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Autry v. Acosta, Inc.

Court of Appeals of Oklahoma, Division IV

November 14, 2017

CARRIE A. AUTRY, Plaintiff/Appellant,
ACOSTA, INC., Defendant/Appellee.

          Mandate Issued: 02/07/2018


          Mark Hammons, HAMMONS, GOWENS, HURST & ASSOCIATES, Oklahoma City, Oklahoma, for Plaintiff/Appellant

          W. Joseph Miguez, McGUIRE WOODS LLP, Austin, Texas, for Defendant/Appellee


         ¶1 Carrie A. Autry appeals a temporary injunction enjoining her from (1) recruiting or hiring the employees of her former employer, Acosta, Inc., (2) using Acosta's confidential or proprietary information, or (3) soliciting or selling to named clients she represented while employed by Acosta. Was granting the temporary injunction to enforce the non-solicitation provision in question an abuse of discretion? We conclude it was, and reverse the order of the trial court.


         ¶2 In her June 2016 petition, Autry sought declaratory and injunctive relief against Acosta, alleging she resigned her employment with Acosta and was seeking employment with "Cruise Marketing, Inc., which [she] agrees is doing the same general kind of work as Acosta." Autry said Acosta threatened her with a lawsuit for violating or threatening to violate a non-compete clause in her contract with Acosta and that "Acosta is affirmatively attempting to interfere with [her] employment with Cruise."

         ¶3 The Non-Solicitation Agreement, dated December 1, 2008, provides in relevant part:

3. Non-Compete Restrictions. Employee agrees that during the term of Employee's employment with Acosta, Employee shall not, on Employee's own behalf or on behalf of others, in any capacity whatsoever, including, without limitation, as an owner, salesperson, sales manager, consultant or otherwise, directly or indirectly, engage[] in any other business that provides, in whole or in part, the same or similar services and/or products offered by Acosta as part of its Business. In the event of any violation by the Employee of this covenant against competition, the term of this covenant shall automatically be extended for a period of one (1) year from and after the later of: (i) the date upon which the Employee permanently ceases such violation; or (ii) the date of the entry by a court of competent jurisdiction of an order or judgment enforcing such covenant, but in no event shall the term of this covenant against competition be extended for a period beyond two (2) years from the date of termination of Employee's employment with Acosta.

         Section 4 of the Non-Solicitation Agreement is titled "Non-Solicitation" and subsection (a) is titled "Business and Accounts." This subsection covers termination, both with and without cause. The "Termination of Employee for Cause" clause states:

Employee agrees that for a period of twelve (12) months following termination by Employee, for any reasons, including resignation, or by Acosta for Cause, Employee shall not, on Employee's own behalf or on behalf of others, in any capacity whatsoever, including, without limitation, as an owner, salesperson, sales manager, consultant, or otherwise, directly or indirectly, engage in the business of selling, soliciting, or promoting the sale of the Clients that Employee represented while employed by Acosta.

         The Agreement also provides that Autry "shall not, directly or indirectly solicit or discuss with any employee of Acosta the employment of such Acosta employee by any other commercial enterprise other than Acosta" or attempt to recruit or hire, or recruit or hire an Acosta employee. The Agreement also covers confidential information.

         ¶4 In its answer, Acosta admitted some of Autry's allegations, denied others, and asserted as affirmative defenses unclean hands, estoppel, failure to state a claim, and the relief sought requires an improper advisory opinion. Acosta asserted counterclaims for breach of the Non-Solicitation Agreement by Autry's solicitation of Acosta's employees and established clients, breach of the Agreement's confidentiality provision, misappropriation of Acosta's proprietary business information, violation of Oklahoma's Uniform Trade Secrets Act, breach of fiduciary duty, tortious interference with prospective economic advantage, and conspiracy. Acosta asked for injunctive relief, a declaration that the Agreement is valid and enforceable, damages, and attorney fees and costs. Acosta also filed an application for a temporary restraining order and temporary injunction.

         ¶5 On June 23, 2016, the trial court announced it was entering a temporary restraining order directing Autry to refrain from (1) soliciting any Acosta employees, (2) sharing any electronic information or documents that she obtained from Acosta, and (3) directly soliciting any clients on a list titled "2016 Oklahoma bakery/deli clients."

         ¶6 The trial court held an evidentiary hearing on Acosta's request for a temporary injunction. Danny Ray Karst, senior vice-president and manager of Acosta, testified that MDS Foods, Reser's, and General Mills terminated their relationship with Acosta on May 23, 2016. Maple Hurst terminated its relationship with Acosta on May 31, 2016, and Eddy Packing did so on May 26, 2016. Autry resigned on May 20, 2016. Karst testified that other companies also terminated their relationships with Acosta.

         ¶7 Karst testified that Autry purchased an external hard drive in early April 2016 and "expensed it to the company and got reimbursed." When he asked why she purchased the hard drive, "She said she does a lot of work from home, and it is easier for her to do work from home with an external hard drive." He stated Autry had a company-issued laptop which she could use remotely for "full access to the Acosta share-point site."

         ¶8 During cross-examination, Karst testified that Acosta now has possession of the external hard drive. He admitted that, if Autry took the laptop home with her, she would have access to Acosta's information. He stated that although he had been told that Autry copied information to her home computer, he did not have personal knowledge that she did so or that she provided any of that information to Cruise Marketing. He stated that the two employees who reported directly to Autry left Acosta on the same day as Autry. Karst "agree[d] that Cruise Marketing is not subject to any contractual restraint on soliciting [Acosta's] employees." Karst testified he had personal knowledge that Autry conveyed Cruise Marketing's employment offers to the two former Acosta employees.

         ¶9 David Dunlevy, Autry's supervisor at Acosta, testified that Tina Genow and Samuel Shinn reported to Autry when they were employed by Acosta. Dunlevy stated that neither Genow nor Shinn individually submitted his or her resignation to him. Autry informed him on May 20, 2016, that she was leaving Acosta and Genow and Shinn were leaving too. Dunlevy testified that Autry sent an email on May 25, 2016, to Alfonso Castillo, who "is the person responsible for King's Hawaiian sales in Oklahoma" and asked him, "Have you made a decision on support?" Dunlevy said, "What this meant to me was that [Autry] was asking if King's Hawaiian was going to go to Cruise Marketing." Acosta offered exhibits containing offer letters from Cruise Marketing to Genow and Shinn. The offer letters were sent by Autry through her Acosta email address to Genow and Shinn on May 19th, before Autry resigned from Acosta.

         ¶10 Shinn testified that during the time he was employed by Acosta, Autry did not solicit him to leave Acosta for Cruise Marketing. He testified Jeff Lober solicited him to leave Acosta to work for Cruise Marketing. Autry did not negotiate his employment with Cruise Marketing, negotiate his terms of employment, or suggest or draft his employment contract terms. He stated he made his decision to go to work for Cruise Marketing before the written employment agreement was ...

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