FILED

NOT FOR PUBLICATION

FEB 11 2025

UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

JOSHUA DAVID MELLBERG LLC, No. 22-15668 DBA JD Mellberg Financial, an Arizona limited liability company; JOSHUA D.C. No. DAVID MELLBERG, an individual, 4:14-cv-02025-CKJ-LCK

Plaintiffs-counter- defendants-Appellants, MEMORANDUM*

v.

FERNANDO GODINEZ; JANE DOE

GODINEZ; CARLY URETZ; JOHN DOE

URETZ,

Defendants-Appellees,

and

JOHN STEVE ARECO; JANE DOE

ARECO; PATRICIA LATHAM; JOHN

DOE LATHAM,

Defendants.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. JOSHUA DAVID MELLBERG LLC, No. 22-15724 DBA JD Mellberg Financial, an Arizona limited liability company; JOSHUA D.C. No. DAVID MELLBERG, an individual, 4:14-cv-02025-CKJ-LCK

Plaintiffs-counter- defendants-Appellees,

v.

FERNANDO GODINEZ; JANE DOE

GODINEZ; CARLY URETZ,

Defendants-Appellants,

and

JOHN DOE URETZ; JOHN STEVE

ARECO; JANE DOE ARECO;

PATRICIA LATHAM; JOHN DOE

LATHAM,

Defendants.

Appeal from the United States District Court for the District of Arizona Cindy K. Jorgenson, District Judge, Presiding

Argued and Submitted January 30, 2025 San Francisco, California

Before: SCHROEDER, RAWLINSON, and BYBEE, Circuit Judges.

Plaintiffs Joshua David Mellberg LLC and its president (collectively,

“JDM”) appeal from the district court’s grant of attorneys’ fees to former

2 employees, Fernando Godinez and Carly Uretz (“Defendants”).1 JDM sued

Defendants and several others, including Impact Partnership LLC (“Impact”), for

various claims related to alleged misappropriation of trade secrets and confidential

information. The court granted summary judgment to Defendants on all claims,

and we affirmed. The district court granted attorneys’ fees to Defendants under

Arizona Revised Statutes section 12-341.01(A), which permits awards to

successful parties in “any contested action arising out of a contract.”

JDM contends that the court erred in awarding fees to Uretz because the

claims against her did not arise out of a contract. That is not correct. JDM

principally claimed that Uretz misappropriated trade secrets, and this required

showing that JDM took steps to maintain the secrecy of the purportedly

misappropriated information. See Ariz. Rev. Stat. § 44-401(4)(b) (a “trade secret”

must be “the subject of efforts that are reasonable under the circumstances to

maintain its secrecy”). JDM relied on allegations that it used written employment

policies to protect its confidential information, and Uretz was subject to these

policies as part of her employment contract with JDM. These policies and Uretz’s

1 On cross appeal, Defendants contend that if the fee award is vacated, we should remand for the district court to consider whether Defendants are entitled to fees under Arizona Revised Statutes section 44-404(1). Because we affirm, we need not reach this issue. 3 breach of them were essential parts of JDM’s misappropriation claims. See Ford v.

Revlon, 734 P.2d 580, 587 (Ariz. 1987) (in banc). JDM’s claims against Uretz

therefore arose out of a contract because the claims could not exist “but for the

breach of the contract implied by [JDM’s] policies.” Id.

JDM also contends that the district court misapplied the Warner factors in

making a discretionary fee award to Defendants. See Associated Indem. Corp. v.

Warner, 694 P.2d 1181, 1184 (Ariz. 1985) (in banc). The court did not abuse its

discretion. See Med. Protective Co. v. Pang, 740 F.3d 1279, 1282 (9th Cir. 2013)

(setting forth standard of review). Defendants prevailed at summary judgment on

the merits because JDM failed to establish damages, an essential element of their

claims. JDM asserts that Defendants’ attorneys’ efforts were superfluous.

Although their attorneys deferred to Impact’s counsel in preparing initial drafts of

dispositive motions, Defendants’ attorneys still needed to determine which of

Impact’s contentions Defendants could rely upon and which issues were specific to

Defendants that needed to be separately addressed.

JDM’s request to certify a question to the Arizona Supreme Court is denied.

See Thompson v. Paul, 547 F.3d 1055, 1065 (9th Cir. 2008).

AFFIRMED.

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