Scherer Design Group, LLC (SDG), provides telecommunications services. Chad Schwartz, an SDG employee, sought to obtain an

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Scherer Design Group, LLC (SDG), provides telecommunications services. Chad Schwartz, an SDG employee, sought to obtain an ownership stake in the firm. When this proved unsuccessful, Schwartz quit to start a competing firm, Ahead Engineering, LLC, and recruited Daniel Hernandez, an SDG colleague, to join him. Hernandez used an SDG computer to transmit his employer’s client information to Schwartz’s firm via Facebook. One of SDG’s largest clients, ExteNet, left SDG to become Schwartz’s client. After Hernandez resigned, SDG used his company laptop to surreptitiously (secretively) access his Facebook account, which revealed the actions Hernandez had taken to secure SDG’s client information and trade secrets. SDG filed a suit in a federal district court against Schwartz’s firm and Hernandez, claiming a breach of the duty of loyalty and seeking an injunction to stop their solicitation of SDG’s clients. The defendants argued that SDG’s “hacking” of Hernandez’s Facebook account barred the plaintiff ’s right to injunctive relief (under the equitable doctrine of unclean hands).

(a) Use the IDDR approach to evaluate the ethics of SDG’s decision to access Hernandez’s Facebook account.

(b) Should SDG’s use of a company laptop to access Hernandez’s Facebook account bar SDG’s right to an injunction?

Explain.

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The Legal Environment Of Business Text And Cases

ISBN: 9780357129760

11th Edition

Authors: Frank B Cross, Roger LeRoy Miller

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