1 1. This case concerns manipulation and bad faith.

As outlined below, Defendants gained

2 access to Plaintiff’s confidential and proprietary business information under the guise of suggesting
3 they would acquire Plaintiff. Despite contracting with Plaintiff to not reveal or misuse any of that
4 valuable material, and despite making numerous misrepresentations designed to lure Plaintiff into
5 disclosing the details of Plaintiff’s lucrative social media/advertising platform, Defendants did not
6 follow through on the acquisition. Instead, with the benefit of Plaintiff’s confidential and proprietary
7 information, Defendants announced plans to introduce a product that will directly compete with
8 Plaintiff’s.
9
2. Plaintiff is informed and believes, and thereon alleges, that Defendants previously
10
lacked the systems, technology and know-how to participate and/or compete in the social media/
11
advertising market in which Plaintiff’s product platform and application operates. Accordingly,
12
Defendants made false promises to Plaintiff that they had no intention of honoring in order to secure
13
access to Plaintiff’s information so as to usurp it for themselves. Defendants have engaged in the
14
unlawful and predatory practices described herein with the purpose of unfairly gaining a competitive
15
advantage over Plaintiff in the marketplace and causing damage to Plaintiff as more fully described
16
and explained below.
17
THE PARTIES
18

19 3. Plaintiff CultureSphere is a corporation duly organized and existing under the laws of

20 the State of Delaware, with its principle place of business in Silicon Valley.

21 4. Plaintiff is informed and believes, and alleges thereon, that Defendant HCL is a

22 corporation duly organized and existing under the laws of the State of California, with its principle

23 places of business in Sunnyvale, California. HCL does business throughout the United States,

24 including California.

25 5. Plaintiff is informed and believes, and alleges thereon, that Defendant BEYONDigital

26 is a corporate entity of unknown corporate form, but Plaintiff is informed and believes, and alleges

27 thereon, that BEYONDigital is a business unit of HCL without any separate or independent corporate

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 1 existence from that company. BEYONDigital does business throughout the United States, including

2 California.

3 6. Plaintiff is unaware of the true names and capacities of defendants sued herein as

4 DOES 1 through 10, inclusive, and therefore sues these defendants by such fictitious names. Plaintiff

5 is informed and believes, and thereon alleges, that each of said fictitiously-named defendants is in

6 some manner responsible for the acts, omissions, injuries and/or damages alleged herein. Plaintiff

7 will amend this complaint to allege the true names and capacities of said fictitiously-named

8 defendants when the same have been ascertained.

9 7. Plaintiff is informed and believes, and thereon alleges, that at all times herein

10 mentioned, each of the defendants was the agent, employee, representative, partner, joint venturer,

11 and/or alter ego of each of the other defendants and, in doing the things alleged herein, was acting

12 within the course and scope of such agency, employment, representation, on behalf of such

13 partnership or joint venture, and/or as such alter ego, with the authority, permission, consent, and/or

14 ratification of each of the other defendants. In particular, HCL has provided legal representation for

15 BEYONDigital and instructed Plaintiff’s counsel that all matters regarding BEYONDigital must go

16 through HCL’s in-house legal department, including lawyers located in HCL’s Sunnyvale, California

17 office.

18 JURISDICTION AND VENUE

19 8. This Court has subject matter jurisdiction over Plaintiff’s claims pursuant to Article VI
20 § 10 of the California Constitution because this case is not given by statute to any other court.
21 9. This Court has personal jurisdiction over the Defendants pursuant to section 410.10 of
22 the California Code of Civil Procedure because they are residents of, organized under the laws of,
23 and/or have their principal place of business in the State of California. Moreover, the unlawful
24 conduct alleged in this Complaint occurred in and/or was directed at this State. Furthermore, this
25 Court has jurisdiction over each Defendant because their wrongful conduct challenged in this
26 Complaint was directed at, and intended to have its primary effect in, this State.
27 10. This Court is authorized to grant injunctive relief pursuant to sections 525 and 526 of
28 the California Code of Civil Procedure.

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 1 11. Venue is proper in this Court pursuant to sections 395 and 395.5 of the California

2 Code of Civil Procedure, because Plaintiff and Defendants reside in this county and/or operate their

3 respective principle places of business within Santa Clara County. Additionally, Defendants made

4 material representations and breached their contractual obligations, as explained herein, to Plaintiff

5 while residing in this county. Moreover, the acts complained of herein arose out of conduct that

6 originated in this judicial district, and the situs of the harm caused by that conduct is located in this

7 judicial district.

8 FACTUAL BACKGROUND
9 12. In the rapidly changing landscapes of social media, mobile engagement, and digital
10 advertising, successful organizations must find ways to maximize internal and external branding
11 strength to grow revenues. Traditional forms of advertising and customer engagement fail to
12 capitalize on the strength and reach of digital and social networks.
13 13. CultureSphere is a technology development company that has pioneered a novel
14 platform and unique application for mobile advertising and branding. CultureSphere’s core focus is
15 on proprietarily combining and integrating the social media of a company’s employees and customers
16 through employee generated content and customer/user generated content, enhancing and promoting
17 both the employee experience and customer experience in one mobile platform. CultureSphere’s
18 proprietary integration enables expanded branding like never before.
19 14. CultureSphere’s approach to brand marketing has been widely recognized as one of
20 the most important marketing tools for businesses in the 21st century. Indeed, after his
21 BEYONDigital team witnessed the CultureSphere platform, HCL’s former Chief Executive Officer,
22 Anant Gupta, publicly declared (image below) that merging an exceptional customer experience with
23 a vibrant employee experience is the “holy grail” for every company:
24

25

26

27

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 1

10

11

12

13 15. Plaintiff is informed and believes that HCL is an information technology services

14 provider offering a portfolio of services including software-led IT solutions, remote infrastructure

15 management, engineering and R&D and business services. Plaintiff is informed and believes that

16 HCL’s business unit, BEYONDigital, provides digitization services to companies in order to make

17 their operations and business functions digital from end to end and enabling such clients to market

18 their product and business services more effectively in the digital world.

19 16. In July 2015, CultureSphere launched the first and only mobile platform that fostered

20 the production, consumption, and viral circulation of employee generated content for both internal

21 and external brand marketing and advertising. CultureSphere’s platform and application allows

22 businesses to create tailor-made advertisements for public social media and private business-owned

23 social channels generated from and distributed by and to customers and employees. The technology

24 further allows companies to utilize proprietary algorithms designated for curators to find, source, and

25 approve content to be delivered to public social networks on the web as well as private business-

26 owned social channels for communities of employees and customers, generating significant market

27 penetration and high demand for the business’ brand. CultureSphere’s unique and novel platform and

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 1 application were designed, developed, created and engineered by the principals of CultureSphere

2 over a three-year period at a cost of several million dollars.

3 17. Upon its launch, CultureSphere’s platform was hailed by the industry as the “missing

4 link” in corporate branding. An article in Forbes called CultureSphere, “A Social Media Platform

5 For Business That Will Profoundly Transform Branding.” W. Burns, Forbes (June 18, 2015)

6 (http://www.forbes.com/sites/willburns/2015/06/18/a-social-media-platform-for-business-that-will-

7 profoundly-transform-branding/#3d60b3237f9c).

8 18. In the following months, CultureSphere was contacted by and met with numerous

9 companies about its digital mobile branding platform and application. CultureSphere signed

10 agreements with a wide range of Global 2000 companies to deploy its platform and application across

11 certain business segments. Throughout the next year, CultureSphere met with numerous parties who

12 were interested in financing and/or acquiring CultureSphere and its novel technology.

13 BEYONDigital was one of those companies.

14 A. BEYONDigital’s Interest In CultureSphere

15 19. Almost one year after the successful launch of the CultureSphere application,

16 executives at CultureSphere and BEYONDigital started discussing the terms and conditions of a

17 complete acquisition of CultureSphere by BEYONDigital, a business unit of HCL.

18 20. Plaintiff is informed and believes that at that time, neither BEYONDigital nor HCL

19 had any technology, platform, design, or service-offering for digital mobile branding and nothing

20 remotely similar to the platform and application CultureSphere developed.

21 21. On July 19 and July 20, 2016, CultureSphere’s founder and Chief Executive Officer

22 (CEO), Daniel Gordon, exchanged emails with HCL’s Chief Marketing Officer, Matt Preschern to set

23 up an in-depth conversation about a transaction with CultureSphere.

24 22. On July 28, 2016, Mr. Gordon and Mr. Preschern had that conversation and Mr.

25 Preschern expressed great interest in acquiring CultureSphere. Mr. Preschern explained to Mr.

26 Gordon that he would be travelling to India shortly, where he would discuss the acquisition with HCL

27 executives.

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 1 23. Plaintiff is informed and believes, and thereon alleges, that among the executives Mr.

2 Preschern met with in India was Jaco Van Eeden, the Executive Vice President and Global Head of

3 BEYONDigital. Plaintiff is also informed and believes that the meeting in India produced very high

4 interest among the HCL executives regarding the CultureSphere platform and technology. Indeed, as

5 a result of the meeting, Mr. Van Eeden was instructed by the HCL executives to meet with Mr.

6 Gordon upon his return to the United States.

7 24. On Thursday, August 11, 2016, Mr. Van Eeden emailed Mr. Gordon to set up a

8 meeting. Mr. Van Eeden and his assistant promptly invited Mr. Gordon to BEYONDigital’s offices

9 in Frisco, Texas, just four days after their email introduction.

10 25. On Monday, August 15, 2016, Mr. Gordon met with Mr. Van Eeden at

11 BEYONDigital. During that meeting, Mr. Van Eeden was very explicit about HCL’s intent and

12 desire to acquire CultureSphere and to obtain possession of CultureSphere’s platform and application

13 for BEYONDigital which was just getting ready to go-to-market. In order to move forward, Mr. Van

14 Eeden requested that BEYONDigital obtain access to CultureSphere’s confidential and proprietary

15 information so as to view the inner workings of CultureSphere’s proprietary platform. The parties

16 agreed that the information and materials that would be shared by Mr. Gordon would be treated by

17 BEYONDigital and HCL as “highly confidential,” and that BEYONDigital and HCL would only use

18 such information and materials for the purpose of BEYONDigital’s acquisition of CultureSphere (the

19 “Agreement”).

20 26. Pursuant to the parties’ Agreement, Mr. Gordon presented confidential information

21 regarding CultureSphere’s platform including its functionality, its integration, its user experience

22 flows and its interactive design. Mr. Gordon used a slide deck he had previously provided to

23 BEYONDigital marked “Confidential – this document is for the sole purpose of HCL Technologies –

24 Internal Use Only” to explicate each operation of the CultureSphere application. Upon his

25 completion, Mr. Van Eeden presented confidential slides and information concerning BEYONDigital

26 and HCL. Once Mr. Van Eeden finished his presentation, Mr. Gordon gave Mr. Van Eeden a full,

27 live demonstration of the CultureSphere platform, which showcased in detail its power, potential, and

28 immense market opportunity as a BEYONDigital offering.

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 1 27. Among the many confidential and proprietary things that were shared that day

2 included the means by which CultureSphere created a unique digital platform with the capability of

3 combining the employee experience and customer experience into a digital and mobile asset for any

4 business. Mr. Gordon provided BEYONDigital with confidential details regarding CultureSphere’s

5 systems architecture, software development environment, and Internet and web infrastructure

6 environment. Mr. Gordon also explained CultureSphere’s technological infrastructure, including its

7 network, database, source code, custom application software, how its data is analyzed and stored for

8 determining what variables are analyzed, and related technical descriptions and analyses.

9 28. In addition, Mr. Gordon provided critical details as to how the “curator” operation

10 functions and provides a novel mobile marketing and branding experience on public social networks

11 and on business-owned social channels. It is through the business-owned social channels where Mr.

12 Gordon demonstrated to Mr. Van Eeden the proprietary method of eliminating marketing emails,

13 interacting with unlimited communities of employees and customers, and virally engaging talent and

14 customer prospects via social media advertising. Mr. Gordon also furnished CultureSphere’s

15 capabilities and plans to embed artificial intelligence and machine learning into its curator

16 algorithms. And, Mr. Gordon explained in detail how CultureSphere’s platform and application

17 provides a unique set of tools for tracking content distribution and approvals relating to that

18 distribution.

19 29. Mr. Gordon also disclosed and discussed the strategic marketing opportunities for

20 CultureSphere’s platform and application and its sales pipeline and revenue projections to be

21 expected by BEYONDigital. Mr. Gordon shared confidential research and analysis that

22 CultureSphere conducted on the market opportunities that existed for CultureSphere. Mr. Gordon

23 also shared sensitive and strategic cost and pricing information for the CultureSphere application and

24 demonstrated its anticipated growth potential. The amount and extent of confidential information

25 that CultureSphere shared with BEYONDigital pursuant to the Agreement far exceeded any other

26 disclosures that CultureSphere made to any other company that expressed interest in a potential

27 acquisition.

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 1 30. As a result of the foregoing discussions and disclosures, BEYONDigital became privy

2 to all of the confidential and proprietary information owned by CultureSphere that was necessary to

3 make, host and launch a version of CultureSphere’s platform as a service to BEYONDigital’s and

4 HCL’s clients. BEYONDigital was not, however, permitted to use the information and materials in

5 such manner. To do so would be a direct violation of Mr. Van Eeden’s explicit promises as well as

6 HCL’s and BEYONDigital’s obligations to CultureSphere pursuant to the Agreement.

7 B. BEYONDigital Pursues Acquisition of CultureSphere

8 31. Upon viewing and receiving CultureSphere’s confidential and proprietary information

9 and materials, BEYONDigital and HCL expressed a clear and unwavering commitment to acquire

10 CultureSphere. Mr. Van Eeden stated that the Defendants believed that CultureSphere would be a

11 tremendous revenue-generating asset for HCL, and that BEYONDigital had nothing like

12 CultureSphere’s platform and technology in its portfolio, or even in development.

13 32. Mr. Van Eeden concluded the meeting by laying out the terms of an acquisition of

14 CultureSphere. Mr. Van Eeden discussed the structure of the transaction, the timing, the cash and

15 revenue-sharing components of the consideration to be paid to CultureSphere’s stockholders, and the

16 target price which the parties agreed would be approximately $20 million. Mr. Van Eeden also

17 discussed the obvious synergies between the two companies and how CultureSphere would be run

18 following the acquisition.

19 33. Within one hour of the August 15 meeting concluding, Mr. Van Eeden emailed the

20 HCL Corporate Development Executive Vice Presidents, Anand Birje and Darren Oberst, to extoll

21 the virtues of CultureSphere and its platform, and to move forward with the transaction.

22 34. Plaintiff is informed and believes, and thereon alleges, that BEYONDigital was eager

23 to acquire CultureSphere’s proprietary “holy grail” platform and application because BEYONDigital

24 had nothing in its portfolio that resembled CultureSphere’s platform or application, nor could it have

25 independently known how to engineer or integrate the customer and employee experiences in the

26 manner and way in which CultureSphere had done so. It was clear from the parties’ discussions that

27 BEYONDigital needed CultureSphere and its technology for its digitization clients.

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 1 35. At the conclusion of the August 15 meeting, after both parties agreed on the key terms

2 of the acquisition, the parties identified and spelled out all of the necessary steps needed to integrate

3 the CultureSphere platform and technology so BEYONDigital could start offering the product as a

4 service to their current customers and further attract the overall market. To facilitate that transfer and

5 transition, the parties discussed and agreed that Mr. Gordon would come on-board at BEYONDigital

6 and directly report to Mr. Van Eeden. And finally, the parties discussed a closing date for the

7 acquisition of September 15, 2016, and that Mr. Gordon would begin work at BEYONDigital on

8 October 1, 2016.

9 C. BEYONDigital Abruptly Ends Discussions And Later Announces Its Own Version of
the CultureSphere Platform
10

11 36. Within a week of the August 15 meeting, however, it became clear that HCL and

12 BEYONDigital never actually intended to honor their promises of confidentiality and acquisition.

13 After Mr. Birje and Mr. Oberst ceased communicating with Mr. Gordon, Mr. Gordon followed-up

14 with emails to several HCL and BEYONDigital representatives to find out what was going on.

15 Initially, Mr. Gordon was told that the lack of communication had nothing to do with CultureSphere

16 or the transaction, but instead was due to HCL taking a “relook” of BEYONDigital’s structure within

17 the HCL organization. Mr. Van Eeden told Mr. Gordon that an acquisition would only be discussed

18 in late September or early October.

19 37. Then, three days later on August 27, Mr. Gordon was told that HCL was reconsidering

20 its commitment entirely. In a moment of candor, Mr. Birje explained that HCL was now exploring

21 whether it could build the same platform itself and any acquisition discussion would have to occur in

22 mid to late October. Mr. Gordon was justifiably outraged at HCL and BEYONDigital’s actions.

23 38. Finally, on September 12, Mr. Gordon was informed that HCL would “not . . . acquire

24 any product/platform for our Beyond Digital [sic] practice as of now.” Having induced Mr. Gordon

25 to disclose CultureSphere’s confidential and proprietary information concerning its “holy grail”

26 digital platform and application, and having strung Mr. Gordon along initially with talk of acquisition

27 terms, BEYONDigital now told Mr. Gordon that Defendants would not complete the acquisition, but

28 instead would develop their own platform to compete with CultureSphere. HCL and BEYONDigital

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 1 stated for the first time that they “cannot see the fit” for an acquisition and that Mr. Gordon

2 “misheard” otherwise at the August 15 meeting.

3 39. In the meantime, HCL and BEYONDigital worked to usurp CultureSphere’s

4 confidential and proprietary information for HCL’s own ends. On November 8, 2016, HCL’s Chief

10

11

12

13

14

15

16

17 Human Resources Officer, Prithvi Shergill, tweeted out publicly (below) that HCL was “on the way”
18 to delivering the very same platform and application that CultureSphere had designed, developed and
19 confidentially disclosed to HCL and BEYONDigital.
20 40. The CultureSphere platform and application represents years of investment,
21 programming, development, and ingenuity. As highlighted above, CultureSphere shared its
22 confidential and proprietary material and information with BEYONDigital pursuant to the Agreement
23 and in reliance upon BEYONDigital’s representations that it sought to lawfully acquire
24 CultureSphere through an arm’s length transaction.
25 41. As described above, BEYONDigital had no product or offering similar to
26 CultureSphere’s platform, nor did it have any similar platform in development at the time
27 CultureSphere shared its confidential and proprietary information pursuant to the Agreement.
28 Plaintiff is informed and believes, and alleges thereon, that BEYONDigital could not create a

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 1 platform or application as complex and as sophisticated as CultureSphere from scratch in two months

2 without having misused and misappropriated CultureSphere’s confidential and proprietary materials

3 and information.

4 D. Defendants’ Actions And Conduct

5 42. Defendants were purposeful and intentional in their action. Rather than legitimately

6 purchase the platform and application that HCL and BEYONDigital praised, Defendants used

7 CultureSphere’s confidential and proprietary materials and information and are now promoting,

8 promising and offering a competing product and service.

9 43. Based on the foregoing, it is readily apparent that HCL and BEYONDigital induced

10 CultureSphere to reveal its confidential and propriety materials and information through false

11 promises of confidentiality and non-use restrictions and the promise of acquisition that, with the

12 benefit of hindsight, HCL and BEYONDigital never intended to honor. Defendants will improperly

13 and wrongfully compete with CultureSphere in the development and sale of CultureSphere’s own

14 technology, platform and application.

15 FIRST CAUSE OF ACTION

16 (Against All Defendants for Breach of Contract)
17 44. Plaintiff hereby incorporates by reference as though fully set forth herein, paragraphs

18 1 though 43, inclusive.

19 45. A contract was formed between CultureSphere and Defendants when CultureSphere

20 (via Mr. Gordon) and BEYONDigital (via Mr. Van Eeden) entered into a valid and binding oral

21 agreement on August 15, 2016, referenced above and herein as the “Agreement.”

22 46. The Agreement provided that all of the evaluation materials and information that Mr.

23 Gordon shared with HCL and BEYONDigital concerning CultureSphere would be treated as

24 confidential and used for the sole purpose of BEYONDigital’s acquisition of CultureSphere, and that

25 the evaluation materials and information would not be used by HCL and BEYONDigital for any

26 other purposes or to the detriment of CultureSphere.

27 47. The evaluation materials and information included, but were not limited to, the

28 technological infrastructure (including the network, database, and systems architecture), product

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 1 offerings (including the underlying systems, infrastructure architecture, technological processes,

2 system flows, and graphical user interface), technological capabilities (including programmed source

3 code and related technical descriptions and analyses), financial information, business plans,

4 strategies, techniques, customer information, and business data, of CultureSphere. Said evaluation

5 materials and information constituted confidential and proprietary information belonging to

6 CultureSphere, and Defendants’ obtaining, using, and further developing of such information was

7 strictly prohibited by Defendants’ obligations under the Agreement.

8 48. CultureSphere performed all of its obligations and commitments under the Agreement

9 by furnishing and providing all of the evaluation materials and information requested by HCL and

10 BEYONDigital. To that end, Plaintiff did all of the things the Agreement required of it.

11 49. All conditions necessary for Defendants to perform the contract have occurred.

12 50. Defendants breached the contract by using CultureSphere’s proprietary materials and

13 information to design, develop and/or launch a competing platform and application in violation of the

14 Agreement to not use such information for such purposes or to the detriment of CultureSphere.

15 51. As a direct and proximate cause of the breach, CultureSphere has sustained injury and

16 suffered damages in an amount to be proven at trial.

17 SECOND CAUSE OF ACTION

18 (Against All Defendants For Breach of the Covenant of Good Faith and Fair Dealing)
19 52. Plaintiff hereby incorporates by reference as though fully set forth herein, paragraphs

20 1 though 51, inclusive.

21 53. There was a contract between the parties, as CultureSphere and Defendants entered

22 into the valid and binding Agreement in August 2016. As a matter of law, the Agreement includes an

23 implied covenant of good faith and fair dealing between the parties.

24 54. As part of the implied covenant of good faith and fair dealing, CultureSphere agreed to

25 disclose confidential and proprietary information to BEYONDigital for the sole purpose of pursuing

26 the acquisition of CultureSphere.

27 55. CultureSphere performed all of its obligations under the Agreement, by doing all or

28 substantially all the significant things the Agreement required.

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 1 56. Having induced CultureSphere to disclose its confidential and proprietary information

2 without the intent of abiding by the Agreement’s restrictions, HCL and BEYONDigital breached the

3 implied covenant of good faith and fair dealing. HCL and BEYONDigital’s conduct, even if it does

4 not amount to a technical transgression of the Agreement, clearly frustrates CultureSphere’s rights to

5 the benefits promised under the Agreement.

6 57. All conditions that were necessary for Defendants to perform under the Agreement

7 have been satisfied.

8 58. Because of Defendants’ actions, BEYONDigital and HCL unfairly interfered with

9 CultureSphere’s rights to receive the benefits of the Agreement, namely, to be free from competition

10 from other businesses using CultureSphere’s own confidential and proprietary information. Thus,

11 Defendants acted in a manner that deprived CultureSphere of its rights to receive benefits and

12 protections of the Agreement.

13 59. As a direct and proximate result of Defendants’ breaches, CultureSphere has suffered

14 damages in an amount to be proven at trial.

15 THIRD CAUSE OF ACTION

16 (Against All Defendants For Unjust Enrichment)
17 60. Plaintiff hereby incorporates by reference as though fully set forth herein, paragraphs

18 1 though 59, inclusive.

19 61. Defendants misappropriated CultureSphere’s confidential and proprietary materials

20 and information in a way that conferred upon Defendants a valuable benefit despite their wrongful

21 actions, and but for such wrongful actions, Defendants would not have otherwise received such

22 confidential and proprietary materials and information. Thus, Defendants have benefited and will

23 profit from the receipt and improper use of CultureSphere’s confidential and proprietary materials

24 and information.

25 62. As a result of the improper actions outlined above, Defendants were unjustly enriched

26 at the expense of CultureSphere.

27 63. Under principles of equity and good conscience, Defendants should not be permitted

28 to use and retain the proprietary and confidential materials and information belonging to

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 1 CultureSphere; Defendants should be enjoined from moving forward on the design, development

2 and/or launch of any similar platform or application; and CultureSphere should be compensated for

3 the loss of the benefit that was provided to Defendants having received and misused CultureSphere’s

4 confidential and proprietary materials and information in an amount to be proven at trial.

5 FOURTH CAUSE OF ACTION

6 (Against All Defendants For Promissory Fraud)

7 64. Plaintiff hereby incorporates by reference as though fully set forth herein, paragraphs

8 1 though 63, inclusive.

9 65. As noted above, Jaco Van Eeden is the Executive Vice President and Global Head of

10 BEYONDigital. As a result of holding these positions of senior management, Mr. Van Eeden had

11 full authority to speak on BEYONDigital’s and HCL’s behalf concerning an acquisition of

12 CultureSphere and all matters related thereto.

13 66. On or about August 15, 2016, while meeting at BEYONDigital’s offices in Texas, Mr.

14 Van Eeden verbally promised Mr. Gordon that Defendants would preserve the confidentiality of

15 Plaintiff’s proprietary information and materials.

16 67. That same day during the same meeting, Mr. Van Eeden also promised that

17 Defendants would use the information only for the agreed purpose of evaluating the acquisition of

18 CultureSphere.

19 68. Mr. Van Eeden also stated that Defendants were then engaged in a good faith process

20 to determine whether or not they would acquire CultureSphere.

21 69. At the time Mr. Van Eeden made these promises and misrepresentations on

22 Defendants’ behalf, they were false and he and the Defendants knew them to be false. Defendants

23 had no intention of honoring the promises above when they were made.

24 70. Instead, Mr. Van Eeden made these statements with the intent to cause Plaintiff to

25 detrimentally rely on them by sharing Plaintiff’s proprietary and confidential business information,

26 knowing full well that Defendants would usurp Plaintiff’s technology for their own gain rather than

27 follow through on the promised acquisition.

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 1 71. Plaintiff justifiably relied on Defendants’ false promises. Plaintiff only entered the

2 Agreement, and Mr. Gordon only gave an extensive presentation to Mr. Van Eeden highlighting

3 CultureSphere’s technology, based on the promises that CultureSphere’s information would be kept

4 confidential and not be used to CultureSphere’s detriment or for any other purpose than evaluating

5 the acquisition.

6 72. As a proximate cause of Defendants’ actions, Plaintiff has been damaged in an amount

7 subject to proof at trial.

8 FIFTH CAUSE OF ACTION

9 (Against All Defendants For Violation of Statutory Unfair Competition Law
Bus. & Prof. Code §§17200 et seq.)
10

11 73. Plaintiff hereby incorporates by reference as though fully set forth herein, paragraphs

12 1 though 72, inclusive.

13 74. Defendants’ acts and practices constitute unlawful and unfair business practices within

14 the meaning of California Business and Professional Code §§17200 et seq.

15 75. Defendants acted in a way to restrain competition or the free exercise of business

16 activity.

17 76. Defendants’ acts were unlawful because they constitute an unfair attempt to gain a

18 competitive edge against CultureSphere. Such unlawful restraint on trade is evidence of unfair

19 competition.

20 77. Defendants’ wrongful conduct is unfair because the harm to CultureSphere far

21 outweighs any lawful utility or justification. Such harm is substantial and such conduct is immoral,

22 unethical, oppressive, and offensive to public policy.

23 78. As a direct and proximate cause of these acts, CultureSphere has sustained injury and

24 suffered damages in an amount subject to proof at trial.

25 PRAYER FOR RELIEF

26 WHEREFORE, as a result of the foregoing, CultureSphere respectfully prays for relief

27 against Defendants as follows:

28 (a) actual damages in the amount proximately caused by Defendants;

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 1 (b) monetary damages in an amount by which Defendants were, are and will be unjustly

2 enriched;

3 (c) compensatory and punitive damages in an amount to be determined at trial, with

4 interest, at the maximum amount permitted by law;

5 (d) attorneys’ fees, costs, and disbursements in prosecuting this action to the extent

6 permitted by law;

7 (e) declaratory and injunctive relief as this Court may deem necessary and proper;

8 (f) pre-judgment interest; and

9 (g) such other and further relief as this Court deems just and proper.

10 DATED: December 28, 2016

11 GIBSON, DUNN & CRUTCHER LLP

12

13 By:
Paul J. Collins
14
Attorneys for Plaintiff CULTURESPHERE INC.
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