Brewer v. Insight Technology, Inc.

Darren Brewer (defendant) worked simultaneously for two companies in direct competition with each other. Brewer was president of Insight Technology, Inc. (ITI) (defendant), an internet-based business founded by Gary Aliengena that matched truckers with freight-hauling jobs. ITI expanded its business to include freight factoring, which involved financing small, independent truckers seeking temporary or one-off jobs. Eventually most of ITI’s business came from factoring, and ITI created a division called FactorLoads to fill a niche in the factoring market. Two years later, Brewer met Pat Hull, who owned competing load-board business GetLoaded.com LLC (GetLoaded). When Hull expressed interest in the factoring business, Brewer tried to persuade Hull to let ITI advertise on getloaded.com, but Hull refused. Instead, Hull incorporated FreightCheck, an internet-based factoring business that competed directly with FactorLoads. Hull and Brewer co-owned FreightCheck equally and shared responsibilities for managing and operating the company. Brewer operated FreightCheck out of the same building as ITI, used the same software, and told ITI employees to do clandestine work for FreightCheck. Within a year, FactorLoads’ revenues decreased, and Brewer convinced Aliengena to sell ITI to GetLoaded. Before the sale closed, an ITI employee told Aliengena that Brewer co-owned and managed FreightCheck. Aliengena fired Brewer and sued. Hull, GetLoaded, and FreightCheck all settled such that only Brewer went to trial. Aliengena testified ITI would have profited in a merger with GetLoaded. The jury found Brewer liable to ITI for over $1 million for breach of fiduciary duty and misappropriation of corporate opportunity. Brewer appealed.