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Deangelo Brothers, Inc. v. Clarius

August 17, 2006

DEANGELO BROTHERS, INC. PLAINTIFF
v.
DAVID G. CLARIUS DEFENDANT



The opinion of the court was delivered by: Chief Judge Vanaskie

MEMORANDUM

Plaintiff DeAngelo Brothers, Inc. ("DBI") has moved for a preliminary injunction to restrain its former employee, Defendant David G. Clarius, from violating a "Non-Disclosure and Non-Competition Agreement." While DBI has established a reasonable likelihood of prevailing on the merits, it has not demonstrated that breach of the agreement will cause the immediate irreparable harm necessary to warrant the extraordinary equitable relief sought. Accordingly, the motion for a preliminary injunction will be denied.

I. BACKGROUND

A. Procedural History

In late December of 2005, DBI learned that Clarius, who had left the employ of DBI over 14 months earlier, was performing storm water maintenance work for Wal-Mart Stores, a significant DBI account before Clarius left DBI. DBI, through counsel, wrote to Clarius in January of 2006, asserting that Clarius was in breach of a non-disclosure and non-competition agreement signed by Clarius during his employment with DBI. On February 24, 2006, after Clarius refused to suspend his storm water maintenance work with Wal-Mart, DBI commenced this action by filing a complaint in equity in the Court of Common Pleas of Luzerne County. On March 2, 2006, DBI petitioned the Luzerne County Court for preliminary injunctive relief. The following day, Clarius, a citizen of the State of Florida, removed the litigation to this Court on the ground that it involved citizens of different states and an amount in controversy exceeding $75,000.

DBI did not immediately renew its request for preliminary injunctive relief in this Court. Instead, it elected to "await [t]he outcome of the bids it had submitted to WAL-MART for storm water maintenance work in March of 2006 before requesting the scheduling of a preliminary injunction hearing by this Court." (Plaintiff's Proposed Conclusions of Law (Dkt. Entry 18) at ¶ 22.) At a case management conference conducted on May 5, 2006, after DBI learned that it had not received any Wal-Mart work, DBI requested the scheduling of a hearing on its request for preliminary injunctive relief. As an accommodation to defense counsel's trial schedule, however, DBI "agreed to refrain from requesting that the hearing be scheduled in May. . . ." (Id. at ¶ 24.) The evidentiary hearing was conducted on June 29 and 30, 2006.

In connection with the hearing, both parties submitted proposed findings of fact, annotated with the opposing party's position as to whether each proposed finding was disputed or undisputed. The parties also presented legal briefs and proposed conclusions of law. The matter is ripe for decision.

B. Findings of Fact

1. DBI is a Pennsylvania corporation with its corporate headquarters located at 100 North Conahan Drive, Hazleton, Pennsylvania.

2. Clarius is a competent, adult individual with an address of 265 S.E. Todd Avenue, Port St. Lucie, Florida 34983.

3. From 1994 until November 19, 1999, Clarius worked for Aquagenix out of that entity's Fort Lauderdale, Florida office. Aquagenix was involved in the business of providing maintenance services for storm water management systems.

4. Clarius's last position with Aquagenix was the Branch Manager of the Fort Lauderdale office.

5. DBI is engaged in several areas of business, including the provision of comprehensive storm water maintenance services to customers such as Wal-Mart Stores, Inc. ("Wal-Mart").

6. In November of 1999, DBI acquired the assets of Aquagenix, which was based in Florida.

7. Wal-Mart was a customer of Aquagenix before November 19, 1999.

8. Prior to November 19, 1999, Clarius was the employee at Aquagenix who was the primary contact person with Wal-Mart.

9. Prior to November 19, 1999, Clarius had a pesticide applicator's license in the state of Florida.

10. Prior to November 19, 1999, Clarius had training and education in aquatic weed control, aquatic plant culture, and re-vegetation.

11. On or about November 19, 1999, Clarius attended a meeting at the Hilton Hotel in West Palm Beach, Florida conducted by officials of DBI.

12. At that meeting, Clarius was supplied with a copy of DBI's Non-Disclosure and Non-Competition Agreement (the "Agreement"), and was informed that executing the Agreement was a condition of employment with DBI.

13. DBI requires all its employees to execute a non-competition agreement, regardless of the employee's position with DBI.

14. On November 19, 1999, Clarius applied for employment with DBI.

15. As part of the DBI employment application process, Clarius signed a form that, in relevant part, stated:

I agree and understand that should I be employed I will not at any time or in any manner, either directly or indirectly, divulge, disclose or communicate to any person, firm or corporation in any manner whatsoever any confidential information concerning any matters affecting or relating to the business of the Employer. I further understand that I will be asked to sign a Confidentiality/Non-Compete Agreement as a condition of employment. [Emphasis added.]

16. Clarius commenced employment with DBI on November 19, 1999.

17. Clarius did not execute the Agreement containing the restrictive covenants at the time he commenced his employment with DBI.

18. On December 27, 1999, without having signed the Agreement, Clarius submitted the following document to DBI:

Please except [sic] this letter as two weeks formal written notice of my resignation. For reasons both personal and professional I feel it necessary to end my employment with Aquagenix/DeAngelo Bros. Thank you for your cooperation in this matter.

19. Three days later, on December 30, 1999, Clarius rescinded his resignation. At no time prior to October 1, 2004 did Clarius leave the employ of DBI.

20. On January 13, 2000, Clarius executed the Agreement containing the restrictive covenants at issue here.

21. The Agreement provides, in relevant part, as follows:

C. Prior to the commencement of employment, Employer and Employee agreed that as a condition of such employment, Employee would be required to, and would in fact agree to certain terms with respect to the non-disclosure of information concerning the business of the employer and non-competition with the Employer during his/her employment, as well as in the event said employment is terminated . . . .

D. Following careful consideration and the opportunity to review the provisions of this Agreement with Counsel of employee's choice, the employee is willing to make and confirm certain agreements with the Employer as are contained in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties do hereby agree as follows:

1. Employer and Employee each agree that the statements contained in the Background paragraphs above are true and correct. Consequently, in consideration of the employment being offered to the Employee by the Employer and other good and valuable consideration, employee agrees to be bound by the terms of this Agreement. Employee further acknowledges that this Agreement was presented to Employee by Employer for his/her review and signature on or before the date employment commenced. In order that the Employee have additional time to review the Agreement, personally and with an attorney if he/she so chooses the Employee understands that any and all offers of employment extended to the Employee is conditional until such time as the Employee executes and returns this Agreement to the Employer, in which case will not be more than thirty (30) days from the Employee's original date of employment.

2. Employee's obligations to Employer are special, unique and extraordinary and during the course or employment he/she will receive proprietary information which is confidential and which greatly affects the effective and successful conduct of the business of the Employer and the Employer's goodwill. Such proprietary information is provided to Employee in confidence due to his/her employment with Employer and his/her need to know such information in order to completely and competently perform his/her duties and obligations on behalf of the Employer. As used herein "proprietary information" shall mean any and all customer lists or other trade secrets of other confidential information pertaining to the financial condition, business affairs or business prospects of the Employer or the Employer's affiliates . . . .

4. [D]isclosure of any such proprietary or confidential information, whether directly or indirectly, including copying or removing of any records of the Employer except in the normal course of business or with the express consent of Employer would be deemed a material breach of the Agreement.

5. The parties acknowledge that as prime consideration for Employee's employment by the Employer, the Employee has agreed and represented to the Employer that for a period of twenty-four (24) months after the termination of Employee's employment, whether the Employee voluntarily or involuntarily resigns or is terminated by the Employer for no reason or for any reason, the Employee will not, directly or indirectly, engage in activities for any person, business concern or other entity that competes with the Employer in any area of the Employer's Business in which the Employee has had any significant responsibilities with the Employer during the time of his/her employment, either for his/her own benefit or for the benefit of any other person, business concern or other entity whatsoever, within any county, district or parish in the continental United States in which the Employee worked while employed by the Employer and/or in the case of management employees, within the entire continental United States expressly including, but not limited to the duties which the Employee has conducted or will conduct himself/herself on behalf of the Employer. This includes the covenant that during this time frame, the Employee will not become an officer, employee, agent, shareholder, partner, director, consultant or otherwise affiliated with any person, business concern or other entity that competes with Employer in any such area of the Employer's Business within any such county, district or parish of any such state, province or district unless receiving prior written approval of the Employer's President.

In addition, and without limiting the generality of the previous paragraph, Employee specifically agrees that for a period of twenty-four (24) months after the termination of his/her employment, . . . the Employee will not, directly or indirectly, either for his/her own benefit or for the benefit of any other person, business concern or other entity whatsoever, engage in any activities similar to activities engaged in by Employee while in the employ of Employer for any person, firm, company, corporation or governmental entity, which was a customer or client of employer during the last twelve (12) months in which Employee was employed by Employer.

6. The Employee further agrees that during the period of twenty-four (24) months immediately after the termination of his/her employment with the Employer, . . . he/she will not . . . make known or divulge the names or addresses of any of the customers or clients or prospective customers or clients of the Employer at the time he/she entered the employ of Employer or with whom he/she became acquainted after entering the employ of Employer, to any person, business concern or other entity, and that he/she will not, directly or indirectly, either for himself/herself or for any other person, firm, company or corporation, call upon, solicit, divert, or take away or attempt to solicit, divert or take away any of the customers, clients or any prospective customers or clients, of the Employer upon whom he/she called or whom he/she solicited or to whom he/she catered or with whom he/she became acquainted with during his/her employment with the Employer.

7. The Employee and Employer acknowledge and agree that the duration of the covenants set forth in paragraphs 5 and 6 have been determined by the parties to be the minimum period of time necessary to secure protection of the Employer's business.

8. The Employee further agrees that he/she will not, during the twenty-four (24) month period subsequent to the date of the termination of Employee's employment, . . . hire or engage the services of, or engage in a business enterprise with, any person who was an employee of the Employer during Employee's employment period preceding termination, nor will Employee induce any such person to terminate his/her employment with the Employer, or recommend that such person be hired, engaged or induced to terminate his/her employment with the Employer without prior written approval of the Employer's President. This prohibition of hiring, solicitation or inducement by the Employee is ...


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