84 Lumber Co., L.P. v. Houser

• Decision Date: 06 August 2010
• Docket Number: No. 2009-P-0056.,2009-P-0056.
• Citation: 936 N.E.2d 131,2010 -Ohio- 3683
• Parties: 84 LUMBER COMPANY, L.P., Appellant, v. HOUSER et al.; McClain, Appellee.
• Court: Ohio Court of Appeals

936 N.E.2d 131

2010 -Ohio- 3683

84 LUMBER COMPANY, L.P., Appellant,

v.HOUSER et al.; McClain, Appellee.

No. 2009-P-0056.

Court of Appeals of Ohio,

Eleventh District, Portage County.

Decided Aug. 6, 2010.

Brouse & McDowell, Christopher J. Carney, and Christopher F. Carino, Akron, OH, for appellant.

Sidney N. Freeman Co., L.P.A. and Sidney N. Freeman, Akron, OH, for appellee.

TIMOTHY P. CANNON, Judge.

*584 {¶ 1} Appellant, 84 Lumber Company, L.P., appeals the judgment entered by the Portage County Court of Common Pleas. The trial court granted a motion for summary judgment filed by appellee, Chad McClain.

{¶ 2} In December 2007, McClain began working as an outside salesman for 84 Lumber from its Ripley, West Virginia store. When he began his employment, McClain signed a "proposal." According to this document, McClain was to be compensated at a rate of 20 percent of the adjusted gross profit of his sales. For the first six months of his employment, McClain received a guaranteed weekly draw of $865.38. This draw was an advance on his commissions. If his commissions exceeded the advances, McClain was to receive the difference. However, if there was a negative balance at the end of the advance period, it would be forgiven. The agreement provided that the advances would end in June 2008, at which time McClain would be compensated solely based on his commissions.

{¶ 3} In June 2008, McClain signed another "proposal." This proposal again stated that McClain would be compensated at a rate of 20 percent of the adjusted gross profit of his sales. This second proposal provided that McClain would receive a draw "in the amount of $576.92 per week, to be paid on a bi-weekly cycle." This draw was also an advance of his commissions. If his commissions exceeded the advance, McClain would receive the difference. However, contrary to the initial proposal, the second proposal provided, "if there is any negative balance at the end of this advance, it will be paid back." Further, unlike the initial proposal, the second proposal stated, "A no compete agreement must be signed for this draw to be implemented."

{¶ 4} Also in June 2008, McClain signed a "standard confidentiality and noncompetition agreement." Among other matters, this agreement provided that McClain would not, for a period of two years after his employment with 84 Lumber ends, engage in any business similar to 84 Lumber or that is competitive *585 with 84 Lumber within a 25-mile radius of 84 Lumber's Ripley, West Virginia location.

{¶ 5} In January 2009, McClain left 84 Lumber and began working for Carter Lumber. Upon learning of his employment at Carter Lumber, general counsel for 84 Lumber sent a letter to Carter Lumber informing it about the noncompetition agreement that 84 Lumber had with McClain and asking for an assurance that McClain was not violating that agreement. In response, John Daily, counsel for Carter Lumber, sent a letter to 84 Lumber stating that McClain was working at the Carter Lumber store in Parkersburg, West Virginia, which is more than 25 miles from Ripley, West Virginia.

{¶ 6} 84 Lumber filed the instant action against Carter Lumber, Charles Houser, and McClain.¹ The complaint alleged causes of action for breach of contract, misappropriation of trade secrets, and tortious interference with contract. In addition,the complaint sought an injunction prohibiting future conduct of the defendants.

{¶ 7} McClain filed a motion to dismiss the complaint for lack of jurisdiction.² In this motion, pursuant to Civ.R. 12(B)(2), McClain asserted that the trial court did not have personal jurisdiction over him. In addition, pursuant to Civ.R. 12(B)(3), McClain argued that Portage County, Ohio was not the proper venue. 84 Lumber filed a memorandum in opposition to McClain's motion to dismiss. Attached to this memorandum was an affidavit from Peter Martin. Martin states that he is an employee of 84 Lumber and that (1) McClain sold products to customers in Ohio when he worked at 84 Lumber, (2) McClain sells products to Ohio customers in his position with Carter Lumber, (3) McClain specifically sold products to Workman Construction, which is located in Marietta, Ohio, and (4) 84 Lumber was outbid by Carter Lumber for the Workman Construction job.

{¶ 8} McClain filed an "amended motion to dismiss, or motion for summary judgment." Therein, McClain again sought the dismissal of the complaint pursuant to Civ.R. 12(B)(2) and (3). Alternatively, McClain asked the trial court to enter summary judgment in his favor. McClain attached several documents to this combined motion, including a copy of the noncompetition agreement and his affidavit.

{¶ 9} On July 2, 2009, the trial court issued a judgment entry granting McClain's motion for summary judgment. However, that same day, 84 Lumber *586 filed a memorandum in opposition to McClain's motion for summary judgment. 84 Lumber attached several documents to its memorandum, including (1) a copy of the initial proposal signed by McClain in December 2007, (2) a copy of the second proposal signed by McClain in June 2008, (3) a copy of the noncompetition agreement, and (4) an affidavit from Harry Smith. In his affidavit, Smith asserts that he is a private investigator and that he observed McClain at the Carter Lumber store in Ripley, West Virginia. Later that day, Smith asserts that he observed McClain unload lumber from his truck at a residence in Ripley that was having its roof repaired or replaced.

{¶ 10} Since the trial court did not consider its response in opposition to the motion for summary judgment, 84 Lumber filed a motion for reconsideration of the trial court's judgment entry granting McClain's motion for summary judgment. McClain filed a brief in opposition to 84 Lumber's motion for reconsideration. In response to McClain's brief in opposition, 84 Lumber filed a reply in support of its motion for reconsideration. Then, on July 21, 2009, McClain filed a reply in support of his amended motion to dismiss or motion for summary judgment. On July 24, 2009, 84 Lumber filed a surreply in opposition to McClain's amended motion to dismiss or motion for summary judgment. 84 Lumber attached a second affidavit from Martin to this surreply. In his affidavit, Martin states that McClain received highly confidential information when working at 84 Lumber, including 84 Lumber's pricing structure, cost structure, and profit margins. Further, Martin states that "[w]ith intimate knowledge of 84 Lumber's cost structure and profit margins McClain was able to undercut 84 Lumber when bidding on jobs for Carter Lumber."

{¶ 11} On August 6, 2009, the trial court issued a second judgment entry regarding McClain's motion for summary judgment. The trial court indicated that it had mistakenlyerred by granting McClain's motion for summary judgment prior to considering 84 Lumber's brief in opposition. Accordingly, the trial court reconsidered the issue in light of all pleadings to date. Thereafter, the trial court again granted McClain's motion for summary judgment.

{¶ 12} In addition, the trial court included language in its entry pursuant to Civ.R. 54(B) indicating that the court intended the entry to be a final, appealable order and that there was no just reason for delay.

{¶ 13} 84 Lumber has filed a timely notice of appeal from the trial court's August 6, 2009 judgment entry. 84 Lumber raises four assignments of error. Its first assignment of error is:

{¶ 14} "The trial court erred in determining that it lacked personal jurisdiction over McClain."

*587 {¶ 15} This court reviews a trial court's determination on whether the court has personal jurisdiction over a party under the de novo standard of review. (Citation omitted.) Snyder Computer Sys., Inc. v. Stives, 175 Ohio App.3d 653, 2008-Ohio-1192, 888 N.E.2d 1117, at ¶ 11.

{¶ 16} As this court has previously observed, " 'if a trial court fails to specifically rule on a motion * * *, it is presumed [that] the trial court has overruled that motion.' " Tenan v. Huston, 165 Ohio App.3d 185, 2006-Ohio-131, 845 N.E.2d 549, at ¶ 53, quoting Niepsuj v. Niepsuj, 9th Dist. No. 21888, 2004-Ohio-4201, 2004 WL 1778883, at ¶ 10. In this matter, the trial court did not specifically rule on McClain's motion to dismiss. While the trial court makes a reference about its inability to enjoin actions that occur in West Virginia and that it has no jurisdiction to address activities that occur in another state, we believe that these comments of the trial court go to the issue of subject-matter jurisdiction, as opposed to personal jurisdiction. Moreover, the fact that the trial court proceeded to the merits of McClain's motion for summary judgment supports the conclusion that the trial court denied his motion to dismiss. Accordingly, we will presume that the trial court denied McClain's motion to dismiss.

{¶ 17} Generally, when considering whether a court has personal jurisdiction over an out-of-state defendant, the court should determine "(1) whether the state's 'long arm' statute and applicable rule of civil procedure confer personal jurisdiction, and if so, (2) whether granting jurisdiction under the statute and rule would deprive the defendant of the right to due process of law under the Fourteenth Amendment of the United States Constitution." Clark v. Connor (1998), 82 Ohio St.3d 309, 312, 695 N.E.2d 751, citing United States Sprint Communications Co., Ltd. Partnership v. Mr. K's Foods, Inc. (1994), 68 Ohio St.3d 181, 183-184, 624 N.E.2d 1048. However, we note that personal jurisdiction is a "waivable right," and an individual may consent to a specific court exercising jurisdiction over him or her. Preferred Capital, Inc. v. Power Engineering Group, Inc., 112 Ohio St.3d 429, 2007-Ohio-257, 860 N.E.2d 741, at ¶ 6.

{¶ 18} One way for an individual to waive personal jurisdiction is to voluntarily appear and submit to the jurisdiction of the court. Snyder Computer Sys., Inc. v. Stives, 175 Ohio App.3d 653, 2008-Ohio-1192, ...