DENNIS HAGER, individually and on behalf of all those similarly situated, Plaintiff, v. METRO ONE LOSS PREVENTION SERVICES GROUP, INC., a Maryland corporation; METRO ONE LOSS PREVENTION SERVICES GROUP (WEST COAST), INC., AND METRO ONE LOSS PREVENTION SERVICES GROUP (GUARDS), INC., Defendants.
CASE NO. 3:25-cv-05164-JHC
UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT TACOMA
May 28, 2025
I
INTRODUCTION
This matter comes before the Court on Plaintiff Dennis Hager‘s Motion to Remand. Dkt. # 14. The Court has considered the materials filed in support of and in opposition to the motion, the rest of the file, and the governing law. The Court finds oral argument unnecessary. Being fully advised, for the reasons below, the Court DENIES the motion.
BACKGROUND
Defendants provide security and loss prevention services to customers across the corporate sector. Dkt. # 1-1 at 4 ¶ 3.7.1 Hager began working for Defendants in March 2023 as an Account Manager and was promoted to Regional Performance Manager in January 2024. Id. at 5 ¶ 5.3.2 Hager alleges that Defendants required him to sign a “Confidentiality and Noncompetition Agreement,” (the Agreement) containing a non-disparagement clause and a noncompetition covenant as part of his employment. Id. at 5–6 ¶¶ 5.4–5.5. The non-disparagement clause requires Hager to refrain from “directly or indirectly, through any agent or surrogate, or in any way otherwise, orally or in writing, either while employed by the Company, or at anytime thereafter, disparage or denigrate the Company.” Id. at 5 ¶ 5.4. The noncompetition covenant prohibits Hager, for two years after his employment ends, from
within a twenty-five (25) mile radius of any location at which the Company maintains or conducts any busines [sic]), operations or facility: (a) start[ing], continu[ing], advis[ing], assist[ing], or in any way otherwise participat[ing] or engag[ing] in any competing business; or (b) seek[ing] or accept[ing] any employment or other affiliation, in any capacity, with any then or thereafter known competitor of the Company which maintains any business, operations or facility.
Id. at 6 ¶ 5.5.
Hager filed this putative class action against Defendants in state court, alleging that the Agreement violated Washington‘s Noncompete Act (NCA),
III
DISCUSSION
Standing under Article III of the United States Constitution is a component of subject matter jurisdiction. Chandler v. State Farm Mut. Auto. Ins., 598 F.3d 1115, 1121 (9th Cir. 2010). It is a “threshold question in every federal case, determining the power of the court to entertain the suit.” Warth v. Seldin, 422 U.S. 490, 498 (1975). Article III standing requires that a plaintiff (1) “suffered an injury in fact[,]” (2) that there was a “causal connection between the injury and the conduct complained of[,]” and (3) the injury is likely “redressed by a favorable decision.” Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992) (internal quotation marks omitted). A plaintiff must have standing for each claim and form of relief sought. Davis v. Fed. Election Comm‘n, 554 U.S. 724, 734 (2008) (citing DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 352 (2006)). And “state law can create interests that support standing in federal courts.” Cantrell v. City of Long Beach, 241 F.3d 674, 684 (9th Cir. 2001) (“If that were not so, there would not be Article III standing in most diversity cases, including run-of-the-mill contract and property disputes.“).
At issue is the first element, injury-in-fact. An injury-in-fact must be “concrete and particularized” and “actual or imminent, not conjectural or hypothetical.” Montana Env‘t Info. Ctr. v. Stone-Manning, 766 F.3d 1184, 1188 (9th Cir. 2014) (quoting Friends of the Earth, Inc. v. Laidlaw Envt‘l Srvs. (TOC), Inc., 528 U.S. 167, 180–81 (2000)). The injury must also be “fairly
An injury is “concrete” for standing purposes if it is “de facto; that is, it must actually exist,” meaning that the injury is “real and not abstract.” Spokeo, 578 U.S. at 340. But “[c]oncrete’ is not, however, necessarily synonymous with ‘tangible.’ Although tangible injuries are perhaps easier to recognize, [the Supreme Court has] confirmed in many previous cases that intangible injuries can nevertheless be concrete.” Id. “Chief among them are injuries with a close relationship to harms traditionally recognized as providing a basis for lawsuits in American courts.” TransUnion, 594 U.S. at 425. When faced with “an intangible harm that is linked to a statutory violation,” courts “are guided in determining concreteness by both history and the judgment of Congress, or the legislature that enacted the statute.” Campbell v. Facebook, Inc., 951 F.3d 1106, 1116 (9th Cir. 2020) (internal quotation omitted). “When a legislature has enacted a ‘bare procedural’ protection, a plaintiff ‘cannot satisfy the demands of Article III’ by pointing only to a violation of that provision, but also must link it to a concrete harm.” Id. at 1117 (emphasis in original) (quoting Spokeo, 578 U.S. at 342). “When, however, a statutory provision identifies a substantive right that is infringed any time it is violated, a plaintiff bringing a claim under that provision ‘need not allege any further harm to have standing.‘” Id. (emphasis in original) (quoting Eichenberger v. ESPN, Inc., 876 F.3d 979, 983–94 (9th Cir. 2017)).
Generally, Washington‘s NCA prohibits employers from imposing noncompetition covenants on employees who earn less than $100,000 annually.
Hager contends that this matter should be remanded because the Complaint does not even allege a hypothetical injury due to Defendants’ violation of the NCA. Dkt. # 14 at 9. He says that “technical and procedural violations of the NCA” do not confer Article III standing absent a plaintiff pleading facts that the noncompetition covenant at issue caused a particularized and concrete injury. Dkt. # 19 at 10.
Defendants respond that the NCA “protects the concrete interest of preventing contracts of adhesion and restraints on employee mobility, particularly with respect to low-wage employees.” Dkt. # 17 at 21. They say that this concrete interest is violated the moment an employee is bound by an unlawful noncompetition covenant in an employment contract. Id. They also contend that the NCA‘s prohibition on noncompetition covenants implicates contract rights—a harm traditionally protected under common law. Id. at 22 (citations omitted).
Hager has a tangible interest in preventing the noncompetition covenant from being enforced against him. As a former employee of Defendants, he alleges that Defendants violated the NCA by “requir[ing]” him to sign an employment contract containing a noncompetition
And the Washington Legislature has said that “workforce mobility is important to economic growth and development” and the NCA “facilitat[es] workforce mobility and protect[s] employees.”
Furthermore, the alleged injury to Hager—the inclusion of a noncompetition covenant in his employment contract—implicates contract rights. This is a harm traditionally recognized as providing a basis for lawsuits in American courts. See TransUnion LLC, 594 U.S. at 413; cf. Eletson Holdings, Inc. v. Levona Holdings Ltd., 731 F. Supp. 3d 531, 571 (S.D.N.Y. 2024) (“History and precedent support that a person whose contractual rights have been violated has standing to sue the breaching party, regardless of whether the non-breaching party has suffered additional harm. . . A breach of contract always creates a right of action; but a breach sometimes
And the case Hager relies on to support his argument is distinguishable. In Rutter v. Bright Horizons Family Solutions Inc., No. C23-0233-KKE, 2024 WL 278928, at *1 (W.D. Wash. Jan. 25, 2024), plaintiff Rutter, a teacher at Bright Horizons, alleged that Bright Horizons violated the NCA based on an enrollment agreement between Bright Horizons and its customers. Id. The enrollment agreement stated that if a client family hired a former Bright Horizons employee within six months of the employee‘s departure from Bright Horizons, the family would have to pay a $5,000 placement fee. Id. The court, in resolving Bright Horizons’ motion to dismiss, determined that Rutter lacked Article III standing because she did not allege a concrete, non-hypothetical injury. Id. at *2. As the court noted, the enrollment agreement was “between Bright Horizons and its customers” and was not a provision “in any employment agreement with Rutter.” Id. The court also observed that “no Washington court has determined whether [the NCA] encompasses agreements that merely impact employees in some way, as opposed to agreements with employees that restrict their workplace mobility.” Id. (emphasis in original) Ultimately, the court‘s analysis turned on the fact that Rutter‘s alleged injuries were “entirely hypothetical,” because the Complaint alleged that “Bright Horizons client families would ‘likely’ not be able to hire her because of the placement fee provision.” Id. (emphasis added). Here, unlike in Rutter, Hager alleges a concrete injury: as an employee he was required to sign an employment contract with Defendants containing a noncompetition covenant restraining his employment mobility for two years after his employment ends.
The decisions of other courts in this District regarding Washington‘s Equal Pay and Opportunities Act (EPOA) are also distinguishable. The EPOA requires employers to “disclose
Similarly, in Atkinson v. Aaron‘s LLC, 733 F. Supp. 3d 1056, 1070 (W.D. Wash. 2024), Atkinson applied online for a position with Aaron‘s that was posted on the company‘s website. Id. at 1063. Atkinson alleged that the job posting did not disclose the wage scale or salary range in violation of the EPOA. Id. The court, in ruling that Atkinson lacked Article III standing, stated that a “nominal [job] applicant with no interest in the position will neither receive a benefit from early pay disclosure nor be harmed by the lack thereof. There is no risk of harm to someone browsing job postings with no intent to apply or with intent only to find those that have no compensation included so they can go through the motion of applying and then sue for the technical violation.” Id. at 1070.
Here, unlike the “nominal applicants” in the EPOA cases, Hager‘s injury is concrete or particularized. He alleges that he is currently bound by an unlawful noncompetition covenant
B. Injury under Washington‘s SNMA
The SNMA “[p]rohibit[s] nondisclosure and nondisparagement provisions in agreements concern[ing] conduct that occurs at the workplace, at work-related events coordinated by or through the employer, between employees, or between an employer and an employee, whether on or off the employment premises.”
Nondisclosure and nondisparagement provisions in agreements between employers and current, former, prospective employees, and independent contractors have become routine and perpetuate illegal conduct by silencing those who are victims or who have knowledge of illegal discrimination, illegal harassment, illegal retaliation, wage and hour violations, or sexual assault. It is the intent of the legislature to prohibit nondisclosure and non-disparagement provisions in agreements, which defeat the strong public policy in favor of disclosure.
Id. (“Official Notes“).
Hager asserts that his contention that Defendants violated Washington‘s SNMA has no concrete injury. Dkt. # 14 at 9. He says that even though there is no precise case law on Article III standing under Washington‘s SNMA, the legislative language of the statute is instructive. Id. at 10 (quoting
Defendants counter that the SNMA codifies the concrete interest of allowing employees to speak freely about illegal acts in the workplace by prohibiting non-disclosure and non-disparagement provisions in employment contracts. Dkt. # 17 at 26. They say, “That interest is violated when an allegedly unlawful non-disparagement clause is included in an employment agreement.” Id. at 27. They also say that Hager‘s claim under the SNMA is premised on a violation of his contract rights, a concept deeply rooted in the common law. Id. at 28.
Hager‘s SNMA claim derives from the alleged inclusion of an unlawful clause in his employment contract. As stated above, the alleged injury to Hager implicates contract rights. This is a harm traditionally recognized as providing a basis for lawsuits in American courts. See TransUnion LLC, 594 U.S. at 413; see also Eletson Holdings, Inc., 731 F. Supp. 3d 531, 574 (S.D.N.Y. 2024) (“[C]ontract rights are a type of private right recognized as conferring Article III standing.“); cf. In re Google Referrer Header Priv. Litig., 465 F. Supp. 3d 999, 1011 (N.D. Cal. 2020) (“An individual to whom a contractual duty is owed may, therefore, allege a concrete legal injury by virtue of the duty‘s breach, apart from any actual damages stemming from that breach“).
Moreover, although Hager contends that Defendants’ alleged violation of the SNMA is “purely technical,” Dkt # 14 at 11, the Washington Legislature in enacting the SNMA recognized the “strong public policy in favor of disclosure” and that non-disclosure and non-disparagement agreements have “become routine and perpetuate illegal conduct.”
IV
CONCLUSION
Based on the above, the Court DENIES the motion to remand the case to Pierce County Superior Court. The Court also DENIES Hager‘s request for attorney fees and costs. The Court DIRECTS the Clerk to issue a new order regarding initial disclosures, joint status report, and early settlement.
Dated this 28th day of May, 2025.
John H. Chun
United States District Judge