N.C. Business Court Opinions, June 18, 2025 – July 1, 2025
Fin. Carrier Servs. LLC v. Kingpin Cap. Inc., 2025 NCBC 27 (N.C. Super Ct. June 19, 2025) (Conrad, J.)
Key Terms: motion to dismiss; non-compete agreement; non-solicitation agreement; misappropriation of trade secrets; UDTPA; tortious interference; fraud, injunctive relief; confidentiality agreement
Defendant Ryan McCray was employed by Plaintiff Financial Carrier Services, LLC, a factoring and financial services company for over a decade, most recently serving as Plaintiff’s Client Services Supervisor. As a condition of his employment with Plaintiff, McCray signed an employment agreement containing broad noncompetition, nonsolicitation, and confidentiality provisions. In early 2024, McCray resigned from his position with Plaintiff, and took a similar role with Defendant Kingpin Capital, Inc. Plaintiff initiated this lawsuit against McCray and Kingpin, alleging misappropriation of trade secrets, breach of contract, tortious interference with contract, unfair and deceptive trade practices, and fraud. McCray and Kingpin moved jointly to dismiss all claims pursuant to Rule 12(b)(6).
Misappropriation of Trade Secrets. The Court granted Defendants’ motion as to Plaintiff’s misappropriation of trade secrets claim, noting the complaint failed to adequately describe the trade secrets at issue with particularity. Plaintiff’s broad descriptions of its alleged trade secrets, such as “business development strategies and goals,” “knowledge of [Plaintiff’s] operations” and “business practices and plans for future business” were held to be inadequate to put Defendants on notice of the precise information allegedly misappropriated.
Breach of Contract – Noncompetition and Nonsolicitation. The Court granted Defendants’ motion as to Plaintiff’s claims against McCray for breach of the employment agreement’s noncompetition and nonsolicitation provisions. The noncompetition provision, which barred McCray from “directly or indirectly” providing financial services to any of Plaintiff’s customers within the United States, was facially overbroad and unenforceable and not subject to blue-penciling because it was not clearly drafted to be divisible. The nonsolicitation provision was likewise facially overbroad and unenforceable because, read literally, it would bar McCray from doing any financial service business with any customer of Plaintiff’s within the United States, including those customers with which he’d had minimal or no contact.
Breach of Contract – Confidentiality. The Court denied Defendants’ motion as to Plaintiff’s claim for breach of the employment agreement’s confidentiality provision. Defendants argued the Complaint failed to adequately plead a breach. Noting that breach of contract claims are not subject to heightened pleading standards, the Court determined the claim was adequately pleaded.
Tortious Interference with Contract and Unfair and Deceptive Trade Practices. Plaintiff asserted that Defendant Kingpin had tortiously interfered with the restrictive covenants in McCray’s employment agreement and had unlawfully induced Plaintiff’s customers to terminate their contract with Plaintiff. Defendants moved to dismiss, arguing that the restrictive covenants were all unenforceable and that any interference with Plaintiff’s contracts was justified. The Court dismissed the claim to the extent it was based on the noncompetition and nonsolicitation provisions of McCray’s employment agreement, which had already been determined to be unenforceable. However, since the claim for breach of the confidentiality provision remained and such breach supplied the unlawful conduct necessary to plead a tortious interference claim, the motion was otherwise denied as to this claim. Because the UDTPA claim was premised on the tortious interference claim, it survived to the same extent as the tortious interference claim.
Fraud. Plaintiff’s fraud claim was based on Defendant’s providing a materially different version of McCray’s employment agreement which Plaintiff believed to be fake. The Court dismissed this claim, concluding that Plaintiff had not alleged that it had been deceived by, relied upon, or been damaged by the disputed document.
Injunctive Relief. Noting that injunctive relief is not an independent cause of action, the Court dismissed the standalone claim for injunctive relief without prejudice to Plaintiff’s ability to seek injunctive relief at a later time if appropriate.
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Accelerando, Inc. v. Relentless Sols., Inc., 2025 NCBC 28 (N.C. Super. Ct. June 19, 2025) (Robinson, C.J.)
Key Terms: motion to dismiss; misappropriation of trade secrets; breach of contract; tortious interference with contract; unjust enrichment, unfair and deceptive trade practices
Plaintiff Accelerando Inc. is a provider of software and services to businesses that license a point-of-sale software owned by NCR Corporation. Defendant Relentless Solutions, Inc. is also an authorized provider of software and services to NCR licensees. In 2017, Plaintiff and Relentless entered into a reseller agreement, whereby Relentless was authorized to resell certain products created by Plaintiff to use with the NCR software. In 2021, three of Plaintiff’s employees, including Defendant Robert Yoder, resigned from Plaintiff’s company and began working for Relentless. Following this, several of Plaintiff’s customers left Plaintiff and began working with Relentless. Plaintiff filed suit, asserting various claims relating to Defendants’ alleged misappropriation of trade secrets. Relentless moved to dismiss all claims asserted against it pursuant to Rule 12(b)(6).
Misappropriation of Trade Secrets. The Court denied in part and granted in part the motion to dismiss the trade secret claim. Relentless argued that the Complaint failed to include sufficient facts or evidence demonstrating that Relentless possessed and used the alleged trade secrets. The Court held that the Complaint’s allegations were “minimally sufficient” at the present stage to the extent the claim was based on Customer Service Protocols taken by Dollaeye, a former employee of Plaintiff. However, the Court ruled that Plaintiff’s allegations relating to trade secrets taken by Defendant Yoder and another employee, Muller, were insufficient to support a claim. Plaintiff conceded that the confidential information taken by Yoder did not warrant trade secret protection. Additionally, the Complaint failed to allege that any trade secrets were taken by Muller and subsequently used by Relentless. Although Relentless argued that the Complaint’s allegations amounted to misappropriation by “inevitable disclosure,” a doctrine not yet recognized in North Carolina, the Court concluded that the pleadings alleged actual, rather than inevitable, disclosure of trade secrets.
Breach of Contract. The Court denied Relentless’ motion to dismiss Plaintiff’s breach of contract claim, holding that the Complaint had met the relatively low bar to state a claim for breach of contract. Specifically, the Court pointed to allegations asserting the existence of a valid contract between Plaintiff and Relentless, and Relentless’ breach of the contract by using Plaintiff’s confidential proprietary information to compete with Plaintiff.
Wrongful Interference with Contract. The Court denied Relentless’ motion to dismiss as to wrongful interference with contract, concluding that Plaintiff had adequately pleaded the claim. Because Plaintiff had alleged that Relentless had interfered with Plaintiff’s contracts through unlawful means, the Court rejected Relentless’ argument that the interference was justified.
Unfair and Deceptive Trade Practices. Because the Court had concluded that Plaintiff’s allegations were sufficient to state claims for misappropriation and tortious interference, the Court concluded that the allegations were likewise sufficient to state a UDTPA claim as to that same conduct.
Unjust Enrichment. The Court dismissed the unjust enrichment claim because, as alleged, any benefit Relentless received resulted from Relentless’ unauthorized taking of Plaintiff’s trade secrets and confidential information, not from a voluntary conferment of benefit from one party to another, as required to state an unjust enrichment claim.
Permanent Injunction. The Court granted Relentless’ motion to dismiss Plaintiff’s claim for a permanent injunction, as injunctive relief is a remedy, not an independent cause of action. The Court dismissed this claim without prejudice to Plaintiff’s ability to seek this remedy at a later time.
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Accelerando, Inc. v. Relentless Sols., Inc. 2025 NCBC 29 (N.C. Super. Ct. June 19, 2025) (Robinson, C.J.)
Key Terms: judgment on the pleadings; breach of contract; tortious interference with contract; unjust enrichment, unfair and deceptive trade practices; restrictive covenants
As described further above, this case arises following certain individuals’ resignation from Plaintiff Accelerando Inc. and subsequent employment with Defendant Relentless Solutions, Inc. In 2009, Defendant Robert Yoder began his employment with Plaintiff. At this time, Yoder executed a subcontractor agreement with Plaintiff containing noncompetition and confidentiality provisions. Yoder served as Plaintiff’s Vice President of Platform Services until his resignation in 2021. On the day of his resignation, Yoder allegedly forwarded certain information relating to two of Plaintiff’s customers to Yoder’s personal email address. Yoder subsequently began employment with Relentless. Plaintiff filed suit against both Relentless and Yoder. Yoder moved for judgment on the pleadings on all claims asserted against him.
Breach of Restrictive Covenants. The Court granted Yoder’s motion as it related to the noncompetition provision of the agreement, on the basis that the restriction was overly broad and unenforceable as a matter of law because, among other reasons, it prohibited “indirect” competition. The Court denied Yoder’s motion as it related to the confidentiality provision, noting that the pleadings adequately alleged the requisite elements for a breach of contract action.
Wrongful Interference with Contract. The Court denied Yoder’s motion as it related to Plaintiff’s claim for wrongful interference with contract. Yoder asserted that the claim failed due to Plaintiff’s failure to allege how Yoder induced the named customers to terminate their contracts with Plaintiff, or allege malice on Yoder’s behalf. The Court disagreed, finding that the Complaint adequately pleaded the elements of the claim, including that Defendants had interfered through unlawful means.
Unfair and Deceptive Trade Practices. The Court denied Yoder’s motion as it relates to Plaintiff’s claim under the NCUDTPA, noting that the survival of the tortious interference claim asserted by Plaintiff warranted the survival of its connected NCUDTPA claim.
Unjust Enrichment. The Court granted Yoder’s motion as it related to the unjust enrichment claim. As with the analysis offered above for Defendant Relentless’ motion to dismiss, the Court found that no benefit was voluntarily conferred upon Yoder by Plaintiff.
Permanent Injunction. The Court granted Yoder’s motion to dismiss Plaintiff’s claim for a permanent injunction, as injunctive relief is a remedy, not an independent cause of action. The Court dismissed this claim without prejudice to Plaintiff’s ability to seek this remedy at a later time.
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Johnson v. Hildebrandt, 2025 NCBC Order 46 (N.C. Super. Ct. June 24, 2025) (Houston, J.)
Key Terms: voluntary dismissal; pro se; motion to reopen case; show cause hearing
Plaintiff filed a putative derivative action on behalf of nominal defendants in March 2024 alleging that Defendants Hildebrandt and Johnson had engaged in corporate mismanagement and waste. Although Plaintiff was represented by counsel, in July 2024, Plaintiff, through his son, filed a pro se notice of voluntary dismissal. Though the dismissal was notarized, Plaintiff’s son stated at hearing that the notarization had taken place without Plaintiff being present and without the notary observing Plaintiff signing the document. Plaintiff’s counsel filed to reopen the case in March 2025, contending that the dismissal was unauthorized and ineffective. Because no material actions were taken in the case prior to the dismissal and no filings were made in the case following the dismissal until the motion to reopen, the Court entered an order requiring Plaintiff to show cause why the action should not be dismissed for failure to prosecute.
Following the show cause hearing, the Court held that the voluntary dismissal should be struck because 1) Plaintiff was represented by counsel and therefore could not make pro se filings; 2) Plaintiff had not obtained leave to file the dismissal, which is required for dismissal of derivative claims; and 3) there were reasonable grounds to question the authenticity of the filing. Plaintiff orally moved for a dismissal without prejudice at the show cause hearing, indicating that a resolution outside of court was expected. Finding that the dismissal was in the best interest of all interested parties, the Court granted this dismissal without prejudice.
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Rhinehart v. Howard, 2025 NCBC Order 47 (N.C. Super. Ct. June 27, 2025) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4; mandatory complex business case; contemporaneous filing
Plaintiff initiated this action in Cumberland County Superior Court on June 24, 2025. On June 25, 2025, Plaintiff filed a notice of designation. The Court determined that designation was improper because the NOD was not contemporaneously filed with the complaint, as required by N.C.G.S. § 7A-45.4(d)(1). This ruling was made without prejudice to the right of any party to seek designation of this action as a mandatory complex business case as provided under N.C.G.S. § 7A-45.4.
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G1.34 Holdings, LLC v. Chapman Grp. Inc. of SC., 2025 NCBC Order 48 (N.C. Super. Ct. June 27, 2025) (Robinson, C.J.)
Key Terms: order on designation; N.C.G.S. § 7A-45.4(a)(5); intellectual property; mandatory complex business case
Plaintiff filed suit alleging claims for unfair and deceptive trade practices and tortious interference. Plaintiff timely filed a notice of designation, designating the case as a mandatory complex business case under N.C.G.S. § 7A-45.4(a)(5), which provides for designation of actions involving a material issue related to disputes involving the ownership, use, licensing, lease, installation, or performance of intellectual property.
The Court held that the case was improperly designated. After a review of the record, the Court determined that the dispute arose from a financing agreement for software development costs, not the software or intellectual property itself. Designation under § 7A-45.4(a)(5) requires the dispute to be “closely tied to the underlying intellectual property aspects” of the property at issue rather than closely tied to areas such as contract, fraud, or tort. The Court also declined to recommend the case for Rule 2.1 designation. This ruling was made without prejudice to the right of any party to seek designation of this action as a mandatory complex business case as provided under N.C.G.S. § 7A-45.4.
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In re Asheville Eye Assocs. Data Incident Litig., 2025 NCBC Order 49 (N.C. Super. Ct. July 1, 2025) (Davis, J.)
Key Terms: pro hac vice; sanctions; duty of candor; barred from practicing law in North Carolina
This Order arises from the Court’s sua sponte reconsideration of its Order granting Andrew J. Shamis pro hac vice status in this matter. Shamis, an attorney with Shamis & Gentile, P.A. in Florida, was listed as additional counsel on the complaint, “pro hac vice forthcoming.” Shamis was also listed as an attorney in two other class action cases in the state. In his various pro hac vice motions for these three cases, Shamis presented conflicting information to the Court regarding the states in which he is admitted to practice, his Florida bar license number, and his history of pro hac vice admission in North Carolina.
On May 9, 2025, Shamis’ conflicting representations were noted by Chief Judge Robinson in one of the other cases, resulting in his request for pro hac vice admission to be denied in that matter. On that same day, unaware of Shamis’ misrepresentations, the Court granted Shamis’ motion for pro hac vice admission in this case. Shamis did not alert the Court of the misrepresentations contained in his motion at this time. Three weeks later, the Court independently discovered this and noticed a hearing to determine whether reconsideration of his admission was warranted.
Three days before the hearing Shamis and local counsel filed an amended motion for Shamis to appear pro hac vice and statement in support thereof. In this amended motion and statement, Shamis disclosed for the first time that he had been admitted pro hac vice in North Carolina multiple times within the last five years. Shamis and local counsel represented that they were unaware of the inaccuracies contained in the pro hac vice motion when filed.
The Court revoked Shamis’ pro hac vice admission. Noting Shamis’ “repeated violations of clear North Carolina rules and his failure to comply with his duty of candor” the Court sanctioned Shamis, prohibiting him from practicing within the state for a period of one year. The Court further admonished local counsel for failing to bring to the Court’s attention the inaccuracies contained in Shamis’ motion.
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