Savis, Inc. v. Cardenas

• Decision Date: 23 March 2021
• Docket Number: Case No.: 18-cv-6521
• Citation: 528 F.Supp.3d 868
• Parties: SAVIS, INC., Plaintiff, v. Neftali CARDENAS, Defendant.
• Court: U.S. District Court — Northern District of Illinois

528 F.Supp.3d 868

SAVIS, INC., Plaintiff,

v.Neftali CARDENAS, Defendant.

Case No.: 18-cv-6521

United States District Court, N.D. Illinois, Eastern Division.

Signed March 23, 2021

Kenneth Young Hurst, Hurst LLC, Burbank, IL, for Plaintiff.

Neftali Cardenas, Norwalk, CA, Pro Se.

MEMORANDUM OPINION AND ORDER

Joan B. Gottschall, United States District Judge

This dispute involves a noncompetition clause in an employment agreement. Plaintiff Savis, Inc. ("Savis"), provides consulting and manufacturing support services to clients in the pharmaceuticals industry. See Def.’s Resp. in Opp'n to Pl.’s LR 56.1 Stmt. of Material Facts in Supp. of Mot. Summ. J. ("Resp. to SOF") ¶ 20, Dkt. No. 163. Savis hired defendant Neftali Cardenas ("Cardenas") in 2016 as a "capital project engineer" providing services to Pfizer, a Savis client, at Pfizer's facility in McPherson, Kansas ("McPherson facility"). Resp. to SOF ¶¶ 8, 10. Cardenas worked at the McPherson facility for Savis until he resigned to take a job with Pfizer at the same facility in September 2018. See id. ¶¶ 11-12. Shortly after Cardenas resigned, Savis filed this diversity suit against Cardenas and moved for a temporary restraining order ("TRO") and preliminary injunction enforcing non-competition and duty of loyalty clauses in employment agreements signed by Cardenas in June 2018. See id. ¶¶ 4–5 (setting forth text of clauses). The court held a hearing and denied Savis's motion. Savis, Inc. v. Cardenas (Savis I ), 2018 WL 5279311 (N.D. Ill. Oct. 24, 2018). The parties then conducted discovery.

The court has before it Savis's motion for summary judgment on the five counts of its complaint. Dkt. No. 139. Savis seeks damages of at least $563,200 and equitable relief, including a permanent injunction preventing Cardenas from working for Pfizer. See id. at 4-5. For the reasons that follow, the court grants the motion in part and denies it in part. The court enters summary judgment that Cardenas is liable for the breach of contract claim alleged in count I of the complaint, but genuine factual disputes exist as to Savis's claimed damages.

I. Background

Savis pleads five claims in its complaint. See Compl. 13-22, Dkt. No. 1. In counts I and II, Savis alleges that Cardenas breached employment contracts signed in June 2018 (see Part I.A below). Compl. 13-18. The remaining three counts assert claims for breach of fiduciary duty (count III), breach of the implied covenant of good faith and fair dealing (count IV), and "tortious interference with contracts, business relationships, and expectations" (count V). Compl. 18-22. Except where noted otherwise, the court summarizes the facts in the light most favorable to Cardenas and draws all reasonable inferences in his favor. See, e.g , Rowlands v. United Parcel Serv. - Ft. Wayne , 901 F.3d 792, 795 (7th Cir. 2018) (citing Malin v. Hospira, Inc. , 762 F.3d 552, 554 (7th Cir. 2014) ); see also Part II.A below (setting forth summary judgment standard).

A. Contractual Language

Two contracts are at issue here. Resp. to SOF ¶¶ 4–5; Pl.’s Exs. D, E. The first is a memorandum entitled "Renewal Offer of Employment" dated May 31, 2018 ("renewal offer") and signed by Cardenas on June 5, 2018. Resp. to SOF ¶ 4; Pl.’s Ex. D. The renewal offer was contingent on Cardenas signing Savis's full employment contract ("employment contract") entitled "Savis Renewal of contract full [sic] Agreement NDA, NCA, and NSA." Pl.’s Ex. D at 2; Pl.’s Ex. E. Cardenas signed the employment contract on June 6, 2018. Resp. to SOF ¶ 5; Pl.’s Ex. E. In consideration for signing these contracts, Savis increased Cardenas's annual salary by $5,000 to $75,000. Resp. to SOF ¶ 4.

The renewal offer contained the following language at issue here:

Employee agrees that during Employee's employment with the Company, Employee will:

1.1. Owe a duty of loyalty to the Company and will devote Employee's full working time, attention and efforts to the business and affairs of the Company.

....

1.3. Will not directly or indirectly engage in any business activity competitive with the Company's business or divert any business opportunity related to the Company's business form [sic] the Company.

....

1.7. Any dispute arising from this offer or employment will be disputed in the state of Florida under Florida law.

Id. ¶ 4 (quoting Pl.’s Ex. D at 1, 3).

Cardenas's full employment contract contained a separate choice of law clause: "This agreement will be governed, construed and enforced in accordance with the laws of the State of Florida." Id. ¶ 5 (quoting Pl.’s Ex. E ¶ 10(c)). Paragraph eight of the employment contract contains a non-competition clause:

8. Non-Compete

Employee recognizes the Company's legitimate interest in protecting, for a reasonable period of time after employment, existing clients and prospective clients of the Company with which Employee becomes involved or as to which Employee acquires Confidential Information during employment with the Company. Employee agrees, during the time the Employee is providing services for the Company and for a period of two (2) years after the termination of services, whether termination is voluntary or involuntary, Employee shall not—without the Employer's prior written consent—directly or indirectly, market, offer, sell or furnish any products or services similar to, or otherwise competitive with, those offered by the Company to any client of the Company, or any prospective client of the Company with which Employee was involved or as to which Employee acquired Confidential Information. Employee further agrees, during the time Employee is providing service for the Company and for the two (2) year period after the termination of services, whether voluntary or involuntary, Employee shall not-without the Employer's prior written consent - directly or indirectly, market, offer, sell or furnish any products or services to a competitor of Company if Employee's duties at the competitor are materially similar to those duties of Employee while employed with the Company. Competitors include, but are not limited to, the following companies and their subsidiaries or affiliates: Amgen, Ben Venue Laboratories, Boehringer-Ingelheim, Agilent, SANDOZ, Novartis, Grifols, Stantec, J.M. Hyde, Mangan, Commissioning Agents Inc., Matrix, Wunderlich Malek, Vista Engineering, Quantic, Beepix, PharmEng, ValSource, Kelly Services, CRB, Jacobs, Avexis, Bayer, Genentech, Gilead, Pfizer, Medtronic, Medimune, RTD.

Employee acknowledges that this restriction is necessary because Employee's position with the Employer would make it impossible for Employee to work for a competitor without disclosing the Employer's Confidential Information, interfering with the Employer's customer relationships, or otherwise violating Employee's obligations under this Agreement. Employee further acknowledge that the Employer does business with customers throughout the United States and in foreign countries, so it is impossible to restrict more narrowly the geographic scope of Employee's obligation not to compete with the Employer. The provisions of this Paragraph shall survive the termination of this Agreement for any reason.

Pl.’s Ex. E at 5.

B. Procedural History

This court's prior opinions discuss the procedural history in detail. See Savis, Inc. v. Cardenas (Savis II ), 2020 WL 4736411, at *1–2 (N.D. Ill. Aug. 14, 2020) ; Savis I , 2018 WL 5279311, at *1. Cardenas presently represents himself. The court recruited counsel for Cardenas shortly after this case was filed. At that time, the record made clear that Cardenas "had a substantial income until recently. But he also recently accepted a position with a new employer, and the purpose of plaintiff's [then pending] motion for a temporary restraining order and preliminary injunction [was] to prevent defendant from working for his new employer." Dkt. No. 20 (Oct. 3, 2018).

Savis's motion for a preliminary injunction was denied on October 24, 2018, and discovery began. At the conclusion of discovery, it became clear that Cardenas was no longer eligible for recruited counsel, although the court was persuaded that while Cardenas had means and was not indigent, his modest means were insufficient to retain counsel for a case of this complexity. Nevertheless, the court felt itself compelled to discharge Cardenas's recruited lawyer in September 2019, leaving him self-represented, a.k.a. pro se.

Savis II , 2020 WL 4736411, at *1 (citations omitted).

Following the conclusion of discovery and unsuccessful settlement efforts, see id. , Savis filed its pending motion for summary judgment in June 2020. Dkt. No. 139. Cardenas filed an untimely and facially deficient pro se summary judgment response, which prompted the court to inquire into the sufficiency of the notice given to him of the consequences of failing to respond adequately to a summary judgment motion. See Savis II , 2020 WL 4736411, at *1-2. This court ruled that although Cardenas had been sent the notice to pro se litigants then required by this court's Local Rule 56.2 (since amended), the notice did not satisfy Seventh Circuit case law on the due process rights of self-represent litigants at summary judgment. Id. at *2-4 (discussing Timms v. Frank , 953 F.2d 281 (7th Cir. 1992), and Lewis v. Faulkner , 689 F.2d 100 (7th Cir. 1982) ). This court provided Cardenas the notice required by Timms and Lewis and set a deadline for him to file a response to Savis's summary judgment motion. See id. at *4.

Cardenas then timely filed a declaration signed under penalty of perjury, Dkt. No. 163-1, and two quite different documents, both entitled "Defendant's Response in Opposition to Plaintiff's Local Rule 56.1 Statement of Undisputed Material Facts in Support of its Motion for Summary Judgment," Dkt. Nos. 163 and 164. Savis filed a reply memorandum of law, Dkt. No. 167, and a separate reply, Dkt. No. 168, to Cardenas's response to its statement of undisputed material facts.

II. Summary Judgment Standard and Fact Statements

A...