Buffkin v. Group

• Decision Date: 07 October 2013
• Docket Number: No. 79A02–1302–PL–141.,79A02–1302–PL–141.
• Citation: 997 N.E.2d 1
• Parties: Daniel B. BUFFKIN, Appellant–Defendant, v. GLACIER GROUP, Appellee–Plaintiff.
• Court: Indiana Appellate Court

997 N.E.2d 1

Daniel B. BUFFKIN, Appellant–Defendant,

v.GLACIER GROUP, Appellee–Plaintiff.

No. 79A02–1302–PL–141.

Court of Appeals of Indiana.

Oct. 7, 2013.

Sara R. Blevins, James E. Zoccola, Lewis & Kappes, P.C., Indianapolis, IN, Attorneys for Appellant.

Gregg S. Theobald, Lafayette, IN, Attorney for Appellee.

OPINION

BROWN, Judge.

Daniel B. Buffkin appeals from the trial court's Findings of Fact and Conclusions of Law Granting Preliminary Injunction, and raises one issue, which we revise and restate as whether the court's ruling is clearly erroneous. We reverse and remand.

FACTS AND PROCEDURAL HISTORY

As an independent contractor, Buffkin began working as a “sales recruiter” for Glacier Group (“Glacier”) in August 2008. Transcript at 6. Glacier provides executive or employee recruiting and placement services in the field of information technology (“IT”). Buffkin and Glacier, by its President Eric Hilleboe, signed an Independent Contractor Agreement dated August 12, 2008 (the “Agreement”). The Agreement provided in part:

1. Description of Work. The work provided by Contractor [Buffkin] is employee recruitment and performance placement for customers and clients of [Glacier]. During the term of this agreement and for the period of time set forth herein, [Buffkin] agrees to perform employee recruitment and performance placement services for only [Glacier] and agrees not to provide such services to any third party without the prior written consent of the [Glacier].

2. Independent Contractor Relationship. [Buffkin] is an independent contractor and is not an employee of [Glacier]. [Glacier] shall determine the work to be done by [Buffkin], but the manner in which he renders such services to [Glacier] shall be within the sole control and discretion of [Buffkin],.... [Buffkin] shall be responsible for all taxes as mandated by law. Since [Buffkin] is not an employee, [he] is not eligible for nor shall he be entitled to receive, any benefits which employees of [Glacier] are entitled to receive and shall not be entitled to workers' compensation, unemployment compensation, medical insurance, life insurance, paid vacations, paid holidays, pension, profit sharing, or Social Security on account of the work performed by [Buffkin] under this agreement.

3. Duration of Agreement. This agreement is effective as of the date it is signed by both parties (“effective date”) and shall continue in effect until cancelled by either party upon thirty (30) days' written notice to the other party.

4. Terms of Payment. During the term of this agreement, in full compensation for his services, [Buffkin] shall be paid by [Glacier] an amount equal to ____ 20____ percent (____20____%) of any fees collected by or paid to [Glacier] resulting from placements originated by [Buffkin]. [Buffkin] has been advised that fees paid to [Glacier] by its customers and clients are not the same and that, as a result, the payments to [Buffkin] will differ. [Buffkin] shall not be entitled to payment for any fees collected by or paid to [Glacier] resulting from placements originated by Eric Hilleboe or from any other placements not originated by [Buffkin]....

5. Trade Secrets and Confidentiality. While during the term of this agreement or at any time thereafter, regardless of expiration or termination of this agreement, [Buffkin] agrees not to disclose, directly or indirectly, to any person or entity any trade secrets or protected information of [Glacier].... Upon termination or expiration of this agreement, [Buffkin] agrees not to solicit, entice away or divert any current or past customers of [Glacier] nor any persons or entities contacted by [Buffkin] while performing services for [Glacier] during the term of this agreement....

6. Covenant not to Compete. Throughout the term of this agreement and for a period of three (3) years immediately following the expiration or termination of this agreement, [Buffkin] shall not, directly or indirectly, whether for compensation or otherwise, either individually, or as an employee, employer, consultant, agent, principal, partner, corporate officer, director, stockholder or in any other individual or representative capacity, enter into, own, manage, engage in, be employed by, operate, participate in, control, aid, assist, or be connected in any way with any business that competes with [Glacier] in employee recruitment or performance placement with employers with offices in the continental United States. [Buffkin] acknowledges and agrees that [Glacier's] client base is drawn from throughout the country in which competition is restricted by this provision and that such restricted area and the length of such restriction on competition is reasonable. This restriction on competition shall be construed as an agreement independent of any other provision of this agreement and the existence of any claim or cause of action by [Buffkin] against [Glacier], whether based on this agreement or otherwise, shall not constitute a defense to the enforcement of this covenant by [Glacier]. In the event of a breach of this paragraph by [Buffkin], [Glacier] shall be entitled to injunctive relief as well as all other remedies available under this agreement and the law. In addition to any other remedies available under the law to [Glacier] for a breach by [Buffkin], as liquidated damages, and not as a penalty, [Buffkin] shall pay to [Glacier], sixty percent (60%) of the gross fees or payments made to [Buffkin] for employee recruitment or performance placement services. In addition, the period of non-competition by [Buffkin] shall be extended by the length of the period of any such breach.

* * * * *

9. Attorney Fees, Costs. In the event either party shall reasonably be compelled to employ an attorney to enforce the provisions of this agreement, the non-defaulting party shall be entitled to reasonable attorney fees and all costs and expenses thereby incurred, including trial and appeal.

Appellant's Appendix at 85–87.

On June 2, 2011, Eric Hilleboe, the President/CEO of Glacier, sent an e-mail message to Buffkin stating that Glacier was terminating the Agreement effective as of that date.

On November 16, 2012, Glacier filed a complaint against Buffkin alleging that he was in breach of Paragraph 6 of the Agreement and requesting damages and injunctive relief. On December 6, 2012, Buffkin filed an answer and a counterclaim alleging that Glacier failed to comply with the termination provision of the Agreement. Glacier filed an answer on December 13, 2012, and on December 26, 2012, filed a motion to amend the complaint to correctly reflect its name as a partnership, and the court granted the motion.

On January 8, 2013, the court held a hearing at which the parties presented evidence and arguments, and then took the matter under advisement and directed counsel to submit proposed findings within two weeks. At the hearing, Hilleboe testified that Glacier “do[es] executive recruiting in the IT ... Sector for companies related to Data Storage, hosting, location, virtualization, manage services,” that its office is located in West Lafayette, Tippecanoe County, Indiana, and that it does “executive recruiting in [the IT] field for primarily sales people, pre-sales engineers, systems engineers, inside sales, leadership positions being directors VP's, CFO's, CEO's those types of positions.” Transcript at 4. When asked if he was essentially a “head hunter in the IT field,” Hilleboe testified “Yeah so basically we have a probably forty-five active clients that request our services in providing sales people or pre-sales engineers to those companies so what we do is we go out to competitors of those companies and we try and find individual sales people that might be a fit based on having ... skills that qualification matches.” Id. at 4–5. Hilleboe testified that Buffkin was hired to be a sales recruiter, that Glacier would provide him with job openings for its particular clients, and that Buffkin would then look for individuals with the skill requirements to be candidates to fill the clients' positions.

Hilleboe further testified that he had numerous conversations with Buffkin about Buffkin's performance, that his performance “from January of 2011 to June of 2011 when he was let go was basically non-existent,” and that “he had assisted in placing one individual candidate in that six month time frame.” Id. at 8. Hilleboe stated that when Buffkin began to work for Glacier, he had no recruiting or IT experience and that Glacier “taught him everything that he knows about how to recruit, who to recruit, when to recruit them, what language to use, how the contracts were written and not only that he was privy and had access to what is called proprietary information from our clients that basically relate to things such as commissions, commissions structures, payouts, products and services of those organizations that we recruit for.” Id. at 11. Glacier presented a client list identifying its clients during Buffkin's tenure of 2008 to 2011 and identifying additional clients Glacier acquired after the termination of the Agreement.¹ In addition, Hilleboe testified that, on November 15, 2011, he went to a website which advertised for job openings and discovered that Buffkin was advertising for jobs in the IT field, including for “data storage, hosting virtualization.” Id. at 14. Hilleboe testified that Glacier did recruiting nationwide and primarily in metropolitan cities. When asked if he was requesting “a preliminary injunction to prevent [ ] Buffkin from engaging in IT recruiting during the pendency of this litigation,” Hilleboe stated “IT recruiting as it relates to data storage, virtualization, hosting, co-location, data analytics, big storage.” Id. at 19.

Buffkin testified that he placed candidates for Glacier in the areas of sales representatives and sales engineers and to his knowledge did not place any other types of individuals in the IT industry....