In Benedict v. Hewlett-Packard Co., a California federal district court permitted HP to bring counterclaims against the lead plaintiff in a wage and hour class action, based on the alleged breach of the plaintiff's confidentiality agreement, discovered when the plaintiff produced confidential and proprietary HP documents in discovery.
Benedict moved to dismiss the counterclaims on the basis that HP did not allege sufficient damages—a required element of a breach of contract claim—or alternatively, that HP's allegations of damages were "implausible" because the plaintiff stated that he imaged his HP laptop only to retain his personal documents, did not disclose the HP materials to anyone other than his attorney and was willing to return them to HP. The court denied the plaintiff's motion to dismiss, finding that HP's alleged damages of lost profits, unjust enrichment and reasonable royalties were sufficient allegations of loss, and that HP's theory that the plaintiff took the documents to use them for his own illicit gain was plausible.
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