Choice Professional Overnight Copy Service, Inc. v. Galeas
66 So. 3d 1216
La. Ct. App.2011Background
- Choice provides copy and litigation support; Galeas, Stevens, and Martin were salesmen with hourly pay plus monthly profit and sales commissions.
- In December 2002, Choice required the three salesmen to sign an Agreement Not to Unfairly Compete With or Solicit Employees, which included a one-year post-employment non-solicitation/non-compete and Exhibit A listing 53 parishes and 53 municipalities.
- Broussard joined Choice in 2008 and signed a later, stricter non-competition/non-solicitation agreement restricting working for competitors for two years.
- On September 30, 2010, Broussard, Stevens, Galeas, and Martin resigned and joined Alliance Overnight Document Service, founded by a former Choice officer.
- Choice sought damages and a preliminary injunction in October 2010; the trial court issued a TRO and later denied the preliminary injunction after hearings, dissolving the TRO, and Choice appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are the agreements enforceable under 23:921? | Choice argues the agreements enforceable under 23:921. | Defendants contend the agreements are invalid as overbroad and lack proper geographic limits. | No abuse of discretion; agreements invalid due to lack of geographic limits for non-solicitation. |
| Do the agreements include valid non-compete and non-solicit terms separately? | Agreement contains both non-compete and non-solicit obligations. | Defendants argue the provisions are not properly separated and defined. | Court treated them as combined but found lack of geographic scope voids the non-solicitation portion. |
| Is there irreparable injury or likelihood of success on the merits warranting injunctive relief? | Choice seeks injunction to prevent irreparable harm from loss of customers. | No irreparable harm shown and likely lack of success on merits due to invalid agreements. | No irreparable injury established; likelihood of success on merits not shown due to invalid scope. |
| Did the trial court abuse its discretion in denying the preliminary injunction? | Trial court erred in denying relief based on flawed interpretation. | The court properly applied strict construction and policy against broad covenants. | No abuse of discretion; affirm the denial of the preliminary injunction. |
Key Cases Cited
- Clear Channel Broadcasting, Inc. v. Brown, 901 So. 2d 553 (La.App. 4 Cir. 2005) (irreparable injury not required for 23:921 relief; strict construction of covenants)
- SWAT 24 Shreveport Bossier, Inc. v. Bond, 808 So.2d 294 (La. 2001) (public policy disfavors non-compete agreements)
- Derbes v. City of New Orleans, 941 So.2d 45 (La.App. 4 Cir. 2006) (three elements for granting a preliminary injunction)
- H.B. Rentals v. Bledsoe, 24 So.3d 260 (La.App. 3 Cir. 2009) (geographic limitation required for non-solicitation to be enforceable)
- Vartech Systems, Inc. v. Hayden, 951 So.2d 247 (La.App. 1 Cir. 2006) (non-solicitation and non-compete provisions subject to 23:921 analysis)