History
  • No items yet
midpage
Midstate Environmental Services, LP v. John Atkinson and 5A Environmental Services, LLC
13-17-00190-CV
| Tex. App. | Dec 14, 2017
Read the full case

Background

  • Midstate employed Atkinson as a route driver for ~19 years; he had access to customer lists, pricing, and solicited customers.
  • In June 2012 Atkinson signed a Retention Agreement and a Non-Compete Agreement that barred competition and solicitation during employment and for one year after; both agreements stated he remained an at‑will employee.
  • In March 2017 Midstate discovered Atkinson had business cards and a DOT permit application for 5A Environmental Services and believed he was starting a competing business.
  • Midstate sued for breach of contract, trade-secret misappropriation, and tortious interference and obtained a TRO; after a temporary injunction hearing the trial court denied injunctive relief and issued findings that Midstate failed to prove irreparable injury and that the Non‑Compete supplanted the Retention Agreement.
  • On accelerated interlocutory appeal Midstate challenged only the denial of the temporary injunction; the Court of Appeals affirmed, holding the trial court did not abuse its discretion because evidence supported the finding that damages would adequately compensate Midstate.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether Midstate proved entitlement to a temporary injunction (three‑part test: cause of action, probable right, probable/irreparable injury) Midstate asserted it had a cause of action and would suffer irreparable harm (including reputational harm and loss of trade‑secrets value) not readily compensable in money Atkinson argued Midstate had an adequate remedy at law because any losses (lost customers/revenue) could be calculated and compensated Held: Court affirmed denial — dispositive: Midstate failed to show irreparable injury; some evidence supported trial court’s finding damages would be adequate
Whether the non‑compete had adequate consideration/supporting facts relevant to injunction Midstate relied on agreements and payments as consideration supporting enforcement Atkinson pointed to at‑will status, prior knowledge of customer lists, and limited additional consideration (one training) as weakening enforceability Held: Court declined to decide ultimate enforceability; noted trial court found insufficient additional consideration but affirmed denial on irreparable‑harm ground

Key Cases Cited

  • Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002) (elements and discretionary nature of temporary injunction)
  • Walling v. Metcalfe, 863 S.W.2d 56 (Tex. 1993) (purpose of temporary injunction and standards)
  • Beaumont Bank v. Buller, 806 S.W.2d 223 (Tex. 1991) (abuse‑of‑discretion review of interlocutory rulings)
  • Sun Oil Co. v. Whitaker, 424 S.W.2d 216 (Tex. 1968) (temporary injunction element requirements)
Read the full case

Case Details

Case Name: Midstate Environmental Services, LP v. John Atkinson and 5A Environmental Services, LLC
Court Name: Court of Appeals of Texas
Date Published: Dec 14, 2017
Docket Number: 13-17-00190-CV
Court Abbreviation: Tex. App.