TB Food U.S. LLC v. Am. Mariculture Inc.

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TB FOOD USA, LLC, a Delaware Limited Liability Company, Plaintiff, v. AMERICAN MARICULTURE, INC., a Florida Corporation, AMERICAN PENAEID, INC., a Florida Corporation, and ROBIN PEARL, Defendants.

AMERICAN MARICULTURE, INC., a Florida Corporation, Third-Party Plaintiff, v. PB LEGACY, INC. a Texas Corporation, Third-Party Defendant.

No. 2:17-cv-9-FtM-29NPM

United States District Court, M.D. Florida, Fort Myers Division

August 1, 2022

OPINION AND ORDER

JOHN E. STEELE UNITED STATES DISTRICT JUDGE.

This matter comes before the Court on review of the following eight post-trial motions: (1) Defendants American Mariculture, Inc., American Penaeid, Inc., and Robin Pearl's Motion For a New Trial Pursuant to Rule 59 (Doc #483); (2) Defendants American Penaeid, Inc. and Robin Pearl's Renewed Motion for Judgment As a Matter Of Law (Doc. #484); (3) Plaintiff TB Food USA, LLC's Motion For Permanent Injunction (Doc. #485); (4) Plaintiff TB Food USA, LLC's Renewed Motion for Judgment As a Matter Of Law (Doc. #486); (5) Defendants American Mariculture, Inc. American Penaeid, Inc., and Robin Pearl's Renewed Motion for Sanctions (Doc. #487); (6) Plaintiff TB Food USA LLC's Motion For Enhanced/Exemplary Damages, Pre and Post Judgment Interest, and Disgorgement (Docs. ##488, 529); (7) Defendants American Mariculture, Inc., American Penaeid, Inc., and Robin Pearl's Motion to Amend Judgment Pursuant To Rule 59 (Docs. ##530, 531, 544); and (8) Defendants American Mariculture, Inc., American Penaeid, Inc., and Robin Pearl's Motion To Dismiss Count IV of the Amended Complaint For Lack of Subject Matter Jurisdiction (Doc. #543). The parties have filed Responses in Opposition and Replies to each other's motions. (Docs. ##489, 502, 504-505, 509-510, 526-528, 534, 540, 542, 546-547.) The Court heard oral arguments on the motions on May 23, 2022. With leave of court, the parties filed supplemental memorandum thereafter. (Docs. ##551, 552.)

I. Jury Verdicts

On November 1, 2021, a jury trial began on the claims set forth in Plaintiff's Amended Complaint (Doc. #20) and in third-party Plaintiff's Counterclaim (Doc. #80) which had not been resolved prior to trial. The jury rendered its verdicts on November 19, 2021 (Doc. #465) as follows:

A. Amended Complaint

(1) Count I - Breach of Contract

The jury found that TB Food USA, LLC (TB Food) had proven American Mariculture, Inc. (AMI) (the only defendant) breached the Nondisclosure Agreement (NDA) and the Grow-Out Agreement (GOA). The jury rejected two equitable estoppel affirmative defenses by AMI, but found that AMI had proven its affirmative defense that the breach of contract claim was barred by the in pari delicto defense. Therefore, TB Food was not awarded any damages as to Count I. (Doc. #465, ¶¶ 1-13; Doc. #500.)

(2) Count III - Defamation

The jury found that TB Food had not proven its defamation claim against AMI or American Penaeid, Inc. (API), but had proven the defamation claim against defendant Robin Pearl (Mr. Pearl). The jury awarded TB Food $500,000 in compensatory damages against Mr. Pearl. (Doc. #465, ¶¶ 14-18; Doc. #500.)

(3) Count IV - Federal Defend Trade Secrets Act

The jury found that TB Food had not proven its federal Defend Trade Secrets Act (DTSA) claim against AMI, but had proven the claim against API and Mr. Pearl. The jury awarded TB Food $4,950,000.00 in compensatory damages. (Doc. #465, ¶¶ 19-30; Doc. #500.) The jury also found that TB Food had proven that Mr. Pearl and API had willfully and maliciously misappropriated one or more of Primo's trade secrets, but awarded no exemplary damages. (Id.)

(4) Count V - Florida Uniform Trade Secrets Act

The jury found that TB Food had not proven its Florida Uniform Trade Secrets Act (FUTSA) claim against AMI, but had proven the claim against API and Mr. Pearl. The jury awarded TB Food $4,950,000.00 in compensatory damages and no exemplary damages. (Doc. #465, ¶¶ 31-40; Doc. #500.)

(5) Count VI - Lanham Act False Advertising Claim

The jury found that TB Food had not proven its Lanham Act False Advertising claim against AMI, but had proven the claim against API and Mr. Pearl. The jury awarded TB Food compensatory damages of $100,000.00 and no exemplary damages. (Doc. #465, ¶¶ 41-50; Doc. #500.)

(6) Counts VII and VIII - Florida Unfair Competition

The jury found that TB Food had not proven its Unfair Competition claims against AMI, API, or Mr. Pearl. (Doc. #465, ¶¶ 51-53; Doc. #500.)

B. Counterclaim

The jury found that AMI had proven that PB Legacy, Inc. (PB Legacy) breached the Grow-Out Agreement. The jury also found, however, that PB Legacy had proven its affirmative defenses of equitable estoppel and ratification, but not its waiver defense. Therefore, AMI was not awarded any damages. (Doc. #465, ¶¶ 61-66; Doc. #500.)

II. Renewed Motions For Judgment As Matter of Law

All parties made oral and/or written motions for judgment as a matter of law pursuant to Fed.R.Civ.P. 50(a) at the appropriate times during trial. The Court took some issues under advisement, while denying the other portions of the motions. After the trial, the Court issued an Opinion and Order (Doc. #499) denying the outstanding portions of the motions. All parties now renew their motions for judgment as a matter of law.

Federal Rule of Civil Procedure 50(b) allows a party to renew a motion for judgment as a matter of law made pursuant to Rule 50(a) following entry of a jury verdict. See Fed.R.Civ.P. 50(b). Rule 50(b) provides, in pertinent part:

(b) If the court does not grant a motion for judgment as a matter of law made under Rule 50(a), the court is considered to have submitted the action to the jury subject to the court's later deciding the legal questions raised by the motion. . . . In ruling on the renewed motion, the court may:

(1) allow judgment on the verdict, if the jury returned a verdict; (2) order a new trial; or (3) direct the entry of judgment as a matter of law.

Fed. R. Civ. P. 50(b).

A renewed motion under Rule 50(b) must be based on the same grounds as the earlier Rule 50(a) motion. Connelly v. Metro. Atlanta Rapid Transit Auth., 764 F.3d 1358, 1363 (11th Cir. 2014) . When considering a Rule 50(b) motion, the court determines whether the record - viewed in the light most favorable to the prevailing party - points so overwhelmingly in favor of the opposing side that the jury's verdict cannot stand. Yates v. Pinellas Hematology & Oncology, P.A., 21 F.4th 1288, 1298 (11th Cir. 2021). “Stated differently, the verdict will be set aside only if no reasonable jury could have arrived at it.” Id. Where there is substantial evidence in the trial record that would allow reasonable minds to reach different conclusions, judgment as a matter of law is not appropriate. Mee Indus. v. Dow Chem. Co., 608 F.3d 1202, 1211 (11th Cir. 2010). The Court does not weigh the evidence or make credibility determinations in determining such a renewed motion. Brown v. Ala. Dept. of Transp., 597 F.3d 1160, 1173 (11th Cir. 2010).

A. Defendants API and Mr. Pearl's Renewed Motion for Judgment As a Matter Of Law

Defendants API and Mr. Pearl renew their request that the Court enter judgment in their favor as a matter of law on Plaintiff's defamation claim (Count III), Defend Trade Secrets Act (DTSA) claim (Count IV), the Florida Uniform Trade Secrets Act (FUTSA) claim (Count V), and the federal unfair competition claim (Count VI). (Doc. #484.) For the reasons discussed below, the motion is denied. Any argument not specifically discussed is denied as without merit.

(1) Sufficiency Of Trade Secret Evidence

Defendants API and Mr. Pearl argue that TB Food failed to introduce legally sufficient evidence that bred shrimp constitute a valid trade secret under either the federal or Florida trade secret statutes. (Doc. #484, p. 3.) Defendants argue that while the DTSA defines a trade secret to include “forms and types of . . . information” that the owner endeavors to keep secret, and the FUTSA protects “information” which has been subject to efforts to maintain secrecy, neither statute references protection of bred animals, genetics, or selective breeding. (Id. pp. 3-5.) Defendants further assert that both the Amended Complaint and the Plaintiff's position at trial was that the trade secret at issue was both the genetic information about the shrimp and the shrimp themselves. The evidence fails to support either theory, Defendants argue, because (1) Primo never had knowledge of the information about “underlying Primo shrimp genetics” since no genetics analysis of its shrimp was ever conducted by Primo, and none of the so-called “information” was ever disclosed to or received by AMI (Id., p. 6); and (2) no court in the United States has ever found that the genetics of bred animals constitute a trade secret under the DTSA or the FUTSA. (Id., p. 7.) In sum, Defendants argue that TB Food failed to adduce legally sufficient evidence to prove that its bred shrimp constituted valid trade secrets under either the DTSA or FUTSA and, while information can be a trade secret, TB Food failed to present any evidence at trial of any information that was known to TB Food and misappropriated by Defendants. (Id., pp. 8-9.)

TB Food responds that a trade secret under both federal and Florida statutes consists of certain “information.” (Doc. #489, p. 4 n.3.) TB Food asserts that the trade secrets in this case were twofold: (1) the “biologic information and markers of animals including genetic information” (Id., p. 4), and (2) “the underlying knowledge as to which Primo shrimp belonged to which Primo families.” (Id.)

The Court previously stated that Primo's alleged trade secrets may qualify as trade secrets if the finder of fact determined they met the statutory criteria...