A Copy, Inc. v. Michaelson, A-COP

Citation599 F.2d 450
Decision Date22 May 1978
Docket NumberA-COP,INC,No. 78-1157
Parties, Plaintiff, Appellee, v. Phillip MICHAELSON, Defendant, Appellant.
CourtUnited States Courts of Appeals. United States Court of Appeals (1st Circuit)

Marcus E. Cohn, Boston, Mass., with whom Landis, Hochberg & Cohn, P. C., Boston, Mass., were on brief, for defendant, appellant.

Richard C. Robinson, Hartford, Conn., with whom Sorokin, Sorokin, Hurwitz & Wetstone, Hartford, Conn., was on brief, for plaintiff, appellee.

Before COFFIN, Chief Judge, CAMPBELL and BOWNES, Circuit Judges.

LEVIN H. CAMPBELL, Circuit Judge.

This appeal under 28 U.S.C. § 1292 is from an interlocutory order of the district court granting a preliminary injunction. The injunction has the effect of preventing appellant Michaelson for the next year from continuing to sell and service copying machines in downtown Boston in competition with his former employer, A-Copy, Inc.

Michaelson was hired as a salesman by A-Copy in December of 1975. A-Copy, a Connecticut corporation, sells and services various makes of copying machines and also sells supplies. In his written contract of employment, which was terminable at will by either party, Michaelson agreed not to engage in the sale or servicing of copying equipment "(f)or a period of one (1) year following the termination of employment" in any territory in which he may have worked for 18 months prior to termination of his employment. Michaelson also agreed to refrain from contacting A-Copy customers after termination and not to disclose confidential information such as a customer list.

Although a successful salesman, Michaelson was discharged on February 17, 1977, because of suspicions by A-Copy that he was engaging in activities inconsistent with his duties and might be planning to compete directly with A-Copy in the copying machine business. Immediately following discharge, Michaelson proceeded to do just that; and there is little question that he has been engaging in activities contrary to the terms of the restrictive covenants. Michaelson does not claim otherwise, nor does he contend that the covenants are unreasonable, See generally, All Stainless, Inc. v. Colby, 364 Mass. 773, 777, 308 N.E.2d 481, 485 (1974), or that a Massachusetts court would not specifically enforce them in appropriate circumstances, Id. Rather he strenuously contends before us, as he did in the district court, that his dismissal from A-Copy's employ was unwarranted and in bad faith, rendering the covenants unenforceable in a court of equity. Economy Grocery Stores Corp. v. McMenamy, 290 Mass. 549, 195 N.E. 747 (1935); See New England Canteen Service, Inc. v. Ashley, 1977 Mass.Adv.Sh. 1186, 1190, 1192-93, 363 N.E.2d 526, 528, 529-30; Cf. Fortune v. National Cash Register Co., 1977 Mass.Adv.Sh. 1569, 1574-78, 364 N.E.2d 1251, 1255-1257.

The present action was promptly commenced by A-Copy a week after Michaelson's discharge, as soon as the former heard of his competitive activities. Preliminary relief as well as damages and a permanent injunction were sought. Two months later, in late April of 1977, the district court held a two day hearing limited to the question of preliminary relief. In addition to affidavits, considerable testimony was received. The court took the case under advisement but, for reasons not apparent, rendered no decision for a year, during which period Michaelson not only sold and serviced copying machines in the area of his former employment but borrowed money and enlarged his staff. Among his customers were former customers of A-Copy. Finally, on April 18 of 1978 the district court issued a Memorandum finding that A-Copy's discharging of Michaelson was "not arbitrary and capricious and was not in breach of implied covenants of good faith and fair dealing." A preliminary injunction was entered which, Inter alia, enjoined Michaelson from engaging in copying machine sales and service in the area of his former employment. The injunction was to be effective upon the posting by A-Copy of a $10,000 bond and was to continue in effect for "one year from the date of entry . . . or until determination of the merits. . . ."

Michaelson argues first that "(i)t is well established that injunctive relief which gives a movant substantially the ultimate relief sought should not be granted." There is no such doctrine. Obviously the more drastic the effect of the injunction, the more carefully the district court should consider staying its hand. But the denial of preliminary relief may in some situations be as fraught with adverse consequences to plaintiff as the granting of relief is fraught with consequences to defendant. In such cases, a court may have no choice but to act even though its decision has the effect of providing most or even all of the ultimate relief in dispute.

Michaelson is on stronger ground in arguing that a court should be reluctant to grant preliminary relief if there is a close factual dispute which could go either way at the trial on the merits. This argument is merely another way of stating that one condition of preliminary relief is a showing that plaintiff will be likely to prevail on the merits. Obviously the more serious the harm to defendant of issuing a preliminary injunction, the stronger must be the showing that plaintiff will probably succeed. Here it is perhaps a closer question whether plaintiff will ultimately prevail than is often the case. A-Copy's president fired Michaelson over the protests of his immediate supervisor, without the courtesy of inviting Michaelson's side of the story. While certain of Michaelson's conduct was suspicious and arguably lacking in candor, and while A-Copy's president appears to have been prompted by business considerations, the evidence of actual misconduct on Michaelson's part seems scant. We are troubled, moreover, by the district court's failure to grapple directly with the question of A-Copy's probability of success at a future trial. Doubtless the court felt that it did enough by determining, on the basis of a hearing consuming the better part of two days during which Michaelson, A-Copy's president and others testified, that A-Copy had demonstrated sufficiently good faith to enforce the covenants in equity. Still, this finding was not quite the same as determining whether Michaelson, armed with the fruits of...

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23 cases
  • Automile Holdings, LLC v. McGovern
    • United States
    • United States State Supreme Judicial Court of Massachusetts
    • January 14, 2020
    ...restrictive covenants] creates a frosty climate for [a company's] attempt to avoid it" [footnote omitted] ); A-Copy, Inc. v. Michaelson, 599 F.2d 450, 452 (1st Cir. 1978) (explaining, in another case involving restrictive covenant in employment context, that "the Supreme Judicial Court of M......
  • Scuncio Motors, Inc. v. Subaru of New Eng.
    • United States
    • U.S. District Court — District of Rhode Island
    • December 20, 1982
    ...could go either way at a trial on the merits, a court should be reluctant to issue an injunction pendente lite. A-Copy, Inc. v. Michaelson, 599 F.2d 450, 451 (1st Cir.1978). In the present case, plaintiff has palpably met three of the four prerequisites for preliminary injunctive Plaintiff,......
  • NATIONAL CUSTOMS BROKERS AND FORWARDERS v. US, Court No. 89-07-00400.
    • United States
    • U.S. Court of International Trade
    • October 10, 1989
    ...102 S.Ct. 1798, 1807, 72 L.Ed.2d 91 (1982); S.J. Stile Assoc. 68 CCPA at 29-30, 646 F.2d at 525 (1981) (citing A-Copy, Inc. v. Michaelson, 599 F.2d 450, 452 (1st Cir.1978)). The court must ascertain whether plaintiff is entitled to some preliminary injunctive relief by balancing the relativ......
  • Massachusetts Coalition of Citizens with Disabilities v. Civil Defense Agency and Office of Emergency Preparedness of Com. of Massachusetts, 80-1520
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • May 26, 1981
    ...a preliminary injunction is addressed to the discretion of the trial court, not to that of the appellate court. A-Copy, Inc. v. Michaelson, 599 F.2d 450, 452 (1st Cir. 1978). Hence the Coalition must meet the heavy burden of establishing that the denial here was an abuse of the trial court'......
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