Jumbosack Corp. v. Buyck
407 S.W.3d 51
Mo. Ct. App.2013Background
- JumboSack Corp sought to enforce a 3-year non-compete against Employee after he began employment in 2003 and signed the Employment-Confidentiality Agreement in 2004.
- The agreement contained a savings clause stating that changes in compensation, position, or duties would not void the remaining provisions.
- Employee later accepted a competitor job and Employer sought injunctive relief for breach in 2010; Employee moved for summary judgment alleging lack of protectable interests and prior breach by Employer.
- Employer argued the Agreement was supported by consideration, that prior breaches did not void the non-compete, and that material issues of fact remained on breach and waiver.
- The trial court granted Employee summary judgment on lack of consideration and lack of protectable interests, prompting Employer’s appeal.
- The Court of Appeals reversed and remanded, holding genuine issues of material fact on material breach and remand for resolution, with some issues left undecided.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether continued employment constitutes valid consideration for post-employment non-compete | Employee argues continued employment alone is insufficient | Employee contends no additional consideration; Sturgis nuance not controlling | Yes; continued employment constitutes valid consideration |
| Whether Employer materially breached the employment agreement prior to Employee’s termination | Employer’s unilateral compensation changes may be material breaches | Changes were not material breaches or are disputed facts | Genuine issues of material fact preclude summary judgment; remanded |
| Whether the trial court erred by not addressing illusory nature of unilateral modification clause (mutuality/consideration) | Agreement may be illusory and unenforceable due to unilateral modification | Allowing unilateral modification may undermine mutuality; Court to remand without ruling on this point | Remanded; Court declined to resolve this issue on record |
Key Cases Cited
- Whelan Sec. Co. v. Kennebrew, 379 S.W.3d 835 (Mo. banc 2012) (non-competes enforceable in limited circumstances; burden on employer to prove reasonableness)
- Healthcare Servs. of the Ozarks, Inc. v. Copeland, 198 S.W.3d 604 (Mo. banc 2006) (reasonableness; narrowly tailored in geography and time; protect trade secrets or customer contacts)
- Marschuetz v. Supermarket Merch. & Supply, Inc., 196 S.W.3d 581 (Mo.App. E.D.2006) (material breach question reserved for trier of fact; unilateral changes can breach employment agreement)
- Nail Boutique, Inc. v. Church, 758 S.W.2d 206 (Mo.App. S.D.1988) (continued access to protectable interests can support consideration for non-compete)