SDNY Judge Greenlights Suit Over Alleged 'Hacking' by Investment Firm of Ex-Employee's Computer
A Manhattan federal judge on Monday declined to dismiss a lawsuit claiming that an asset management firm had illegally accessed the computer and two hard drives of a former senior director.
May 13, 2019 at 05:49 PM
3 minute read
A Manhattan federal judge on Monday declined to dismiss a lawsuit claiming that an asset management firm had illegally accessed the computer and two hard drives of a former senior director.
U.S. Judge John Keenan of the Southern District of New York on Monday said in a 21-page opinion that the federal action could proceed parallel to a state court case alleging that Paul Iavovacci had been improperly terminated from his position at Brevet Capital Management.
Brevet, a privately owned firm that invests in public equity markets, had asked Keenan to dismiss the lawsuit on abstention grounds, citing “significant overlap” between the two cases, which both stemmed from the “very same set of factual allegations” that led to his firing in 2016.
According to court documents, Iacovacci had undergone surgery in December 2015, which required extensive treatment and hospitalization. Given his health issues, Iacovacci told the firm that he planned to retire, but Brevet instead decided to terminate his employment, leading to his state-court lawsuit in October 2016.
Iacovacci said that documents produced in that case revealed that Brevet, its president, chief investment officer and head of technology had launched a “hacking campaign” to access files stored on Iacovacci's computer, which Brevet had purchased and installed in his home. According to the opinion, the defendants admitted in a state court affidavit that they had reviewed “hundreds” of files from the computer, two hard drives and a Yahoo email account.
Iacovacci filed his federal suit in September, alleging violations of the Computer Fraud and Abuse Act, the Federal Wiretap Act and the Stored Communications Act.
Responding to Brevet's motion, Iacovacci and his Krieger Kim & Lewin attorneys argued that the federal case was distinct because it named different defendants and requested different relief. While the state court action was essentially a contract dispute, the Southern District case was premised primarily on supposed violations of federal law, Iacovacci said.
In his ruling, Keenan said that the state court case did “touch on” the question of whether Iacovacci's devices were accessed without him permission, but, he said, the judge would not need to resolve the issue in order to reach a verdict on the wrongful termination claims.
“The court agrees with Iacovacci that the state and federal actions are not parallel. Iacovacci does not assert any of the federal law claims that he asserts here in state court, nor would the state court necessarily have to resolve the issues raised in this federal litigation,” Keenan wrote.
Paul M. Krieger, who represents Iacovacci, said his client was grateful that his cyberintrusion claims were allowed to proceed.
“We look forward to holding Brevet and the other defendants to account for repeatedly and unlawfully breaking into Mr. Iacovacci's personal home network, electronic devices, and viewing his personal Yahoo email,” Krieger said in a statement.
Attorneys for Brevet and its officers did not return calls Monday afternoon requesting comment on the ruling.
Iacovacci is also represented by Chelsea Lin O'Donnell and Jonathan Bolz of Krieger Kim & Lewin.
The defendants are represented by Christine Isabelle Laurent, Joseph Kim and Philip Semprevivo of Biedermann Hoenig Semprevivo and Daniel Seth Weinberger and Edward William Larkin of Gibbons.
The case is captioned Iacovacci v. Brevet Holdings.
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