XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al. 07/28/2026 in Department 43 Demurrer to First Amended Complaint by Mohammad Ibrahim Demurrer to First Amended Complaint by Shawn Aleman, CNKTD Technologies, LLC and InAuto LLC

The morning calendar in courtroom 43 will normally begin at 8:45. Please arrive for your hearing no later than 8:30 a.m. The door will be opened before the calendar is called. The Court allows remote appearances by Zoom. Refer to the Courtroom 43 webpage for more information about remote appearances. For Zoom appearances, all counsel appearing by Zoom must register no later than 3:00 p.m. the court day before the hearing. If appearing by Zoom, log into the hearing no later than 8:30 a.m. The Court will transfer you to the meeting room when the calendar begins.

Additional instructions can be found on the Court website. When you log in to Zoom, be sure that your name and the case name are used as your Zoom name. With respect to the tentative ruling below, no notice of intent to appear is required. If you wish to submit on the tentative ruling you can fax notice to Judge Coats's secretary, Ms. Brantner at 805- 477-8790, stating that you submit on the tentative. Or you may email Courtroom43@ventura.courts.ca.gov with all counsel copied on the email. Do not call in lieu of sending a fax or email.

If you submit on the tentative without appearing and the opposing party appears, the hearing will be conducted in your absence. If you are the moving party and do not advise the Court that you submit on the tentative, or you do not appear at the hearing, the Court may deny your motion irrespective of the tentative. Unless stated otherwise at the hearing, if a formal order is required but not signed at the hearing, the prevailing party shall prepare a proposed order and comply with CRC 3.1312 subdivisions (a), (b), (d) and (e).

The signed order shall be served on all parties and a proof of service filed with the court. A "notice of ruling" in lieu of this procedure is not authorized. Motions:

1. Demurrer to First Amended Complaint by Mohammad Ibrahim 2. Demurrer to First Amended Complaint by Shawn Aleman, CNKTD Technologies, LLC and InAuto LLC

Tentative Rulings: On the Demurrer of Defendant Mohammad Ibrahim to the First Amended Complaint and the Demurrer to First Amended Complaint by Shawn Aleman, CNKTD Technologies, LLC and InAuto LLC the Court rules in omnibus fashion as follows:

The Demurrer of Shawn Aleman to the First Cause of Action for Breach of Fiduciary Duty is OVERRULED. The FAC pleads more than preparation to compete. The company allegedly founded by Defendant Aleman competes with Plaintiff. (FAC at ¶¶4, 100, 108). The argument as

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

to whether the acquisition of INAUTO can be actionable given the timeline of events is not resolvable on demurrer.

The Demurrers are OVERRULED as to the Second Cause of Action for Breach of Contract. Notwithstanding Plaintiff’s inclusion of potentially relevant documents at Ex. 6 to the FAC, the question of whether Plaintiff is the proper entity to bring the breach of contract claim cannot be resolved on demurrer.

The Demurrers are OVERRULED as to the Third Cause of Action for Conversion. Plaintiff pleads a wrongful act through conversion of Plaintiff’s laptop and hard drives (FAC ¶¶119-121) which as alleged exceeds the trade secret scope of the California Uniform Trade Secrets Act (CUTSA).

The Demurrers are OVERRULED as to the Fifth Cause of Action for Tortious Interference with Contract. The cause of action is not displaced by the California Uniform Trade Secrets Act (CUTSA) because the allegations exceed the scope of trade secret misappropriation as they include, inter alia, intentional steps taking by Defendant Aleman to interfere with Defendant Ibrahim’s contract with P. (FAC at ¶138).

The Demurrers are OVERRULED as to the Sixth Cause of Action for Misappropriation of Trade Secrets. The allegations in the FAC, including ¶88 and ¶146, are sufficient for purposes of demurrer to identify the trade secrets at issue.

The Demurrers are OVERRULED as to the Seventh Cause of Action for Unfair Competition and Unjust Enrichment. A demurrer does not lie to a portion of a cause of action (i.e., unjust enrichment). PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682. The Demurrer is OVERRULED as to the displacement of this cause of action by the CUTSA. There are allegations of wrongdoing, incorporated by reference, including soliciting employees to leave and soliciting third party customers to refrain from working with Plaintiff (FAC at ¶116) that exceed the trade secret scope of the CUTSA.

The Demurrers are OVERRULED as to the Eight and Ninth Causes of Action for Intentional/Negligent Interference with Prospective Economic Advantage. As with the Seventh Cause of Action, there are allegations in the FAC that go beyond allegedly misappropriating trade secrets.

The Demurrer is SUSTAINED without leave to amend as to the Fourth Cause of Action for Breach of Fiduciary Duty. Plaintiff has not alleged more than an employment relationship with moving Defendant Ibrihim. Calvao v. Superior Court (1988) 201 Cal.App.3d 921, 923. Moreover, the claim is preempted by CUTSA.

The Demurrers are SUSTAINED without leave to amend as to the Tenth Cause of Action for Injunctive Relief. Injunctive relief is not a cause of action. Shamsian v. Atlantic Richfield Co. (2003) 107 Cal.App.4th 967, 984.

DISCUSSION:

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

Moving Defendant’s Request for Judicial Notice - The requests for judicial notice of the original Complaint filed in this action and the First Amended Complaint are granted. (Ev. Code, §452(c).)

The request for judicial notice of the January 8, 2025, press release is denied.

Analysis

Preface re: CUTSA

Under California law, CUTSA occupies the field and preempts all non-contractual common law claims that are "based on the same nucleus of facts as the misappropriation of trade secrets claim for relief" (K.C. Multimedia, Inc. v. Bank of America Tech. & Operations, Inc. (2009) 171 Cal. App. 4th 939, 958). If there is no "material distinction" between the wrongdoing alleged in a common law claim and a CUTSA claim, the common law claim must be dismissed (SunPower Corp. v. SolarCity Corp. (N.D. Cal. 2012) 2012 WL 6160472, at *3). A common law tort claim is preempted if it lacks a "material distinction" from the core wrongdoing alleged in the trade secret claim. Because Xirgo rephrased the factual allegations of data theft across its other counts, those counts are duplicative.

Plaintiff's argument that its claims survive because they target "proprietary" or "confidential" information rather than statutory "trade secrets" fails as a matter of law. Under Silvaco Data Systems v. Intel Corp. (2010) 184 Cal. App. 4th 210, 239, information that does not fit the definition of a statutory trade secret, and is not otherwise made property by positive law, belongs to no one and cannot be converted. Allowing tort claims to proceed under the generic banner of "confidential information" would nullify the statutory system created by CUTSA. Any state law tort claim based on the alleged disclosure of proprietary data would be preempted.

1st COA: Breach of Fiduciary Duty – Defendant Aleman demurrers to the 1st cause of action. The FAC pleads more than preparation to compete. The company allegedly founded by Defendant Aleman competes with Plaintiff. (FAC at ¶¶4, 100, 108). The FAC alleges that in June of 2022, during the pendency of his employment, Aleman founded and signed an Amendment to the Articles of Incorporation for CNKTD Technologies, a business that directly competes with Xirgo. Aleman founded CNKTD prior to his employment ending with Xirgo Technologies, Inc. ending on May 31, 2023, and by using CNKTD to acquire InAuto to compete with Xirgo, Aleman acted in a manner that contradicted those duties by acting in his own self interest and failing to act in the best interest of Xirgo.

Aleman also retains Xirgo’s confidential business files, copies of handwritten notes, annotated schematics, and other Xirgo documents which he has used to further CNKTD’s business in competition with Xirgo. (FAC ¶107-109.) The argument as to whether the acquisition of INAUTO can be actionable given the timeline of events is not resolvable on demurrer. The Demurrer of Shawn Aleman to the 1st Cause of Action for Breach of Fiduciary Duty is overruled.

2nd COA: Breach of Contract – All defendants demurrer to the 2nd cause of action. The question of whether Plaintiff is the proper entity to bring the breach of contract claim cannot be resolved by this demurrer. Furthermore, the claim for breach of contract is not preempted by CUTSA due to an explicit statutory carve-out (Cal. Civ. Code § 3426.7(b)(1)). The Court is unable to determine

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

on demurrer from the documents attached to the FAC that there is no standing. The demurrer to the 2nd Cause of Action is overruled.

3rd COA: Conversion – All defendants demurrer to the 3rd cause of action. To the extent the conversion claim is predicated on the theft, alteration, or use of Xirgo's intangible confidential files and data, it is completely preempted by CUTSA (Silvaco, 184 Cal. App. 4th at 236). However, the allegation that the defendant stole a physical laptop or physical hard drive, allows the plaintiff to bring suit for the conversion of the tangible item itself, independent of the data contained thereon. The allegation that “property” was converted is sufficient to encompass tangible property. The demurrer to the 3rd Cause of Action is overruled.

4th COA: Breach of Fiduciary Duty – All defendants demurrer to the 4th cause of action. A regular employee can have a fiduciary relationship with his employer, based on the facts alleged. Guild Mortgage Co. LLC v. CrossCountry Mortgage LLC (2026) 120 Cal.App.5th 885, 895. The facts alleged in the FAC are insufficient to establish the basis for the alleged fiduciary relationship. Moreover, Plaintiff's breach of fiduciary duty claim is expressly tied to Defendant Ibrahim's alleged violation of an "Inventions, Confidentiality and Non-Solicitation Agreement" and the subsequent disclosure of Xirgo's proprietary operational secrets to competitors. Because the core "breach" is defined as a failure to maintain secrecy, it lacks any material distinction from the CUTSA claim (K.C. Multimedia, 171 Cal.App.4th at 961). The demurrer is therefore sustained without leave to amend.

5th COA: Tortious Interference with Contract - Defendants Shawn Aleman, CNKTD Technologies, LLC and InAuto LLC demurrer to the 5th cause of action. The allegations of the FAC are that Aleman took intentional steps to interfere with the contract between Abrahim and Plaintiff. (FAC ¶138.) While that may have involved trade secrets, the allegations of the FAC are not limited to that scope. The demurrer to the 5th Cause of Action is overruled.

6th COA – Misappropriation of Trade Secrets – All defendants demurrer to the 6th cause of action. The FAC at ¶49 alleges product drawings identifying all of the products and their components, handwritten notes, schematics, and product information. Ibrahim accessed Xirgo’s designs, records, processes, software programs, and devices in connection with his role as a hardware engineer. The information to which Ibrahim had access will be used in future products that Xirgo is developing and is proprietary. The drawings, notes, and information on each product would be useful to a competitor, as they identify key components of the products that would allow another engineer to recreate a version of the product.

The FAC at ¶146 alleges the trade secrets are:

- pricing information negotiated with Xirgo’s customers; - cost information negotiated with suppliers and third parties; product and component drawings and specifications identifying Xirgo’s products and their components, handwritten notes, product schematics, and product information. - This information is used by Xirgo to develop future products, and is proprietary. These drawings, notes, and information on each product would be useful to a competitor, as they identify key components of the products that

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

would allow another engineer to recreate a version of the Xirgo product without the significant investment of their own independent development;  the identities of parties who supplied components for products and services provided by Xirgo Technologies, Inc., Sensata Technologies and Xirgo;  the confidential terms concerning any relevant supply agreements with third parties;  source code;  Xirgo’s customer lists and information detailing the scope of the relationships with customers; and  Xirgo’s business plans and development documents relating to existing and future products and/or services that may be offered.

The FAC at ¶88 identifies four schematics XT47, XT35, XT34, and XT31 that were (allegedly) accessed.

These allegations are sufficient and the demurrer to the 6th cause of action is overruled.

7th COA Unfair Competition and Unjust Enrichment – All defendants demurrer to the 7th cause of action. California does not recognize unjust enrichment as a separate cause of action. Castillo v. Toll Bros., Inc. (2011) 197 Cal.App.4th 1172, 1210. But a demurrer does not lie to a portion of a cause of action, so the demurrer is overruled as to that issue. (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682.)

With respect to the CUTSA, the allegations are:

¶158 Defendants and those acting in concert with Defendants have violated the Unfair Competition Law, Business & Professions Code sections 17200 et seq., by committing unlawful and unfair business acts and practices. These acts or practices include, but are not limited to, the following:

(a) Defendants have retained, accessed, and used Xirgo’s trade secrets. (b) At least Ibrahim has accessed the information affirmatively in connection with his employment at CNKTD.

Plaintiff's Unfair Business Practices (UCL) and unjust enrichment claims rely in part on the premise that Defendants "retained, accessed, and used" trade secrets to their own commercial advantage. Because the same conduct gives rise to both the statutory trade secret claim and the UCL claim, the UCL claim would be preempted (Farmers Ins. Exch. v. Steele Ins. Agency, Inc. (E.D. Cal. 2013) 2013 WL 3872950, at *10).

But Plaintiff has alleged more than just trade secret unfairness: covert dual employment, his breach of confidentiality agreements, and the exploitation of an ongoing employment relationship to benefit a competitor. These allegations exceed those covered by the CUTSA. The demurrer is overruled as to the 7th cause of action.

8th COA Interference with Prospective Economic Advantage

2026CUCO059612: XIRGO TECHNOLOGIES, LLC, A DELAWARE LIMITED LIABILITY CORPORATION, vs SHAWN ALEMAN, AN INDIVIDUAL, et al.

9th COA Negligent Interference with Prospective Economic Advantage-

All defendants demurrer to the 8th and 9th causes of action. Plaintiff alleges that Defendants' misappropriation caused third-party vendors (an online retailer, a shipping company, and an insurance carrier) to remove Xirgo from business consideration. The FAC explicitly incorporates its trade secret misappropriation facts into these counts and alleges willful "misappropriation" as the required "independently wrongful act" to sustain an interference claim. However, Plaintiff also alleges other wrongful interference mechanisms independent of the trade secret theft such as soliciting employees to leave and soliciting third party customers to refrain from working with Plaintiff, the claims are not fully displaced by CUTSA.

The demurrer is overruled. 10th COA: Injunctive Relief - All defendants demurrer to the 10th cause of action. A request for injunctive relief is not a cause of action. Shamsian v. Atlantic Richfield Co. (2003) 107 Cal.App.4th 967, 984. This demurrer is sustained without leave to amend.

6