456 P.3d 201
Idaho2019Background
- Trumble was a Farm Bureau independent contractor under a 1995 Career Agent Contract (90‑day noncompete) and participated in a Service Bonus Commission Memorandum that conditioned payment of accrued bonus credits on a one‑year post‑termination noncompetition period.
- Farm Bureau’s 2011 Memorandum expressly stated commission credits would be deposited with interest but would not be payable unless the agent satisfied all plan requirements, terminated, and observed the one‑year no‑competition restriction; unpaid credits would revert to Farm Bureau.
- Farm Bureau terminated Trumble on May 4, 2016 for alleged dishonesty; Farm Bureau informed him it would deny payment and noted the one‑year restriction applied even if termination was by Farm Bureau.
- Trumble sued seeking immediate payment and a ruling the one‑year restriction was unenforceable; after the 90‑day Agent Contract restriction expired he began working for a competitor and solicited customers from a 578‑name "Subject List."
- Farm Bureau counterclaimed under the Idaho Trade Secrets Act (ITSA) and for intentional interference with prospective economic advantage; the district court granted summary judgment to Farm Bureau on the bonus claim (forfeiture) and granted summary judgment to Trumble on the counterclaims; both parties appealed.
Issues
| Issue | Plaintiff's Argument (Trumble) | Defendant's Argument (Farm Bureau) | Held |
|---|---|---|---|
| Enforceability/scope of 1‑year noncompetition/forfeiture in 2011 Memorandum | Clause does not apply because Farm Bureau terminated him; alternatively, condition is unreasonable, punitive, or unconscionable; estoppel/anticipatory repudiation/futility excuses compliance | Memorandum is unambiguous; the one‑year restriction is a conditional forfeiture (not a restraint of trade or penalty) and applies regardless of who terminated; Farm Bureau complied with the Memorandum | Memorandum unambiguous; Trumble is bound by his concession below; forfeiture provision is enforceable and not unconscionable or a penalty; summary judgment for Farm Bureau affirmed (Trumble forfeited bonus) |
| Trade‑secret misappropriation (ITSA) | Subject List is Farm Bureau’s confidential customer data and was misappropriated; some names came from Farm Bureau commission statements | The list was compiled primarily from Trumble’s independent sources (phone contacts, memory); contact info is readily ascertainable and Farm Bureau took no reasonable measures to keep it secret | Subject List is not a trade secret on these facts and, even if it were, there is no evidence of improper acquisition or use; summary judgment for Trumble affirmed |
| Intentional interference with prospective economic advantage | Trumble’s use of the Subject List interfered with Farm Bureau’s expectancy | Interference arises from lawful pursuit of Trumble’s own business; no wrongful means or improper motive shown; interference claim rests on failed ITSA theory | No wrongful interference shown (ITSA claim fails); summary judgment for Trumble affirmed |
| Attorneys’ fees on appeal | Each party sought fees under I.C. §12‑120(3) | Same | Neither party is the overall prevailing party on appeal; fees and costs denied |
Key Cases Cited
- Anderson v. Farm Bureau Mut. Ins. Co., 112 Idaho 461, 732 P.2d 699 (Ct. App. 1987) (conditional forfeitures in agent agreements are not the same as traditional employee noncompete restraints and are generally enforceable)
- La Bella Vita, LLC v. Shuler, 158 Idaho 799, 353 P.3d 420 (2015) (customer lists may be trade secrets but protection depends on how lists were compiled and confidentiality measures)
- Hull v. Giesler, 156 Idaho 765, 331 P.3d 507 (2014) (contracts that expressly provide for forfeitures may be enforced; courts scrutinize unconscionability and penalty theories)
- Magic Valley Truck Brokers, Inc. v. Meyer, 133 Idaho 110, 982 P.2d 945 (Ct. App. 1999) (liquidated damages clauses may be unenforceable as penalties if exorbitant or unconscionable)
- Wesco Autobody Supply, Inc. v. Ernest, 149 Idaho 881, 243 P.3d 1069 (2010) (recognizing customer lists can be trade secrets)
- Northwest Bec‑Corp v. Home Living Serv., 136 Idaho 835, 41 P.3d 263 (2002) (ITSA should not be construed so broadly that normal employee knowledge/skills are forbidden to use)
- Freiburger v. J‑U‑B Eng’rs, Inc., 141 Idaho 415, 111 P.3d 100 (2005) (reasonableness standard for employee noncompete covenants)