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October 20, 2019Cart

Business

by Westchester County Business Journal
by WCBJ

Yonkers military contractor sues former executive over trade secrets

A Yonkers military contractor has sued a former company executive for allegedly stealing customer trade secrets.

Crestwood Technology Group Corp. claims that Patrick Dunn, its former executive vice president of development, may have given confidential company information to his son, head of a Maryland company that is a direct competitor.

Crestwood sells electronic components to the military, aerospace and defense industries, commercial aviation and other businesses. The company was founded in 2000 and employs fewer than 100 people.

“What lawsuit?” Dunn responded to an email request for his side of the story. He did not respond to a second email that attached a copy of the complaint.

Dunn began working for Crestwood in January 2016, at $300,000 a year. Part of his job was to cultivate relationships with the company’s top 25 customers.

He agreed to keep all company information confidential, according to the lawsuit filed last month in federal court in White Plains. Employees also are required to take annual training on ethics and security standards. They may not, for instance, forward customer information to nonsecured servers or email accounts, including their personal accounts.

Some employees also have to be cleared by the Department of the Navy to work on sensitive government contracts.

Crestwood suspended Dunn from March 30 to June 19, because of a pending debarment by the Navy for something that happened before he joined the company. The lawsuit does not explain what those actions were.

Dunn was reinstated in June. But on Sept. 19, according to the lawsuit, a technology officer discovered that Dunn had forwarded 37 confidential company emails, from 2014 to the present, to his private Gmail account. The messages allegedly contained customer information and preferences.

An investigation identified another 61 messages that were forwarded or printed, the lawsuit claims, concerning clients with revenues of at least $5 million. Dunn also allegedly switched his company cellphone number to his personal Verizon account.

Crestwood believes that Dunn gave stolen client lists and other information to his son, Scott Dunn, owner-operator of Beltway Electronics Co., a direct competitor founded in 2016 in Cockeysville, Maryland.

Dunn moved to Townson, Maryland on Sept. 20 and Crestwood fired him on the following day.

He has refused to return any of the allegedly stolen information, the lawsuit states, or the company cellphone.

Crestwood accuses Dunn of misappropriation of trade secrets, computer fraud, unfair competition and theft.

Crestwood is asking the court to order Dunn not to use or share any of the company information and to return trade secrets and destroy his copies, bar him and any Beltway Electronics representatives from soliciting Crestwood’s customers, return the company cellphone and award unspecified damages for the harm he allegedly caused.