Campbell Alliance Grp., Inc. v. Forrest
Decision Date | 27 March 2018 |
Docket Number | No. 5:15-CV-667-D,5:15-CV-667-D |
Court | U.S. District Court — Eastern District of North Carolina |
Parties | CAMPBELL ALLIANCE GROUP, INC., Plaintiff, v. LYNN FORREST, and ANDREW KWON, Defendants. |
On December 23, 2015, Campbell Alliance Group, Inc. ("Campbell" or "plaintiff") sued defendants Lynn Forrest ("Forrest") and Andrew Kwon ("Kwon") (collectively "defendants") for breach of contract and injunctive relief to prevent defendants from violating their employment agreements [D.E. 1].1 On September 23, 2016, the court held a hearing concerning Campbell's request for a preliminary injunction and denied that request [D.E. 64-65]. On March 23, 2017, defendants moved for summary judgment [D.E. 75] and filed a memorandum in support [D.E. 76]. On April 27, 2017, Campbell responded [D.E. 87]. On May 11, 2017, defendants replied [D.E. 102]. As explained below, defendants' motion for summary judgment is denied.
[D.E. 1-1] 4 (Section 4.3). The employment agreements define "Client" or "Actively Targeted Prospect" as a "department within a company or other entity (under the control of a Director, VP or comparable position) for which Campbell has provided Covered Services or actively marketed (e.g., called upon to discuss) Covered Services." Id. The employment agreements define "Covered Services" as "the services provided by Employee for or on behalf of Campbell during Employee's employment with Campbell." Id. The non-competition covenant remains in effect for 12 months after the employee leaves Campbell, and the non-solicitation covenant remains in effect for 18 months after the employee leaves Campbell. See id. at 4-5. The employment agreements provide, however, that the period will be tolled during any time that the employee is not complying with thecovenants. See id. at 4.
[D.E. 1-1] 5. This covenant remains in effect for 18 months after the employee leaves Campbell and is also subject to tolling. See id. at 4.
Between July 2015 and October 2015, Kwon and Forrest discussed possible employment with Acsel Health, LLC ("Acsel"). See [D.E. 88] 40 ¶ 71. On August 10, 2015, Kwon resigned from Campbell, and on the same day, Forrest told her direct supervisor that she intended to resign. See id. 39 ¶¶ 66-67. Shortly thereafter, Forrest and Kwon began working for Acsel.
Campbell alleges that defendants breached their restrictive covenants by soliciting and providing "covered services" to "one of [Campbell's] largest pharmaceutical-group clients, the Janssen Pharmaceutical Companies of Johnson & Johnson, ("Janssen")." [D.E. 87] 2. Specifically, Campbell contends that while at Campbell, defendants performed work for the following "clients," as defined by the employment agreements: (1) the Oncology, Immunology, and Training departments at Janssen Global Services, LLC, (2) the Cardiovascular and Metabolic, Immunology, Oncology, and Training departments at Janssen Pharmaceuticals, Inc., (3) the Oncology department at Janssen Biotech, Inc., and (4) the Oncology department at Janssen Research & Development, LLC. See id. at 13. According to Campbell, each of these departments is Campbell's "client," and defendants violated their restrictive covenants by soliciting and providing covered services to individuals in these departments after joining Acsel. See id. at 10-13.
Defendants admit that they have performed work for at least ten different client contacts at Janssen related entities. Defendants worked with at least some of those contacts while employed at Campbell. See [D.E. 77] ¶¶ 76, 78 ( ); [D.E. 88] 42-43 ¶ 76.3 In support of their motion for summary judgment, defendants argue that numerous provisions in the restrictive covenants are unenforceable. See [D.E. 76] 1-2. Defendants also contend that Campbell has failed to show the restrictive covenants are no broader than necessary to protect its legitimate business interests, that Campbell failed to show defendants solicited its clients, and that Campbell failed to identify what departments at Janssen are its "clients." See id.
In considering a motion for summary judgment, the court views the evidence in the light most favorable to the non-movant and applies well-established principles under Rule 56 of the Federal Rules of Civil Procedure. See, e.g., Fed. R. Civ. P. 56; Scott v. Harris, 550 U.S. 372, 378 (2007); Celotex Corp. v. Catrett, 477 U.S. 317, 325-26 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-55 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 585-87 (1986). Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); see Anderson, 477 U.S. at 247-48. The party seeking summary judgment must demonstrate an absence of a genuine issue of material fact. See Celotex Corp., 477 U.S. at 325. Once the moving party has met its burden, the nonmoving party then must demonstrate that there exists a genuine issue of material fact for trial. See Matsushita, 475 U.S. at 587. "[T]here is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Anderson, 477 U.S. at 249. Conjectural arguments will not suffice. See id. at 249-52; Beale v.Hardy, 769 F.2d 213, 214 (4th Cir. 1985) (). Likewise, a "mere . . . scintilla of evidence in support of the [nonmoving party's] position [will not suffice]; there must be evidence on which the [fact finder] could reasonably find for the [nonmoving party]." Anderson, 477 U.S. at 252; see Evans v. Techs. Applications & Serv. Co., 80 F.3d 954, 962 (4th Cir. 1996).
This court has subject-matter jurisdiction based on diversity. Thus, the court applies state substantive law and federal procedural rules. See Erie R.R. v. Tompkins, 304 U.S. 64, 78-80 (1938); Dixon v. Edwards, 290 F.3d 699, 710 (4th Cir. 2002). Defendants' motion for summary judgment requires the court to consider the parties' state-law claims and defenses, and the parties agree that North Carolina law applies. Accordingly, the court applies North Carolina law, and the court must determine how the Supreme Court of North Carolina would rule. See, e.g., Twin City Fire Ins. Co. v. Ben Arnold-Sunbelt Beverage Co. of S.C., 433 F.3d 365, 369 (4th Cir. 2005). "If the Supreme Court of [North Carolina] has spoken neither directly nor indirectly on the particular issue before us, [this court is] called upon to predict how that court would rule if presented with the issue." Id. (quotation omitted).4 In making that prediction, the court may consider opinions of the North Carolina Court of Appeals, treatises, and the practices of other states. See id.
A.
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