Salas v. Chris Christensen Sys. Inc.

• Decision Date: 14 September 2011
• Docket Number: No. 10-11-00107-CV,10-11-00107-CV
• Parties: ERIC SALAS, Appellant v. CHRIS CHRISTENSEN SYSTEMS, INC., Appellee
• Court: Court of Appeals of Texas

ERIC SALAS, Appellant

v.CHRIS CHRISTENSEN SYSTEMS, INC., Appellee

No. 10-11-00107-CV

TENTH COURT OF APPEALS

Opinion delivered and filed September 14, 2011

From the 77th District Court

Freestone County, Texas

Trial Court No. 10-033-A

MEMORANDUM OPINION

By thirteen issues in this restricted appeal, appellant, Eric Salas, complains about several orders and a default judgment granted in favor of appellee, Chris Christensen Systems, Inc. (hereinafter "Christensen"). We affirm as modified.

I. BACKGROUND

On June 1, 2008, Christensen, a renowned manufacturer and distributor of "high quality dog grooming products that are used by dog show enthusiasts around the world," hired Salas, a pet handler and groomer, to serve as Vice-President of Sales andEducation Director. Prior to the commencement of his employment, Salas signed a Non-Compete and Confidentiality Agreement ("Agreement"). Christensen asserted in the trial court that the Agreement was necessary because the company is an industry leader in the manufacturing and distribution of dog grooming products, and through his employment, Salas received training about Christensen's unique systems and other trade secrets, including its confidential customer and distributor list and ingredients and manufacturing methods for its products. According to the Agreement, Salas agreed, for a period of five years after separation from Christensen, to not:

(a) directly or indirectly interfere with, or endeavor to entice away from the Company [Christensen] any clients or accounts with whom the Employee [Salas] had direct contact with at any time during his or her employment at Company, or for or with any other person, firm, corporation, partnership, joint venture, association, or other entity whatsoever, which is or intends to be engaged in providing and manufacturing pet supplies and related products manufactured and distributed by Company.

. . . .

(c) induce or attempt to induce any supplier, licensee[,] or other business relation of the Company to cease doing business with the Company, or in any way interfere with the relationship between any such supplier, licensee[,] or business relation and the Company.

Salas also agreed not to:

communicate, divulge, use, or disclose for use by any other person, firm, corporation, partnership, joint venture, association[,] or other entity whatsoever, any information or knowledge, known, disclosed[,] or otherwise obtained by him/her during his/her employment with Company (including information and knowledge conceived, discovered[,] or developed by Employee), which is not generally known in the pet supply manufacturing and distribution industry which relates to the business of the Company, or is in the nature of a trade or business secret of the Company or other Confidential material, unless publicly availableor required by a court of law or government agency. Further, Employee agrees that he/she will not work for any employer in any capacity to whom or to whose benefit he/she has divulged any trade secret, client, customer, or other confidential information of the Company.

After signing the Agreement, Christensen provided Salas with training and education regarding the company's product lines, and Salas was provided access to confidential information regarding the company's products, manufacturing and distribution processes, and many other trade secrets. Company President Chris Christensen testified at trial that the information that Salas had access to was very sensitive and that the company went to great lengths to ensure that the information remained confidential.

With respect to his job responsibilities, Salas promoted and marketed Christensen's dog-grooming products to the company's distributors and at dog shows throughout the United States. In addition, Salas conducted educational classes for participants and enthusiasts at the dog shows. As compensation for his services, Christensen paid Salas a salary and various benefits, including a house in Freestone County, Texas, though his job required that he travel much of the year.

On September 3, 2009, Salas resigned from the company. In the trial court, Christensen alleged that within forty-eight hours of his resignation, Salas contacted the company's main competitor in the dog-grooming industry, Pure Paws, and began promoting and marketing their products while using confidential information obtained from Christensen for the benefit of Pure Paws. Christensen also alleged that Salas induced two of Christensen's main distributors, A Magic Reflection and Rens PetDepot, to discontinue selling Christensen products and begin promoting and selling a competitor's products. According to Christensen, these acts constitute violations of the Agreement and resulted in Christensen losing $172,465.42 in profits.

On January 28, 2010, Christensen filed suit against Salas, seeking a temporary injunction and actual and exemplary damages. In its original petition, Christensen asserted that Salas had breached the Agreement he had signed with the company, misappropriated Christensen's trade secrets, converted Christensen's confidential information, and tortiously interfered with Christensen's prospective business relations. Salas filed an "Answer & Defenses" on February 26, 2010. A couple days later, Salas filed an amended "Answer & Defenses."¹ Christensen's temporary injunction request was set to be heard on March 4, 2010.

However, before the March 4, 2010 hearing, Salas faxed the trial court a letter, stating the following:

Please see attached. This matter is scheduled for a hearing on 3/4/10 at 9:00 a.m. I am currently a resident of Wildwood, FL[,] and I am currently in Chicago and will not return for another two weeks and would request that I attend this hearing telephonically. Thank you.

Later, Wendy Iaconetti filed a notice of appearance on Salas's behalf informing the trial court that she and Salas would be appearing for the temporary injunction hearing by telephone.

At the March 4, 2010 hearing, Iaconetti represented Salas and stated that she is an attorney licensed in Florida with the firm of Mandelbaum, Fitzsimmons & Hewitt.² Iaconetti informed the trial court that, although not speaking, Salas was participating in the hearing via conference call. In addition, Iaconetti requested that the trial court continue the hearing, but the trial court denied her request. Chris Christensen, the sole witness who testified at the hearing, detailed the allegations against Salas. At the conclusion of the hearing, the trial court granted Christensen's request for a temporary injunction and set the temporary injunction bond at $2,500. The case was set for trial on October 4, 2010.

Shortly after the temporary injunction hearing, Christensen discovered that Iaconetti is not a licensed attorney in Florida or any other state; instead, she was a legal assistant with the law firm of Mandelbaum, Fitzsimmons & Hewitt. Iaconetti later executed an affidavit explaining the situation:

I was contacted by Eric Salas to assist him with the lawsuit filed by Chris Christensen Systems, Inc. I prepared the answer that Mr. Salas filed in this case at his request. I contacted the 77th District Court about appearing as Mr. Salas's attorney at the hearing on the Temporary Injunction. In order to appear at the hearing, I forged the fax letterhead for the law firm of Mandelbaum, Fitzsimmons & Hewitt, and listed my name as an attorney of the firm. At the time, I was employed as a paralegal for Mandelbaum, Fitzsimmons & Hewitt.

I appeared at the hearing on March 4, 2010, and misrepresented myself to the court that I was Eric Salas's attorney. I am not, nor have I ever been, a licensed attorney in Florida or Texas or any other state. Eric Salas knew that I was not a licensed attorney when he asked me to attend the hearing on March 4, 2010 on his behalf. Eric Salas was also present onthe telephone on March 4, 2010, and heard me tell the court that I was a licensed attorney in Florida, which he knew was not true.

I prepared the answer and attended the hearing for the benefit of Eric Salas because he asked me to assist him in this matter.

Christensen subsequently revealed this discovery to the trial court; the trial court issued a show-cause order and, on May 6, 2010, conducted a hearing on a motion for contempt filed by Christensen.³ Salas did not appear for this hearing. The trial court ultimately: (1) concluded that Salas had committed a fraud on the court; (2) held Salas in contempt; (3) awarded Christensen $3,650 in attorney's fees; and (4) limited Salas's discovery to requests for disclosure, interrogatories, and requests for production.

Later, Christensen propounded discovery on Salas in the form of requests for disclosure, requests for production, and interrogatories. Salas did not respond to Christensen's discovery requests, so Christensen moved to compel Salas to respond. The trial court granted Christensen's motion to compel and ordered Salas to provide responses to Christensen's discovery within fourteen days.

In the meantime, Christensen noticed Salas's deposition. Once again, Salas failed to appear; thus, Christensen took a certificate of non-appearance. Additionally, Salas did not provide any responses to Christensen's discovery, a clear violation of the trial court's order on Christensen's motion to compel. As a result, Christensen filed a second contempt motion, and the trial court issued a second show-cause order.

On June 30, 2010, the trial court conducted a hearing on Christensen's second contempt motion. Salas did not appear at this hearing. Counsel for Christensen represented to the trial court that Salas had not complied with the trial court's previous contempt order requiring him to answer discovery and pay Christensen $3,650 in attorney's fees. Counsel also informed the trial court that Salas failed to appear for his noticed deposition. At the conclusion of this hearing, the trial court entered a second contempt order. Having already...