Our client, J Park & Associates, Inc., purchased an accounting, tax and tax problem resolution (TPR) practice in Mechanicsville in August of 2018 from a trust setup by defendant Steve Rue. Rue stayed on as an employee after the sale, along with his two daughters, defendants Randi Power and Sherri Eggleston. In 2021, the defendants secretly started a competing business called Rue Ward and conspired to copy the company server onto a a 16TB external hard drive and to covertly, while still employed by our client, move over the files, staff, and clients to Rue Ward.
After the lawsuit was filed, all defendants indicated in discovery that Rue had no involvement with Rue Ward and they represented to the court that there were no responsive text message communications because the defendants did not use their cellphones for business. After a third-party subpoena revealed that these representations were false, the court ordered a forensic review of defendants’ cell phones and computers, and it was confirmed, among other things, that Rue was substantially involved in the conspiracy and was actively competing. The Court entered an adverse inference against Power and Eggleston, but not Rue. At trial, the jury found defendants liable on all counts.
In awarding our client total damages of $8,835,674.99, which includes $350,000 in punitive damages, the jury found all defendants liable for Statutory Conspiracy, Common Law Conspiracy and Tortious Interference. The jury found Power liable for violation of the Virginia Trade Secrets Act and the Virginia Computer Crimes Act. In addition, the jury found Rue personally liable for breach of the Non-Compete. We successfully advanced a legal theory of “closely related parties” to enforce the non-compete against Rue personally, although only the trust was a party to the original sale documents.
Rue filed a counterclaim for $1.6 mil alleging unauthorized used of his image under Va Code § 8.01-40, unjust enrichment, breach of contract and other equitable claims. We successfully struck Rue’s expert in the middle of his testimony and thereby defeated the § 8.01-40 claim. As for the other claims, we were largely successful in either defeating them entirely or otherwise reducing them. In the end, the jury reduced Rue’s claim from $1.6 mil down to $86,972.83.