Health Care Management Consulting, Inc. v. McCombes, 95-1578
| Decision Date | 22 September 1995 |
| Docket Number | No. 95-1578,95-1578 |
| Citation | 661 So.2d 1223 |
| Parties | 1995-2 Trade Cases P 71,138, 20 Fla. L. Weekly D2191 HEALTH CARE MANAGEMENT CONSULTING, INC., a Florida corporation, Appellant, v. William J. McCOMBES, Appellee. |
| Court | Florida District Court of Appeals |
Robert G. Riegal, Jr., and Kelly B. Pritchard of Coffman, Coleman, Andrews & Grogran, P.A., Jacksonville, for Appellant.
Joseph S. Farley, Jr. of Mahon & Farley, P.A., Jacksonville, for Appellee.
We review a non-final order dissolving a temporary injunction to enforce a covenant not to compete in an employment contract. We reverse the order and remand with directions to the trial court to reinstate the injunction with the following modifications as set forth below.
Health Care Management Consulting, Inc. (HCMC) was formed in 1977. One of its purposes is to provide consulting services to home health care agencies in such areas as Medicare reimbursement (bonuses/pensions, cash flow management, accounting systems, tax planning, cost report preparation, documentation) and clinical operations (allowable and non-allowable services such as nursing). HCMC's primary method of soliciting clients is through the presentation of seminars covering the topics of Medicare reimbursement as well as clinical and management matters related to the home health care industry. Dwight Cenac, owner and president of HCMC, personally consults with clients on application of the federal Medicare regulations to their individual home health care agencies.
On August 20, 1990, Charles McCombes (McCombes) was hired to perform marketing duties for HCMC. His primary job responsibility was to cultivate and develop new clientele. Prior to his employment with HCMC, McCombes had not performed any type of work in the home health care industry. He had, however, been employed on occasion in the business of conducting motivational and training seminars for various organizations. While employed with HCMC, McCombes worked closely with Cenac and attended numerous private client consultations. In August 1994, still employed with HCMC, McCombes formed InfoQuest Enterprises, Inc. (InfoQuest), for the purpose of presenting seminars in various subject matter areas. Some two months later, on October 8, 1994, McCombes resigned from his position with HCMC. On the date of his resignation, McCombes executed a joint general release and agreement (Agreement), whereby he agreed not to "induce, directly or indirectly, entice or lure away from HCMC, or otherwise attempt to secure any current clients of HCMC or its affiliate companies" or "compete directly or indirectly against HCMC and its affiliate companies for the period of one year from this date."
On February 7, 1995, HCMC sued McCombes, seeking damages and injunctive relief for what HCMC alleged to be McCombes' use of HCMC's trade secrets and solicitation of clientele. Specifically, HCMC alleged that HCMC's clients had received an InfoQuest brochure advertising a home health care seminar in New Orleans to be conducted on February 12-14, 1995. HCMC alleged that this brochure evinced a specific intent on the part of McCombes to reveal trade secrets developed by and belonging to HCMC and that McCombes had directly solicited HCMC's clients by telephone and mail. In a motion for temporary injunction filed in connection with the complaint, HCMC attached the affidavit of Cenac detailing the content of the alleged trade secrets. Following an ex parte hearing, the trial court issued a temporary injunction. Finding that McCombes had directly solicited clients of HCMC, that McCombes may be planning to disclose certain information developed by HCMC that constitutes a trade secret, that HCMC may be irreparably harmed by the direct solicitation and divulging of trade secrets, the trial court enjoined McCombes, his agents, employees, representatives, and any other persons acting in concert with him, from soliciting HCMC's clients and from disclosing any trade secrets of HCMC pending further order of the court, including any and all participation in the scheduled New Orleans seminar. An amended injunction, entered one day later, enjoined McCombes from soliciting HCMC's clients and from disclosing HCMC's trade secrets, but allowed the New Orleans seminar to proceed as long as McCombes did not participate.
On February 24, 1995, McCombes filed a motion to dissolve the injunction in part on the basis that HCMC had no legitimate business interests to be protected within the meaning of section 542.33, Florida Statutes, inasmuch as its purported trade secrets and confidential methodology are nothing more than its interpretations of Federal rules and regulations which fall within the public domain. On March 15, 1995, HCMC filed a motion to broaden the injunction to prevent McCombes from presenting an InfoQuest seminar in Texas scheduled for April 4-5, 1995.
Following an evidentiary hearing, the court entered an order dissolving the injunction based on the following findings: (1) McCombes is not in competition with HCMC in the field of Medicare reimbursement consulting; (2) the providing of consulting advice regarding federal regulations does not involve trade secrets; and (3) enforcement of the Agreement would be unreasonable to McCombes and the potential effects on McCombes far outweigh the potential effects on HCMC.
Section 542.33(2)(a), Florida Statutes (1989), provides in pertinent part:
[O]ne who is employed as an ... employee may agree with his employer to refrain from carrying on or engaging in a similar business and from soliciting old customers of such employer within a reasonably limited time and area ... so long as such employer continues to carry on a like business there. Said agreements may, in the discretion of a court of competent jurisdiction, be enforced by injunction.
Chapter 90-216, Section 1, Laws of Florida, amended section 542.33(2)(a) on June 28, 1990, by adding the following three sentences:
However, the court shall not enter an injunction contrary to the public health, safety, or welfare in any case where the injunction enforces an unreasonable covenant not to compete or where there is no showing of irreparable injury. However, use of specific trade secrets, customer lists, or direct solicitation of existing customers shall be presumed to be an irreparable injury and may be specifically enjoined.
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