# ZipBy USA LLC v. Parzych

> District Court, D. Massachusetts · April 19, 2024

URL: https://www.frixlaw.com/law-library/cases/10201958

## Case

- **Court:** District Court, D. Massachusetts
- **Decided:** April 19, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

ZIPBY USA LLC, TMA GROUP OF *
COMPANIES LIMITED, and TMA *
CAPITAL AUSTRALIA PTY LTD, *
*
Plaintiffs, *
v. * Civil Action No. 1:20-cv-10926-IT
*
GREGORY PARZYCH, *
*
Defendant. *

MEMORANDUM & ORDER

April 19, 2024
TALWANI, D.J.
Plaintiffs ZipBy USA LLC, TMA Group of Companies Limited, and TMA Capital
Australia Pty Ltd. (collectively, the “ZipBy entities” or “ZipBy”) brought claims against
Defendant Gregory Parzych for breach of fiduciary duty (Count I), breach of contract (Count II),
misappropriation of trade secrets under state and federal law (Counts III and IV), trademark
infringement under state and federal law (Count V and VII), and false designation (Count VI).
Following a five-day jury trial, the jury returned a verdict in favor of Plaintiffs as to all counts,
awarding $1,500,000 in compensatory damages and $1,000,000 in exemplary damages. Verdict
[Doc. No. 373].
Parzych brings three motions challenging the jury verdict. For the reasons set forth
herein, Parzych’s Motion for a New Trial on Damages [Doc. No. 391] and Motion for a New
Trial Pursuant to Rule 59 [Doc. No. 390] are DENIED, and his Motion for Judgment as a Matter
of Law [Doc. No. 381] is DENIED in part and GRANTED in part.
I. Standard of Review
“A trial court evaluating a motion for judgment as a matter of law under Rule 50(b) must
‘view the evidence in the light most flattering to the verdict and must draw all reasonable
inferences therefrom in favor of the verdict.’” Rodríguez-Valentin v. Doctors’ Ctr. Hosp.

(Manati), Inc., 27 F.4th 14, 20 (1st Cir. 2022) (internal quotation omitted). Similarly, “when an
argument that the evidence was insufficient forms the basis of a motion for new trial,” the district
court may “us[e] the same reasoning as in [addressing] a motion for judgment as a matter of
law.” Lama v. Borras, 16 F.3d 473, 477 (1st Cir. 1994).
The court may also grant a motion for a new trial where “action is required to prevent
injustice.” Rodríguez-Valentin, 27 F.4th at 20. Where, as here, a due process violation is
claimed, the defendant must demonstrate that he was deprived of “constitutionally adequate
process.” See González-Droz v. González-Colón, 660 F.3d 1, 13 (1st Cir. 2011).
II. Claimed Procedural Due Process Violation
Parzych argues that his due process rights were violated because one of his lawyers,

Michelle Blair, was required to participate in the trial remotely after she contracted COVID-19
on Day 3 of the five-day trial.
The jury was empaneled on Monday, November 27, 2023, with both Attorney Blair and
Attorney Robert Dionisi representing Defendant. Opening arguments for both sides and
Plaintiffs’ case in chief commenced the following day. Plaintiffs’ counsel began direct
examination of Parzych on Wednesday, November 29, 2023. On Thursday, November 30, 2023,
Attorney Blair reported that she had tested positive for COVID-19 the prior evening. The court
advised the parties of the need to follow CDC guidelines and required Attorney Blair to
quarantine for five days. Tr. Day 4 at 5:7-9. Attorney Blair requested to participate remotely for
her examination of Parzych. Tr. Day 4 at 5:10-12. The court explained the logistics involved in
Attorney Blair’s remote participation, offered “[t]he other option is we recess for five days, but I
think we may lose our jury if we do,” and inquired as to whether Attorney Blair was well enough
to proceed remotely. Tr. Day 4 at 7. Attorney Blair responded:

I believe I can proceed. . . . [Plaintiff’s expert] was the witness today,
which Mr. Dionisi was going to examine. [Defendant’s witness] tomorrow,
Dionisi was going to examine. I’m examining just Mr. Parzych, and then was
planning on doing the closing.
But, yes, I believe I can proceed, Your Honor. . . .
. . . .
I don’t want to risk losing – losing the jury. So I think I can proceed.
Tr. Day 4 at 7. After conferring further with counsel for both sides, the court determined that the
remainder of trial could proceed with Attorney Blair participating via Zoom, and Attorney
Dionisi continuing to participate in person. Tr. Day 4 at 20:10-13. The court also inquired as to
whether there was any objection to having Plaintiffs’ direct examination of Parzych continue
while Attorney Blair was making arrangements for her Zoom participation, and Attorney Blair
responded that “[a]s long as Attorney Dionisi is there for objections, I do not have a problem
with that.” Tr. Day 4 at 9:24-10:2.
Following a break, Attorney Dionisi reported that Parzych was “very uncomfortable
going forward without Attorney Blair in the courtroom.” Tr. Day 4 at 17. Attorney Dionisi
suggested suspending the following day and returning to the courtroom on Monday, Tr. Day 4 at
18, which would not have satisfied the five-day quarantine requirement. When Attorney Dionisi
expressed concern with proceeding before Attorney Blair was connected by Zoom, the court
delayed Plaintiffs’ examination of Parzych until later in the day. Neither Attorney Dionisi nor
Attorney Blair formally objected to proceeding with Attorney Blair participating remotely.
Days 4 and 5 also proceeded without objection regarding Attorney Blair’s remote
participation. Trial included the reading of deposition testimony, Plaintiffs’ counsel’s conclusion
of Parzych’s direct examination, Attorney Dionisi’s cross-examination of Plaintiffs’ expert
witness and direct examination of a Defense witness (as was previously scheduled), and Attorney

Blair’s examination (by Zoom) of Parzych. The court permitted Attorney Blair to raise
objections to the evidence and repeatedly dismissed the jury so that she could do so freely
despite not being in the courtroom. Tr. Day 4 at 96:22-108:25; 178:11-25; Tr. Day 5 at 122:16-
124:12. On Day 6, both sides presented closing argument, with Attorney Blair rejecting the
court’s offer that she conduct her closing statement in person with a mask and presenting her
argument over Zoom. See Tr. Day 5 at 15:4-18.
The court finds that Parzych has waived his due process argument by failing to raise any
formal objection to proceeding with trial at any time prior to this Motion. Attorney Blair herself
consented on multiple occasions to the arrangement, as did Attorney Dionisi. “Counsel cannot
play a waiting game and after an adverse verdict is rendered raise an objection . . . for the first

time.” Wildman v. Lerner Stores Corp., 771 F.2d 605, 609 (1st Cir. 1985). But even without the
waiver, allowing Attorney Blair to participate in trial remotely as requested did not deprive
Parzych of due process where he was ably represented by counsel throughout the trial. Parzych’s
request for a new trial based on a procedural due process violation is denied.
III. Substantive Claims in Parzych’s Motion for a New Trial Pursuant to Rule 59
and his Motion for Judgment as a Matter of Law
Because many of the remaining arguments in Parzych’s motions overlap, the court
addresses the motions together. Parzych argues that the verdict ran afoul of the corporate
opportunity doctrine, the law of contract formation, and the law regarding the rights of at-will
employees; and that the trade secret misappropriation and trademark infringement verdicts were
against the great weight of the evidence.
A reasonable jury could find the following facts from the evidence at trial. While Parzych
was the President of ZipBy USA, he was contacted by the managing director of Q-Free (the

company that owned Parzych’s former company, TCS International (“TCS”)) and asked if ZipBy
would be interested in acquiring TCS. Parzych informed ZipBy’s CEO, Anthony Karam, about
the offer. Karam then asked Parzych about the advisability of ZipBy acquiring TCS. After
initially expressing enthusiasm over the deal, Parzych advised Karam not to acquire TCS
because, among other reasons, TCS’s parent company was misrepresenting the financial
information such that the deal appeared better than it was. After leading Karam to believe the
deal was no good, and while still employed by ZipBy, Parzych attempted to acquire the company
on his own, without discussing the purchase with Karam or ZipBy’s board.
While he was President of ZipBy USA, Parzych also secretly purchased the office
building where ZipBy USA was based and then renegotiated ZipBy USA’s lease without

disclosing to ZipBy that he was now ZipBy USA’s landlord.
After being fired by ZipBy, Parzych reached out to others in the parking industry and
indicated that TCS was offering parking technology solutions. These parking technology
solutions were highly similar in description to projects in development at ZipBy to which
Parzych had had access.1 Parzych also used ZipBy’s logo on his personal webpage, MJP Global,
and continued to do so after being fired.

1 Parzych signed several of these emails as “President of TCS,” although at trial he testified that
he was not TCS’s President and that his email signature was a typo.
A. Breach of Fiduciary Duty
Parzych argues in both motions that the court misrepresented the governing legal
standard regarding the duties of an employee to his employer.
First, Parzych argues that he was permitted to pursue the TCS opportunity under the

corporate opportunity doctrine and that the jury was misled into believing that an employee may
never pursue an opportunity even if his employer has rejected that opportunity. “[T]he corporate
opportunity doctrine is best seen as a rule of disclosure obligating the fiduciary to disclose all
material facts to the corporation so that the corporation can make an informed decision on the
opportunity.” Report and Recommendation at 19 [Doc. No. 257] (citing In re Cumberland
Farms, Inc., 284 F.3d 216, 228 (1st Cir. 2002)) (emphases added), adopted as to this issue by the
court, see Clerk’s Notes [Doc. No. 293]. The jury was presented with substantial evidence that
Parzych presented intentionally misleading and incomplete information about TCS to Karam and
could reasonably have concluded that ZipBy did not have the requisite knowledge to make a
fully informed decision not to pursue the opportunity on its own.

Relatedly, Parzych’s assertion that a new trial is warranted based on ZipBy’s counsel’s
references to Parzych’s secretive conduct during closing arguments is unavailing. The jury was
properly instructed that opening and closing arguments were not evidence. See Tr. Day 6 at
19:20-25; 77:17-21. Considering that curative instruction, as well as “the context in which [the
statement] occurred” and “the strength of the evidence against the defendant,” the court finds
that references to secretive conduct in opening and closing arguments cannot serve as the basis
for a new trial, particularly where the jury could properly infer that secretive conduct was indeed
indicative of bad faith. See United States v. Robinson, 473 F.3d 387, 398 (1st Cir. 2007).
Second, Parzych argues that the court erred in refusing to instruct the jury that at-will
employees are free to pursue other opportunities while employed at their current positions. As
the court explained during the charge conference, Parzych was not “merely” an at-will employee:
He was bound by his general fiduciary duty to ZipBy as President of the company and bound

further by contracts including a noncompete agreement and his employment agreement. Tr. Day
4 at 187:9-15; Ex. 1 (employment agreement); Ex. 3 (NDA and IP agreement). Because these
agreements and duties supersede the general rules governing at-will employment arrangements,
the court declined to introduce a jury instruction about at-will employment that ignored these
other legal obligations. Moreover, the evidence was more than sufficient for the jury to find that
Parzych was doing more than simply looking for another job opportunity while still employed by
ZipBy: It is disingenuous to compare an employee searching for a new position during his lunch
break to Parzych’s covert attempts to acquire a valuable asset behind his employer’s back.
Parzych’s argument otherwise ignores the facts and the law at issue in this case. For these
reasons, Parzych’s motions are denied as to his fiduciary duty argument (Count I).

B. Breach of Contract
Parzych challenges the verdict as to the breach of contract claims. The jury’s conclusion
that Parzych was in breach of the Employee Handbook is supported by sufficient evidence. First,
a jury could reasonably have concluded that ZipBy’s Employee Handbook was enforceable as to
Parzych, where Anthony Karam testified that Parzych was given a raise in exchange for signing
the Employee Handbook, see Tr. Day 2 at 145:15-25. Second, the jury could reasonably have
concluded that Parzych took actions in violation of the Handbook, where the Handbook required
Parzych to devote his time and energy to ZipBy and to refrain from misusing company property,
see Ex. 2A. Regardless, the damages associated with the various breaches of contract claims are
overlapping in that they arose from the same unlawful conduct and resulted in the same lost
opportunity to ZipBy such that any error associated with the jury’s conclusions on the Handbook
issue would not have altered the final judgment award. Parzych’s motions are denied as to the
breach of contract claim (Count II).

C. Trademark Infringement
Parzych also challenges the jury’s verdict on trademark infringement. “[P]roof of actual
confusion is not essential to finding likelihood of confusion” in a trademark infringement claim.
Boston Duck Tours, LP v. Super Duck Tours, LLC, 531 F.3d 1, 25 (1st Cir. 2008) (internal
quotation marks and citation omitted). Rather, ZipBy was required to demonstrate that “the
allegedly infringing conduct [] create[d] ‘a likelihood of confounding an appreciable number of
reasonably prudent purchasers exercising ordinary care.’” See id. at 12 (internal citation
omitted). ZipBy provided evidence that Parzych used ZipBy’s logo and photos of company
products on his personal website, and that he used the website to advertise his capabilities as an
expert and leader in the parking industry. ZipBy also provided evidence that Parzych maintained

this website, as well as the photos and references to ZipBy products, after he was terminated
from ZipBy’s employment. A jury could reasonably have concluded that this conduct was likely
to cause consumer confusion as to whether Parzych was “the producer of the successful brand.”
See id. at 12. Parzych’s motions are denied as to the trademark infringement and false
designation claims (Counts V, VI, and VII).
D. Trade Secrets Misappropriation
Parzych also challenges the jury verdict as to trade secret misappropriation. “The
standard for misappropriation under the [Defend Trade Secrets Act] is substantially similar to
that under Massachusetts law.” Viken Detection Corp. v. Videray Tech. Inc., 384 F. Supp. 3d
168, 177 (D. Mass. 2019). “To prevail on a claim for misappropriation of trade secrets under
Massachusetts law,” a plaintiff must establish three things: “1) the information at issue
constitutes a trade secret, 2) the plaintiff took reasonable measures to secure the confidentiality
of the information, and 3) the defendant obtained the trade secret through improper means.” Id.

(citing Optos, Inc. v. Topcon Med. Systems, Inc., 777 F. Supp. 2d 217, 238 (D. Mass. 2011));
see also M.G.L. c. 93, § 42(4) (defining “trade secret”). The DTSA defines “trade secret” as
information that (A) the owner thereof has taken reasonable measures to keep secret; and (B)
derives independent economic value from not being known to, and not being readily
ascertainable through proper means by, another person who could derive economic value from
the information’s disclosure or use. 18 U.S.C. § 1839(3); see Allstate Ins. Co. v. Fougere, 79
F.4th 172, 188 (1st Cir. 2023). Similarly, under Massachusetts law, “[a] trade secret is any
confidential information used in the plaintiff’s business that ‘gives [the owner] an advantage
over competitors who do not know or use it.’” Viken Detection Corp., 384 F. Supp. 3d at 177
(quoting J.T. Healy & Son, Inc. v. James A. Murphy & Son, Inc., 357 Mass. 728, 736 (1970)).

Matters of public knowledge or information generally known in an industry are not protectable
trade secrets. Id.
ZipBy contends that Parzych misappropriated two trade secrets: (1) the financial
information sent by Q-Free regarding the potential TCS acquisition; and (2) the minutes of the
board meeting in which ZipBy decided not to proceed with the TCS acquisition. The court finds
that the evidence does not support a verdict in favor of ZipBy on these claims.
1. Board Meeting Minutes
The evidence before the jury was not sufficient to support Plaintiffs’ conclusion that
Parzych improperly obtained the meeting minutes’ contents.2 Anthony Karam, ZipBy’s CEO,
testified that he had a phone call with Parzych several days before the board meeting at issue. Tr.

Day 3 at 24:2-5. During that phone call, Parzych informed Karam about several purported
discrepancies between the financial information Q-Free had provided and the “insider”
information Parzych had acquired from a friend still employed at TCS. Tr. Day 3 at 27-28.
Parzych then recommended that ZipBy not proceed with the acquisition, and Karam testified that
he “accepted his recommendation after what we had discussed.” Tr. Day 3 at 30:17-19.
Similarly, Parzych testified that during that same phone call, Karam communicated his lack of
interest in the TCS deal. Tr. Day 5 at 81:18-20.
The evidence before the jury also was not sufficient to support a conclusion that Parzych
improperly disclosed the meeting minutes’ contents where Parzych was authorized to
communicate with Q-Free on behalf of ZipBy regarding the TCS deal and ZipBy put forward no

evidence of Parzych discussing ZipBy’s decision with any other entity. Karam testified that
Parzych was the main point of contact between Q-Free and ZipBy regarding the potential TCS
deal. Q-Free first contacted Parzych, not Karam, about the potential deal, see Tr. Day 2 at 150:24
(discussing call), Karam assigned Parzych as the point man to investigate the details of the deal,
see Tr. Day 2 at 152:21-25 (“[T]here was no one better to understand and look at the business

2 ZipBy failed to introduce evidence that Parzych ever had access to the board meeting minutes
themselves. Nevertheless, ZipBy contends that it is the company decision not to acquire TCS that
was embodied in the minutes, not the physical minutes themselves, that constituted a trade
secret. Because the court’s decision does not turn on this distinction, the court need not address it
further, and assumes for the purposes of the issue that the decision not to acquire TCS qualifies
as a trade secret.
than Greg. I couldn’t even look at it as good as Greg could look at it.”), and Parzych received
and handled the follow-up communication from Q-Free regarding the deal, see Ex. 170 (emails
from Morten Andersson to Parzych regarding financials). The evidence demonstrates that any
disclosure Parzych may have made to Q-Free about ZipBy’s disinterest in the deal was therefore

properly within the scope of his employment at the time.
ZipBy argues that Parzych’s relaying to TCS that ZipBy was not interested in the deal
was used for improper purposes, namely, to try to acquire TCS himself. But while this conduct
supports ZipBy’s other claims, as set forth in this decision, this motivation does not convert the
actions here to a misappropriation of trade secrets claim.
2. Q-Free Financial Information
The record also does not support ZipBy’s claim that the Q-Free/TCS financial
information Andersson sent to Parzych was owned by ZipBy and therefore constituted ZipBy’s,
rather than Q-Free’s, trade secret. Karam testified that Q-Free and ZipBy had a standing
proprietary information agreement and NDA but did not specify the information covered by

those documents, or what kinds of rights those documents gave ZipBy in information and/or data
generated by Q-Free. Tr. Day 2 at 127:9-20. ZipBy did not introduce the NDA or proprietary
agreement into evidence. Karam also testified that the reason business information from
collaborators was generally kept confidential was because “as a company, if you don’t keep
information confidential, you damage your company, and you damage your brand”—not because
the documents or information were themselves independently valuable. Tr. Day 2 at 127:22-24;
cf. 18 U.S.C. § 1839(3)(B) (specifying “independent economic value” as requirement of trade
secret). Karam did not testify that ZipBy generally considered the business information of its
collaborators or partners ZipBy’s own “trade secrets,” and when directly asked to list examples
of ZipBy’s trade secrets or proprietary information that Parzych had access to, Karam did not
describe anything resembling the financial information at issue. See Tr. Day 2 at 98:5-17.
The record also does not support ZipBy’s claim that Q-Free intended to keep its financial
information confidential. While Andersson initially emailed the financial documents to Parzych

as ZipBy’s representative, Andersson’s emails did not include any specific requests to keep the
attached financial documents confidential. Moreover, evidence from both Parzych and ZipBy
showed that Parzych was in regular communication with executives at both TCS and Q-Free and
could easily have obtained duplicate (or additional) financial documents independently of the
emails he received from Andersson at his ZipBy email address.
Parzych’s motions are granted as to the trade secret misappropriation claims (Counts III
and IV).3
IV. Motion for New Trial on Damages
ZipBy’s expert, William Scally, testified that the lost profits to ZipBy of not acquiring
TCS in June of 2020 ranged from $1.5 million to $2.4 million. In his Motion for a New Trial on

Damages, Parzych contends that Scally relied on insufficient and misleading evidence in
reaching his damages calculation and that he failed to properly consider relevant evidence,
including the effects of COVID-19 on the value of the TCS acquisition. Scally offered testimony
on the lost profit to ZipBy based on the inability to acquire TCS in June 2020. Scally is a partner
at Marcum LLP, a financial advisory firm, and reviewed the “documents and facts that were

3 Because the court finds that the weight of the evidence does not support a verdict in favor of
ZipBy on the trade secrets claims, the jury’s award of $1 million in exemplary damages will be
reversed. However, where the evidence as to damages from Parzych’s breach of contract and
breach of fiduciary duty are entirely contiguous with any damages from the alleged trade secrets
misappropriation, the court need not disturb the jury’s verdict as to the compensatory damages
amount.
disclosed within this case,” including TCS’s financial statements, customer profitability data,
accounts payable and receivable, and historical performance data, in preparing his damages
calculation for this trial. Scally relied on that information to calculate damages using a
comparison of TCS’s expected earnings to its present value, which he explained is referred to as

an “income approach” by financial experts. Tr. Day 4 at 139. Scally’s expert testimony was
based on “sufficient facts [and] data,” used “reliable principles and methods,” see Crowe v.
Marchand, 506 F.3d 13, 17 (1st Cir. 2007), and employed the “intellectual rigor that
characterizes the practice of an expert in the relevant field,” see Kumho Tire Co., Ltd. v.
Carmichael, 526 U.S. 137, 152 (1999). See Tr. Day 4 117:22-25; 126:17-127:6 (describing
methodology and qualifications). Scally testified that as of March 2021, ZipBy’s lost profits
associated with the unrealized TCS acquisition were $1.53 million; Scally further projected that,
based on the interest rates in 2021, 2022, and 2023, that value would have reached $2.4 million
as of the date of trial. The jury awarded compensatory damages in the amount of $1.5 million.
Parzych nevertheless disputes Scally’s calculation, contending that Scally ignored

important evidence, including the effect of the COVID-19 pandemic on the value of TCS, TCS’s
tax returns, and David Radford’s testimony about TCS’s losses in 2020, 2021, and 2022.
However, (1) Scally expressly considered reputable industry sources in conducting his analysis,
and those sources considered the impact of the COVID-19 pandemic on profitability, see Tr. Day
4 at 34:1-35:9 (discussing use of IBISWorld 2020 report); (2) Scally was not required to conduct
an audit or analyze tax returns in the course of reaching his expert opinion, see Coy v. Simpson
Marine Safety Equipment, Inc., 787 F.2d 19, 27 (1st Cir. 1986); see also Tr. Day 4 at 164:16-19
(explaining that an audit would only be relevant if “there were fraud in the financial statements
or an expectation of fraud”); and, in any case, (3) the jury could reasonably have discredited or
given limited weight to David Radford’s testimony where the evidence indicated that Radford
was Parzych’s close friend who had worked with Parzych to acquire TCS in the first instance,
and where Radford’s individual business management strategies from 2021 through 2023 were
not relevant to an objective valuation of the company. The court additionally notes that Radford

testified TCS earned $1.3 million in revenue in 2021 and $1.6 million in revenue in 2022, see Tr.
Day 5 at 150:19-21, 154:4; in light of these figures, it is entirely possible that the jury did
consider Radford’s testimony in reaching its figure of $1.5 million in damages. In sum, the jury’s
award of $1.5 million in compensatory damages was not against the great weight of the
evidence. Parzych’s Motion for a New Trial on Damages is denied.
V. Conclusion
For the foregoing reasons, Parzych’s Motion for Judgment as a Matter of Law is
GRANTED as to the trade secret misappropriation claims (Counts III and IV) and DENIED as to
all other claims, and Parzych’s Motion for a New Trial Pursuant to Rule 59 and Motion for a
New Trial on Damages are DENIED.

IT IS SO ORDERED
April 19, 2024 /s/ Indira Talwani
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10201958. Public record. Not legal advice.