Rogers v. Burch Corp.

• Decision Date: 19 June 2020
• Docket Number: 1190088
• Citation: 313 So.3d 555
• Parties: Joshua ROGERS v. BURCH CORPORATION
• Court: Alabama Supreme Court

313 So.3d 555

Joshua ROGERS

v.BURCH CORPORATION

1190088

Supreme Court of Alabama.

June 19, 2020

Albert L. Vreeland II of Lehr Middlebrooks Vreeland & Thompson, P.C., Birmingham, for appellant.

John W. Clark IV of Clark Law Firm, P.C., Birmingham, for appellee.

BOLIN, Justice.

Joshua Rogers appeals from a preliminary injunction entered by the Jefferson Circuit Court preventing Rogers from soliciting any employees or clients of Burch Corporation, his former employer, as contractually agreed to under restrictive covenants in an employment agreement. We dismiss the appeal.

I. Facts and Procedural History

Burch Corporation is an Alabama construction company with a division that designs and builds cold-storage facilities for use in industries such as food processing and food storage. Burch operates its cold-storage facilities in several states. In spring 2016, Burch and Rogers began discussing Rogers's employment as project manager for its cold-storage division in Tampa, Florida. On August 2, 2016, Burch wrote a letter to Rogers outlining the terms of his proposed employment as project manager and stated that the offer was good through August 5, 2016. Rogers accepted the offer by signing and returning the letter to Burch on August 3, 2016. The offer further provided that Rogers's first day of employment would be August 29, 2016.

One of the prerequisites of Rogers's employment with Burch outlined in the letter was entering into an employment agreement. A copy of the employment agreement was included with the letter mailed to Rogers on August 2, 2016. On August 8, 2016, Rogers signed the employment agreement, and on August 29, 2016, Rogers began working with Burch. That same day, Burch's president signed Rogers's employment agreement.

The employment agreement provided, in pertinent part, as follows:¹

"2. Confidentiality: Trade Secrets: Proprietary Information.

"a. Definition of Proprietary Information. As an employee of [Burch], [Rogers] will have access to [Burch's] ‘Proprietary Information’ which is defined as property belonging to [Burch] and utilized in its products and services provided to customers and clients which is confidential in nature, and includes, but is not limited to: ‘trade secrets,’ as defined in Alabama Code [1975,] § 8-27-2, Florida Statute Ann. § 688.002(4) and/or the Georgia Trade Secrets Act, OCGA § 10-1-761(4) ; pricing information and methodology, compensation; customer lists; customer data and information; mailing lists; prospective customer information; financial and investment information; management and marketing plans, business strategy, technique, and methodology; business models and data; [Burch] provided files, software, code, reports, documents, manuals, and forms used in the business that may not otherwise qualify as a trade secret but which are treated as confidential to [Burch], in whatever medium provided or preserved; relationships or contacts with specific prospective or existing customers, vendors, or clients; customer or client goodwill associated with the ongoing business of [Burch] and each specific marketing or trade area in which [Burch] does business; any specialized or unique training provided by [Burch] to [Rogers]; [Burch's] products themselves; [Burch] technology; [Burch] technology support and support services; sales methods and support; labeling; quality standards; suppliers and distributors; intellectual property of any kind and any and all other business or strategic information relating to [Burch's] technological information, products and/or services, all of which [Rogers] acknowledges are owned by [Burch] and which are regularly used in the operation of the business of [Burch].

"b. Confidentiality of Proprietary Information. [Rogers] shall hold all Proprietary Information in the strictest confidence and shall not disclose any of this Proprietary Information, directly or indirectly, or use it in any way, either during the term of this Agreement or at any later time, except as required in the course of [Rogers's] employment with [Burch] or with the express written authorization from [Burch]. [Rogers] acknowledges and agrees that any disclosure of the Proprietary Information shall result in immediate and irreparable harm to [Burch], and that [Burch] shall be entitled to seek injunctive relief as well as recovery of any direct, indirect, consequential, or punitive damages as provided by Alabama law resulting from any disclosure in violation of this Agreement.

"c. Company Property. All files, plans, pricing and other records, documents, drawings, specifications, equipment, computer data and images, and similar items relating to the business of [Burch], whether prepared by [Rogers], or otherwise coming into [Rogers's] possession, shall remain the exclusive property of [Burch] and shall be returned to [Burch] immediately upon termination of [Rogers's] employment with [Burch].

"3. No Post-Employment Solicitation of Customers for Two (2) years. Upon the termination of [Rogers's] employment with [Burch], for any reason whatsoever, and for two (2) years following said termination, [Rogers] shall not, directly or indirectly, impliedly or expressly, either as an employee, member, manager, employer, consultant, agent, principal, partner, stockholder, corporate officer, director, or in any other individual or representative capacity, offer to provide goods and services that are provided by [Burch] to, or otherwise call on, solicit, or take away, or attempt to call on, solicit, or take away, any customer for which [Burch] provided services (or solicited to provide services) during [Rogers's] employment with [Burch].

"4. No Post-Employment Solicitation of Employees for Two (2) Years. Upon the termination of [Rogers's] employment with [Burch], for any reason whatsoever, and for two (2) years following said termination, [Rogers] shall not, directly or indirectly, impliedly or expressly, either as an employee, member, manager, employer, consultant, agent, principal, partner, stockholder, corporate officer, director, or in any other individual or representative capacity, offer to employ any person who is employed by [Burch], or who was employed by [Burch] during [Rogers's] employment with [Burch].

"5. Compensation for Breach. In the event of a breach of this Agreement by [Rogers], in addition to the termination of [Rogers's] employment with [Burch], [Burch] may recover from [Rogers], at [Burch's] sole discretion, either (1) any and all damages actually sustained by [Burch]; or, (2) in recognition of the fact that the exact amount of damages sustained by [Burch] will be difficult or impossible to ascertain, as liquidated damages and not as a penalty, the sum of $10,000, such amount representing the reasonably foreseeable minimum amount of damages that would be sustained by [Burch] in the event of a breach of this Agreement by [Rogers]

"6. Equitable and Injunctive Relief Available. In the event of a breach or threatened breach by [Rogers] of the obligations under this Agreement, [Rogers] acknowledges that [Burch] will not have an adequate remedy at law and shall be entitled to such equitable and injunctive relief as may be available to restrain [Rogers] from the continued (or threatened) violation of this Agreement. Nothing in this paragraph shall be construed as prohibiting [Burch] from pursuing any other remedies available for breach or threatened breach of this covenant not to compete, including the recovery of damages from [Rogers]."

On November 21, 2017, Rogers gave notice to Burch that he would be resigning effective December 5, 2017. After receiving that notice, Burch informed Rogers that he did not need to continue working for Burch.

Soon after leaving Burch, Rogers started working for American Thermal Systems, Inc. ("ATS"), as its president. ATS constructs cold-storage facilities. At the time, ATS was owned by Rogers's father.²

Clyde Walker was employed with Burch as the manager of its cold-storage facilities in Birmingham.³ As part of his job, Walker handled many aspects of every cold-storage project coming through Burch's Birmingham office. Walker's duties included bid processes, construction management, and client management.

On December 6, 2018, Rogers offered Walker a job with ATS. Walker accepted the offer on December 10, 2018. On December 31, 2018, Walker notified Burch that he was resigning. Walker's final day of employment with Burch was January 11, 2019. After beginning employment with ATS, Walker contacted the Burch customers that he had worked with while he was employed with Burch.

On January 29, 2019, Burch sued Rogers, Walker, and ATS, setting out seven counts in its complaint. In count 1, Burch alleged that Rogers breached the provisions in his employment agreement regarding confidentiality, trade secrets, proprietary information, and solicitation of customers. In count 2, Burch alleged that Rogers and Walker solicited clients in violation of the employment agreement. In count 3, Burch alleged that Rogers and Walker were negligent and wanton in handling proprietary information belonging to Burch. Count 4 alleged conversion against ATS, Rogers, and Walker regarding proprietary information. Count 5 asserted violations of trade secrets against ATS, Rogers, and Walker. In count 6, Burch sought injunctive relief against ATS, Rogers, and Walker to prevent further allegedly improper use of Burch's proprietary information. Count 7 alleged civil conspiracy against ATS, Rogers, and Walker for soliciting Burch's customers and employees and for using Burch's proprietary information.

Rogers, Walker, and ATS were served with notice and were notified that depositions would be taken. On September 30, 2019, Burch sought a preliminary injunction against Rogers, alleging that the unique and confidential information developed by Burch's management-level employees like Rogers is not available to the public and is part of Burch's proprietary information. Burch further alleged that Rogers's...