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Document 1
Filed 06/23/16
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vs.
JC-BIOMETHANE, LLC; ESSENTIAL
CONSULTING OREGON LLC; and
DEAN FOOR,
Defendants.
COMES NOW Sparkasse Bregenz Bank AG (Sparkasse or Plaintiff), and files this
Complaint against JC-Biomethane, LLC (JCB), Essential Consulting Oregon, LLC (ECO)
and Dean Foor (FOOR) (collectively, Defendants), showing the Court as follows:
INTRODUCTION
1.
Copyright Act and Computer Fraud and Abuse Act, misappropriation of trade secrets,
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conversion, breach of contract, quantum meruit, and breach of duty of good faith and fair dealing
that arises from Entec Biogas GmbH (Entec)s agreement to engineer, procure, and
construction a bio-methane plant for JCB.
PARTIES
2.
to Entec and which has taken an assignment of Entecs claims in this matter.
4.
the State of Oregon with its principal place of business in Junction City, Oregon. Service of
process on JCB may be obtained by serving its registered agent Mike Arnold, 401 East Tenth
Avenue, Suite 400, Eugene, OR 97401.
5.
the laws of the State of Oregon with it principal place of business in Eugene, Oregon. Service of
process on ECO may be obtained by serving its registered agent Dean C. Foor, 1543 W. 24th
Place, Eugene, OR 97405.
6.
FOOR is a resident of the state of Oregon, and at all relevant times was a member
of ECO. Upon information and belief, FOOR also served as the chief executive officer of JCB
until JCB fired him in or about June of 2014. Service of process on FOOR may be obtained by
serving him at his residence at 259 WALNUT DR S, MONMOUTH, OR 97361.
JURISDICTION AND VENUE
7.
This Court has subject matter jurisdiction over this action pursuant to 15 U.S.C.
Venue is proper in this Court under 28 U.S.C. 1391(b)(1), as JCB and ECO
have their principal places of business located within this District, and FOOR resides within this
District.
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FACTUAL BACKGROUND
9.
The averments set forth in Paragraphs 1 through 8 above are incorporated herein
by reference.
10.
Prior to April 22, 2012, JCB decided to build a biogas energy facility in Junction
City, Oregon. Upon information and belief, JCB decided to use pre-consumer food waste as a
feedstock for the plant, so as to receive certain tax credits or other incentives or subsidies
available to users of that waste stream.
11.
On or about April 22, 2012, JCB entered into an Engineering, Procurement and
Construction Agreement (EPC Contract) with Entec for the design, procurement, and
construction of the bio-energy facility in Junction City, Oregon (the Project). A true and
correct copy of the EPC Contract, without voluminous incorporated documents, is attached
hereto as Exhibit A.
12.
calculations, documents and information which have been and will be supplied (the
Documents) (herein Design Documents) are the intellectual property of [Entec] and will
remain in the copyright of [Entec]. [JCB] is allowed to use the [Design] Documents only with
written permission from [Entec].
13.
Sparkasse provided loans to Entec for the design and construction of the Project.
14.
Upon information and belief, after JCB entered the EPC Contract, JCB, acting
through ECO, FOOR, and/or other representatives, learned that the tax credit or subsidies for
users of pre-consumer food waste would not be available for the Project. As a result, JCB, acting
through ECO, FOOR, and/or other representatives, directed Entec to change the design of the
Project to use post-consumer food waste, instead of pre-consumer food waste, as the feedstock
for the Project, resulting in additional cost to Entec and delaying completion of the Project.
15.
JCB, acting through ECO, FOOR and/or other representatives directed Entec to
make other changes in the design or construction of the Project, and JCB failed to timely pay
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Entec for work it performed, which resulted in additional costs to Entec and delayed completion
of the Project.
16.
17.
18.
Entec substantially performed its obligations under the EPC Contract; however,
JCB has failed to pay Entec for the work it performed and for the additional costs caused by
JCBs breaches of the EPC Contract and its changes to Project.
19.
Entec demanded payment from JCB of amounts due and owing under the EPC
Contract.
20.
JCB has failed and refused to pay Entec the amounts that were due and owing to
On or about January 23, 2013 Entec and Ormatic GmbH (Ormatic) entered into
a subcontract for the development and supply of a Software Program titled Automated Control
System Software for Junction City integrating a human-machine interface Human Machine
Interface (HMI) and Programmable Logic Controller (PLC) (collectively referred to as the
Software Program) to run the Project.
22.
JCB and third-parties by creating access to the Software Program via a password known only to
a few developers at Ormatic. Neither Ormatic nor Entec provided the password to JCB, FOOR,
or ECB at any point in time.
23.
2014, FOOR indicates that JCB accessed the Software Program, albeit without the password or
authorization by Entec or Ormatic, when he writes, Further, the code is written in German-lish
[sic] and in a manner to intentionally create dependency and with a multitude of relic code.
Email attached as Exhibit B.
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24.
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Upon information and belief, JCB, ECB, and FOOR accessed the Software
JCBs failure to pay Entec for the installation of the Software Program, the
Unauthorized Modifications to the Software Program, and JCBs ongoing operation of the
Project and use of the Software Program without having paid Entec for a license to use the
Software Program, have damaged Entec in an amount exceeding $5,000.
26.
full or in substantial part to JCBs refusal and failure to pay Entec amounts due under the EPC
Contract.
27.
All conditions precedent to the filing of this action have occurred, have been
The averments set forth in Paragraphs 1 through 27 above are incorporated herein
by reference.
29.
Ormatic is the author of the Software Program. Entec payed Ormatic for the right
to use the Software Program in connection with the Project, but Ormatic retained all copyrights
in the Software Program.
Without permission or license from Ormatic, Defendants prepared derivative works
within the United States based upon Ormatics copyrighted Software Program when they
modified the Software Program.
30.
U.S.C. 501.
31.
Defendants wrongful conduct has deprived Entec of its goodwill and has caused
harm to Entec.
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32.
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committed willfully with knowledge of Entecs rights in the Software Program and the Design
Documents.
33.
34.
On April 15, 2016, Ormatic assigned its copyright in and the right to sue for past
Defendants.
37.
it has suffered and any additional profits the Defendants obtained as a result of their wrongful
acts as hereinabove alleged pursuant to 17 U.S.C. 504.
SECOND CLAIM FOR RELIEF
(Circumvention of Copyright Protection Systems, 17 U.S.C. 1201(a))
38.
reference.
39.
40.
Neither Plaintiff, Ormatic, nor Entec provided Defendants with use of the
hacked into Entecs computer systems to access Ormatics Software Program and modify the
Software Program.
42.
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Defendants wrongful conduct has deprived Entec and Ormatic of its goodwill
Program was committed willfully with knowledge of Entecs and Ormatics rights in and
protection of the Software Program.
45.
circumvention of the copyright protection system, including the destruction of Entecs business.
47.
On April 15, 2016, Ormatic assigned its copyright in and the right to sue for past
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
Entec and Ormatic have suffered and any additional profits the Defendants obtained as a result of
their wrongful acts as hereinabove alleged pursuant to 17 U.S.C. 1203.
50.
Additionally, Plaintiff requests this Court to provide for the recovery of costs
and/or award reasonable attorneys fees pursuant to 17 U.S.C. 1203(b)(4) and 17 U.S.C.
1203(b)(5).
THIRD CLAIM FOR RELIEF
(Computer Fraud and Abuse Act, 18 U.S.C. 1030, 1030(g))
51.
reference.
52.
At all times relevant hereto, Entecs computer system was routinely involved in
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system.
54.
such access to obtain information from Entecs protected computers that Defendants were not
entitled to obtain.
By their conduct, Defendants obtained information and caused loss to Entec and
As the direct result of the conduct of Defendants, Entec has incurred reasonable
costs to respond to the unauthorized access of its computer system and the theft of the
information thereon, to conduct a damage assessment, and other consequential damages and
losses incurred thereby, in an aggregate amount exceeding $5,000.
58.
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
Defendants the damages Entec has suffered, as well as gains, profits, advantages, and unjust
enrichment Defendants have obtained as a result of their wrongful acts as hereinabove alleged.
Plaintiff is presently unable to ascertain the full extent of these damages, gains, profits,
advantages, and unjust enrichment.
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reference.
61.
The Software Program itself and much of the content within the Software
Program is non-public information which derives actual or potential economic value from not
being generally known nor readily ascertainable by proper means by other persons who can
obtain economic value from its disclosure or use.
62.
Entec took reasonable steps to protect the confidentiality of the Software Program
and much of the content within the Software Program, and treated such information as
confidential and proprietary.
63.
The Software Program and much of the content within constitute trade secrets
Defendants acted with the intent to deprive Entec of the exclusive use of its trade
secrets, and/or to appropriate Entecs trade secrets to their own use or to the use of another.
66.
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
By stealing Entecs trade secrets, Defendants have caused damage and loss to
Entec which damages and losses Plaintiff is entitled to recover. Defendants misappropriation of
Entecs trade secrets has been willful and malicious as a result of which, pursuant to OR. REV.
STAT. 646.465(3) and 646.467, Plaintiff is entitled to recover punitive damages in an amount
equal to twice the award made pursuant to OR. REV. STAT. 646.465(1) and (2), and attorney fees
respectively.
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68.
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Plaintiff is also entitled to recover from Defendants the damages Entec suffered,
as well as the gains, profits, advantages, and unjust enrichment the Defendants have obtained as
a result of their wrongful acts as hereinabove alleged. Plaintiff is currently unable to ascertain
the full extent of these damages, gains, profits, advantages, and unjust enrichment.
69.
profits, advantages, and unjust enrichment are not adequately proven, Plaintiff is entitled to a
reasonable royalty pursuant to OR. REV. STAT. 646.463(2).
FIFTH CLAIM FOR RELIEF
(Conversion, 22A OF RESTATEMENT (SECOND) OF TORTS )
70.
reference.
71.
72.
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
Sparkasse is the owner of the Software Program and the content within the
Software Program.
74.
the Design Documents and the Software Program, to the exclusion of, or inconsistent with,
Sparkasses rights.
75.
76.
well as the gains, profits, advantages, and unjust enrichment the Defendants have obtained as a
result of their wrongful acts as hereinabove alleged. Plaintiff is currently unable to ascertain the
full extent of these damages, gains, profits, advantages, and unjust enrichment.
77.
Plaintiff respectfully requests that this Court also award reasonable attorneys fees
COMPLAINT
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reference.
79.
JCB and Entec entered into the EPC Contract for the design and construction of
the Project.
80.
JCB breached the EPC Contract when (1) JCB failed to pay Entec amounts owed
to Entec; (2) JCB used and/or allowed others to use the Design Documents without written
permission from Entec; (3) JCB made or allowed others to make the Unauthorized Modifications
to the Software; and (4) JCBs ongoing operation of the Project and use of the Software Program
without having paid Entec for a license to use the Software Program.
81.
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
trial, including the destruction of Entecs business, plus additional damages to be proven at trial,
including interest, costs, and reasonable attorneys fees. Sparkasse is entitled to recover these
damages.
SEVENTH CLAIM FOR RELIEF
(Quantum Meruit)
83.
reference.
84.
JCB unjustly failed and refused to compensate Entec for the services it performed,
even though JCB knew that Entec expected compensation when it performed the services.
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Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
As a result of the failure and refusal of JCB to compensate Entec, Entec has
suffered losses, costs, and damages in an amount to be proven at trial, plus interest, costs and
attorneys fees, to which Sparkasse is entitled.
EIGHTH CLAIM FOR RELIEF
(Breach of Duty of Good Faith and Fair Dealing)
88.
reference.
89.
JCB had a duty to Entec to perform and enforce the contract in good faith.
90.
JCB breached this duty by, among other things, (1) making changes to the Project
without paying Entec for the cost of those changes; (2) asserting claims to Entecs copyrights
and other intellectual property; (3) claiming to have designed the plant even though Entec
designed most of the plant; (4) refusing to pay Entec amounts due to it; (5) making the
Unauthorized Modifications; (6) operating the Project and using of the Software Program
without having paid Entec for a license to use the Software Program; and (7) asserting inflated
and non-meritorious claims and set-offs against Entec and the amounts owed to Entec.
91.
Plaintiff Sparkasse provided the commercial loans to Entec and has taken an
amount to be proven at trial, including the destruction of its business, interest, costs, and
reasonable attorneys fees, to which Sparkasse is entitled.
WHEREFORE, Sparkasse prays that this Court grant judgment in its favor and against
the Defendants:
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Any other affirmative relief that the Court deems necessary and just.
By:
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