Suit Alleges 'Poaching' of Consumer Cellular via Stolen Trade Secrets

Two former employees of Vox Network Solutions, a supplier of contact center and network support services, conspired with Gage Technologies to steal Vox’s trade secrets for the purpose of "poaching" Consumer Cellular as a client when they resigned to join Gage's leadership team, alleged a Dec. 28 complaint (docket 3:22-cv-09135) in U.S. District Court for Northern California in San Francisco. Gage Technologies (formerly Gage Telecom) is Vox's direct competitor.

Kristopher McGreevey, a former regional Vox sales director, and Kevin Frazier, a former Vox senior account manager, worked “in concert” and conspired to use Vox trade secrets to “cultivate” existing Vox clients and “migrate” them to Gage, beginning about September 2021, alleged the complaint. While still on the Vox payroll and in “flagrant disregard of their fiduciary duties and duties of loyalty,” McGreevey and Frazier “exploited their access to and knowledge” of Vox’s trade secrets, it said.

Wielding the trade secrets to their advantage, McGreevey and Frazier “discreetly and surreptitiously” solicited existing Vox clients into terminating their existing relationships with Vox and “lured these clients” into contracts with Gage, alleged the complaint. Gage “knowingly received and capitalized” on Vox’s stolen trade secrets, and “aided and abetted” the wrongful conduct of McGreevey and Frazier, it said.

During the last few months of their employment at Vox, “and up until the moment they left” to work for Gage, McGreevey and Frazier “engaged in a systematic attempt to cover up evidence of their ongoing theft and other misconduct,” said the complaint. McGreevey joined Gage as president-CEO in October 2021, and Frazier joined the next month as executive vice president-chief revenue officer, per their LinkedIn profiles. Efforts to reach Gage, McGreevey and Frazier for comment Tuesday were unsuccessful.

McGreevey and Frazier “are close friends,” and before joining Vox together, “had worked collaboratively for several years,” where they developed relationships with Consumer Cellular and Avaya as account executives for a former employer, said the complaint. Consumer Cellular “would later transition to become an important client” for Vox, with Consumer Cellular buying Avaya products and product support through Vox, it said. Avaya and Vox have “an ongoing business partnership,” but that’s no longer so for Consumer Cellular, it said.

As part of the conspiracy, Gage recruited and hired Vox salespeople, including McGreevey and Frazier, plus technical employees “who possessed the Avaya enterprise certifications needed” for Gage to “poach” Vox clients like Consumer Cellular, alleged the complaint. The defendants’ conspiracy to steal and capitalize on Vox’s trade secrets “for the purpose of poaching” Consumer Cellular as a client for Gage involved a series of covert acts that occurred over several months, it said.

Consumer Cellular, around October 2021, was in “urgent need” of subscription-based Avaya product licenses,” said the complaint. “Undoubtedly to bridge the gap in Avaya related services before Gage was able to take on Consumer Cellular as a client, Frazier hatched the idea of obtaining temporary Avaya product licenses for Consumer Cellular “while the surreptitious subscription quote” to make Customer Cellular a permanent Gage client “was being finalized,” it said. Much of the work that McGreevey and Frazier performed to make Consumer Cellular a permanent Gage client took place when the two executives were still on the Vox payroll, it said.

On Oct. 15, 2021, the same day that Avaya approved the temporary product licenses for Consumer Cellular, McGreevey terminated his employment with Vox, falsely assuring Vox’s CEO “that he would not be competing” with Vox, said the complaint. On Oct. 27, 2021, two days after Frazier resigned to join Gage, Vox learned for the first time that Avaya and Consumer Cellular intended to migrate Consumer Cellular to a subscription-based model under Gage’s watch, it said.

Vox was “rightfully suspicious” that several Vox employees who had recently resigned, especially McGreevey and Frazier, had “orchestrated and concealed” the new subscription deal from Vox, said the complaint. Its “suspicions were confirmed” when a forensic review of Frazier’s former Vox email account found all communications about Consumer Cellular’s planned migration to a subscription-based model had been wiped clean, it said. Lending further support that Frazier “methodically concealed” this subscription deal from Vox and “intentionally purged evidence of his misconduct,” Vox also found that the deleted items folder in Frazier’s email account “was also completely scrubbed of his emails related to development of the subscription plan quote to Consumer Cellular," it said.

Despite Vox’s “guaranteed” offer of a $269,000 annual discount if Consumer Cellular stayed with Vox, Consumer Cellular told Vox it had decided to move its account to Gage, effective January 2022, said the complaint. From the Consumer Cellular account alone, Vox “has lost and will lose well in excess” of $1 million as a result of the defendants’ “tortious conduct,” it said.

Amid the defendants’ misappropriation of Vox’s trade secrets and other torts, Vox brings the allegations “to prevent any further misuse” of its trade secrets, and to seek compensatory damages for the defendants’ “unjust enrichment resulting from their unlawful conduct,” said their complaint. It alleges violations of the California Uniform Trade Secrets Act and civil conspiracy.