its way from LTI to SBC Communications (“SBC”), which then used the information in what became AT&T's U-Verse internet-based entertainment system.[2]

         The relevant facts of record can be divided into two distinct categories: (1) background facts that explain the relationship between McFreen and LTI; and (2) facts that relate to the development of AT&T's U-Verse product. This fact section contains those facts of record, viewed in the light most favorable to the Plaintiff, as the non-moving party, that are necessary to give the reader the necessary context for the Court's discussion of the issues. Additional facts are included where relevant in the discussion section.

         A. Background Facts

         In 2017, the ability to access various forms of entertainment over the internet whenever the mood strikes is an integral part of daily life for many consumers. That was not the case in 2000, however; at that time, there was no technology in place to allow consumers to seamlessly access and stream video and audio over their televisions and other devices. In approximately 1998, Plaintiff Padraic McFreen “conceived of and began developing a concept for an Internet Protocol (“IP”) lifestyle multimedia and entertainment network for the delivery of an Internet-based system that aggregated, bundled, and distributed a wide range of personalized entertainment products and services, enabled by the public use of the Internet as a network and to be provided, as a service for a fee (“Network as a Service” or “NaaS”), to Internet Service Providers (“ISPs”) through a single Internet-based conduit or portal, ” a concept that was “revolutionary” at the time. Dkt. No. 54 at 2-3. McFreen called his “platform, product, services, and content marketplace” MiVu, which stands for Multiservices Internet Virtual Universe and which represents “McFreen's purpose for his platform, product and services: To create a uniquely personalized experience. MiVu's market positioning statement exemplified this purpose: ‘All things important to me and my life right here (within arms' reach) . . . my view of the world.'” Id. at 3.

         In 2000, McFreen contacted LTI to inquire about purchasing a switch that he needed to build the MiVu network. McFreen was put in touch with LTI employee Nathan Geesey, who worked at LTI's Overland Park, Kansas, office. After McFreen had several conversations with Geesey and others from LTI, Geesey suggested that McFreen and LTI execute a Mutual Nondisclosure Agreement (“NDA”), which they did on October 18, 2000. The NDA provided that the confidential information provided to LTI by McFreen would be used “solely for the planning, design and implementation of the MiVu concept.” The confidential information to be provided was described in the NDA as “Multiservices containing Internet Radio, Interactive Television, Gaming, Digital Chat Rooms, Video on Demand, Major Feature Films, and Broadcast Video and Audio Services.” Id. at 6. McFreen was given “a dedicated area for the development of MiVu in the LTI office [in Overland Park] and left documents, pictures, drawings, and files materials [sic] in a cubicle.” Id. at 7. In meetings both in person and over the phone, McFreen “shared with LTI the conceptual, branding, and technological details of the bundled services IP platform he had developed.” Id.

         After working closely with LTI engineers and other personnel “with the shared goal of bringing the MiVu concept to market, ” id. at 9, culminating in January 2001 in a plan to conduct a feasibility study, McFreen ultimately was notified by LTI on or about February 15, 2001, that “senior stakeholders within [LTI] having reached a decision of ‘hold' on the MiVu project due to unplanned internal financial developments and a significant lack of confidence in the feasibility of the MiVu network and associated ISP services, [LTI] would no longer supply financing in support of the project.” Id. at 17. After some additional back and forth between McFreen and LTI, the parties ended their business relationship in April 2001.

         McFreen's NDA with LTI expired on October 18, 2005; after that date, LTI was free to disclose any information that it received from McFreen.

         B. Facts Relating to AT&T U-Verse[3]

         Project Lightspeed was SBC's internal code name for a broadband project that would use SBC's fiber optic network and FTTN (fiber-to-the-node) technology to deliver voice, video, and Internet services. The commercial name for Project Lightspeed was U-Verse. Before 2005, Alcatel demonstrated to SBC a working model of a system that delivered voice, video, and high- speed Internet over an FTTN network that it had developed. Alcatel was chosen by SBC as the primary contractor for SBC's Project Lightspeed/U-Verse. As the primary contractor, Alcatel developed the technical solutions ...

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