Full opinion text
ORDER JAMES E. GRITZNER, District Judge. The matter before the Court for decision is the action of Plaintiff NCMIC Finance Corporation (NCMIC) against Defendants William Artino (Artino) and Pro Funding Group, LLC (PFG) (collectively Defendants). On June 13, 2007, the Court issued an injunction against Artino and PFG enforcing the restrictive covenants contained in Artino’s employment agreement with NCMIC. Order of June 13, 2007, Clerk’s No. 10. On December 15, 2008, the Court commenced a bench trial on the Complaint. The bench trial concluded on December 16, 2008. Attorneys Frank Harty and Ben Roach represented NCMIC. Attorneys Stan Thompson and Sarah Franklin represented Defendants. On January 20, 2009, both NCMIC and Defendants filed their written closing statements. The Court finds the matter fully submitted and ready for disposition. This order constitutes the Court’s findings of fact and conclusions of law. Fed. R.Civ.P. 52(a) (“In an action tried on the facts without a jury or with an advisory jury, the court must find the facts specially and state its conclusions of law separately.”). I. JURISDICTION The Court issued an order on November 24, 2008, denying Defendants’ motion to dismiss for lack of subject-matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(l). Order of November 24, 2008, Clerk’s No. 54. Defendants argued NCMIC failed to assert a colorable claim under the Computer Fraud and Abuse Act (CFAA), 18 U.S.C. § 1030; and therefore the Court lacked federal question subject-matter jurisdiction. The Court determined “NCMIC’s complaint adequately alleges a substantial and colorable CFAA violation against [Defendants],” without deciding the merits of NCMIC’s CFAA claim. Order of November 24, 2008, at 9, Clerk’s No. 54. The Court exercised supplemental subject-matter jurisdiction over NCMIC’s state law claims “because those claims ‘are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.’ ” Order of November 24, 2008, at 4 n. 3 (quoting 28 U.S.C. § 1367(a)). II. FINDINGS OF FACT After assessing the credibility of the trial witnesses and analysis of the exhibits offered into evidence, the Court finds the following facts by a preponderance of the evidence. A. The Parties NCMIC is a subsidiary of NCMIC Group Inc., a financial services holding company. The original and core business of NCMIC has been to provide professional liability insurance to chiropractors. In the business division pertinent to this case, NCMIC provides lease equipment financing primarily for small-ticket healthcare items. NCMIC’s leasing customer base is half chiropractic professionals and half other healthcare professionals. NCMIC’s customer base comes from healthcare vendors who recruit customers to purchase or lease their healthcare equipment. The healthcare vendors forward these prospective purchasers to NCMIC to secure financing for purchasing the healthcare vendor’s equipment. Artino entered the lease finance business starting in 1984. From 2000 through June 2003, Artino founded Professional Capital Group (PCG) with Scott Stewart (Stewart). PCG was an equipment leasing business that offered direct base loans over the Internet to service healthcare vendors. Artino and Stewart both owned and operated PCG. PCG developed a business relationship with NCMIC, whereby NCMIC provided a line of credit to PCG that allowed PCG to write leases. Artino became a NCMIC employee in June 2003 when NCMIC purchased PCG and hired Artino as vice president and general manager of NCMIC’s equipment-financing division. In August 2006, Artino met with Daniel Kerr (Kerr) on at least twelve different occasions to discuss forming a new corporation called Pro Funding Group (PFG) that would compete against NCMIC and serve as a captive leasing company for ProSolutions, Inc. (PSI), a chiropractic equipment vendor. Artino considered Kerr his business partner at PFG. Artino hoped PFG could help PSI’s customers secure financing with lenders in exchange for receiving commissions from PSI. B. Artino’s Employment with NCMIC Around August 2002, NCMIC and PCG began negotiations for an asset-purchase agreement in which NCMIC would acquire PCG. After ten months of negotiations, NCMIC purchased PCG in June 2003. As part of the transaction, Artino was offered $60,000, an employment offer as NCMIC’s vice president and general manager of the equipment-financing division that the parties memorialized in a written employment agreement (Employment Agreement), a severance pay package (Severance Agreement), and a personal goodwill purchase agreement (Goodwill Agreement). These agreements were all executed simultaneously as part of one transaction. Artino began employment at NCMIC on June 30, 2003. The Severance Agreement provided Artino eighteen months salary in the event of severance, while all other NCMIC executives only received twelve months severance pay. The Goodwill Agreement paid Artino one half of one percent of all leasing business booked by NCMIC during Artino’s employment. Even though the Goodwill Agreement provided Artino incentives to generate a high volume of leases without regard to the riskiness of the lease, Greg Cole (Cole), NCMIC’s president, testified that Artino always “made appropriate underwriting decisions.” Tr. 114. Artino explained the Goodwill Agreement’s significance in the overall deal as follows: “[T]he actual form of goodwill came up as a suggestion from McGladrey [& Pullen, CPAs] for a way for us to treat the sale [of PCG] as a capital gain.... Since this was the acquisition of [PCG] and all of its — you know, our knowledge and us coming on, McGladrey came up with this personal goodwill purchase which got us capital gains treatment for tax, for income taxes on that payment.” Tr. 345; 347. Artino explained that the parties agreed that the bulk of Artino’s compensation would be paid through the Goodwill Agreement because of its tax implications. Artino explained, “It wasn’t like ... we were disposing of [PCG] and then coming in as employees at NCMIC. I mean, that’s how it got structured, but we — clearly, the consideration was for the acquisition and our efforts toward developing [PCG].” Tr. 349. Even though NCMIC purchased PCG’s intellectual property, including a website used for determining the creditworthiness of prospective customers, NCMIC believed that Artino’s expertise was a primary reason for purchasing PCG’s assets. Cole testified that the “big” asset NCMIC was purchasing from PCG was “the intellectual knowledge that [Artino] brought to the table, along with [Stewart], because they had been in the lease finance industry for so long and in very high level positions.” Tr. 83. Cole retained every PCG employee because of their expertise in the industry. Patrick McNerney (McNerney), NCMIC Group Inc.’s chief executive officer, testified that NCMIC purchased PCG because of Artino’s wealth of experience in lease finance and his experience and contacts in the business. The Employment Agreement was part of the consideration for the NCMIC-PCG transaction. Artino read and understood the terms of the Employment Agreement, Goodwill Agreement, and Severance Agreement. Artino obtained legal counsel to review these documents before executing the sale of PCG to NCMIC. Artino’s Employment Agreement contained a restrictive covenant not to compete with NCMIC or solicit NCMIC’s customers for a period of eighteen months following the termination of Artino’s employment and prohibiting Artino from disclosing any confidential information to NCMIC’s competitors. Both the Employment Agreement and Goodwill Agreement could only be modified in writing during Artino’s employment with NCMIC. As vice president and general manager, Artino had total day-to-day control of the equipment-financing division. Artino became a NCMIC officer at the first board of directors meeting after Artino began employment at NCMIC and was an officer until his resignation became effective on December 1, 2006. As vice president and general manager, Artino had access to and played a central role in developing NCMIC’s business plan, vendor relationships, and customer relationships regarding equipment-lease financing. In NCMIC’s corporate hierarchy, Artino reported directly to Cole. In early 2006, NCMIC expressed concern that Artino’s and Stewart’s compensation levels were too high. Cole wrote in a performance evaluation that Artino’s salary, coupled with his benefits, was too “rich” and the “single largest expense item” in the equipment-financing division. Tr. 115. In January 2006, Cole approached Artino and Stewart about changing the way their goodwill payments were calculated under the Goodwill Agreement. Cole testified that he “suggested after some time how about if we consider a quarter percent versus half percent for each of them commission and maybe up to forty percent of the net profit from the line of business share.” Tr. 177. After these discussions, Artino worked with Gary Hoffman, NCMIC’s chief financial officer, to figure out a way to make the equipment-financing division more profitable, but the parties never reached an agreement changing the terms of the Goodwill Agreement. Following these discussions and attempts to renegotiate Artino’s and Stewart’s compensation, Stewart resigned from NCMIC in March 2006. Stewart, whose own Employment Agreement and Goodwill Agreement were substantially similar to Artino’s agreements, was paid his full severance and goodwill payments upon his resignation. Stewart voluntarily left NCMIC, meaning he was not contractually entitled to eighteen months severance pay. McNerney explained that NCMIC paid the full amount because of NCMIC’s concern that Stewart could argue a claim of constructive discharge. Artino testified that NCMIC’s treatment of Stewart made him concerned whether NCMIC would honor his Severance and Goodwill Agreements. C. ProSolutions ProSolutions, Inc. (PSI) markets a piece of chiropractic equipment called the Pro-Adjuster. PSI’s founder and chief executive officer is Moe Pisciottano (Pisciottano). PSI held monthly programs where it invited chiropractors to its offices for demonstrations in an attempt to sell them chiropractic equipment. However, by far the largest proportion of PSI’s business arose out of national trade shows, which occurred twice each year, in May and November. PSI would sell its chiropractic equipment and related marketing and practice-management services and then forward credit applications to equipment-leasing companies for lease financing. NCMIC became familiar with PSI through Kerr, a former PCG employee, who joined NCMIC when it acquired PCG. NCMIC developed a substantial relationship with PSI whereby NCMIC would provide equipment leasing financing at PSI’s trade shows. In advance of PSI’s trade shows, PSI would forward NCMIC a list of likely attendees for credit pre-approval. NCMIC would supplement this list with “the credit decision and/or qualification” of the attendee. The attendees’ names and Social Security numbers came from PSI. NCMIC would evaluate the creditworthiness of the attendees and either approve, decline, or identify what additional information was needed to make the decision and provide that to PSI. NCMIC sent employees to PSI’s national trade shows in order to help facilitate the lease transactions and cement the referral relationship with PSI. PSI preferred to have its leases financed by NCMIC because of NCMIC’s reputation in the chiropractic community and the successful business relationship they had together. During 2005 and 2006, the efforts of Artino and Kerr blossomed into a substantial referral relationship for lease financing with PSI. In terms of dollar amount, PSI was NCMIC’s largest vendor, with approximately $30 million in contracts by the end of 2006. Cole testified that during the summer and fall of 2006, NCMIC had concerns about the size and volume of its PSI business. Specifically, NCMIC was concerned about the “concentration of one product type from one vendor within the finance company’s equipment lease division ... you don’t want all your eggs in one basket.” Tr. 88. In an e-mail dated May 24, 2006, Cole told Artino that there was too much concentration in chiropractors in general and PSI specifically, and that NCMIC needed to do something about the concentration. After a year of booking PSI business, McNerney was concerned that although NCMIC was booking a large volume of PSI business, “taking into account credit risk, ... overhead costs, in particular the costs for [Artino’s] and [Stewart’s] goodwill agreement, employment agreement, that the net profit after taking out salaries and overhead wasn’t as much as NCMIC wanted to have.” Tr. 48. Cole testified that one reason the equipment-financing division was less profitable than other divisions was the high overhead costs required by Artino’s and Stewart’s Goodwill Agreements’ compensation structure. NCMIC had a credit covenant with one of its main lenders, Wells Fargo Bank, that excluded leases from NCMIC’s borrowing base for any vendor with a concentration of over twenty-five percent of NCMIC’s total leasing portfolio. Robert Gagne, a Wells Fargo employee who worked on NCMIC’s account, testified about the concentration limits tied to NCMIC’s credit line. Gagne explained there is a “percentage limitation that would allow a particular sort of lending to one company. If it gets above that, then there would be a limit as to what we want to provide to that one company.” Tr. 267. Although NCMIC’s concentration of PSI leases exceeded twenty-five percent in 2006, Wells Fargo waived that requirement and never prohibited NCMIC from writing additional PSI leases. Wells Fargo was also interested in purchasing a portion of NCMIC’s PSI lease portfolio and had bid on a portion of the existing portfolio. Wells Fargo declined to purchase the PSI leases, and Cole testified that NCMIC’s failure to sell its PSI paper meant NCMIC had a “lesser appetite to take on new business than would have existed had that paper been sold.” Tr. 117-18. Despite the awareness of concentration issues concerning PSI leases, NCMIC never stopped writing PSI leases. However, McNerney testified that he wanted to increase the diversification in the equipment-financing portfolio of leases, and NCMIC’s plan for 2007 was limiting the “concentrations in the various business lines.” Ex. W; Tr. 57. D. The November 2006 Trade Show The events leading up to and including the November 2006 trade show serve as the basis for NCMIC’s allegations against Artino. Artino emphasizes several e-mails between Cole and Artino discussing how much leasing volume NCMIC would be willing to book at the November 2006 trade show. On May 24, 2006, Cole wrote Artino an e-mail stating that PSI leasing volume should slow down. The May 24 email also explained that PSI should have more than one funding source. Cole agreed this e-mail-implies that in order for PSI to acquire another funding source, that source would be a NCMIC competitor. On July 27, 2006, Cole reiterated NCMIC’s position to Artino that NCMIC should “target a maximum of $20 million to be held on our books and shoot for sales at least twice each year to stay at or below the $20 million level.” Ex. 55. On August 11, 2006, Cole again told Artino “the best option is to tell [Pisciottano] he has to develop other outlets asap as we cannot be his primary funding source simply due to the concentration it presents.” Ex. UU. In the summer or early fall of 2006, NCMIC determined that it could not write an unlimited amount of PSI business. Cole and Artino started discussing “hold” positions, whereby NCMIC’s portfolio of PSI leases would not permanently exceed a certain amount, such as $20 million. NCMIC’s plan was to sell portions of its PSI portfolio to free up portfolio space to write new PSI business. To accomplish this purpose, NCMIC had several financial companies interested in purchasing portions of its PSI portfolio, including LEAF Financial Corporation (LEAF), Wells Fargo, and National City Corporation (National City). During negotiations with each of these companies, NCMIC used confidentiality agreements, NCMIC controlled which information the purchasers saw, and NCMIC only provided information about existing booked leases, not future lease prospects. On November 3, 2006, a potential partial sale of NCMIC’s PSI portfolio was pending with National City, and Cole set a limit of $7 million of new PSI business to be originated through the end of the year. Cole wrote Artino an e-mail telling Artino to “get with [Pisciottano] ASAP and find another outlet for the upcoming convention business.” Ex. H. At that time, Cole did not see a need for NCMIC to send any employees to the November 2006 trade show because there was a good chance it would fulfill its $7 million in leasing volume even without sending a representative since NCMIC was PSI’s preferred lender, and due to the pre-approval activity already occurring. Cole also instructed Artino to help PSI find other outlets for lease business that NCMIC did not want to write. Cole testified that he only intended for Artino to introduce PSI to other potential lenders due to his significant industry knowledge and contacts. When this e-mail was sent, NCMIC had $28 million in PSI paper; if another $7 million had been added it would have totaled $35 million, which would have exceeded its twenty-five percent concentration limit. On November 8, 2006, Cole increased the amount of lease volume NCMIC could undertake for new PSI leases for the rest of 2006 from $7 million to $10 million. NCMIC wanted to write pre-approvals for the November 2006 trade show, at least to those customers with good credit, whom Cole considered “solid deals,” and write $10 million in leases to those customers. On November 9, 2006, Cole reiterated NCMIC’s intent to write up to $10 million of new PSI business through the end of 2006, even after the potential sale of part of the PSI lease portfolio to National City fell through. From late October 2006 through the November 2006 trade show held on November 17 and 18, 2006, NCMIC and PSI were in communication about NCMIC’s pre-approval of chiropractor leases in advance of the November 2006 trade show. NCMIC remained committed to writing additional business for PSI because many of its customers had existing relationships with NCMIC, and NCMIC’s core business was chiropractors. At no time prior to the outset of this litigation did NCMIC stop writing PSI leases. Artino attended the November 2006 trade show as a NCMIC employee and officer. ■ Artino received NCMIC’s customer spreadsheet containing the names of the attendees of the November 2006 trade show from Melissa Ehlers (Ehlers), a NCMIC employee, on November 7, 2006. Artino forwarded the customer spreadsheet from his work e-mail account to his personal e-mail account. Cole testified that Artino could have made a copy of the customer spreadsheet and was authorized to do so. At the November 2006 trade show, Artino introduced PSI to LEAF, NCMIC’s competitor in the equipment finance business. Artino and Kerr worked with PSI to place leases with LEAF. Artino introduced LEAF representatives to Pisciottano, and Artino believed that he did so at Cole’s direction, which Cole denies. Artino noted the PSI leases that he booked for LEAF on a printed copy of NCMIC’s spreadsheet. Artino and Kerr used NCMIC’s pre-approval list to keep track of the November 2006 trade show attendees’ credit scores and approval status with LEAF. Artino and Kerr used NCMIC’s computer system to obtain the credit score information that they wrote on this spreadsheet. Kerr would book leases for LEAF, even though the leases were pre-approved by NCMIC, and booked them with LEAF to earn a commission from LEAF. At the time of the November 2006 trade show, Artino and LEAF had an implied understanding that Artino would get compensation from LEAF for PSI referrals at the November 2006 trade show. Artino believed he could keep LEAF’S commissions from the November 2006 trade show because in his view NCMIC abandoned the business. Artino never told McNerney or Cole of his intent to work with PSI to find lease sources other than NCMIC, including direct referrals to LEAF. After the November 2006 trade show, Artino and Kerr used NCMIC time, telephone, and computer resources to assist LEAF book PSI leases. At least thirty PSI leases booked by Artino and Kerr for LEAF were completed by the time of Artino’s resignation. Artino and Kerr worked to book those leases while Artino was still employed by NCMIC. At the November 2006 trade show, Cole testified that NCMIC would have written PSI leases with credit scores above 650, and NCMIC had never prohibited any employee from writing PSI leases with higher credit scores. NCMIC actually wrote substantial amounts of PSI leases throughout 2006, even after the November 2006 trade show. NCMIC did book $2.5 million in new leases from the November 2006 trade show. NCMIC also wrote over $1.5 million in PSI leases in 2007 and 2008. E. Artino’s Resignation from NCMIC Artino announced his resignation from NCMIC in mid-October 2006, and his last day as a NCMIC employee was December 1, 2006. After Artino’s resignation, NCMIC paid Artino $191,250 severance pay under the Severance Agreement, which equaled eighteen months of his base salary. NCMIC also paid Artino $467,820 goodwill pay under the Goodwill Agreement. McNerney testified that NCMIC made these payments to prevent any claim of unfair treatment and to compensate Artino for the eighteen month non-compete agreement NCMIC expected Artino to obey, even though NCMIC was not required to make such payments because Artino voluntarily resigned. McNerney and Cole testified'that NCMIC would not have paid Artino severance or goodwill payments if NCMIC had knowledge that Artino was booking leases with LEAF in exchange for commissions. In discussions with McNerney and Cole, Artino told them he was leaving the leasing industry after his resignation. Artino did not inform McNerney or Cole that he planned to help PSI place leases with LEAF, and both McNerney and Cole testified that they would never authorize Artino to book leases on LEAF’S behalf. Artino denies this and claims he informed Cole that he was going to consult with Pisciottano. Kerr subsequently resigned from NCMIC and joined Artino at PFG. Kerr testified that PFG was not set up to compete with NCMIC but that he and Artino hoped NCMIC would be PFG’s funding partner. Kerr testified that Artino told him he did not think he was violating his non-compete agreement because NCMIC was trying to reduce their PSI volume and subjectively believed that NCMIC would not want this additional business. However, Kerr testified that he and Artino “actually time[d their] departures from NCMIC so as to not arouse suspicion.” Tr. 186. PFG received $169,207.51 in commissions from LEAF for the November 2006 trade show on January 22, 2007, and $33,955.17 in commissions from LEAF on March 12, 2007, for a total of $203,162.68. Of that amount, PFG paid Artino $27,164.07 based on Artino’s efforts at the November 2006 trade show. PFG continued doing business until this Court ordered an injunction on June 13, 2007, prohibiting PFG from soliciting PSI business. Order of June 13, 2007, Clerk’s No. 10. III. CONCLUSIONS OF LAW A. Count One: Computer Fraud and Abuse Act (CFAA) Against Artino NCMIC has pleaded two distinct civil claims against Artino under the CFAA: one under 18 U.S.C. § 1030(a)(2)(C) and one under 18 U.S.C. § 1030(a)(4). The parties dispute three issues: (1) whether §§ 1030(a)(2)(C) and 1030(a)(4) confer liability to an agent-employee who had authority to access his employer’s computer but proceeded to use that access to breach his duty of loyalty to his employer; (2) whether NCMIC can establish a prima facie CFAA case under §§ 1030(a)(2)(C) and 1030(a)(4); and (3) whether NCMIC can satisfy the requisite amount of compensable damages under the CFAA to maintain a cause of action. 1. Without Authorization When construing the terms of a statute, the Court must begin with the statute’s plain language. Dahl v. R.J. Reynolds Tobacco Co., 478 F.3d 965, 969 (8th Cir.2007). The Court’s “objective in interpreting a federal statute is to give effect to the intent of Congress. When no specific definition for a term is given in the statute itself, [the Court] look[s] to the ordinary common sense meaning of the words. Absent clearly expressed legislative intent to the contrary, the language is regarded as conclusive.” Watson v. Ray, 192 F.3d 1153, 1155-56 (8th Cir.1999) (internal citations and quotations omitted). NCMIC argues the CFAA confers liability on an employee who accesses an employer’s computer in order to obtain business information for his own personal benefit and to the detriment of his employer, thereby breaching his duty of loyalty to his employer (the broad view), while Artino argues the CFAA confers liability only when the employee’s initial access to the computer is not permitted and subsequently misappropriates the employer’s information (the narrow view). The Eighth Circuit has not yet ruled on the issue, which requires the Court to interpret the statute’s meaning. Under the CFAA, conduct “exceed[ing] authorized access” is defined as “accessing] a computer with authorization and us[ing] such access to obtain or alter information in the computer that the accesser is not entitled so to obtain or alter.” Id. § 1030(e)(6). The CFAA does not define “authorization.” The issue for the Court to decide is whether an employee may act “without authorization” or “exceeds authorized access” when he accesses confidential and proprietary business information from his employer’s computer that he has permission to access, but then uses that information in a manner inconsistent with the employer’s interests or in violation of other contractual obligations, and where the employee intended to use the information in that manner at the time of access. “Authorize indicates permission endowing the power or right to act.” Webster’s New Int’l Dictionary 147 (3d ed.2002). Consistent with the CFAA’s definition as stated in section 1030(e)(6), a person “exceeds authorized access” when that person possesses a minimum level of access to a computer — a limited power to act — but then accesses the computer beyond the level of access which the access-grantor intended. See EF Cultural Travel BV, 274 F.3d at 583-84 (concluding that where a former employee of the plaintiff provided another company with proprietary information in violation of a confidentiality agreement in order to “mine” his former employer’s publically accessible website for certain information, he exceeded the authorization he had to navigate the website). In the employment context, an employee “exceeds authorized access” when the employee accesses information that he is not entitled to view but does not breach his duty of loyalty to the company’s business interests. In contrast, a person is “without authorization” when an individual either (1) has never been granted access to the computer yet obtains access to the computer without the access-grantor’s permission, see Shurgard, 119 F.Supp.2d at 1126 (“[I]ntruders often alter existing log-on programs so that user passwords are copied to a file which the hackers can retrieve later.”), or (2) has been granted access as the access-grantor’s agent but loses authorization to access the computer when the agent breaches his duty of loyalty, see id. at 1125 (“Unless otherwise agreed, the authority of an agent terminates if, without knowledge of the principal, he acquires adverse interests or if he is otherwise guilty of a serious breach of loyalty to the principal.” (quoting Restatement (Second) of Agency § 112)). Courts, acknowledging the importance of agency law in discussing “authority,” have applied agency law to federal statutes to effect the statute’s clear language and its intended purpose. See Faragher v. City of Boca Raton, 524 U.S. 775, 803 n. 3, 118 S.Ct. 2275, 141 L.Ed.2d 662 (1998) (interpreting Title VII as requiring an employer’s vicarious liability for its employees’ sexual harassment because “our obligation here is not to make a pronouncement of agency law in general ... [but] adapt agency concepts to the practical objectives of Title VII”); Commerford v. Olson, 794 F.2d 1319, 1323 (8th Cir. 1986) (interpreting federal securities laws and finding that applying “common law agency principles to determine secondary liability for violations of the securities acts does not expose corporations, employers, and other such potential defendants to strict liability for all acts of their agents or cause them to be insurers of their agent’s actions”). Judge Richard A. Posner of the Seventh Circuit Court of Appeals explains the difference between “without authorization” and “exceeding authorized access” as defined by the CFAA: Muddying the picture some, [the CFAA] distinguishes between “without authorization” and “exceeding authorized access,” and, while making both punishable, defines the latter as “accessing a computer with authorization and ... using such access to obtain or alter information in the computer that the accesser is not entitled so to obtain or alter.” That might seem the more apt description of what [the employee] did. The difference between “without authorization” and “exceeding authorized access” is paper thin, but not quite invisible. In EF Cultural Travel BV ..., for example, the former employee of a travel agent, in violation of his confidentiality agreement with his former employer, used confidential information that he had obtained as an employee to create a program that enabled his new travel company to obtain information from his former employer’s website that he could not have obtained as efficiently without the use of that confidential information. The website was open to the public, so he was authorized to use it, but he exceeded his authorization by using confidential information to obtain better access than other members of the public. Our case is different. [The employee’s] breach of his duty of loyalty terminated his agency relationship (more precisely, terminated any rights he might have claimed as [the employer’s] agent — he could not by unilaterally terminating any duties he owed his principal gain an advantage!) and with it his authority to access the laptop, because the only basis of his authority had been that relationship. Violating the duty of loyalty, or failing to disclose adverse interests, voids the agency relationship. Unless otherwise agreed, the authority of the agent terminates if, without knowledge of the principal, he acquires adverse interests or if he is otherwise guilty of a serious breach of loyalty to the principal. Citrin, 440 F.3d at 420-21 (some internal citations and quotations omitted). The Court concludes that the broad view can best distinguish between the CFAA’s statutory language “exceeds authorized access” and “unauthorized access” by looking solely at the text of the statute. Additionally, the First and Seventh Circuit Courts of Appeals have adopted the broad view, and the Fifth Circuit has acknowledged the broad view in dicta; in contrast, no Courts of Appeals decisions have adopted the narrow view of the CFAA. See United States v. Phillips, 477 F.3d 215, 220-21 (5th Cir.2007) (“Neither [the defendant], nor members of the public, obtain such authorization from [the website] merely by viewing a log-in page, or clicking a hypertext link. Instead, courts have recognized that authorized access typically arises only out of a contractual or agency relationship. While [the defendant] was authorized to use his [e-mail account on the website] and engage in other activities defined by [the website’s] acceptable computer use policy, he was never authorized to access [a particular program on the website].”). The legislative history of § 1030(e)(6) supports the broad view. In 1994 Congress amended the ■ CFAA, which was originally a criminal statute, to include a private cause of action when the alleged conduct involves certain enumerated factors. Id. § 1030(g). The 1994 amendment was intended “to expand the statute’s scope to include civil claims challenging the unauthorized removal of information or programs from a company’s computer database.” Pac. Aero., 295 F.Supp.2d at 1196. As noted by the Third Circuit, “the scope of [the CFAA’s] reach has been expanded over the last two decades.” P.C. Yonkers, Inc. v. Celebrations the Party. & Seasonal Superstore, LLC, 428 F.3d 504, 510 (3d Cir.2005). “Employers ... are increasingly taking advantage of the CFAA’s civil remedies to sue former employees and their new companies who seek a competitive edge through wrongful use of information from the former employer’s computer system.” Id. (quoting Pac. Aero., 295 F.Supp.2d at 1196). In 1996, Congress further broadened the statute by substituting the phrase “federal interest computer” with “protected computer.” The Senate Report on these amendments states as follows: The proposed [§ ] 1030(a)(2)(C) is intended to protect against the interstate or foreign theft of information by computer. ... This [section] would ensure that the theft of intangible information by the unauthorized use of a computer is prohibited in the same way theft of physical items are protected. In instances where the information stolen is also copyrighted, the theft may implicate certain rights under the copyright laws. The crux of the offense under [§ ] 1030(a)(2)(C), however, is the abuse of a computer to obtain the information. ... Those who improperly use computers to obtain other types of information- — such as financial records, non-classified Government information, and information of nominal value from private individuals or companies — face only misdemeanor penalties, unless the information is used for commercial advantage, private financial gain or to commit any criminal or tortious act. For example, individuals who intentionally break into, or abuse their authority to use, a computer and thereby obtain information of minimal value of $5,000 or less, would be subject to a misdemeanor penalty. The crime becomes a felony if the offense was committed for purposes of commercial advantage or private financial gain, for the purposes of committing any criminal or tortious act in violation ... of the laws of the United States or of any State, or if the value of the information obtained exceeds $5,000. Shurgard, 119 F.Supp.2d at 1128-29 (omissions and emphasis in original) (quoting S.Rep. No. 104-357, at 7-8 (1996)). The Shurgard court concluded, “[tjhis legislative history, although in reference § 1030(a)(2), demonstrates the broad meaning and intended scope of the terms ‘protected computer’ and ‘without authorization’ that are also used in the other relevant sections” of the CFAA, which supports the broad view of the statute. Id. at 1129. The Court notes that the broad view does not focus on an employee’s later misuse of information but rather focuses on an employee’s initial access of the employer’s computer with the intent to either obtain information or defraud the employer, thereby obtaining something of value. Thus, § 1030(a)(2)(C) “requires that a person intentionally access a computer without authorization and thereby obtain information.” United States v. Willis, 476 F.3d 1121, 1125 (10th Cir.2007). Section 1030(a)(4) requires “a person act with the specific intent to defraud,” but can violate § 1030(a)(4) “by obtaining ‘anything of value’ by the unauthorized access,” whereas § 1030(a)(2)(C) requires the person to obtain “information.” Id. Both inquiries focus on a person’s intent at the time of accessing the computer, not on a person’s subsequent misappropriation of the information or thing of value obtained from the employer’s computer. Accordingly, the Court has previously and continues to analyze Artino’s conduct under the broad view of the CFAA. 2. Prima Facie Case a. Section 1030(a)(2)(C) Section 1030(a)(2)(C) states in pertinent part as follows: Whoever ... intentionally accesses a computer without authorization or exceeds authorized access, and thereby obtains ... information from any protected computer if the conduct involved an interstate or foreign communication ... shall be punished as provided in [section] (c) of this section. Id. § 1030(a)(2)(C). NCMIC is required to prove three elements, by a preponderance of the evidence, to establish a cause of action under § 1030(a)(2)(C): (1) Artino’s conduct involved interstate or foreign communication; (2) Artino used a “protected computer” in that it was used for interstate or foreign communication; and (3) Artino used NCMIC’s computer to obtain information without authorization or exceeded his authorized access. See Willis, 476 F.3d at 1125 (elements of criminal statute under § 1030(a)(2)(C) do not require the intent to defraud as required under § 1030(a)(4)); Diamond Power Int’l., 540 F.Supp.2d at 1341 n. 17 (interpreting the civil CFAA statute as requiring the plaintiff to prove a CFAA claim under §§ 1030(a)(2)(C) and (a)(4) by a preponderance of the evidence). Additionally, NCMIC must prove by a preponderance of the evidence that NCMIC suffered losses compensable under section 1030(c)(4)(A)(i). See Modis, Inc. v. Bardelli, 531 F.Supp.2d 314, 318 (D.Conn. 2008) (stating a § 1030(a)(2)(C) claim requires the plaintiff to establish loss or damage under one of five § 1030(c)(4)(A)(i) factors). The first and second elements are not disputed. The term “protected computer” includes any computer “which is used in or affecting interstate or foreign commerce or communication.” Id. § 1030(e)(2)(B). “As both the means to engage in commerce and the method by which transactions occur, the Internet is an instrumentality and channel of interstate commerce.” United States v. Trotter, 478 F.3d 918, 921 (8th Cir.2007) (internal quotations omitted) (interpreting the criminal CFAA statute). Because NCMIC’s computers were connected to the Internet, NCMIC’s computers “were part of a system that is inexorably intertwined with interstate commerce and thus properly within the realm of Congress’s Commerce Clause power.” Id. (internal quotations omitted). The fact that Artino’s communications may have been limited to intrastate communications is not material to whether Artino accessed a protected computer. Id. (holding the location of the purported CFAA violation is not relevant because “[o]nee the computer is used in interstate commerce, Congress has the power to protect it from a local hammer blow, or from a local data packet that sends it haywire” (quoting United States v. Mitra, 405 F.3d 492, 496 (7th Cir.2005))). While the parties do not dispute that Artino obtained “information” from NCMIC’s computer, the parties do dispute whether Artino was authorized to obtain this information from NCMIC. Under the broad view, the Court must determine whether Artino accessed proprietary business information from NCMIC’s computer that Artino had permission to access but intended to use that information in a manner inconsistent with NCMIC’s interests, thereby stripping Artino of any authority to access that information. Citrin, 440 F.3d at 420-21. In other words, the determinative question is whether Artino breached his duty of loyalty to NCMIC when Artino obtained information from NCMIC’s computers. A breach of a duty of loyalty can terminate an agency relationship, and termination of that relationship makes the accessing of computer files that had previously been authorized transform into unauthorized access under the CFAA. Citrin, 440 F.3d at 420-21; see also Midwest Janitorial Supply Corp. v. Greenwood, 629 N.W.2d 371, 375 (Iowa 2001) (under Iowa law, a corporate officer owes a fiduciary duty of loyalty to their employer). Artino served as NCMIC’s vice president and general manager of its equipment-financing division. NCMIC’s CFAA allegation occurred when Artino, acting as NCMIC’s agent, accessed NCMIC’s computer and e-mailed a customer spreadsheet containing NCMIC proprietary information to his personal email account. This customer spreadsheet contained prospective customer’s Social Security numbers and NCMIC’s credit determination whether the customer was pre-approved for equipment financing and the amount of credit NCMIC could offer to each customer. Artino and Kerr used NCMIC’s credit determination to assess the credit worthiness of prospective customers. The Court accepts Artino’s testimony that he never provided these spreadsheets to LEAF; however, the Court also accepts Kerr’s testimony that both he and Artino used NCMIC’s spreadsheet to broker leases on LEAF’S behalf. Kerr testified that he and Artino would divert leases from NCMIC to LEAF, including some leases that NCMIC had pre-approved for credit financing. Therefore, Artino’s actions in accessing NCMIC’s computer system to send e-mails aiding his unlawful competition with NCMIC and to obtain NCMIC’s customer spreadsheet occurred without NCMIC’s authorization and satisfy the third element of a § 1030(a)(2)(C) claim. Because the Court adopts the broad view of the CFAA, most of Artino’s other arguments regarding the third element fall short. While NCMIC could rest a CFAA claim based on breach of NCMIC’s computer policy, see EF Cultural Travel BV v. Zefer Corp., 318 F.3d 58, 62 (1st Cir.2003) (holding that an employee breached his confidentiality agreement with his ex-employer when the employee used confidential information he obtained as an employee to obtain information from his ex-employer’s website thereby exceeding his authorized access in violation of the CFAA), NCMIC does not argue Artino acted in violation of NCMIC’s computer policy. Rather, NCMIC argues Artino’s CFAA liability is predicated on Artino’s breach of fiduciary duty, which rendered Artino without authority to access NCMIC’s customer spreadsheet. Citrin, 440 F.3d at 420-21. Additionally, while Artino undeniably had authority to access NCMIC’s customer information while acting in his capacity as NCMIC’s agent, “the authority of an agent terminates if, without knowledge of the principal, he acquires adverse interests or if he is otherwise guilty of a serious breach of loyalty to the principal,” which occurred when Artino decided to compete against NCMIC and subsequently e-mailed NCMIC’s customer spreadsheet to his personal e-mail account. Shurgard, 119 F.Supp.2d at 1126 (quoting Restatement (Second) of Agency § 112). b. Section 1030(a)(4) Section 1030(a)(4) states, Whoever ... knowingly and with intent to defraud, accesses a protected computer without authorization, or exceeds authorized access, and by means of such conduct furthers the intended fraud and obtains anything of value ... shall be punished as provided in [section] (c) of this section. Id. § 1030(a)(4). NCMIC is required to prove four elements, by a preponderance of the evidence, to establish a cause of action under § 1030(a)(4): (1) Artino accessed a “protected computer;” (2) Artino accessed NCMIC’s computer without authorization or by exceeding authorized access; (3) Artino did so “knowingly” and with “intent to defraud;” and (4) Artino’s access “further[ed] the intended fraud and obtained] anything of value.” See P.C. Yonkers, 428 F.3d at 508. Additionally, NCMIC must prove by a preponderance of the evidence that NCMIC suffered losses compensable under § 1030(c)(4)(A)(i). See Modis, 531 F.Supp.2d at 318. The Court determines that NCMIC satisfies the first two elements of a prima facie § 1030(a)(4) case: Artino accessed NCMIC’s protected computer and did so without authorization. Regarding the third element, while the CFAA does not define “intent to defraud,” the Eighth Circuit model jury instructions define the phrase under the mail fraud statute as requiring the defendant “to act knowingly and with the intent to deceive someone for the purpose of causing some financial loss to another or bringing about some financial gain to oneself or another to the detriment of a third party.” Eighth Circuit Model Jury Instructions, Criminal 6.18.1341 (2007). Courts have interpreted “defraud” under the CFAA as meaning “wronging one in his property rights by dishonest methods or schemes.” Shurgard, 119 F.Supp.2d at 1126 (citing McNally v. United States, 483 U.S. 350, 358, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987)) (interpreting mail fraud statute); accord United States v. Czubinski, 106 F.3d 1069, 1078 (1st Cir.1997) (holding that the CFAA’s use of the word “defraud” “should apply to those who steal information through unauthorized access as part of an illegal scheme”). Under this standard, the Court finds Artino’s conduct violated NCMIC’s property rights when he accessed NCMIC’s customer spreadsheet, emailed it from his work e-mail account to his personal e-mail account without authorization, and used the customer spreadsheet for his own personal gain and against NCMIC’s financial interests. Kerr testified that while Artino was a NCMIC employee, Kerr met with Artino at least twelve times to discuss how to divert preapproved leases from NCMIC to LEAF in exchange for commissions paid by LEAF. Artino deceived NCMIC by not telling NCMIC of his plan to divert leases to LEAF in exchange for LEAF’S commissions, which constitutes financial gain. These facts demonstrate that Artino committed these acts knowingly and with the intent to defraud NCMIC under the CFAA. Artino also satisfies the last element because Artino obtained something of value, namely NCMIC’s customer spreadsheet. Courts have defined “anything of value” under the CFAA as “[t]he value of information is relative to one’s needs and objectives; here, the [plaintiff] had to show that the information was valuable to [the defendant] in light of a fraudulent scheme.” Czubinski, 106 F.3d at 1078; see Triad Consultants, Inc. v. Wiggins, 249 Fed.Appx. 38, 41 (10th Cir.2007) (unpublished) (same definition of “anything of value”). The Czubinski court noted, The plain language of [§ ] 1030(a)(4) emphasizes that more than mere unauthorized use is required: the “thing obtained” may not merely be the unauthorized use. It is the showing of some additional end — to which the unauthorized access is a means — that is lacking here. The evidence did not show that [the defendant’s] end was anything more than to satisfy his curiosity by viewing information about friends, acquaintances, and political rivals. No evidence suggests that he printed out, recorded, or used the information he browsed. Czubinski, 106 F.3d at 1078. The Tenth Circuit made a similar observation, noting that § 1030(a)(4) requires that the defendant do more than merely access information without authorization: the defendant must obtain something of value from his unauthorized access of information, which requires the plaintiff to prove that the defendant’s “access to information was central to the claimed violation — [the plaintiff must prove] the information was either deleted, used to compete, or given to a competitor.” Triad Consultants, 249 Fed.Appx. at 41. In this case, Artino clearly obtained something of value from his unauthorized access of NCMIC’s customer spreadsheet. Artino testified that his company, PFG, was paid commissions of $169,205.51 by LEAF from transactions that occurred at the November 2006 trade show, where Artino used NCMIC’s customer spreadsheet in part to identify which clients could receive financing from LEAF. Unlike the defendant in Czubinski, Artino (1) recorded NCMIC’s customer spreadsheet for his personal use when he e-mailed it to his personal account, (2) printed the customer spreadsheet for use at the November 2006 trade show, and (3) actually used the customer spreadsheet at the November 2006 trade show for his financial gain. Accordingly, Artino’s unauthorized access furthered his intended fraud and resulted in his obtaining something of value. 3. Damages The CFAA’s civil action provision states, “Any person who suffers damage or loss by reason of a violation of this section may maintain a civil action against the violator to obtain compensatory damages and injunctive relief or other equitable relief.” Id. § 1030(g). As the plain language of the statute makes clear, only a person who has suffered “damage or loss” can maintain a cause of action. Id. The CFAA defines “damage” as “any impairment to the integrity or availability of data, a program, a system, or information.” Id. § 1030(e)(8). The CFAA defines “loss” as “any reasonable cost to any victim, including the cost of responding to an offense, conducting a damage assessment, and restoring the data, program, system, or information to its condition prior to the offense, and any revenue lost, cost incurred, or other consequential damages incurred because of interruption of service.” Id. § 1030(e)(ll). This Court’s Order of November 24, 2008, concluded that under the CFAA, NCMIC need only establish loss or damages, not both. Order of November 24, 2008, Clerk’s No. 54 at 15-16 (citing P.C. of Yonkers, Inc. v. Celebrations! The Party and Seasonal Superstore, LLC, Civ. No. 04-4554, 2007 WL 708978, at *2, 2007 U.S. Dist. LEXIS 15216, at *5 (D.N.J. Mar. 2, 2007)). The Court agrees with Artino that NCMIC does not allege damage as defined by the CFAA. NCMIC does not allege “any impairment to the integrity or availability of data, a program, a system, or information,” id. § 1030(e)(8), such as facts that would plausibly suggest that Artino’s e-mailing of the customer spreadsheet caused a diminution in the completeness or usability of NCMIC’s computerized data. See Garelli Wong & Assocs., Inc. v. Nichols, 551 F.Supp.2d 704, 710 (N.D.Ill.2008) (misappropriation of trade secrets alone does not constitute damage under the CFAA). Since Artino cannot prove the requisite amount of damages under the CFAA, if Artino cannot prove by the preponderance of evidence $5000 in losses during any one-year period, then Artino cannot recover under the CFAA. See Theofel, 359 F.3d at 1078 (holding the § 1030(c)(4)(A)(i) factors are jurisdictional). If the plaintiff has suffered only “loss,” the statute requires the plaintiff to satisfy the CFAA’s jurisdictional threshold of “loss to 1 or more persons during any 1-year period ... aggregating [to] at least $5000 in value” to maintain a cause of action. Id. § 1030(e)(4)(A)(i)(I). Courts have interpreted “loss” to include the cost of responding to a security breach, such as the cost of performing a computer system damage assessment, even if the losses are not derived from any change to the computers themselves or the information contained on the computer. See EF Cultural Travel BV, 274 F.3d at 584; I.M.S. Inquiry Mgmt. Sys. v. Berkshire Info. Sys., 307 F.Supp.2d 521, 525-26 (S.D.N.Y.2004) (holding that “loss” includes the “damage assessment and remedial measures”). The CFAA’s definition of loss is a “broadly worded provision plainly contemplating] consequential damages of the type sought by [the plaintiff] — costs incurred as part of the response to a CFAA violation, including the investigation of an offense.” A.V. ex rel. Vanderhye v. iParadigms, LLC, 562 F.3d 630, 646 (4th Cir.2009) (noting that “the costs of responding to the offense are recoverable including costs to investigate and take remedial steps” (internal quotations omitted)); SuccessFactors, Inc. v. Softscape, Inc., 544 F.Supp.2d 975, 980-81 (N.D.Cal.2008) (holding that “the cost of investigating and identifying the CFAA offense, including many hours of valuable time away from day-to-day responsibilities, causing losses well in excess of $5000, qualified as cost[s] of responding to an offense under § 1030(e)(11).” (internal quotations omitted)). The Senate Report on the 1996 amendments to the CFAA support this interpretation: “[when] the system administrator [must] devote resources to re-secur[e] the system ... although there is arguably no ‘damage,’ the victim does suffer ‘loss.’ If the loss to the victim meets the required monetary threshold, the conduct should be criminal, and the victim should be entitled to relief.” EF Cultural Travel BV, 274 F.3d at 584 (quoting S.Rep. No. 104-357, at 11 (1996)). Other courts have relied on this legislative history to support losses incurred as a result of the plaintiff responding to the defendant’s misappropriation of their data. Id. (holding the $20,944.92 the plaintiff paid “to assess whether their website had been compromised” was sufficient to satisfy the $5000 threshold); Pac. Aero., 295 F.Supp.2d at 1196-97; In re DoubleClick Inc. Privacy Litig., 154 F.Supp.2d 497, 521 (S.D.N.Y.2001); Shurgard, 119 F.Supp.2d at 1126-27. While NCMIC does not allege Artino’s conduct caused damage to NCMIC’s computers, Eric Madcharo (Madcharo), NCMIC’s chief information officer, testified about the following CFAA-related losses NCMIC incurred resulting from Artino’s conduct: (1) $5831 for a damage assessment to determine the extent of Artino’s security breach; (2) $3747.50 for legal research and assistance with remedial actions related to the security breach; and (3) $1614.50 for identity-theft-prevention services for individuals whose Social Security numbers Artino obtained without NCMIC’s permission. The total cost of NCMIC’s remedial action and investigation into Artino’s conduct was $11,193. Madcharo testified that when NCMIC first learned that Artino e-mailed NCMIC’s customer spreadsheet from his NCMIC account to his personal account, NCMIC asked Madcharo to investigate the extent of Artino’s disclosure of Social Security numbers and credit information to third parties. Madcharo testified that he spent fifty hours searching the e-mail accounts of Artino, Kerr, and Sally Schmaltz to determine the extent of the disclosure since all three were involved in the formation and operation of PFG. NCMIC valued Madcharo’s time investigating this matter at $5831. Madcharo testified that only Artino sent this information to a non-NCMIC computer. The Court acknowledges that fifty hours is a considerable amount of time for a damage assessment. Artino did not present any evidence that, under the circumstance of this case, Madcharo’s time investment was unreasonable or that Madcharo’s reported time was not used for the purpose of conducting a damage assessment in response to Artino’s conduct. See Patrick Patterson Custom Homes, Inc. v. Bach, 586 F.Supp.2d 1026, 1036 (N.D.Ill.2008) (concluding that under the CFAA, “costs are recoverable regardless of whether there is an interruption of service, and courts have sustained actions based on allegations of costs to investigate and take remedial steps in response to a defendant’s misconduct”); cf. Nexans Wires S.A. v. SarkUSA, Inc., 319 F.Supp.2d 468, 476 (S.D.N.Y.2004) (rejecting the plaintiffs claim that travel time constituted loss under the CFAA because (1) “the affidavits do not allege any facts showing that this assessment or response was in any way related to a computer”; (2) “nothing suggests that the trips were taken to engage in any type of computer investigation or repair”; and (3) “no facts are alleged showing that preventive measures were added to the computers or that the system was augmented to tighten security — after all, these were discussions between senior executives-not computer experts”). The Court considers Madcharo’s time as recoverable under the CFAA. NCMIC also retained counsel to survey federal and state law to determine whether NCMIC had any obligation to report the disclosure of the Social Security numbers or to notify the victims of the disclosure. Cole testified that NCMIC officers believed they had a duty to report Artino’s conduct under various state laws. The cost of counsel’s investigation and reporting assistance totaled $3747.50. As a result of its investigation, NCMIC determined it had to notify approximately sixty-nine individuals, in several different states, of the security breach. NCMIC sent letters to each individual and to the attorney general’s office of three states. NCMIC purchased identity-theft-prevention services for the sixty-nine affected individuals. Thirty-eight of the affected individuals were NCMIC policy holders. The identity-theft-prevention services for one year cost NCMIC $3.75 per person, for a total of $142.50. The cost of the identity-theft-prevention services for thirty-two of the affected individuals who were not NCMIC policy holders was $46 per person, for a total of $1472. Thus, NCMIC paid a total of $1614.50 to purchase identitjr-theft-prevention services for the affected individuals. Both of these types of losses are recoverable under the CFAA because they are “reasonable cost[s] to any victim, including the cost of responding to an offense, conducting a damage assessment, and restoring the data, program, system, or information to its condition prior to the offense,” and these costs were incurred as a result of Artino’s conduct. Id. § 1030(e)(11). If Artino did not use NCMIC’s customer spreadsheet in an unauthorized manner, NCMIC would not have been required to respond to the improper use of Social Security numbers by incurring attorneys’ fees and paying for identity-theft-prevention services for NCMIC clients. Although attorneys’ fees in prosecuting a CFAA action do not count toward the $5000 statutory threshold, see Wilson v. Moreau, 440 F.Supp.2d 81, 110 (D.R.I.2006), attorneys’ fees incurred responding to the actual CFAA violation to place the plaintiff in their ex ante position are permissible as costs “incurred as part of the response to a CFAA violation, in-eluding the investigation of an offense.” A.V. ex rel. Vanderhye, 562 F.3d at 646. NCMIC has proved by the preponderance of the evidence that Artino violated CFAA §§ 1030(a)(2)(C) and 1030(a)(4) and owes NCMIC $11,193 resulting from NCMIC’s losses incurred as a result of Artino’s unauthorized access of NCMIC’s customer spreadsheet using NCMIC’s computer. B. Count Two: Breach of Contract Against Artino NCMIC argues that Artino breached the restrictive covenants contained in his Employment Agreement preventing Artino from competing with NCMIC for eighteen months following termination of Artino’s employment. Artino resists and advances two affirmative defenses providing legal justification for his breach: NCMIC’s unclean hands and breach of an implied duty of good faith and fair dealing. 1. Language of the Agreement At the time Artino was hired by NCMIC, Artino signed an Employment Agreement concerning the disclosure of confidential information and non-competition with NCMIC. The Employment Agreement included the following relevant provisions: 6. Confidential Information. (a) Employee acknowledges and agrees that it is necessary for the Company to prevent the unauthorized use and disclosure of Confidential Information (as that term is defined below) regarding the Company and its services, products and business. Accordingly, and in further consideration for this Agreement, Employee covenants and agrees that Employee will not, during the term of this Agreement or at any time thereafter (whether this Agreement is terminated by the Company, by Employee or by mutual consent, and for whatever reason or for no reason), directly or indirectly, engage in or take any action or inaction which may in any way lead to the use or disclosure of any Confidential Information by or to any person, nor use or disclose any such Confidential Information for Employee’s own benefit, excepting only such limited uses or disclosures by Employee during the term of this Agreement which are within the limited authority expressly granted to Employee by this Agreement. (b) For purposes of this Agreement, the term “Confidential Information” mea