Restivo v. Hanger Prosthetics & Orthotics, Inc., Civil Action No. 06-32.
| Decision Date | 11 April 2007 |
| Docket Number | Civil Action No. 06-32. |
| Citation | 483 F.Supp.2d 521 |
| Court | U.S. District Court — Eastern District of Louisiana |
| Parties | Edmund J. RESTIVO, Jr. v. HANGER PROSTHETICS & ORTHOTICS, INC. |
Franklin David Beahm, Daniel Gabriel Collarini, Beahm & Green, New Orleans, LA, for Edmund J. Restivo, Jr.
Marie Olympia Riccio, Marie Riccio Wisner, Attorney at Law, New Orleans, LA, for Hanger Prosthetics & Orthotics, Inc.
ORDER AND REASONS
Before the Court is the First Motion for Summary Judgment (Rec.Doc.No.18) of Plaintiff Edmund J. Restivo, Jr. seeking judgment on his Declaratory Action (Rec. Doc.No.1) as well as dismissal of the claim alleging breach of a non-compete contract in the Counterclaim (Rec.Doc.No.12) of Defendant Hanger Prosthetics & Orthotics, Inc. ("Hanger"). After reviewing the pleadings, memoranda, and relevant law, the Court hereby grants Plaintiff's motion, in part, and denies it, in part, for the reasons assigned below.
Also before the Court is the Second Motion for Summary Judgment (Rec.Doc. No.57) of Plaintiff Edmond J. Restivo, Jr. ("Restivo"), wherein he seeks a judgment in his favor dismissing the entire Counterclaim (Rec.Doc.No.12) of Defendant Hanger Prosthetics & Orthotics, Inc. ("Hanger"). After reviewing the pleadings, memoranda, and relevant law, the Court hereby grants Plaintiff's motion, in part, and denies it, in part, for the reasons assigned below.
Plaintiff Restivo was employed with Hanger from July 1992 until his resignation in August 2005, as office manager for Hanger's office on 3211 D'Hemecourt at Tulane Avenue, New Orleans, Louisiana. The office is located in Orleans Parish. As a condition of employment, Plaintiff signed an employment contract which contained non-compete, confidentiality, and non-solicitation provisions. See Mot. Summ. J., Exhibit A "Employment Contract" (Rec. Doc.No.18). The relevant portions of the agreement read as follows:
5. Non-Compete
(a) In the event the Employment Period is terminated under paragraphs 4(b) or 4(c) above, then the non-compete provisions of this paragraph 5 will apply to the Employee. In the event the Employment Period is otherwise terminated, such as without Cause, then no part of this paragraph 5 will apply to Employee.
(b) Employee recognizes and acknowledges that by virtue of accepting employment hereunder, Employee will acquire valuable training and knowledge, enhance Employee's professional skills and experience, and learn proprietary trade secrets and Confidential Information of the Company. In consideration of the foregoing and this employment contract, Employee agrees that during the Employment Period and for two (2) years thereafter (the "Non-Compete Period"), Employee shall refrain from directly or indirectly initiating, starting up, brokering, underwriting or commencing any business which is competitive with the Company's business of fabricating, distributing, wholesaling or retailing or orthotics or prosthetics, or the operation of clinics to fit patients for orthotics or prosthetics, or any other related non-manufacturing businesses which the Company is engaged in during and at the expiration of the Employment Period, at any location in the State of Louisiana within the parishes of Jefferson Parish, Orleans Parish, Plaquemines Parish, St. Bernard Parish, St. Charles Parish, St. James Parish, St. John the Baptist Parish (in which Employee acknowledges that the Company is currently carrying on its business), together with any other parishes or municipalities in which the Company is carrying on its business at the time of the termination of the Employment Period and where Employee has performed services on the Company's behalf (the "Non-Compete"). Nothing herein will prevent Employee from being a passive owner of non more than 1% of the outstanding stock of any class of a corporation which is engaged in a competitive business of the Company and which is publicly traded, so long as Employee has no participation in the business of such corporation. Employee agrees that the restraint imposed under this paragraph 5 is reasonable and not unduly harsh or oppressive.
(c) If, at the time of enforcement of any provision of paragraph 5(b) above, a court or arbitrator holds that the restrictions stated therein are unreasonable or unenforceable under circumstances then existing, the Company and Employee agree that the maximum period, scope, or geographical area reasonable or permissible under such circumstances will be substituted for the stated period, scope or area.
(d) Since a material purpose of this Agreement is to protect the Company's investment in the Employee and to secure the benefits of Employee's background and general experience in the industry, the parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this paragraph 5. Therefore, in the event of a breach by Employee of any of the provisions of this paragraph 5, the Company or its successors or assigns may, in addition to other rights and remedies existing in its favor, apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive or other relief in order to enforce or prevent any violations of the provisions of this Agreement.
6. Confidential Information.
Employee acknowledges that the information, observations, data and trade secrets (collectively, "Confidential Information") obtained by Employee during the course of Employee's performance under this Agreement, and previously if Employee has already been an employee of the Company, concerning the business or affairs of the Company are the property of the Company. For purposes of this Agreement, "trade secret" means any method, program or compilation of information which is used in the Company's business, including but not limited to: (a) techniques, plans and materials used by the Company, (b) marketing methods and strategies employed by the Company, and (c) all lists of past, present or prospective patients, customers, referral sources and suppliers of the Company. Employee agrees that Employee will not disclose to any unauthorized Person or use for Employee's own account any of such Confidential Information without written consent of the Company, unless and to the extent that the aforementioned matters become generally known to and available for use by the public other than as a result of Employee's acts or omissions to act or become known to Employee lawfully outside the scope of Employee's employment under this Agreement. Employee agrees to deliver to the Company at the termination of Employee's employment, or at any other time the Company may request, all memoranda, notes, plans, records, reports and other documents (and copies thereof) relating to the business of the Company which Employee may then possess or have under Employee's control.
7. Non-Solicitation.
Employee recognizes and acknowledges that by virtue of accepting employment hereunder, Employee will acquire valuable training and knowledge, enhance Employee's professional skills and experience, and learn proprietary trade secrets and Confidential Information of the Company. In consideration of the foregoing and this employment contract, Employee agrees that during the Employment Period and for two (2) years thereafter (the "Non-Solicitation Period"), Employee shall refrain from directly or indirectly soliciting any then existing patient, customer, referral source or supplier of the Company for the purpose of conducting business similar to that of the Company's business of fabricating, distributing, wholesaling or retailing or orthotics or prosthetics, or the operation of clinics to fit patients for orthotics or prosthetics, or any other related non-manufacturing businesses which the Company is engaged in during and at the expiration of the Employment Period, with such patient, customer, referral source or supplier, at any location in the State of Louisiana within the parishes of Jefferson Parish, Orleans Parish, Plaquemines Parish, St. Bernard Parish, St. Charles Parish, St. James Parish, St. John the Baptist Parish (in which Employee acknowledges that the Company is currently carrying on its business), together with any other parishes or municipalities in which the Company is carrying on its business at the time of the termination of the Employment Period and where Employee has performed services on the Company's behalf (the "Non-Solicitation"). Furthermore, during the Non-Solicitation Period, Employee shall not, without the Company's prior written consent, directly or indirectly, knowingly solicit or encourage or attempt to influence any employee to leave the employment of the Company or to participate or assist with the formation or operations of any business that competes, or is intended to compete, with the Company.
Mot. Summ. J., Exhibit A "Employment Contract" (Rec.Doc.No.18).
Seeking declaration that he was not in violation of the terms of the non-compete covenant, Mr. Restivo filed a declaratory action in Civil District Court for the Parish of Orleans, State of Louisiana. Specifically, he sought a ruling that his opening of Limbcare Prosthetics & Orthotics, Inc. ("Limbcare") in St. Tammany Parish was not a violation of the terms of his Employment Contract. Defendant Hanger removed the action and filed its Counterclaim (Rec.Doc.No.12) requesting that the Court award monetary damages and injunctive relief related to losses arising out of Mr. Restivo's breach of his Employment Contract.
The central question with respect to the First Motion for Summary Judgment is whether the provision in the contract expanding the geographical limitation of the non-compete agreement extends to St. Tammany Parish by virtue of the language prohibiting Plaintiff from competing with Hanger in parishes ...
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