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PRUDENTIAL INS. CO. OF AMERICA v. STELLA

February 10, 1998

THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
v.
THOMAS M. STELLA



The opinion of the court was delivered by: JOYNER

 JOYNER, J.

 February 10, 1998

 This civil action is once again before us for disposition of the parties' cross-motions for summary judgment. For the reasons which follow, defendant's motion shall be granted in part and plaintiff's motion shall be denied in its entirety.

 History of the Case

 As discussed at greater length in the Findings of Fact recently issued in this court's Decision on plaintiff's motion for preliminary injunction, this action arose out of defendant, Thomas Stella's resignation as a Prudential insurance agent on August 16, 1996 to work for Allstate Insurance Company. On June 19, 1997, Prudential filed this suit against Stella based upon diversity jurisdiction under the common law theories of breach of fiduciary duty, breach of contract, misappropriation of trade secrets, unfair competition, tortious interference with contractual relations and conversion. That same date, plaintiff filed its motion seeking a preliminary injunction to prevent defendant from continuing to use Prudential's client files and confidential client information to solicit his former customers for his new company and for his own benefit.

 Following the hearing on the motion for preliminary injunctive relief, defendant filed a motion for summary judgment and/or for partial summary judgment in which he essentially argues: (1) that plaintiff has no legitimate, reasonable entitlement to an injunction against him given that defendant's former Prudential clients contacted him and thus the complaint against him should be dismissed with prejudice; (2) that the non-competition covenant included in the agent's agreement is void and unenforceable for lack of consideration and thus plaintiff is entitled to neither equitable nor monetary relief on the basis of those covenants; and (3) that because he has since returned all of Prudential's client files and documents in his possession to the company, it has no right to either equitable or monetary relief as the result of his having failed to immediately return those materials.

 In response, plaintiff filed a cross-motion for summary judgment against defendant in which it reiterates the same arguments which it advanced in support of its motion for preliminary injunction. As we have already determined that the restrictive covenants are enforceable as a consequence of their having been amended and superseded by the collective bargaining agreement between Prudential and the AFL-CIO & CLC and have denied plaintiff's preliminary injunction motion, we incorporate by reference those portions of our Decision in which those issues are addressed. For the reasons outlined below and the basis of the record presently before us, we cannot agree with defendant that he is entitled to judgment as a matter of law on all of plaintiff's claims.

 Standards Applicable to Summary Judgment Motions

 The legal standards and principles to be followed by the district courts in resolving motions for summary judgment are clearly set forth in Fed.R.Civ.P. 56. Subsection (c) of that rule states, in pertinent part, ... The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. A summary judgment, interlocutory in character, may be rendered on the issue of liability alone although there is a genuine issue as to the amount of damages.

 In this way, a motion for summary judgment requires the court to look beyond the bare allegations of the pleadings to determine if they have sufficient factual support to warrant their consideration at trial. Liberty Lobby, Inc. v. Dow Jones & Co., 267 U.S. App. D.C. 337, 838 F.2d 1287 (D.C. Cir. 1988), cert. denied, 488 U.S. 825, 109 S. Ct. 75, 102 L. Ed. 2d 51 (1988). See Also : Aries Realty, Inc. v. AGS Columbia Associates, 751 F. Supp. 444 (S.D. N.Y. 1990).

 As a general rule, the party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion and identifying those portions of the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986). In considering a summary judgment motion, the court must view the facts in the light most favorable to the party opposing the motion and all reasonable inferences from the facts must be drawn in favor of that party as well. U.S. v. Kensington Hospital, 760 F. Supp. 1120 (E.D. Pa. 1991); Schillachi v. Flying Dutchman Motorcycle Club, 751 F. Supp. 1169 (E.D. Pa. 1990).

 When, however, "a motion for summary judgment is made and supported [by affidavits or otherwise], an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response...must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate may be entered against [it]." Fed.R.Civ.P. 56(e).

 A material fact has been defined as one which might affect the outcome of the suit under relevant substantive law. Boykin v. Bloomsburg University of Pennsylvania, 893 F. Supp. 378, 393 (M.D.Pa. 1995) citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). A dispute about a material fact is "genuine" if "the evidence is such that a reasonable jury could ...


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