Southeastrans, Inc. v. Landry, CASE NO. 20-CV-00086
| Decision Date | 12 March 2021 |
| Docket Number | CASE NO. 20-CV-00086 |
| Parties | SOUTHEASTRANS, INC. v. MORGAN LANDRY, ET AL. |
| Court | U.S. District Court — Western District of Louisiana |
Pending before the court is a Motion for Partial Summary Judgment filed by defendant Morgan Landry. [ECF No. 26] Landry seeks dismissal of Southeastrans, Inc.'s ("Southeastrans") claims against him for violation of non-competition and non-solicitation provisions in his employment agreement. Southeastrans has filed an opposition [ECF No. 29], to which Landry has filed a reply. [ECF No. 34] For the following reasons, the motion is GRANTED IN PART and DENIED IN PART.
Southeastrans is a Georgia corporation that provides non-emergency medical transportation ("NEMT") brokerage services throughout the United States. [ECF No. 1 at 1] Defendants Landry and Lester were employed by Southeastrans in Louisiana until late 2019. [ECF No. 1 at 2] Southeastrans alleges that, in addition to general policies related to the use of proprietary and confidential information, Landry's employment agreement included non-competition provisions prohibiting him from competing with Southeastern and soliciting Southeastrans' customers; the agreement also requires the return of all Southeastrans' confidential information upon termination of his employment. [ECF No. 1 at 3-4] Southeastrans asserts that under a Non-Emergency Medical Transpotration Provider Agreement, Medi Trans agreed to provide transportation services, agreed not to compete with Southeastrans in the NEMT market, and agreed not to solicit Southeastrans' employees for up to one year after their employment terminated. [ECF No. 1 at 6-7]
The "Non-Compete, Non-Solicitation, and Confidentiality Agreement" ("the Non-Compete Agreement") attached both to the Complaint [ECF No. 1-2] and to Southeastrans' opposition [ECF No. 29-2] contains the relevant restrictions on competition and solicitation. Section 4 of the Non-Compete Agreement provides that Landry shall not engage in any listed form of solicitation during his employment with Southeastrans and for one year following termination. [ECF No. 29-2 at 2] Section 4(A) bars Landry from soliciting or attempting to solicit any of Southeastrans' "customers or actively sought prospective customers, with whom [Landry] had material contact" for the purpose of competing with Southeastrans, and bars Landry from bidding to provide NEMT services within the Restricted Territory." [Id.] Section 4(B) bars Landry from soliciting or inducing any employee or independent contractor of Southeastrans to terminate an employment relationship or contract with Southeastrans or to obtain employment with an entity other than Southeastrans. [Id.]
Section 5 imposes the restrictions on competition. Section 5(C) provides that Landry will not provide any advice or services to any enterprise that competes with Southeastrans during his employment there. [ECF No. 29-2 at 2] Section 5(C) further provides that Landry will not compete with Southeastrans in the Restricted Territory for a period of one year following the termination of his employment. [Id.] Section 5(B) defines the Restricted Territory as consisting of "the State of Louisiana" for purposes of the Non-Compete Agreement. [Id.]
Southeastrans alleges that defendants Landry and Lester negotiated with Medi Trans to develop a competing NEMT brokerage business for it while they were still employed bySoutheastrans. It also alleges that they either copied or failed to return Southeastrans' proprietary and confidential information and are using this confidential and proprietary information to compete with it. [ECF No. 1 at 4-7] Accordingly, Southeastrans filed a Complaint [ECF No. 1] alleging that the defendants violated their non-competition and non-solicitation agreements with Southeastrans, and that they used Southeastrans' proprietary or confidential information to compete against it. Southeastrans further asserts claims for trade secret misappropriation in violation of 28 U.S.C. § 1831, et seq., violation of the Louisiana Uniform Trade Secrets Act, La. R.S. 51:1431, et seq., and deceptive practices in violation of the Louisiana Unfair Trade Practices Act. Southeastrans further asserts that Landry and Lester violated their fiduciary duties to Southeastrans. Southeastrans requests damages and injunctive relief.
The Court previously entered a temporary restraining order enjoining all defendants from using, sharing, altering, or destroying any confidential or proprietary information belonging to Southeastrans or from soliciting Southeastrans employees, among other orders. [ECF No. 8] Defendants then filed a Counterclaim asserting that Southeastrans has violated the Louisiana Unfair Trade Practices Act and committed tortious interference with their business relations, seeking damages and injunctive relief. [ECF No. 11] This Court previously dismissed those counterclaims. [ECF No. 46] Landry now seeks dismissal of Southeastrans' claims against him for violation of contractual agreements not to compete and not to solicit.
Summary judgment is proper if the pleadings, discovery products on file, and affidavits show that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The purpose of summary judgment is to pierce the pleadings, to assess the proof, and to determine whether there is a genuine need for trial. SeeMatsushita Electric Industries v. Zenith Radio Corp. 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L.Ed.2d 538 (1986). Summary judgment procedure is designed to isolate and dispose of factually unsupported claims or defenses. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S. Ct. 2548, 91 L.Ed.2d 265 (1986). If the movant bears the burden of persuasion at trial on a claim or defense addressed in the motion for summary judgment, the movant must establish that there is no genuine dispute of material fact as to those claims or defenses. To satisfy this burden, the movant must come forward with competent summary judgment evidence conclusively establishing that no reasonable trier of fact could find other than for the moving party. See Calderone v. United States, 799 F.2d 254, 259 (6th Cir.1986). To avoid summary judgment, the non-movant must then come forward with evidence showing that there is a genuine dispute of material fact.
If the non-moving party has the burden of persuasion at trial with respect to an issue addressed in the motion for summary judgment, the moving party may satisfy its initial burden by either (1) demonstrating affirmatively that there is no triable issue of fact as to each element of the non-moving party's affirmative defenses or claims, or (2) "showing" that the non-moving party cannot present evidence sufficient to satisfy the essential elements of its defenses or claims and thus cannot meet its burden of persuasion at trial. Celotex Corp., 477 U.S. at 324-326, 106 S. Ct. 2548. If the moving party makes a showing that there is "no evidence" to support the non-moving party's claims or defenses, the non-moving party must come forward with "substantial" evidence showing a genuine dispute of material fact with respect to each essential element of its affirmative defenses or claims. Id. Substantial evidence for purposes of defeating summary judgment is evidence sufficient to support a jury verdict in the non-movant's favor. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-252, 106 S. Ct. 2505, 91 L.Ed.2d 202 (1986). Under this standard, the non-movant cannot rely on unsupported assertions or arguments but must submit sufficientlyprobative evidence supporting its claims or defenses. Even if the burden shifts to the non-moving party, the movant still retains the ultimate burden of persuasion on the motion for summary judgment. Celotex Corp., 477 U.S. at 330-331, 106 S. Ct. 2548.
In considering a summary judgment motion, "the court must disregard all evidence favorable to the moving party that the jury is not required to believe and should give credence to the evidence favoring the nonmoving party as well as that evidence supporting the moving party that is uncontradicted and unimpeached." Roberts v. Cardinal Servs., 266 F.3d 368, 373 (5th Cir. 2001); see also Feist v. Louisiana, Dept. of Justice, Office of the Atty. Gen., 730 F.3d 450, 452 (5th Cir. 2013)(court must view all facts and evidence in the light most favorable to the non-moving party). "Credibility determinations are not part of the summary judgment analysis." Quorum Health Resources, L.L.C. v. Maverick County Hosp. Dist., 308 F.3d 451, 458 (5th Cir. 2002). Rule 56 "mandates the entry of summary judgment . . . against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof." Patrick v. Ridge, 394 F.3d 311, 315 (5th Cir. 2004) (alterations in original) (quoting Celotex v. Catrett, 477 U.S. 317, 322 (1986)).
Landry argues that the non-competition and non-solicitation provisions in his employment agreement are unenforceable under Louisiana Revised Statute 23:921 as a matter of law because they do not include a geographic restriction that specifies the parishes, municipalities, or territories where they apply. [ECF No. 26-2 at 3] The agreements provide that the restrictions apply in "the State of Louisiana," which Landry contends is an improper geographic designation. [ECF No. 26-2 at 1-2] Southeastrans clarifies that Landry executed agreements covering two distinct types ofsolicitation in addition to competition: solicitation of Southeastrans' employees and solicitation of its customers. Southeastrans argues that the agreement not to solicit its employees is not barred by 23:921 because that statute does not apply to agreements...
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