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Acacia Communications, Inc. v. ViaSat, Inc.

Superior Court of Massachusetts, Suffolk

October 16, 2018

ACACIA COMMUNICATIONS, INC.
v.
VIASAT, INC.

          DECISION AND ORDER REGARDING PLAINTIFF’S MOTIONS TO DISMISS COUNTERCLAIMS (DOCKET ENTRY NO. 33.0)

          Brian A. Davis, Associate Justice of the Superior Court

          This is an action, filed in July 2017, in which plaintiff Acacia Communications, Inc. ("Plaintiff" or "Acacia") alleges that it was defamed, in or about July 2017, by purportedly false statements made by defendant ViaSat, Inc. ("Defendant" or "ViaSat") to members of Optical Internetworking Forum ("OIF") to the effect that Acacia has misappropriated ViaSat’s trade secrets. ViaSat has counterclaimed alleging that Acacia has, in fact, misappropriated ViaSat’s trade secrets and disclosed them, or threatened to disclose them, to OIF’s membership in violation of the parties’ agreements, common law, and G.L.c. 93A. Another action between the same parties currently is pending in the California courts (the "California Action"). That action, which was commenced in January 2016 by ViaSat, also involves claims that Acacia has misappropriated ViaSat’s trade secrets, but it predates Acacia’s purported actual or threatened disclosure of ViaSat’s trade secrets to OIF’s membership.

         Acacia now has moved to dismiss ViaSat’s counterclaims in this action on the ground that ViaSat is engaged in improper "claim splitting." More specifically, Acacia argues that ViaSat’s counterclaims in this case "are duplicative of claims currently pending between the parties" in the California Action and must be pursued, if at all, in that action. ViaSat opposes Acacia’s motion to dismiss on the ground, in part, that its claims in this action are different and that it is free to pursue in this proceeding any claims it may have arising from Acacia’s alleged misuse of ViaSat’s trade secrets following the commencement of the California Action.

         The Court conducted a hearing on Acacia’s motion to dismiss on October 9, 2018. Upon consideration of the written submissions of the parties and the oral arguments of counsel, Acacia’s motion is DENIED in its entirety. The factual record establishes that, in this case and in the California Action, both parties have been on both sides of the issues presented by Acacia’s motion to dismiss. For example, it is undisputed that, during the past year, Acacia has taken the position in the California Action that its alleged disclosure of ViaSat’s trade secrets to OIF’s membership is irrelevant to the claims asserted by ViaSat in that proceeding and that to allow ViaSat to "sweep in OIF now [would be] highly improper." See Affidavit of Stuart V.C. Duncan Smith, dated May 30, 2018, Exhibit 1 at 17 n.5. ViaSat, in turn, has taken the seemingly incongruous position in the California Action that its claims in that case "include[ ] the OIF and Acacia’s threatened disclosure of trade secrets ..." Id. at 8. Thus, the equities of the present situation benefit neither Acacia, nor ViaSat.

         Irrespective of the contradictory positions taken by the parties in the past, however, Acacia’s argument that ViaSat counterclaims must be pursued, if at all, in the California Action is simply wrong. Massachusetts courts consistently have held that a dismissal based on the "long-barred practice of claim-splitting" is appropriate when "the same parties are involved in two actions, one begun before the other, and ... all the operative facts relied on to support the [second] action had transpired prior to the commencement of the first action." Gold Star Homes, LLC v. Darbouze, 89 Mass.App.Ct. 374, 377 (2016) (emphasis added, internal quotation marks and citations omitted). See also Zora Enterprises, Inc. v. Burnett, 61 Mass.App.Ct. 341, 346 (2004), cert. denied, 543 U.S. 1150 (2005) (same); Keen v. Western New England College, 23 Mass.App.Ct. 84, 85-87 (1986) (same); Eight Arlington Street, LLC v. Arlington Land Acquisition-99, LLC, 2007 WL 2367753, at *9 (Mass.Super. Aug. 3, 2007) [22 Mass.L.Rptr. 733] ("Claim splitting bars claims that existed at the time a party filed its previous suit. On the other hand, a party may file a subsequent suit asserting claims that arose after it filed the first suit") (internal citations omitted).

          ViaSat’s counterclaims in this case turn on Acacia’s alleged disclosure, or threatened disclosure, of ViaSat’s trade secrets to OIF’s membership in or around May, June, and July of 2017. Those events undeniably occurred (if they occurred at all) more than one year after ViaSat commenced the California Action. It is, therefore, apparent that all of the operative facts relied upon by ViaSat to support its counterclaims did not "transpire[ ] prior to the commencement" of the California Action, and that ViaSat is not barred from pursuing its counterclaims against Acacia as a result.[1] Gold Star Homes, LLC, 89 Mass.App.Ct. at 377.

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Notes:

[1] In this context, the Court has considered, and rejects, Acacia’s argument that its alleged continuing misappropriation of ViaSat’s trade secrets, including its actual or threatened disclosure to OIF’s membership, constitutes a single, indivisible "claim" that cannot be asserted in multiple forums. Most of the trade secret cases cited by Acacia in support of this proposition turn on language contained in the Uniform Trade Secrets Act ("UTSA"). See, e.g., Cadence Design Systems, Inc. v. Avant! Corp., 29 Cal.4th 215, 222 (2002) ("The most critical section of UTSA for purposes of this case is section 3426.6, which provides: ‘An action for misappropriation must be brought within three years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered. For the purposes of this section, a continuing misappropriation constitutes a single claim ’ ") (emphasis in original). The UTSA only became effective in Massachusetts on October 1, 2018, and its terms explicitly "do not apply" to any alleged ...


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