Brock Servs., LLC v. Rogillio

• Decision Date: 18 May 2020
• Docket Number: CIVIL ACTION NO. 18-867-JWD-EWD
• Parties: BROCK SERVICES, LLC v. RICHARD ROGILLIO, ET AL.
• Court: U.S. District Court — Middle District of Louisiana

BROCK SERVICES, LLC v. RICHARD ROGILLIO, ET AL.

CIVIL ACTION NO. 18-867-JWD-EWD

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF LOUISIANA

May 18, 2020

RULING AND ORDER

This matter is before the Court on Kristy Bauer's Motion to Compel Arbitration and to Dismiss (Doc. 219); Rhonda Redd's Motion to Compel Arbitration and to Dismiss (Doc. 220); Ken Rodgers' Motion to Compel Arbitration and to Dismiss (Doc. 221); Gene Gatlin's Motion to Compel Arbitration and to Dismiss (Doc. 223); Ricky Rogillio's Motion to Compel Arbitration and to Dismiss (Doc. 224) (together the "Individual Defendants' Motions to Compel"); and Apache's Motion to Compel Arbitration and to Dismiss, or Alternatively, Motion to Stay Proceedings Pending Completion of Arbitration (Doc. 249) ("Apache's Motion to Compel"). Brock opposes Individual Defendants' Motions to Compel (Doc. 256) and Apache's Motion to Compel (Doc. 260). Individual Defendants and Apache filed replies. (Docs. 263 and 268.) Brock filed a sur-reply responding to Individual Defendants. (Doc. 267.) Oral argument is not necessary. Having considered the arguments raised by the parties, the relevant facts, the law and for the reasons explained below, the Court will grant Individual Defendants' Motions to Compel Arbitration and Apache's Motion to Compel Arbitration.¹

I. RELEVANT FACTS AND PROCEDURAL HISTORY

a. Allegations in the complaints

Brock is a provider of industrial maintenance services, including complex scaffolding work, and asbestos abatement. (Doc. 192 at ¶ 12.) In order to develop customer relationships, Brock researches customer needs and develops marketing plans, pricing structures, and produces other confidential information that is crucial to success in a competitive market. (Doc. 192 at ¶ 13.) Brock's Information Technology policy restricts access to their confidential information. (Id. at ¶ 14.) Apache Industrial Group, Inc. ("Apache") is Brock's competitor and operates in Louisiana.

This case arose out an employment dispute when Brock filed a complaint against Richard Rogillio, its former Vice President of Operations, to enforce a non-competition agreement. (Doc. 1.) On October 12, 2018, Brock filed its first Amended Complaint naming Kristy Bauer, Rhonda Redd, and Gene Gatlin as well as Apache as additional defendants and alleging new claims under the Computer Fraud and Abuse Act, the Defend Trade Secrets Act, the Louisiana Uniform Trade Secrets Act. (Doc. 4.) On January 15, 2019, Brock filed its Second Amended Complaint, naming as an additional defendant Ken Rogers; together, Mr. Rogillio, Ms. Bauer, Ms. Redd, Mr. Gatlin, and Mr. Rogers will be referred to as the "Individual Defendants". (Doc. 57.) In the Second Amended Complaint, Brock alleged additional claims under the Louisiana Unfair Trade Practice Act as well as claims for breach of fiduciary duty, civil conspiracy and unjust enrichment. (Doc. 57 at 1.) On July 18, 2019, Brock filed a Third Amended Complaint against Individual Defendants and Apache under the same causes of action.

Brock alleges that Individual Defendants resigned from Brock within weeks of each other and began working at Apache. (Doc. 192 at 1.) When Mr. Rogillio resigned on September 3, 2018, he deleted thousands of files from his work computer and terminated employees to make them employable by Apache. (Id.) In this manner, Mr. Rogillio recruited Ms. Bauer, Ms. Redd,Mr. Gatlin, and Mr. Rogers to work at Apache. (Id. at 2.) Ms. Bauer, Ms. Redd, Mr. Gatlin and Mr. Rogers also deleted files from their work computers. Ms. Bauer, Ms. Redd, and Mr. Rogers misappropriated trade secrets and other confidential information by placing confidential documents on USB storage devices and brought those devices to their employment with Apache. (Id.) In addition Mr. Gatlin sabotaged one of Brock's customer relationships. (Id.)

Brock likewise alleges that Apache knew that Individual Defendants acquired the misappropriated trade secrets by improper means and continues to use the confidential and proprietary information to benefit Apache. (Doc. 192 at 31.) As such, Apache allegedly "aided, abetted, and encouraged the unlawful competition with the specific intent of harming Brock and depriving Brock of its customers and competitive advantage." (Doc. 192 at ¶ 153.) "Thus, Apache conspired with Employee Defendants . . . to unlawfully compete against Brock and transfer Brock's business to Apache." (Id. at 154.)

b. Brock's Employee Handbook and Dispute Resolution Policy

General Counsel for Brock provided an affidavit in a separate action that states that it is company policy that a condition of employment is that an employee must sign both Brock's Employee Manual and a separate document detailing its dispute resolution policy, which contains a mutually binding arbitration agreement ("Dispute Resolution Policy"). (Doc. 220-6, Affidavit of Krystal Hunter, Carl Lee v. Brock Services, filed 1/31/2018, Case No. 1:17-cv-00272-LG-RHW (S.D. Miss)).) Brock has produced partial copies of Mr. Rogillio, Ms. Redd, and Mr. Gatlins' personnel files, including a Dispute Resolution Policy signed by each employee in 2010. (Doc. 263-1 at 3-4; Doc. 263-1 at 7-8; Doc. 263-1 at 11-12.) A signed Dispute Resolution Policy has not been produced for Ms. Bauer or Mr. Rogers. (Doc. 263-1 at 13, 17.)

Although Brock's Employee Handbook does not contain the Dispute Resolution Policy, it references the Dispute Resolution Policy in two sections: Section 8.1 - Employee Grievances and Section 8.2 - Dispute Resolution Policy. Section 8.1 - Employee Grievances (2008)² states:

8.1 - EMPLOYEE GRIEVANCES

It is the policy of the Company that all employees have the right to voice their complaints.

Should a condition exist, which an employee feels is unsatisfactory, it is important that s/he bring it to the attention of the appropriate person in the appropriate manner. Normally that person is the employee's immediate supervisor. If the supervisor is the source of the complaint, the employee is to contact the next higher level of management or Human Resources.

If the employee feels the problem remains unresolved following discussions with the supervisor, the employee may submit the complaint in writing for reconsideration. A written complaint is to be submitted to the Site Manager or Office Manager, or Human Resources. In certain cases, the manager, supervisor and employee may wish to meet to provide a fuller explanation of the situation andthe action taken. Normally, all complaints will be resolved by this step of the grievance procedure.

An employee who feels the complaint has not received adequate attention after management review may direct the written complaint to the corporate Human Resources Department. The Human Resources Department will review the complaint and the steps already taken.

If an employee is still dissatisfied with the Company response to the situation, the employee may then arrange for an independent arbitration/mediation as outlined in the Dispute Resolution Policy. An employee will not be penalized for presenting a good-faith complaint to the supervisor or to members of management.

(Doc. 267-1 at 59.) Section 8.2 - Dispute Resolution Policy (2008)³ states:

8.2 - DISPUTE RESOLUTION POLICY

All employees of the Company shall be subject to the Company's Dispute Resolution Policy set forth on the following page for resolution of all matters relating to the employee's employment with the Company. This Dispute Resolution Policy shall be mutually binding on the Company and the employee and is a distinct and separate agreement from all other modifiable Company policy provisions. The employee acknowledges that the terms and conditions of the Dispute Resolution Policy has been provided to employee as a separate document either through notice or as part of the employee's hiring package. In addition, the employee may request a copy of this policy at any time by contacting the Human Resources Department.

The Dispute Resolution Policy is a binding agreement and acceptance and/or continuation of employment with the Company constitutes knowing and voluntary acceptance and agreement to the terms and condition of the Dispute ResolutionPolicy. The Company hereby advises the employee to consult with legal counsel regarding the consequences of the Company's Dispute Resolution Policy. The Dispute Resolution Policy does not in any way alter the "at will" status of the employment relationship.

(Doc. 267-1 at 60.)

The Dispute Resolution Policy states:

1. This Dispute Resolution Policy, effective as of October 15, 2008, creates a mutual obligation to arbitrate between Brock Holdings I, LLC, its affiliates, subsidiaries and parent (the "Brock Group"1), and all employees of The Brock Group (collectively, The Brock Group and employees of The Brock Group are herein referred to as the "Parties"), and is for the express benefit of all other persons or entities included in the definition of the term "Company" and "Company's Customer" (as both terms are hereinafter defined). Each, every, any and all claims, disputes and/or controversies now existing or later arising between or among the Parties, or between or among the employees of The Brock Group and any other person or entity constituting the Company or a Company Customer, whether now known or unknown, arising out of or related to employment or termination of employment with The Brock Group shall be resolved only through final and binding arbitration, pursuant to the Federal Arbitration Act, 9 U.S.C. § 1, et seq., and not by way of court or jury trial. Such claims, disputes, and/or controversies, without limitation, include those arising out of or relating to: all issues of arbitrability, including but not limited to unconscionability and all grounds as may exist at law or in equity for the revocation of any contract, the interpretation or application of this Dispute Resolution Policy, employment application process, employment relationship, the Company's Customers, all property

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