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govinfo:USCOURTS-alnd-5_25-cv-01840-0

U.S. District Court for the Northern District of Alabama · 2026-06-15

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UNITED STATES DISTRICT COURT 
FOR THE NORTHERN DISTRICT OF ALABAMA 
NORTHEASTERN DIVISION 
 
STOCKTON MORTGAGE CORP. 
 
Plaintiff, 
 
v. 
 
IXONIA BANCSHARES INC. d/b/a 
NOVUS HOME MORTGAGE, et 
al., 
 
Defendants. 
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MEMORANDUM OPINION 
Plaintiff Stockton Mortgage Corporation is a mortgage lender. Over the course 
of two months in 2025, eighteen of its employees 1 (collectively, “the Individual 
Defendants”) resigned and went to work for its competitor, Defendant Ixonia 
Bancshares, Inc., d/b/a Novus Home Mortgage. Stockton filed suit against Novus 
and the Individual Defendants, asserting twelve causes of action. In the interest of 
remaining concise, the court will not list every claim against every defendant but 
 
1 The Individual Defendants are Logan Hoffman, Eric Wagner, Chris Hoehn, Amber 
O’Rear, Adam Goode, Jerry Bryant, Elizabeth Harrell, Amanda Leopard, Sara Kidd, Kim Sherrell, 
Emma Amara, Ashley Hoehn, Leslie Swearengin, Elliot Farmer, Jennifer Detulleo, Elizabeth 
Blagburn, Brandi McEwen, and Sherry Dougherty. (Doc. 71 at 1 & ¶¶ 4–21). 
FILED
 
 2026 Jun-15 PM 04:49
U.S. DISTRICT COURT
N.D. OF ALABAMA

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will instead address only the specific claims at issue in the motion currently before 
the court. Those claims are: 
Count One: Eight of the Individual Defendants breached the duty 
of loyalty, non- disclosure, and non- solicitation of 
customers clauses in their employment agreements 
Count Four: The Individual Defendants breached their fiduciary 
duty to Stockton by providing confidential materials 
to Novus and soliciting Stockton’s existing and 
prospective borrowers 
Count Five: Seven of the Individual Defendants violated the 
Defend Trade Secrets Act, 18 U.S.C. § 1836 
Count Six: Seven of the Individual Defendants violated the 
Alabama Trade Secrets Act (“ATSA”), Ala. Code § 8-
27-3 
Count Seven: Eight of the Individual Defendants converted 
Stockton’s borrower files and documents 
Count Eight: The Individual Defendants tortiously interfered with 
Stockton’s business relationships 
Count Ten: The Individual Defendants tortiously interfered with 
Stockton’s business expectancy with its current and 
prospective borrowers 
Count Twelve: The Individual Defendants engaged in a civil 
conspiracy to commit the foregoing torts 
 
(Doc. 71 ¶¶ 171–82, 202–41, 251–59, 267–76). 
The Individual Defendants move to dismiss Counts Four, Seven, Eight, Ten, 
and Twelve as preempted by the ATSA. (Doc. 75 at 1). Twelve of the Individual 
Defendants (Mses. Harrell, Leopard, Kidd, Sherrell, Amara, Detulleo, Blagburn, 
McEwen, Dougherty, and Swearengin, and Messrs. Bryant and Farmer) move to be 
dismissed as defendants because the factual allegations against them are insufficient 

3 
to state a claim. (Id.). The court WILL GRANT IN PART and WILL DENY IN 
PART the motion to dismiss. Because the ATSA bars (1) the part of Count Four 
asserting breach of fiduciary duty by providing Novus with misappropriated data 
and (2) Count Seven as to Mses. Swearengin, O’Rear, and Ashley Hoehn, and 
Messrs. Hoffman, Wagner, Goode, and Chris Hoehn,2 the court WILL GRANT the 
motion and WILL DISMISS those claims WITH PREJUDICE. The court WILL 
DENY the motion as to all other claims. 
In reviewing the amended complaint, the court found some inconsistencies 
between the defendants identified in the title of a count and those mentioned in the 
body of the count. The court WILL ORDER Stockton to amend its complaint to 
clarify which defendants are named in each count. 
I. BACKGROUND 
In considering a Federal Rule of Civil Procedure 12(b)(6) motion to dismiss 
for failure to state a claim, the court must accept as true the factual allegations in the 
complaint and construe them in the light most favorable to the plaintiff. Butler v. 
Sheriff of Palm Beach Cnty., 685 F.3d 1261, 1265 (11th Cir. 2012). The court may 
also “consider exhibits attached to a complaint . . . , and if the allegations of the 
complaint about a particular exhibit conflict with the contents of the exhibit itself, 
 
2 Count Seven also names Novus as a defendant. (Doc. 71 at 32). Novus did not join in the 
motion to dismiss (see doc. 75), so the claim against it remains pending. 

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the exhibit controls. ” Hoefling v. City of Miami , 811 F.3d 1271, 1277 (11th Cir. 
2016). 
Stockton and Novus are mortgage lenders that compete in the area of 
residential mortgages. (Doc. 71 ¶¶ 28–30). In 2023, Stockton hired Mr. Hoffman as 
a branch manager of several branches located in Huntsville, Madison, and Rainbow 
City. (Id. ¶ 35). Between May 2023 and July 2024, Stockton hired the rest of the 
Individual Defendants to work at the branches Mr. Hoffman managed. (Id. ¶¶ 50–
66). Each of the Individual Defendants executed an employment agreement that 
contained confidentiality provisions and restrictive covenants. (Id.; doc. 71-1 at 8–
11; doc. 71-2 at 5–8; doc. 71-3 at 6–10; doc. 71-4 at 6–10; doc. 71-5 at 6–10; doc. 
71-6 at 6–10; doc. 71-7 at 5–8; doc. 71-8 at 6–10; doc. 71-9 at 5–8; doc. 71-10 at 9–
12; doc. 71-11 at 6–10; doc. 71-12 at 6–10; doc. 71-13 at 6–10; doc. 71-14 at 6–10; 
doc. 71-15 at 6–10; doc. 71-16 at 6–10; doc. 71-17 at 6–10; doc. 71-18 at 6–10). 
The complaint alleges that all the employment agreements contained four 
identical clauses: a duty of loyalty clause, a non-disclosure clause, a non-solicitation 
of employees clause, and a non-solicitation of customers clause. (Doc. 71 ¶ 67). It is 
true that all the employment agreement s contain the first three clauses. (Doc. 71-1 
at 3, 8–11; 71-2 at 2, 5–8; doc. 71-3 at 2, 6–10; doc. 71-4 at 2, 6–10; doc. 71-5 at 2, 
6–10; doc. 71-6 at 2, 6–10; doc. 71-7 at 2, 5–8; doc. 71-8 at 2, 6–10; doc. 71-9 at 2, 
5–8; doc. 71-10 at 4, 9–13; doc. 71-11 at 2, 6–10; doc. 71-12 at 2, 6–10; doc. 71-13 

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at 3, 6–10; doc. 71-14 at 2, 6–10; doc. 71-15 at 2, 6–10; doc. 71-16 at 2, 6–10; doc. 
71-17 at 2, 6– 10; doc. 71 -18 at 2, 6 –10). But Mses. Amara’s, Harrell’s, and 
Swearengin’s employment agreements do not contain the non- solicitation of 
customers clause. (See doc. 71-2 at 8; doc. 71- 7 at 8; doc. 71-9 at 8). Accordingly, 
because the exhibits contradict that allegation, the court does not accept it as true 
with respect to those three defendants. See Hoefling, 811 F.3d at 1277. 
Thirteen of the Individual Defendants (Mses. Leopard, Kidd, Sherrell, 
Detulleo, Blagburn, McEwen, O’Rear, Hoehn, and Doughtery and Messrs. Farmer, 
Wagner, Hoehn, and Goode ) were responsible for soliciting new business and 
originating loans for Stockton. (Doc. 71 ¶ 69). Three of the Individual Defendants 
(Mses. Amara, Harrell, and Sweareng in) were responsible for collecting borrower 
information and preparing or processing borrower loan files. ( Id.). Two of the 
Individual Defendants (M essrs. Bryant and Hoffman) w ere responsible for 
recruiting and management functions. (Id.). 
In the course of originating new consumer mortgage loans, employees must 
do “credit pulls” about customers. (See id. ¶ 111). For example, from April through 
September 2025, Ms. Detulleo pulled credit reports for fifteen to twenty customers 
and prospective customers per month. (Doc. 71 ¶ 110). But in October 2025, she did 
only one credit pull, while sending the other files to Novus. ( Id.). This trend held 
true across all of Mr. Hoffman’s branches. ( See id. ¶ 111–12). In July 2025, 

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Mr. Hoffman’s branches did 166 unique credit pulls; in August 2025, they did 145 
unique credit pulls; in September 2025, they did 119 unique credit pulls; and in 
October 2025, they did 43 unique credit pulls. (Id. ¶ 112). 
Between August 2025 and October 2025, several Stockton employees, 
including Ms. Swearengin, emailed with Novus employees about diverting 
Stockton’s borrowers and prospective clients to Novus. (Doc. 71 ¶ 73). Specifically, 
in October 2025, a Novus employee emailed a Stockton employee asking for 
information needed to close a loan. ( Id. ¶ 109; doc. 71- 53; see doc. 71 ¶ 53). The 
Stockton employee added Ms. Swearengin to the email chain and answered the 
questions. (Doc. 71 ¶ 109; doc. 71-53). 
Between September 12, 2025 and October 31, 2025, the Individual 
Defendants resigned from Stockton and began working for Novus. (Doc. 71 ¶¶ 122–
27, 133–34, 137–44). At some point in or after October 2025, Stockton noticed the 
drastic reduction in credit pulls and became suspicious that its employees were either 
not soliciting new loans or were diverting loans to a competitor. (Doc. 71 ¶¶ 112–
13). It soon discovered the emails its employees had exchanged with Novus 
employees, as well as evidence that Mr. Hoffman had shared confidential 
information with Novus. (Doc. 71 ¶¶ 113–20). 
 
 

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II. DISCUSSION 
The Individual Defendants move to dismiss all the Alabama common law tort 
claims (Counts Four, Seven, Eight, Ten, and Twelve) as preempted by the ATSA. 
(Doc. 75 at 1, 3 –5). Twelve of the Individual Defendants (Mses. Harrell, Leopard, 
Kidd, Sherrell, Amara, Detulleo, Blagburn, McEwen, Dougherty, and Swearengin, 
and Messrs. Bryant and Farmer) move to be dismissed as defendants because the 
factual allegations against them are insufficient to state a claim. (Doc. 75 at 1, 6–11). 
The court will address preemptio n first, followed by the sufficiency of the 
allegations. 
1. Preemption 
The ATSA provides a statutory cause of action for misappropriation of trade 
secrets, which it defines as “ disclos[ing] or us[ing] the trade secret of another, 
without a privilege to do so .” Ala. Code § 8-27-3. It further provides that “[t] hose 
provisions of this chapter that are inconsistent with the common law of trade secrets 
supersede the common law; otherwise, this chapter should be construed to be 
consistent with the common law of trade secrets. ” Id. § 8-27 -6. The Alabama 
Supreme Court has held that the ATSA “ replace[s] common law tort remedies for 
the misappropriation of trade secrets.” Allied Supply Co. v. Brown, 585 So. 2d 33, 
37 (Ala. 1991) . The Individual Defendants argue that Brown and federal district 
court opinions interpreting Brown require dismissal of all the common law tort 

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claims in this action as preempted by the ATSA. (Doc. 75 at 3 –5). The court 
disagrees. 
In Brown, the plaintiff asserted that the defendants violated both common law 
and the ATSA by “breach[ing] their fiduciary duty by soliciting employees, 
customers, and vendors of [the plaintiff] while still employed by the corporation and 
by misappropriating confidential documents.” 585 So. 2d at 37. The trial court 
granted summary judgment in favor of the defendants on the ATSA claim but denied 
summary judgment on the common law claim. Id. at 36–37. The Alabama Supreme 
Court affirmed the grant of summary judgment on the ATSA claim. Id. at 36. But it 
held that the common law claim was in fact two claims: (1) breach of fiduciary duty 
by solicitating employees, customers, and vendors and (2) breach of fiduciary duty 
by misappropriating trade secrets and confidential documents. See id. at 37. The 
Court held that the breach of fiduciary duty by solicitation claim could proceed, but 
that the ATSA barred the breach of fiduciary duty by misappropriation claim because 
the ATSA “replace[d] common law tort remedies for the misappropriation of trade 
secrets, while leaving existing contract remedies or safeguards in place.” Brown, 585 
So. 3d at 37. 
Brown is the only decision from any Alabama state court addressing the 
ATSA’s effect on common law tort claims. Federal district courts have read Brown 
to mean that the ATSA bars any common law claim “based on the same underlying 

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facts giving rise to a claim under the ATSA.” Madison Oslin Inc. v. Interstate Res., 
Inc No. 11-1343, 2012 WL 4730877, at *6 (N.D. Ala. Sept. 30, 2012) ; see also 
Physiotherapy Assocs., Inc. v. ATI Holdings, LLC, 592 F. Supp. 3d 1032, 1044 (N.D. 
Ala. 2022) (citing Madison Oslin Inc.). This court disagrees. In Brown, the Alabama 
Supreme Court allowed a claim of breach of fiduciary duty by solicitation to proceed 
while barring a claim of breach of fiduciary duty by misappropriation, even though 
both claims were based on the same underlying facts (the theft and usage of customer 
and vendor lists the plaintiff alleged were trade secrets). See 585 So. 2d at 35–37. 
This court is bound by the Alabama Supreme Court’s interpretation of Alabama law. 
See United States v. Rowe, 143 F.4th 1318, 1326 (11th Cir. 2025) (“The highest court 
of the state wields ultimate authority over interpretations of state law.”). As a result, 
the dispositive question is not whether claims arise from the same underlying facts, 
but whether the claims seek a common law remedy for misappropriation of trade 
secrets. See 585 So. 2d at 37 (“[E]xisting common law tort theories of recovery have 
been replaced by the provisions of the [ATSA] . . . .”). 
In Count Four, Stockton asserts that the Individual Defendants breached their 
fiduciary duty by (1) providing Novus with Stockton’s confidential data; 
(2) soliciting Stockton’s borrowers to move to Novus; and (3) soliciting Stockton’s 
prospective borrowers to apply for loans with Novus. (Doc. 71 ¶ 204). Brown easily 
resolves the issue of whether the ATSA bars any part of this claim: just as in that 

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case, the breach of fiduciary duty claim fails to the extent it is based on the 
misappropriation of the documents but not to the extent it is based on solicitation. 
See 585 So. 2d at 37. The court therefore WILL GRANT the motion to dismiss the 
part of the claim asserting breach of fiduciary duty by providing Novus with 
Stockton’s confidential data but WILL DENY the motion to dismiss the other parts 
of the claim. 
In Count Seven, Stockton alleges that eight of the Individual Defendants 
converted Stockton’s “borrowers files and documents.” (Doc. 71 ¶¶ 229–30). Again, 
Brown makes clear that the ATSA bars this claim because the claim seeks a remedy 
for the misappropriation of what Stockton asserts are trade secrets. See 585 So. 2d 
at 37. The court therefore WILL GRANT the motion and WILL DISMISS Count 
Seven as to Mses. Swearengin, O’Rear, Detulleo, and Ashley Hoehn, a nd Messrs. 
Hoffman, Wagner, Goode, and Chris Hoehn on the basis that the ATSA bars the 
claim. 
In Count Eight, Stockton asserts that the Individual Defendants tortiously 
interfered with its business relationships with its borrowers and clients by diverting 
those borrowers and clients to Novus and failing to disclose that Stockton still 
employed the Individual Defendants. (Doc. 71 ¶¶ 237–38). In Count Ten, Stockton 
asserts that the Individual Defendants tortiously interfered with its business 
expectancy in the continuance of its relationship with current and prospective buyers 

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by diverting those relationships to Novus. ( Id. ¶¶ 253, 256). These claims do not 
seek a remedy for the misappropriation of confidential documents but instead for the 
diversion of borrowers and clients (and, in Count Eight, for the failure to disclose 
the Individual Defendants’ employment status) . See Brown, 585 So. 2d at 37. 
Accordingly, the court WILL DENY the motion to dismiss Counts Eight and Ten as 
barred by the ATSA. 
In Count Twelve, Stockton alleges that all defendants engaged in a conspiracy 
to divert current and prospective clients to Novus, interfere with Stockton’s 
contractual relations, and interfere with Stockton’s expectancy of continued business 
relationships. (Doc. 71 ¶¶ 268–72). This count does not allege that the Individual 
Defendants conspired to misappropriate trade secrets or confidential documents. 
(See id.). Because it is limited to claims that the court has held may proceed, the 
conspiracy claim may also proceed. The court WILL DENY the motion to dismiss 
Count Ten as barred by the ATSA. 
2. Sufficiency of the Allegations 
Twelve of the Individual Defendants contend that the allegations against them 
fail because the complaint do es not (1) identify how Stockton’s consumer contact 
information constitutes a trade secret or (2) allege how they used or shared the trade 
secrets. (Doc. 75 at 6–11). 

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To survive a Rule 12(b)(6) motion, a party must “plead ‘a claim to relief that 
is plausible on its face.’” Butler , 685 F.3d at 1265 (quoting Bell Atl. Corp. v. 
Twombly, 550 U.S. 544, 570 (2007)). In response to the Individual Defendants’ 
motion to dismiss, Stockton inexplicably relies on a long -outdated pleading 
standard. (Doc. 77 at 11) (citing Swierkiewicz v. Sorema N.A. , 534 U.S. 506, 514 
(2002) (“[A] court may dismiss a complaint only if it is clear that no relief could be 
granted under any set of facts that could be proved consistent with the allegations.”), 
overruled in relevant part by Twombly, 550 U.S. at 562–63 (explaining that the “‘no 
set of facts’ language . . . has earned its retirement”). The correct standard is facial 
plausibility: “A claim has facial plausibility when the plaintiff pleads factual content 
that allows the court to draw the reasonable inference that the defendant is liable for 
the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 
For their part, the Individual Defendants make general arguments without 
reference to the elements of any of the claims they challenge. (Doc. 75 at 6–11). The 
court will not undertake an analysis the Individual Defendants declined to do and 
will instead limit its discussion to the generalized arguments presented by the 
Individual Defendants. 
The Individual Defendants’ first argument is that Stockton has not identified 
the consumer data at issue with enough specificity. (Doc. 75 at 7 –8). But the 
complaint alleges that the documents identified Stockton’s “actual and prospective 

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borrowers and their mortgage loan needs, which include confidential personal 
information, such as social security numbers, credit history and score, employment 
details, assets and liabilities, bank statements, tax returns and other financial data 
and records,” as well as “mortgage loan related pricing and loan programs.” (Doc. 
71 ¶ 31–32). That suffices to give the Individual Defendants “ fair notice” of the 
records and information that Stockton asserts are trade secrets. See Erickson v. 
Pardus, 551 U.S. 89, 93 (2007) (“Specific facts are not necessary.”). 
The Individual Defendants also contend that Stockton has not established 
“how the generic consumer contact information” is a trade secret. (Doc. 75 at 8). In 
support, it relies on a non- binding district court opinion that concluded a plaintiff 
inadequately pleaded the existence of trade secrets when the plaintiff identified 
“trade secrets, candidate lists, and valuable business information” as the trade secrets 
at issue. (Id. at 7–8); see M5 Mgmt. Servs., Inc. v. Yanac, 428 F. Supp. 3d 1282, 1287 
(N.D. Ala. 2019); see also id. at 1289 (reiterating the plaintiff’s argument that it had 
identified as trade secrets “sensitive and valuable business information, trade secrets, 
pricing information, and prospect lists”) (alteration accepted). But the allegation in 
this case is distinguishable: as set out above, Stockton identified “ confidential 
personal information, such as social security numbers, credit history and score, 
employment details, assets and liabilities, bank statem ents, tax returns and other 
financial data and records.” (Doc. 71 ¶ 31). 

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The Individual Defendants next argue that the complaint is in adequate 
because it alleges only that “these defendants had access to customer data, left 
[Stockton]’s employment, and in a conclusory fashion, that the defendants 
transferred existing and prospective customers, and their data, to Novus.” (Doc. 75 
at 8). T hey contend that absent specifics about how the Individual Defendants 
transferred the data and customers, the allegation is conclusory . ( Id.). The court 
disagrees. The Individual Defendants have conceded that the complaint alleges they 
“transferred existing and prospective customers, and their data, to Novus.” (Id.) That 
allegation is not “conclusory.” A conclusory allegation is one that draws a legal 
conclusion, such as that a defendant breached a duty or a contract. See, e.g., Franklin 
v. Curry , 738 F.3d 1246, 125 1 (11th Cir. 2013) (explaining that “ a formulaic 
recitation of the elements of a cause of action” is conclusory). An allegation that the 
Individual Defendants transferred existing and prospective customers to Novus is 
not a legal conclusion; it is the factual allegation in support of Stockton’s position 
that the Individual Defendants breached a duty (or a contract, or a statute). 
The Individual Defendants offer slightly more argument about Mses. Detulleo 
and Swearengin (doc. 75 at 9 –10), but those arguments also fail. The complaint 
alleges that Ms. Detulleo “was sending [customer and prospective customer] files to 
Novus” while employed by Stockton. (Doc. 71 ¶ 110). And the complaint alleges 
that Ms. Swearengin, while still employed by Stockton, was included in an email 

15 
between a Stockton employee and a Novus employee about moving a loan to Novus. 
(Id. ¶ 109; doc. 71 -53). Construed in the light most favorable to Stockton, this 
supports a reasonable inference that Ms. Swearengin was involved in diverting that 
loan to Novus. See Iqbal, 556 U.S. at 678 (“A claim has facial plausibility when the 
plaintiff pleads factual content that allows the court to draw the reasonable inference 
that the defendant is liable for the misconduct alleged.”). 
The Individual Defendants’ final argument is that after dismissal of “the 
inadequately pleaded claims against Ms. Dougherty,” a “potentially viable” breach 
of contract claim against her should be dismissed for lack of subject matter 
jurisdiction. (Doc. 75 at 10). The court rejects this argument because it depends on 
the success of the Individual Defendants’ other arguments about the viability of 
Stockton’s claims. 
The court WILL DENY the motion to dismiss the Individual Defendants 
based on the failure to make sufficient allegations about them. 
3. Request for Default Judgment 
In its response brief, Stockton asks for entry of default judgment against the 
Individual Defendants because they have not filed answers. (Doc. 77 at 15 –16). “A 
request for a court order must be made by motion.” Fed. R. Civ. P. 7(b)(1). The court 
does not consider informal requests made in briefs to be proper motions. Cf. 
Rosenberg v. Gould, 554 F.3d 962, 967 (11th Cir. 2009) (“Where a request for leave 

16 
to file an amended complaint simply is imbedded within an opposition 
memorandum, the issue has not been raised properly. ”) (quotation marks omitted). 
Even if Stockton had filed its request as a separate motion, Stockton has not sought 
entry of default, a necessary prerequisite to entry of a default judgment. See 
Fed. R. Civ. P. 55(a). The court therefore will not consider Stockton’s request. 
4. Inconsistencies in Title and Body of Counts 
Two counts of the complaint have inconsistencies between the defendants 
identified in the title and those identified in the body . The title of Count Five lists 
Ms. Swearengin as a defendant but does not list Ms. Detulleo (doc. 71 at 30), while 
the body of the count does not mention Ms. Swearengin but does mention 
Ms. Detulleo (see id. ¶¶ 209–17). Likewise, the title of Count Six lists 
Ms. Swearengin as a defendant (doc. 71 at 31), but the body of the count does not 
mention her (id. ¶¶ 222–24). Because the court is left unsure which defendants are 
sued in those counts, the court WILL ORDER Stockton to file a third amended 
complaint clarifying the defendants named in each count. 
III. CONCLUSION 
The court WILL GRANT IN PART and WILL DENY IN PART the 
Individual Defendants’ motion to dismiss the complaint. The court WILL GRANT 
the motion and WILL DISMISS WITH PREJUDICE (1) the part of Count Four 
asserting breach of fiduciary duty by providing Novus with misappropriated data 

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and (2) Count Seven as to Mses. Swearengin, O’Rear, Detulleo, and Ashley Hoehn, 
and Messrs. Hoffman, Wagner, Goode, and Chris Hoehn. The court WILL DENY 
the motion with respect to the remaining claims. 
The court WILL ORDER Stockton to file a third amended complaint 
clarifying which defendants are named in each count. 
DONE and ORDERED this June 15, 2026. 
 
 
 
 _________________________________ 
 ANNEMARIE CARNEY AXON 
 UNITED STATES DISTRICT JUDGE 
 
 

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