Wang

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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RELIANCE COMMUNICATIONS LLC,

Plaintiff, MEMORANDUM

AND ORDER

-against- 24-CV-4433(SIL)

SONIM TECHNOLOGIES, INC.,

Defendants.

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STEVEN I. LOCKE, United States Magistrate Judge:

Presently before the Court in this diversity-unfair competition litigation is

Defendant Sonim Technologies, Inc.’s (“Sonim” or “Defendant”) motion to dismiss the

Amended Complaint (“Am. Compl.”), Docket Entry (“DE”) [25], for failure to state a

claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure (“Fed. R. Civ.

P.”). See DE [37]. Plaintiff Reliance Communications LLC (“Reliance” or “Plaintiff”)

opposes Sonim’s motion. See DE [38]. In the event that Defendant’s motion is

granted, Reliance requests leave to file a second amended complaint. See Plaintiff’s

Memorandum in Opposition, (“Pl.’s Mem.”), DE [38] at 18-19.

By way of Complaint dated June 21, 2024, Plaintiff commenced this action

asserting five causes of action for: (1) violation of the Defend Trade Secrets Act

pursuant to 18 U.S.C. § 1831, et seq., (2) common law misappropriation of trade

secrets, (3) unfair competition, (4) breach of contract, and (5) unjust enrichment,

against Sonim and former Defendants Chuan Wang (“Wang”), Teleepoch Limited

LLC (“Teleepoch”) and Uni America LLC (“Uni”). See Complaint, DE [1]. On

December 2, 2024, Plaintiff filed an Amended Complaint solely against Sonim

asserting claims for (1) unfair competition and (2) unjust enrichment. See Am.

Compl.; see also Notice of Voluntary Dismissal Without Prejudice Pursuant to Fed.

R. Civ. P. 41(a)(1)(A)(i), DE [17]; Elec. Order, Nov. 12, 2024. For the reasons set forth

herein, Defendant’s motion to dismiss is granted in part and denied in part as set

forth below, and Plaintiff’s request to file a second amended complaint is denied.

I. BACKGROUND

A. Facts

Unless otherwise stated, the facts are drawn from the Amended Complaint.

1. The Parties and Relevant Non-Parties

Reliance, a limited liability company organized under the laws of New Jersey,

maintains a primary place of business in Hauppauge, New York, and engages in

original equipment manufacturing. See Am. Compl. ¶¶ 2,7. Plaintiff holds itself out

as a market leader in wireless communications products. Id. at ¶ 2. Sonim is a

Delaware corporation with its principal office in San Diego, California. Id. at ¶ 8.

Defendant’s largest shareholder, AJP Holding Company LLC (“AJP”), owns nearly

50% of Sonim’s shares and is controlled by the Wang family.1 Id. Previously

dismissed Defendant Wang is the Chairman and CEO of two California corporations,

Teleepoch and Uni. Id. at ¶ 9. According to Reliance, Teleepoch and Uni are

1 Plaintiff makes multiple allegations “upon information and belief.” See Am. Compl ¶¶ 1, 2, 8-11, 13,

54, 60-61, 68, 70, 73, 75, 88. Reliance is not precluded from doing so “where the facts are peculiarly

within the possession and control of the defendant . . . or where the belief is based on factual

information that makes the inference of culpability plausible.” Arista Records, LLC v. Doe 3, 604 F.3d

110, 120 (2d Cir. 2010). Accordingly, the Court considers these facts herein.

controlled by Wang, and, during the relevant time period the two companies were

used interchangeably to manufacture devices for Reliance. Id. at ¶¶ 10-11.

2. Relevant Agreements

The crux of Plaintiff’s claims is that Sonim, Uni, Teleepoch, and AJP were

involved in an “elaborate scheme to steal confidential and proprietary information

created by [Reliance].” Id. at ¶ 1. In or about 2017, Plaintiff retained Teleepoch and

Uni to assist in the “design, testing, and manufacturing” of select Reliance products

in Shenzhen, China at Teleepoch’s facility (the “Shenzhen Facility”). Id. at ¶ 2. In or

around February 23, 2016, Reliance and Teleepoch entered a Mutual Non-Disclosure

Agreement (the “NDA”), with Wang executing the NDA on Teleepoch’s behalf.2 Id.

at ¶ 18. Under the NDA, Plaintiff and Teleepoch agreed to transmit confidential

information to those who needed to know “for the purpose of evaluating the potential

business venture.” Id. at ¶ 21. Plaintiff relied on the NDA in disclosing confidential

and proprietary information to Teleepoch and Uni. Id. at ¶ 18. Further, on or about

March 27, 2017, Reliance and Teleepoch agreed to a term sheet for the production of

a new wireless device, under which Teleepoch confirmed that Plaintiff’s “products’

industrial design[s], hardware design[s], software design[s], and features, are

exclusive to Reliance.” Id. at ¶¶ 22-23.

Over several years, Teleepoch manufactured numerous wireless

communication products for Reliance using specifications provided by Plaintiff. See

2 The NDA defines confidential information, in part, as “[a]ll information shared by [Plaintiff] to

[Teleepoch] related to any proprietary and confidential information belonging to any wireless carrier.

. .”. Am. Compl. ¶ 19.

id. at ¶¶ 24-25. Each product spent approximately ten weeks in development, after

which, Teleepoch sent it to the Federal Communications Commission (“FCC”) for

approval. Id. at ¶ 26. Pursuant to the NDA, Teleepoch manufactured approximately

50 products for Reliance, using the same manufacturing framework. Id. at ¶ 28.

3. The Orbic Speed 5G Hotspot and Orbic Trophy 5G Mobile Phone

In 2022, with Teleepoch’s manufacturing efforts, Reliance released the Orbic

Speed 5G Hotspot (the “Orbic Hotspot”). Id. at ¶¶ 29-30. The device has a unique

antenna placement and, according to Plaintiff, at the time of its release was the “only

hotspot on the market that was capable of working with the C-Band 5G frequency.”

Id. at ¶¶ 32, 34. In 2023, Reliance’s Chief Technology Officer (“CTO”), who is not

identified by name, developed a new technology that would create a high-performance

mmWave signal using a single antenna module, instead of the then-industry

standard two-antenna module. Id. at ¶¶ 35-36. In or about November 2023,

Reliance’s CTO informed Teleepoch’s chief engineer of the new technology so it could

be incorporated into new products that Teleepoch designed for Reliance. Id. ¶ 37.

This included the Orbic Trophy 5G Mobile Phone (the “Orbic Mobile”). Id. Teleepoch

ensured Reliance that only approximately ten of its employees would be permitted

access to the new technology. Id. Those employees were subject to the NDA. Id.

After being told by a Teleepoch or Uni employee that the new model would not work,

Plaintiff’s CTO provided directions on how to implement the new technology through

various email communications and in-person instruction. Id. at ¶¶ 39-44. After these

communications, and continued refining of the design, on approximately January 16,

2024, the new technology yielded performance numbers that met major wireless

carriers’ requirements. Id. at ¶ 44.

4. Sonim’s Alleged Misuse of Reliance Confidential and Proprietary

Information

According to Plaintiff, Sonim originally manufactured mobile communication

devices for first responders. Id. at ¶ 47. From its creation in 2019, Sonim continued

to lose increasing amounts of money. See id. at ¶¶ 49-51. By the end of 2021, its

financial condition was “dire.” Id. at ¶ 51.3 In October 2021, Wang along with family

members, apparently through AJP, approached Sonim for the purposes of investing

in, or purchasing, Sonim. Id. at ¶¶ 53-54. In April 2022, AJP entered a subscription

agreement to purchase $17,500,000 worth of Sonim’s common stock. Id. at ¶ 58.

Reliance alleges that Wang’s son, Jeffrey Wang, received a seat on Sonim’s board and

was appointed Chairman as a part of AJP’s investment. Id. at ¶ 60. Following this

investment, Teleepoch began designing and manufacturing for Sonim. Id. at ¶ 61.

In fact, on a date Plaintiff does not specify, certain unidentified Reliance employees

witnessed Teleepoch personnel designing the Sonim H500V (the “Sonim Hotspot”).

Id. at ¶ 63. It appeared to be an exact copy of the Orbic Hotspot.4 Id. Plaintiff alleges

that in April 2024, a Reliance employee witnessed Teleepoch personnel working on

the Sonim Hotspot while reviewing instructions to build Plaintiff’s single antenna

3 Plaintiff cites to Sonim’s March 21, 2022 10-K report filed with the Securities Exchange Commission

which highlights that Defendant had “an accumulated deficit of $234.8 million as of December 31,

2021.” See Am. Compl. ¶ 51.

4 The Amended Complaint includes a photo, allegedly taken by Reliance employees at the Shenzhen

Facility, which displays the Sonim Hotspot on the same desk as the Orbic Mobile. Id. at ¶¶ 66-67.

module. Id. at ¶ 69.5 When Reliance’s CEO confronted Wang about it, he (Wang)

denied that Teleepoch was even working on a hotspot for Sonim. Id. at ¶¶ 64-65.

Like Plaintiff’s pioneering technology, the Sonim Hotspot uses laser direct

structuring to place the antenna on the device.6 Id. at ¶ 68. The Sonim Hotspot also

incorporates Reliance’s single antenna technology to meet the performance needs of

major wireless providers.7 Id. at ¶¶ 44, 68-69. After taking a hiatus from submitting

newly developed products to the FCC for approval, Plaintiff alleges that Sonim

submitted a product that appeared to be a copy of the Orbic Hotspot. Id. at ¶ 62.

According to Reliance, Sonim misappropriated Reliance’s proprietary combination of

precise angling of its single antenna module and its custom programming prior to the

information becoming public. Id. at ¶ 73.

B. Procedural History

Reliance commenced this action on June 21, 2024 against Sonim, Wang,

Teleepoch and Uni. See DE [1]. On November 11, 2024, Plaintiff voluntarily

dismissed its claims against Defendants Wang, Teleepoch, and Uni pursuant to Fed.

R. Civ. P. 41(a)(1)(A)(i). See DE [17]. That same day, Sonim moved to dismiss

Plaintiff’s complaint. See DE [20]. On December 2, 2024, Plaintiff filed the Amended

Complaint. See DE [25]. Defendant now seeks to dismiss the Amended Complaint

5 It is unclear whether this employee was one of the employees who witnessed Teleepoch personnel

designing the Sonim Hotspot.

6 While Plaintiff pleads that Sonim copied Reliance’s antenna placement process, Plaintiff explains

that this technology is separate from its single antenna module, and not the issue in this action. Id.

at ¶ 68.

7 Plaintiff alleges that Sonim first began replicating the Orbic Hotspot, which had two antenna

modules, and when Teleepoch learned of Plaintiff’s single antenna module, it incorporated the new

technology into Sonim’s Hotspot. Id. at ¶ 70.

and Plaintiff opposes. See Defendant’s Memorandum of Law in Support of its Motion

to Dismiss, (“Defendant’s Memorandum” or “Def.’s Mem.”) DE [37-1]; “Pl.’s Mem.”,

DE [38].

II. LEGAL STANDARD

To survive a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), a complaint

must contain “sufficient factual matter, accepted as true, to ‘state a claim to relief

that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937,

1940 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955,

1960 (2007)). A claim is considered plausible on its face “when the plaintiff pleads

factual content that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678, 129 S. Ct. at

1949. But a pleading “that offers only ‘labels and conclusions’ or ‘a formulaic

recitation of the elements of a cause of action will not do.’” Id. (quoting Twombly, 550

U.S. at 555, 127 S. Ct. at 1965). “Nor does a complaint suffice if it tenders ‘naked

assertion[s]’ devoid of ‘further factual enhancement.’” Id. (quoting Twombly, 550 U.S.

at 557, 127 S. Ct. at 1966).

In deciding a motion to dismiss under Fed. R. Civ. P. 12(b)(6), “a court must

‘accept all allegations in the complaint as true and draw all inferences in the non-

moving party's favor.’” U.S. ex rel. Siegel v. Roche Diagnostics Corp., 988 F. Supp. 2d

341, 343 (E.D.N.Y. 2013) (quoting LaFaro v. N.Y. Cardiothoracic Grp., 570 F.3d 471,

475 (2d Cir. 2009)). Nevertheless, “threadbare recitals of the elements of a cause of

action” that are supported by “conclusory” statements and mere speculation are

inadequate and subject to dismissal. Chavis v. Chappius, 618 F.3d 162, 170 (2d Cir.

2010) (internal quotation and citation omitted). Further, the court may only consider:

(1) the factual allegations in the complaint, which are accepted as

true; (2) documents attached to the complaint as an exhibit or

incorporated ... by reference; (3) matters of which judicial notice may

be taken; and (4) documents upon whose terms and effect the

complaint relies heavily, i.e., documents that are “integral” to the

complaint.

Calcutti v. SBU, Inc., 273 F. Supp. 2d 488, 498 (S.D.N.Y. 2003) (internal citation

omitted). A complaint incorporates a document by reference when it “makes a clear,

definite, and substantial reference to the document.” Serrata v. Givens, No. 18-CV-

2016(ARR), 2019 WL 1597297, at *3 (E.D.N.Y. Apr. 15, 2019) (internal citation

omitted). Where a complaint quotes heavily from a document, courts in this Circuit

consider that document incorporated by reference. See, e.g., My Mavens, LLC v.

Grubhub, Inc., No. 20 Civ. 4657(PGG), 2023 WL 5237519, at *3 (S.D.N.Y. Aug. 14,

2023); Tavenner v. Int'l Bus. Machines Corp., No. 21 Civ. 6345(KMK), 2022 WL

4449215, at *2 (S.D.N.Y. Sept. 23, 2022), No. 22-2318, 2023 WL 4984758 (2d Cir. Aug.

4, 2023).

III. DISCUSSION

Defendant moves to dismiss Plaintiff’s remaining unfair competition and

unjust enrichment causes of action. See generally, Def.’s Mem. Reliance opposes, and

requests leave to file a second amended complaint in the event that Defendant’s

motion is granted. See Pl.’s Mem. at 18. For the reasons set forth herein, Defendant’s

motion is granted in part and denied in part as explained below, and Plaintiff’s

request to file a second amended complaint is denied.

A. Defendant’s Motion to Dismiss

1. Documents and Photos Incorporated By Reference

As an initial matter, the Court considers whether the parties’ supporting

documents beyond the Amended Complaint should be treated as incorporated into

the Amended Complaint or otherwise considered. In support of its motion to dismiss,

Defendant submits a December 12, 2024 letter from Sonim’s attorney to Plaintiff’s

counsel demanding that the lawsuit be withdrawn and containing several

photographs, which Defendant then incorporates into it Memorandum of Law

requesting that they be considered herein. See Def.’s Mem. at 3-4; DE [37-3] at 3-5.

The photographs detail the placement of the single antenna module in the Sonim

Hotspot compared to that of the Orbic Hotspot. See Def.’s Mem. at 3-4. In opposition,

Plaintiff submits its December 20, 2024 reply letter, a Declaration of its CTO, Venkat

Kalkunte,8 and a Sonim SEC Schedule 13-D. See DE [38-1],[38-3],[38-4].

The Court declines to consider any of these submissions on a Rule 12(b)(6)

motion. Defendants’ attorney letter and the photographs contained therein are both

beyond the pleadings, and in any event, are not authenticated in a way that the Court

could consider them. Plaintiff’s extraneous submissions fare no better. The

December 20, 2024 reply letter is just a characterization of Defendant’s December 12,

2024 letter, and there is no meaningful way for the Court to evaluate the Kalkunte

Declaration in the context of a motion directed to the pleadings. Under these

8 It appears that Venkat Kalkunte may have been Reliance’s CTO at the time of the incidents underlying the Amended

Complaint but it is not entirely clear.

circumstances, the Court declines to consider any of the supporting documentation

beyond the Amended Complaint itself.

2. Unfair Competition

Initially, the Court addresses Plaintiff’s unfair competition cause of action.

New York law recognizes two theories of common-law unfair competition: palming

or passing off, and misappropriation.9 CDC Newburgh Inc. v. STM Bags, LLC, 692

F. Supp. 3d 205, 225 (S.D.N.Y. 2023) (citation omitted). Reliance claims the latter.

See Am. Compl. ¶¶ 75-80. To state a cause of action for unfair competition by

misappropriation, a plaintiff must allege that the defendant: (1) misappropriated the

plaintiff's labors, skills, expenditures, or goodwill; and (2) displayed some element of

bad faith in doing so. CDC Newburgh Inc., 692 F. Supp. 3d at 226. “Although claims

of unfair competition often allege misappropriation of trade secrets or ideas, a claim

may be based on misappropriation of information not rising to that level, such as

client lists, internal documents, and business strategies,” Salonclick LLC v. SuperEgo

Mgmt. LLC, No. 16 Civ. 2555(KMW), 2017 WL 1906865, at *4 (S.D.N.Y. May 8,

2017) (citation omitted), so long as a plaintiff can “establish that a defendant

misappropriated or misused the plaintiff's property or the fruit of its labors and

expenditures.” Big Vision Private Ltd. v. E.I. Dupont De Nemours & Co., 610 Fed.

App’x 69, 71 (2d Cir. 2015); see Milton Abeles, Inc. v. Farmers Pride, Inc., 603 F. Supp.

2d 500, 503 (E.D.N.Y. 2009). The “gravamen” of the cause of action is that the

9The parties agree that New York state law applies. See Henneberry v. Sumitomo Corp. of Am., No.

04-Civ-2128(PKL), 2005 WL 991772, at *5, n.3 (S.D.N.Y. Apr. 27, 2005) (“Where the parties so assume,

the Court need not address choice of law sua sponte.”).

defendant’s misappropriation was in bad faith. Bytemark, Inc. v. Xerox Corp., 342 F.

Supp. 3d 496, 510 (S.D.N.Y. 2018). The claim is “broad and flexible” and is more

fact-dependent than other causes of action. Telecom Int’l Am., Ltd. v. AT&T Corp.,

280 F.3d 175, 197 (2d Cir. 2001).

Here, the parties dispute whether Plaintiff has satisfied the second element,

namely that Reliance properly alleged that Sonim acted in bad faith. See Def.’s Mem.

at 5-7; Pl.’s Mem. at 10-14. Defendant asserts that Plaintiff failed to plead a single

fact that Sonim acted in bad faith or knew that the technology it acquired from

Teleepoch and Uni was misappropriated from Plaintiff. See Def.’s Mem. at 6;

Defendant’s Reply in support of the Motion to Dismiss (“Def.’s Reply”), DE [39], at 5-

6. The Court disagrees.

Initially, the Amended Complaint alleges facts that allow the Court to

reasonably infer the first element of Plaintiff’s unfair competition claim–i.e., that

Sonim misappropriated Plaintiff’s confidential and proprietary “know-how”

regarding its single antenna module. See Am. Compl. ¶¶ 61-68, 75-79 (alleging that

after Teleepoch began manufacturing for Sonim, Defendant submitted a new product

for FCC approval that appeared to be a copy of the Orbic Hotspot, and that Reliance

employees observed Teleepoch personnel working on Sonim’s Hotspot in close

proximity to Plaintiff’s devices that utilize its confidential and proprietary

information). Indeed, Defendant’s motion does not dispute that the Amended

Complaint pleads the first element of an unfair competition claim.

Similarly, the Court can reasonably infer that Sonim acted in bad faith when

misappropriating Plaintiff’s technology. At its core, Reliance alleges that Wang used

three companies he controls with his family, Defendant Sonim, Teleepoch and Uni,

to obtain Plaintiff’s confidential information pursuant to the NDA, which Wang

signed on Teleepoch’s behalf, to obtain cutting edge technology. In fact, Teleepoch’s

staff could not even implement the new technology without extensive instruction from

Plaintiff, and then turned around and used that same technology to revitalize Sonim,

which had been a failing company operating in a different market until that point.

Moreover, when Wang was asked about it, he denied that Teleepoch was working for

Sonim, despite an eyewitness account to the contrary. These allegations are

sufficient to establish bad faith to defeat Defendant’s motion to dismiss.

In reaching this conclusion the court acknowledges Sonim’s argument that

that it could not have copied the “precise angling and orientation” of the antenna on

the Orbic Hotspot, because the antenna in Sonim’s is oriented on the front of the

device and is perpendicular to the circuit board, while the antenna in Reliance’s is at

a 40-degree angle to the circuit board and in the top right corner of the device, and

the photographs it submits in support. The Court is unable to resolve the parties’

disputed positions on this point on pleadings however, without the benefit if relevant

admissible evidence from all sides. Accordingly, this question is better addressed at

summary judgment or trial as appropriate.

Further, the cases Sonim relies upon Bytemark, Inc. v. Xerox Corp., 342 F.

Supp. 3d 496 (S.D.N.Y. 2018) and Schroeder v. Pinterest, 133 A.D.3d 12, 17 N.Y.S.3d

678 (1st Dep’t 2015), are distinguishable. See Def.’s Mem. at 5-7. Bytemark was a

patent infringement suit where the Court had to consider whether the patent

infringement claims and unfair competition claims sufficiently overlapped to warrant

preemption (which is further discussed below) and whether there was sufficient

evidence of bad faith. See Bytemark at 506-11. And there, the Court actually denied

the motion as to the misappropriation—unfair competition claim as to one of the

defendants based on its connection to the alleged unlawful conduct, similar to Sonim’s

alleged conduct here. See id. at 511 (denying motion as to Conduent, which was an

entity related to those who entered the underlying confidentiality agreements).

In Schroeder, while the corporate recipient of the investment was dismissed

from that case on the basis that the relationship between the plaintiff and that

company was too attenuated, the relationship here is closer. Schroder, 133 A.D.3d at

327-29, 17 N.Y.S.3d at 690-92. Sonim received funds from AJP, making the Wangs

substantial owners of Sonim while Wang himself was also Chairman and CEO of

Teleepoch and Uni, the former of which had and NDA with Plaintiff, and based on

that, access to a variety of Reliance’s confidential information. Then Teleepoch

started manufacturing products for Sonim similar to Plaintiff’s, as confirmed by

certain unidentified Reliance employees and despite Wang’s statement to the

contrary. Taking Reliance’s allegations as true, the Court concludes that the

relationship between Teleepoch and Sonim are sufficiently intertwined that the claim

may be sustained. Accordingly, the motion to dismiss the unfair competition cause

of action is denied.

3. Unjust Enrichment

Next, the Court turns to the unjust enrichment cause of action. “To state a

claim for unjust enrichment under New York law, a plaintiff must allege (1) ‘that the

defendant was enriched at the plaintiff's expense’ and (2) ‘that equity and good

conscience require the plaintiff to recover the enrichment from the defendant.’”

Speedfit LLC v. Woodway USA, Inc., 53 F. Supp. 3d 561, 579-80 (E.D.N.Y. 2014)

(quoting Giordano v. Thomson, 564 F.3d 163, 170 (2d Cir. 2009)). “When considering

an unjust enrichment claim, a court's ‘essential inquiry’ is one of ‘equity and good

conscience.’” Marini v. Adamo, 12 F. Supp. 3d 549, 552 (E.D.N.Y. 2014), aff'd, 644 F.

App'x 33 (2d Cir. 2016) (quoting Paramount Film Distrib. Corp. v. State of New York,

30 N.Y.2d 415, 421, 334 N.Y.S.2d 388, 393 (1972)).

A cause of action for unjust enrichment “sounds in quasi-contract and cannot

lie where an enforceable contract governs the disputed matter.” Speedfit LLC, 53 F.

Supp. 3d at 580 (citing Labajo v. Best Buy Stores, L.P., 478 F. Supp. 2d 523, 530-31

(S.D.N.Y. 2007)). Indeed, an unjust enrichment claim is not available where it simply

duplicates, or replaces, a conventional contract or tort claim. Mancuso v. RFA

Brands, LLC, 454 F. Supp. 3d 197, 208 (W.D.N.Y. 2020) (quoting Corsello v. Verizon

New York, Inc., 18 N.Y.3d 777, 790, 944 N.Y.S.2d 732, 740 (2012)). Nevertheless,

where no contract exists between the parties, or where the existence or validity of a

contract is in dispute, a party is permitted to assert equitable claims as alternative

theories of liability. See Fishman v. Philadelphia Fin. Life Assur. Co., No. 11 Civ.

1283(TPG), 2016 WL 2347921, at *13 (S.D.N.Y. May 3, 2016) (citing New Paradigm

Software Corp. v. New Era of Networks, Inc., 107 F. Supp. 2d 325, 329 (S.D.N.Y.

2000)).

To this end,

while privity with defendant is not required, the plaintiff must assert

a connection between the parties that is not too attenuated . . . . [A]

relationship is too attenuated if the parties were not connected in a

manner that could have caused reliance or inducement, . . . or if they

simply had no dealings with each other. . . .

GateGuard, Inc. v. Amazon.com Inc., No. 21-CV-9321(JGK), 2023 WL 2051739, at *11

(S.D.N.Y. Feb. 16, 2023) (internal quotations and citations omitted).

Sonim asserts that Plaintiff cannot succeed on an unjust enrichment claim

because the parties lack a “close relationship” to one another. See Def.’s Mem. at 8.

The parties’ relationship as competitors who had no direct interaction is too

attenuated to support Plaintiff’s unjust enrichment claim, even in light of the

allegation that both companies worked with Teleepoch for manufacturing purposes.

Further, there are no facts alleged suggesting the necessary reliance or inducement

to support a cause of action. See Barbagallo v. Marcum LLP, 820 F. Supp. 2d 429,

448 (E.D.N.Y. 2011) (dismissing an unjust enrichment claim where an “employer

benefits from misappropriated material gleaned from the former employee of a

competitor, even when the defendant-employer knows or induces such

misappropriation”); Techno-Comp, Inc. v. Arcabascio, 130 F. Supp. 3d 734, 744-45

(E.D.N.Y. 2015) (dismissing unjust enrichment claim where the pleadings are devoid

of any interactions between the parties). Accordingly, Defendant’s motion to dismiss

Plaintiff’s unjust enrichment cause of action is granted.

4. Federal Preemption

As an alternative, Defendant argues that both claims are preempted by federal

patent or copyright law. See Def.’s Mem. at 9-10. “[S]tate law cannot protect ‘an

unpatented utilitarian or design conception which has been freely disclosed by its

author to the public at large’ . . . [however the Court recognizes] that all state

regulation of potentially patentable but unpatented subject matter is not ipso facto

pre-empted.” Hall v. Bed Bath & Beyond, Inc., 705 F.3d 1357, 1371 (Fed. Cir. 2013)

(quoting Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 154, 109 S. Ct.

971, 979 (1989)).

[A] state may not offer patent-like protection to intellectual creations

that would otherwise remain unprotected as a matter of federal law.

Speedfit LLC v. Woodway USA, Inc., 226 F. Supp. 3d 149, 159

(E.D.N.Y. 2016) (quoting Univ. of Colorado Found., Inc. v. Am.

Cyanamid Co., 342 F.3d 1298, 1305 (Fed. Cir. 2003)). If a plaintiff

bases its [ ] action on conduct that is protected or governed by federal

patent law, then the plaintiff may not invoke the state law remedy,

which must be preempted for conflict with federal patent law. Hunter

Douglas, Inc. v. Harmonic Design, Inc., 153 F.3d 1318, 1335 (Fed. Cir.

1998), overruled on other grounds by Midwest Industries, Inc. v.

Karavan Trailers, Inc., 175 F.3d 1356 (Fed. Cir. 1999). Accordingly,

the Federal Circuit has held that “the field of federal patent law

preempts any state law that purports to define rights based on

inventorship.” HIF Bio, Inc. v. Yung Shin Pharm. Indus. Co., Ltd.,

600 F.3d 1347, 1353 (Fed. Cir. 2010).

Spectrum Dynamics Med. Ltd. v. Gen. Elec. Co., No. 18-CV-11386(VSB), 2023 WL

4159358, at *9 (S.D.N.Y. June 2, 2023) (internal citations omitted). Federal “patent

laws will not preempt [state law claims, however], if they include additional elements

not found in the federal patent law cause of action and if they are not an

impermissible attempt to offer patent-like protection to subject matter addressed by

federal law.” Bytemark, Inc., 342 F. Supp at 507-08 (holding that Plaintiff’s unfair

competition claim is not preempted to the extent Plaintiff premised its theories of

misappropriation).

Applying these standards the Court rejects Sonim’s argument. There is no

patent or patent claim at issue here and the Court does not see how one could be

asserted. The misappropriation claim turns more generally on the alleged unlawful

taking of confidential proprietary information, not publicly available potentially

patentable intellectual property. Accordingly, the elements of each cause of action

are distinct and Reliance’s claims are not preempted by federal patent or copyright

law.

B. Plaintiff’s Motion to File a Second Amended Complaint

In addition to opposing Sonim’s motion, Reliance moves to remedy pleading

deficiencies “if necessary.” This motion is denied.

For the reasons set forth above, one of Plaintiff’s two causes of action is dismissed

and the other remains. The Court cannot tell from the pleadings whether this makes

leave to file second amended complaint “necessary”.

In any event, to file a request to amend or supplement one’s pleadings in this

District the local rules require that:

[a]ll motions made by a represented party under Fed. R. Civ. P.

15(a)(2) or (d) must also include as an exhibit (1) a clean copy of the

proposed amended or supplemental pleading; and (2) a version of the

proposed pleading that shows—through redlining, underlining,

strikeouts, or other similar typographic method—all differences from

the pleading that it is intended to amend or supplement.

Local Civ. Rule. 15.1. Plaintiff fails to attach its proposed second amended complaint,

or a redline highlighting the changes to its request in accordance with Local Civil

Rule 15.1. Accordingly, Plaintiff's motion to file a second amended complaint is

denied.

IV. CONCLUSION

For the reasons set forth herein, Defendant’s motion to dismiss is granted in

part and denied in part. Specifically, Defendant’s motion to dismiss is denied with

respect to Plaintiff’s unfair competition claim and granted as to Reliance’s unjust

enrichment cause of action. Moreover, Plaintiff’s motion for leave to file a second

amended complaint is denied.

Dated: Central Islip, New York

February 25, 2026 SO ORDERED.

/s/ Steven I. Locke

STEVEN I. LOCKE

United States Magistrate Judge