Paparazzi sues to stop confidential information leaks
Not so. The company has found time to sue an ex-employee and former consultants.
Paparazzi claims the group “stole confidential and protected information” and distributed it on social media.
Paparazzi is going after the ex-employee and group of former distributors, for violating their “confidential and non-competition agreement” and Policies and Procedures respectively.
Named former consultant defendants in Paparazzi’s suit are:
- Geraldine Souza
- Kylee Robinette
- Morgan Ferguson
- Jennifer Dyer
- Jaime Robinson
- Jennifer Carrol and
- Kimberly Drewry
The ex-employee defendant is Melissa Sorenson. Based on the date she signed her confidentiality agreement, Sorenson seems to have commenced employment at Paparazzi on or around August 2019.
Paparazzi terminated Sorenson’s employment contract on January 18th, 2022. A reason for the termination isn’t provided.
An exhibit detailing correspondence from the Papa Group United chat suggests Sorenson feels she was unfairly terminated.
Regardless of why Sorenson was terminated, Paparazzi allege after they terminated her, Sorenson joined the a FaceBook group chat titled “Papa Chat United”.
Paparazzi claims the group was run by the other former consultant defendants, “for the express purpose of organizing efforts to harass and harm Paparazzi.”
Upon information and belief, all of the Defendants individually participated in the Group Chat over the course of several months.
Upon information and belief, the Group Chat was used as a means for ExConsultant Defendants to communicate with Sorenson about stealing confidential Paparazzi documents and information, including information which is defined as Confidential Information pursuant to the Confidentiality Agreement.
Citing communication between the Group Chat, Paparazzi allege Sorenson told the chat on February 24th that, upon being terminated from Paparazzi,
she had improperly retained access to a corporate administration account, which had not been shut down following Sorenson’s termination.
Sorenson reported in the Group Chat that she could login to Paparazzi’s confidential databases through the Paparazzi Admin Account.
Knowledge of this saw the former consultant defendants
conspire, encourage, and work with Sorenson to use the improperly retained login information to access and share Paparazzi’s Confidential Information.
Paparazzi claim Sorenson and the former consultant knew their access was illegal, citing an attempt by Sorenson to cover her tracks.
In an effort to protect herself and her co-conspirators, Sorenson explained in the Group Chat that she would “spoof” her IP address and use a VPN to avoid getting caught by Paparazzi.
Clearly, Sorenson and the Ex-Consultant Defendants knew their access of the Confidential Information was improper and illegal.
Over the next few months, Paparazzi allege Sorenson
accessed, downloaded, and shared vast amounts of Confidential Information with the Ex-Consultant Defendants in the Group Chat, including the total number of Paparazzi Consultants, customers, Consultant profiles, and active Consultants that she stole from the Paparazzi computer database.
Upon information and belief, Sorenson accessed and shared Paparazzi’s financial data and information, including information relating to sales and commission reports.
Sorenson shared information regarding Paparazzi’s business operations and processes, including operations relating to some of Paparazzi’s active Consultants.
This information is alleged to have been shared with the former consultant defendants.
Together, they then shared information obtained from Paparazzi with “other people”.
Sorenson and the Ex-Consultant Defendants did so to try and harm and disrupt Paparazzi’s business, including, for example, its operations and its contractual relationships with its Consultants.
Paparazzi never authorized nor permitted Defendants’ improper and illegal access of Paparazzi’s Confidential Information.
And Paparazzi never authorized nor permitted Defendants to share the Confidential Information via the internet.
At all times, Defendants acted in secret, and in such a way as to prevent Paparazzi from learning of their unlawful actions.
In fact, at one point in the Group Chat, Sorenson even asked “just to make sure.. no one is ever going to know where these came from correct? . . . like no one will ever know how they were obtained.”
Carrol responded: “Never”.
Paparazzi claims it learned of Sorenson’s access on April 20th. Access was finally revoked on April 23rd.
Paparazzi filed suit against Sorenson and the former consultant defendants on April 25th for
- injunctive relief;
- breach of contract (Sorenson);
- breach of implied covenant of good faith and fair dealing (Sorenson);
- intentional interference with economic advantage;
- civil conspiracy;
- violating the Federal Fraud and Computer Abuse Act (Sorenson); and
In addition to injunctive relief, Paparazzi are also seeking damages.
On April 25th, the same day Paparazzi filed its lawsuit, the company also filed an emergency motion requesting a Temporary Restraining Order (TRO).
Paparazzi respectfully requests that the Court enter a temporary restraining order without notice, and, subsequently, a preliminary injunction, enjoining Sorenson and the Ex-Consultant Defendants from further accessing, maintaining, or sharing Paparazzi’s confidential business records.
An example of harm sustained by Paparazzi if an ex-parte TRO was not granted, pertained to Paparazzi’s current consultants.
Defendants’ actions have caused and continue to cause Paparazzi irreparable harm.
Some Consultants have reached out to Paparazzi with concern that their confidential personal information, including addresses, contact details, financial information, and Paparazzi commission payments have been accessed and shared outside of Paparazzi’s business operations.
These concerns cause reputational and loss of goodwill, and are fueled by Defendants’ improper and illegal acts. In fact, there is a risk that some Consultants could cancel their contractual relationship with Paparazzi based on Defendants’ improper disclosure of Confidential Information.
Such harm cannot readily be reduced to monetary damages. Thus, given this irreparable harm and the threat it poses to Paparazzi’s business, the Court should enter a TRO, without notice, and a PI.
The court declined to issue an ex-parte TRO against the defendants.
Following service and summons in early May, a TRO hearing was held on May 10th.
In a subsequent order granting the requested TRO, the court found
Paparazzi has shown a substantial likelihood it will succeed on the merits of its breach of contract claim which provides the basis for preliminary injunctive relief in the form of a temporary restraining order.
The Confidentiality Agreement is a valid and binding contract between Paparazzi and Defendant Sorenson.
The Confidentiality Agreement required Sorenson to keep Paparazzi’s Confidential Information strictly confidential.
Sorenson breached the Confidentiality Agreement when she shared Paparazzi’s Confidential information by email and though the Papa Group Chat with third parties including the Former Consultant Defendants.
While there are factual disputes about these breaches, Sorenson acknowledges that she obtained and disclosed Paparazzi’s Confidential Information and Defendants admit that they knew of the confidentiality obligation or did not themselves receive any confidential information and therefore do not oppose the restrictions of this Order.
And as a result of Sorenson’s breaches and disclosures, Paparazzi has suffered damages to its business reputation.
The Confidentiality Agreement expressly entitles Paparazzi to injunctive relief to prevent Sorenson’s disclosures of Paparazzi’s Confidential Information.
Paparazzi has demonstrated the likelihood that irreparable harm will occur without injunctive relief.
Here, there is a need to act promptly because Paparazzi’s Confidential Information has been obtained and distributed. Once distributed, confidential information is very hard to protect and recover.
Competitors could also exploit the Defendants’ disclosures of Paparazzi’s proprietary Confidential Information to the detriment of Paparazzi’s business.
In addition to damage to Paparazzi’s business reputation with its Consultants and customers, Paparazzi may also face reputational damage if it is found to have violated state privacy laws.
The granted TRO prohibits Defendants from obtaining and further using or discussing Paparazzi’s “Confidential Business Information” in any manner.
The TRO is in place till May 20th. As of yet there are no further updates on the case docket but I believe that means a preliminary injunction hearing is likely on or before May 10th.
If granted, a preliminary injunction will make the term of the granted TRO permanent.
Given how this has played out so far, it’s highly likely Paparazzi will get a preliminary injunction. From there the case will proceed to trial (although I think settlements are highly likely given the preponderance of evidence).
I’ll continue to monitor the case docket for updates.
Update May 21st 2022 – Paparazzi has been granted a preliminary injunction.