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Phoenix Capital, Inc. v. Dowell
2007 WL 2128330
Colo. Ct. App.
2007
Check Treatment

*1 light of the evidence modification. such had parties operated record that plan modificationof a de facto disrupted would least the children sleepover ar-

continuing their current that it was perceive we do not

rangements, modify plan to

an abuse of discretion chil- the best interests

accommodate

dren.

III. brief, makes number reply

In her mother not made in her arguments that were brief, and,

opening apparently, were not consider trial court. We will

made Marriage re arguments. See In these

Atencio, (Colo.App.2002)

(issue the trial court will not raised before Marriage In re appeal); be addressed on Smith, (Colo.App.1999) (issue in appellant’s time raised for first considered). not be

reply brief will

The orders are affirmed. Judge

Judge HAWTHORNE VOGT

concur. CAPITAL, INC. and Phoenix

PHOENIX Services,

Analytic Inc., Plaintiffs-

Appellants Cross-Appellees, DOWELL, Defendant-Appellee

Robert M. Cross-Appellant.

No. 05CA2712. Appeals, Court of

Div. V.

July 2007.

Certiorari Denied Feb.

838 *3 Forbes, LLP, Forbes,

Horowitz Peter C. Colorado; Denver, Neuwirth, P.C., Dean Neuwirth, Denver, Colorado, Dean Plain- tiffs-Appellants Cross-Appellees. Reichert, LLP, Shepherd Barry Kamlet & Schwartz, Denver, Colorado, A. for Defen- dani>-Appellee Cross-Appellant. Opinion Judge DAILEY. Plaintiffs, (PCI) Capital, Inc. *4 Services, Analytic (PAS), appeal Inc. denying trial court’s order their mo- defendant, preliminarily enjoin tion to Robert Dowell, violating M. noncompetition agreement injunctive denying relief against beyond one-year Dowell limit time specified in agreement. a nonsolicitation Do- cross-appeals well pre- trial court’s order liminarily enjoining him violating agreement nonsolicitation for the remainder specified period. part, affirm in part, vacate and remand with directions. Background I. is an provides

PCI investment bank that analytic brokerage assistance to financial sell, buy, institutions and investors who manage servicing certain rights associated pools with large mortgages. Those servic- ing rights mortgage payments, collect —to taxes, and on mortgages interest residential proceeds and then to remit these mortgage independently holder —exist underlying mortgage obligations themselves. initially employed PCI as a Dowell senior portfolio analyst. In Dowell signed an PCI, agreement with which he was prohibited, in employ, the event he left PCI’s from competing with soliciting PCI or or employees year. customers for one agreement provided binding that it was would “inure to the parties, benefit assigns.” and [PCI’s] successors and By was Dowell the head of PCI’s analytics Subsequently, division. PCI independent formed PAS as an company to analytical undertake its functions and trans- manage analytics ferred Dowell to divi- sion at PAS. PAS, CO/Bluffs, Apartments, 159 L.L.C. forming executed a transfer

In PCI (Colo.2007), voluntarily Phoenix had pertinent part, provided, agreement which transfer, “sell, scope those agreed limit the closing, PCI would PAS, only efforts clients or “active” to solicit assign, properties, all and deliver assets, every employees. kind and business goodwill, personal, both real and description, 1(a)(3), Phoenix and Pursuant to C.A.R. intangible, analytic ser- tangible appeal aspects each those of the trial Dowell (‘the division, as set forth on Schedule vices injunction preliminary ruling that court’s Assets’).” original.) PCI’s (Emphasis in respective their were adverse to interests. employment agreements were not listed nor, matter, any- 1; for that Schedule Preliminary Injunction II. Standards thing else. prelim granting or of a “The denial resigned from PAS In March injunction adju inary does not amount to an forming a join competitors in one of PCI’s controversy. rights dication the ultimate According to PCI and PAS company. new injunction, preliminary granting Phoenix), actively began to (collectively, attempt what court should not to do can clientele, company his new solicit assist PCI’s hearing full done after a final de work, brokerage competing with PCI Querard, Litinsky v. cree.” *5 key employ- try of PAS’s to convince two (citation omitted). Thus, (Colo.App.1984) 819 join company. to his new ees prelimi findings by a trial after a made court action, present the injunction hearing Phoenix instituted nary not determina enforce, injunctive to and dam- seeking relief of the ultimate merits of the case. Car tive of, noncompeti- ages past Stancato, 18, the for violations v. 144 354 P.2d 1018 roll Colo. provisions (1960). in Dowell’s tion and nonsolicitation employment agreement. Preliminary injunctions protect hearing, the trial court determined After a irreparable injury plaintiffs sustaining preliminary to in- was entitled preserving ability the while trial court’s

junctive respect to the non- relief with following meaningful a a trial render decision provisions solicitation preliminary injunction is the A on merits. agreement. warranted, however, unless the trial has moving party finds the demon that Phoenix The trial court determined (1) following each of the six factors: probability reasonable strated had not established a moving probabili a party has reasonable the and thus was not the of success on merits (2) merits; ty danger of of success on respect to relief with the noncom- entitled (1) real, immediate, injury Dowell, irreparable exists at the petition provision because relief; may injunctive prevented by “pro- signed agreement, time was not (3) plain, speedy, moving party has no [or] fessional staff executive (4) law; remedy adequate grant meaning § 8-2- personnel” within the of thus, injunction will dis- 113(2)(d), C.R.S.2006, ing preliminary of a noncom- (5) interest; initio; public of balance provision void ab serve petition injunction; granting given equities favors provision initio could not be the void ab injunction preserve quo when, will the status subsequently, Dowell effect attained v. pending a trial on merits. Rathke managerial position with PCI and prominent (Colo. 648, MacFarlane, P.2d 648 PAS. 1982); Collegiate v. Nat’l Athletic see Bloom was, that Phoenix The trial court ruled Ass’n, 621, (Colo.App.2004). 93 623 P.3d however, enforce the entitled to case, presents present side In the neither addressing nonsolieitation of customers because, argument the last five Rathke Atmel about employees consistent with Instead, appeal and Corp., both Phoenix’s Corp. 30 factors. v. Vitesse Semiconductor turn the trial court’s 789, abrogated cross-appeal in Dowell’s (Colo.App.2001), P.3d 796 is, factor, first that wheth- by Ingold AIM part grounds v. assessment on other 840 probabili- management personnel.”

er shown a unper- Phoenix has reasonable areWe ty of success on the merits. suaded. grant We review a trial court’s Operative A. Date the Covenant of injunction preliminary denial of a for abuse Three divisions of this court have standard, Under that discretion. ex 8-2-113, C.R.S.2006, § interpreted to mean ruling amine the court’s determine wheth that “a right covenant which restricts application er it is on an based erroneous person compensation to receive for work law, manifestly arbitrary, or is otherwise performed any employer is void ab ini- unreasonable, or unfair. Bloom Nat’l Col tio,” Management than “rather voidable.” Ass’n, legiate P.3d at Athletic 93 Boulder, Miller, Recruiters Inc. 762 (Colo.App.1988); P.2d 765 accord In re n Noncompetition III. The Provision Fischer, (Colo. Marriage 272 P.2d Phoenix contends that the trial court erred Machs., App.1992); Accounting Colo. Inc. v. ruling that it had not established a reason- Mergenthaler, 156-57, 44 Colo.App. request able probability success' on (1980). 1125, 1127 noncompetition enforce provision. A provision covenant or that is void disagree. beginning, ab initio is “[n]ull compete, “Covenants not to from the first moment when contract is exceptions, contrary some narrow Dictionary entered into.” Black’s Law public policy of Colorado and are void.” (7th ed.1999)' initio”); (defining “void ab see Enters., DBA Findlay, City County & Bd. County Denver v. (Colo.App.1996). preliminary in Comm’rs,

junction context, employer has the bur (Colo.App.1982)(equating ab void initio with *6 den to establish the covenant not to void, stating, meaning and “The of the term compete within falls one of those narrow ‘null, ineffectual, void nugatory.’ A.‘void’ Indus., exceptions. Porter Inc. v. Hig judgment, example, for is one. which ‘has gins, 1339, (Colo.App.1984). 680 P.2d 1341 (citation incipience.’” neither life nor omit ted) (quoting Black’s Dictionary Law and 8-2-113(2)(d) here, § pertinent As pro- Chevrolet, City County Davidson Inc. v. & vides prohibition that the on covenants not to of Denver, 175, 171, 1116, 138 Colo. compete not apply “shall to ... [executive (1958))). 1118 personnel management and officers and employees professional who constitute staff 35(f), Under C.A.R. the trial court to management executive personnel.” obliged was to follow the in decisions Man Here, Boulder, the trial court denied Phoenix’s agement re- Recruiters Inc. v. Mil of quest preliminary injunction ler, for a because it Fischer, supra, Marriage In re of found that Phoenix had not established a Machines, Accounting and Colorado that, probability reasonable the time Do- Mergenthaler, supra. Consequently, per we agreement, signed well the he fell within “the ceive no of abuse the trial court’s discretion statutory exception professional for staff.” decisions, in concluding, consistent with those validity of a noncompetition provi Phoenix asserts that the court trial erred sion is determined as of agree the time the First, respects. in applica- two it the asserts into, any ment is entered of and not as time bility exception § of the contained in 8-2- thereafter. 113(2)(d), of is determined not as the time 2000, but, signed agreement result, Dowell the in In reaching necessarily we re- rather, ject employ as of time he left PAS’s in supreme the the Phoenix’s reliance on 2005, Second, Whalen, was a manager. when he it court’s in Shepler decision v. 119 1084, asserts if applicability (Colo.2005), even the of the P.3d in 1088 which the exception is phrase determined as of time Do- court noted that “shall be void” in was, signed agreement, well even at governing “conveyances statute to de- time, “professional interpreted staff executive fraud had creditors” [in “been

841 Anderson, 308, conveyance (Colo.App P.2d 976 ease to mean that the prior law] .1998) case, (discussing appellate court present we standard In the deal is voidable.” fact). findings statute, 8-2-113, review trial court’s of How § has of which been with ever, error our use clear standard consistently interpreted twenty-five for over premised upon the court’s review is trial upon by the years in manner relied trial having correctly applied making law persuasive perceive rea court. And fact, findings we review novo de that line to abandon or decline to follow son application the trial court’s law. See Court, 907 authority. Smith v. Dist. Cf. J.R.T., People 219 in Interest P.3d (Colo.1995)(“Considerations P.2d (Colo.App.2002), People sub nom. v. uniformity, certainty, stability, which are aff'd (Colo.2003). Martinez, P.3d 474 objectives decisis doctrine stare govern court of this state.” should decisions Here, Phoenix that the trial court’s asserts omitted)). (citation factual is marred an erro- determination understanding meaning neous persuaded by Phoenix’s asser- Nor phrase “professional staff executive adhering to of those tion that the decisions personnel.” disagree. employers unprotected divisions leaves who, employees qualifying per- while not as Assembly General did define 8-2-113(2)(d) § when sonnel described phrase “professional staff executive and contracts, they into enter in management personnel,” two promoted key positions compa- later appellate expounded have our courts stances ny. may always An enter into new employer meaning of upon phrase. In Boulder employment agreements employees (Colo. as its Moore, v. Medical Center responsibilities, and the take additional App.1982), a division of this refused to employer, employee, than has the rather “professional physicians exclude staff’ obligation protect employer’s best in- employees” been “professional because had terests. persons legal, law defined in case as “such engineering, personnel and medical scientific found, Thus, as trial court the determi- junior together professional their assis whether, question is native Moore, supra, tants.” Boulder Med. Ctr. “professional staff to and man- executive (quoting at 465 NLRB Bell Aero agement personnel.” Co., space 284 n. 416 U.S. 94 S.Ct. (1974)). *7 1757, 1767, in 40 134 And L.Ed.2d B. to Executive Professional Staff Sellers, 15, (Colo.App 17 Smith 747 P.2d v. Management Personnel and .1987), division, citing Webster’s Third preliminarily found that The trial court (1986), Dictionary New 2219 International “professional not fall within the Dowell did responsible personnel “staff’ as “the defined because, provision although report- he staff’ functioning or the for the of an institution executives, managers to and most them ed carrying out an as establishment or the eighty ninety to salespersons and doubled as signed overall or task an director performed in percent of Dowell’s work was head.” staff, support rather than in of the sales disagree “profes- that Phoenix does not support management or func- of executive legal, engineering, include sional staff’ would tions. scientific, personnel, as well as and medical assistants, junior professional their who Ordinarily, determination “[t]he responsible functioning of institu- or for the an employee whether an is executive man staff, carrying out tion or the personnel, professional or is a or the establishment agement court,” an director Manage assigned of an task under overall question of for the trial fact Miller, Boulder, “profes- or But asserts the head. ment Recruiters of exception enough to is broad we will not sional staff’ supra, 762 P.2d at who, Dowell, are persons like encompass unless disturb trial court’s determination highly respective areas sup find skilled their clearly it is so erroneous as to report managers Tiger v. to or executives. port generally See the record. 842 statute, Thus, issue, view, construing a a in our is

When whether give to management per- court must ascertain effect the was “staff to executive and Assembly and refrain intent General sonnel.” judgment is rendering a that inconsis respect The statute is silent with legisla To tent with intent. determine interaction, type quality in terms of or intent, first to the words of tive we look time, quantity person a must have Nieto, statute. State v. 993 500 management personnel quali- or executive to (Colo.2000). acquired Unless words have fy “professional to staff executive and by particular meaning legisla a or technical personnel.” Section 8-2- otherwise, they given or tive definition 113(2)(d) added). (emphasis according commonly their effect under assessing legislative After his text 2-4-101, § accepted usage. stood and See statute, tory of the one set of com C.R.S.2006; Prop. Nat’l Farmers Union & purpose mentators has concluded Mosher, v. Cas. Co. Estate § underlying exception contained in 8-2- (Colo.App.2000). 113(2)(d) protect employers “to from the If the words used are clear and disruption operations upon which occur unambiguous import, apply we the statute key the loss of a or executive member his Nieto, supra, as written. State v. 993 P.2d at Krendl, Cathy staff.” James H. Krendl & S. If, however, ambiguous 500. the words are Noncompetition Covenants in Colorado: A unclear, or such that “the chosen words do Solution?, Statutory Den. L.J. result,” inexorably single to a lead (1975). regard, In this another commentator consider, may among things, other legis noted, “By allowing employers require has declaration, object sought lative to be management personnel executive and attained, consequences particu and the aof professional their to sign noncompeti staff Nieto, supra, lar construction. State agreements, employ tion the statute assures Ultimately, 501. statute must be very enterprise— ers that their heart of legislative construed further intent plans high-level strategies business —will represented by statutory the entire scheme. (or intentional) subject not be to accidental Nieto, supra, State P.2d at competitor.” to a disclosure Christine M. Here, commonly accepted meaning of O’Malley, Compete Covenants Not is, “professional” argues, the term as Phoenix Industry: Assessing Massachusetts Hi-Tech than simply broader member of a “learned Solution, Legislative the Need 79 B.U. Webster’s, profession.” at 1811 (Dec.1999)(footnote L.Rev. omit (defining adjective “professional” as “en- ted). gaged professions in one of the learned or in purpose, In accord with this con requiring occupation high level of train- phrase clude “professional staff ing proficiency ...: characterized management personnel” executive and is lim conforming to the technical or ethical stan- who, persons ited to qualifying those while *8 profession dards a or an occupation: of mani- “professionals” reporting managers to or festing artistry workmanship fine or based executives, primarily key serve as members knowledge on sound and conscientiousness: manager’s of the or in executive’s staff the education,

reflecting the results of training, implementation management of or executive , experience”). functions. Thus, that, readily perceive we edu- may experience, person cation and a be con- statutory This construction of the (1) “professional,” phrase to be comports public sidered a in with policy of sense, may that disfavoring Dowell well have been a Colorado covenants not to com Enters., “professional” pete, Findlay, in member PCI’s staff see DBA su However, (“Covenants reported persons pra, Dowell to who 923 P.2d at 302 not to management held positions compete contrary public policy or executive but ... are who, (2) ”); him part, requirement for the most related to in a .... nonmanagement exceptions capacity. or nonexecutive that the nar- statute be Automation, was, authority again, following precedential Logixx rowly See construed. Trust, Corp. this See Atmel v. Vitesse Family court. v. Lawrence Michels Inc. Corp., supra, to P.3d at 796 1224, 1230 (Colo.App.2002)(exeeptions Semiconductor a (“Injunctive on restrictive em- against not relief based general rule covenants construed); agreement must co-extensive ployment Nat’l Pro narrowly compete contract.”). (Colo. Miller, with the terms of the Corp. v. 18 P.3d pane App.2000)(same). (1) Phoenix, however, argues Atmel is that distinguishable; questionable Atmel is of case, nothing in In we discern validity, unpub- it relies on two inasmuch as ruling departs that from our the trial court’s eases; supreme court has lished understanding “professional staff’ ex a the Atmel limitations on never embraced whether, in was ception. issue authority grant injunctive relief. court’s managers and relationship to PCI’s Dowell’s primarily that he served narrowly executives was such do read Atmel as We imple key wish, is, of their staff in the as a member in apply that Phoenix would func or mentation executive “past alleged wrong” where violated cases a (TRO). light prelimi In the trial court’s tions. In temporary restraining order ninety percent of nary finding eighty Atmel, that was concerned with viola- division (rather than a work in a sales Dowell’s underlying agreements, not with tions role, perceive addition, management) support we In it was the violations of the TRO. prelim in the trial of discretion court’s injunction abuse improper use of future unlikely he was to have inary conclusion that remedy past underlying violations to, in, type had the access involvement improper. ruled agreements the division management or executive decisions Corp. Atmel v. Vitesse Semiconductor bring “professional within would him Corp., supra, at 796. category employees against which

staff’ Similarly, do not view the Atmel divi- we noncompetition provision could be enforced. unpublished as a cases sion’s reliance uphold court’s Consequently, reason, itself, the trial At- questioning and of Further, that Phoenix had not shown viability. although determination the su- mel’s probability of with re- reasonable success preme may not have embraced limitation, spect rejected to this claim. it has Atmel time also And at one other of this it. least division it, TV. Provisions Tele- Employment Nonsolicitation court has followed see Enters., Barocas, LLC v. vision court erred Phoenix contends trial (“the should (Colo.App.2004) trial court length extending in not of time which injunction light scope of the reconsider the in ef- provisions the nonsolieitation could be purchase agreement”), terms of the beyond one-year period specified in fect do here. and we likewise employment agreement. cross- his however, in the Consequently, discern no error appeal, contends finding terms of refusing trial court that the nonsolici- trial court’s to extend the erred preliminary injunction beyond at all the one- tation were enforceable Phoenix, agree- disagree year parties’ him. but term against specified part agree in with Dowell. ment. Extending B. Dowell’s Contentions

A. Phoenix’s Contention: the Nonsolicitation Provisions *9 the nonsolicitation Dowell contends (1) the preliminarily provisions ruled unenforceable because trial noncompetition provision is provisions accompanying were nonsolicitation (2) enforceable; employment his contract period forth in the not enforceable for the set (that is, personal contract which could year one from the was a services provision itself assigned; qualify not as not be PAS did termination of Dowell’s 2005). entity employment contract ruling, to which his March In so the trial court an was, any assigned; working employer could be there for another business”). event, assignment evidence of recruitment insufficient agree from PCI to with Dowell’s PAS. respect With to covenants not to solicit assertion, first as it to his insofar relates customers, reject applicability we customers; agreement not to Phoenix’s solicit passive Atmel distinction active and between however, reject his as assertions insofar policy underly- solicitation efforts. The core they agreement not solicit relate to his ing unenforceability noncompetition employees. Phoenix’s prohibition is a on the restraint of or, here, pertinent right

trade to make In Accompanying, living. living, order to make a Effect of Unenforceable employee former needs to free to solicit Noncompetition Provision customers, (actively passively) or former Prohibiting a. Provision Solicitation long employer’s as he she does not use the Employees § 8-2-113(2)(b), trade secrets to do so. See (recognizing validity C.R.S.2006 of con- reject Initially, we Dowell’s assertion protection secrets); tracts for the of trade law, agreement as a an matter of not to see, Stewart, e.g., Supply Colo. Co. employer’s employees solicit former cannot (Colo.App.1990) (analyz- 1306-07 accompanying- be enforced an noncom- when secrets). ing customer lists as trade In con- provision petition is determined to be invalid. trast, agreement employees not solicit provision Where nonsolicitation is limited impair employee’s would not the former abili- initiating prohibiting only or “ac contacts ty living. to make a employer’s employees, tive” solicitation of the court, trial initially alleged, enforceable, despite invalidity it of an pursue, but then determined not to a claim of accompanying noncompetition provision. See improper use trade secrets Dowell. Corp. Corp., Atmel v. Vitesse Semiconductor Because, as Phoenix opening conceded its supra, 30 P.3d at 796.

brief, appeal any present does not issues secrets, relating perceive to trade legal Prohibiting b. Provision Solicitation distinguish upon basis which to the unen- Customers noncompetition agreement forceable from the The Atmel division did not discuss agreement not to solicit Phoenix’s customers. validity agreement of an not to solicit the employer’s accompanying customers when an c.Conclusion noncompetition provision is invalid. In our that, although invalidity We conclude view, legal there is no basis to enforce an noncompetition provision did not ren- customers, agreement not to solicit where agreement der invalid Dowell’s not to solicit 8-2-113(2) § agreement invalidate an would employees, Phoenix’s it rendered invalid Do- compete. agreement well’s not to solicit Phoenix’s cus- Thus, tomers. the trial in pre- court erred

This agreement follows because an not to liminarily enjoining from soliciting Dowell agreement solicit customers is form of an customers, Phoenix’s not from actively but compete. Paddock, Jr., John R. soliciting employees. Employment Law and Practice 5.30, (2d ed.2005) § (agreements pro- 2. Personal Services Contract hibiting employees competing for exist- ing “precisely type” points customers are correctly out that noncompetition agreements encompassed by generally Colorado law “does not allow as 8-2-113(2)); § Management signments see also Re- personal for matters of trust or Boulder, Miller, confidence, cruiters personal or for services.” Rob (invalidating Hart, P.2d at § 8-2- erts v. Holland & 113(2) a prohibiting clause (Colo.App.1993). Setting the solicitation aside the issue of customers because it “would noncompetition have had whether and nonsolicitation effect of restricting employee] agreements assignable [the former independently of

845 conjunction they ap- bingo- of with a in which “successor” employment the contracts statute, least, Lemons, 107, licensing in part raffle be- 119 Colo. pear, see Cantrell v. use 911, cause the of this definition would allow 111, (noncompeti- 200 P.2d 912-13 multiple in violation licenses of constitutional assignable), law tion Thus, statutory provisions. the division exception against to the rule recognizes an concept contracts, excluded from the “successor” personal services where assigning had statute entities that assumed “cer- assignment. employee consents functions, activities, parts tain or of an or- 79, White, 220 Colo. See Matson ganization.” Ginny’s Kids Sec’y Int’l v. (1950); Campbell see also P.2d of State, supra, 29 at 336. Ventures, LLC, 132 N.M. Millennium (Ct.App.2002)(discussing we, Here, court, trial like the see reason subject). law on the ease why ordinary understanding of the term applied. not be “successor” should And be- employment Assuming that Dowell’s con noted, cause, court “the as trial more qualify personal as a services tract would successor” includes a usual definition of busi- do contract —an not decide—we issue part to the or ness that succeeds whole of that to its nonetheless conclude he consented company, of the trial business another court part to the of assignment when he assented preliminarily did abuse discretion in not agreement that employment said concluding PAS was a successor to PCI. binding upon shall be and shall “Agreement parties, to the inure benefit Assignment Sufficiency Evidence: L assigns.” See Pino v. successors [PCI’s] Florida, Inc., Spanish Sys. reject Finally, Broad. Dowell’s conten 186, 189 (Fla.Dist.Ct.App.1990) (accept So.2d tion insufficient that evidence was ing to show language finding similar sufficient court’s that PCI support trial had employee assign “consented his assigned employment contract PAS. original employment writing ment in her premises largely his contention on contract”). Agreement the fact that the Transfer that his purported to transfer con- PAS’s as Successor to PCI Status tract, along every proper- other kind of Relying Ginny’s Kids Interna ty, from PCI to PAS was left blank. State, tional, Secretary Inc. v. 29 P.3d 333 particular No formalities neces (Colo.App.2000), Dowell asserts PAS However, assignment. sary to effect a valid thus, and, could was not “successor” PCI assignment the “intent to make the must be for qualify type assignee which “may apparent,” and that intent be reflected have assignment could been consented-to by by the written instruments executed Even fact that Dowell’s made. aside parties or ... inferred the acts and account the use argument does not assignor.” Lookout Moun conduct “successors,” “assigns” term in addition to Hills Homeowners’ Ass’n v. tain Paradise persuaded. we are (Colo. Assocs., Viewpoint 867 P.2d Kids, Ginny’s this a division of court App.1993). that, ordinarily, a corpora- “successor” noted parties requi had the Whether corporation tion defined as “another ques is a assignment intent to effect site consolidation, through amalgamation, which fact trial tion of for the court resolve. interests, assumption or vested other Paradise Hills Home Lookout Mountain rights corpo- with the and duties of an earlier Assocs., Viewpoint supra, Ass’n v. owners’ Int’l, Sec’y Ginny’s Kids ration.” at 74. State, also P.3d at 336. It noted found, Here, upon the based general definition included the as- trial officer, corporation testimony of chief executive by PCI’s sumption the successor “there’s that the intent of the previously conducted no doubt” functions activities However, assign, among corporation. was to predecessor PCI-PAS transaction rejected things, employment agreements ultimately PCI’s this definition other the division *11 by executive officer decide of the main briefed to PAS. PCI’s chief testified one issues parties, namely, employees PCI to transfer Dowell’s em- what kind of that intended qualify “professional and rea- ployment agreement staff.” We conclude accepted blank Agreement meaning son the Transfer was left that “the of the term ‘pro- lawyers in simply and accountant is ... was because the fessional’ broader than a mem- charge profession,’” form do so ber completing by failed to of a ‘learned closing. experience, person may dint of education or a before “professional.” be considered a support Because there in the record was Here, preliminary finding necessary trial court’s it was not to decide con- to, did, clusively “profession- PCI intended and indeed transfer whether Dowell was al,” PAS, employment agreement to not “staff we will because was not to executive Tiger management However, finding appeal. personnel.” on disturb See Anderson, supra, (appel- every P.2d at can 310-11 case be resolved on this basis. findings court of fact in accepts late trial court’s There could arise instances which an em- they clearly ployee qualify as to unless are so erroneous would “staff to executive record). support management personnel” find because he or key primarily she serves as a member of the Attorney Fees

V. manager’s or imple- executive’s staff management mentation executive func- Based on Phoe- his successful defense of tions, where a legitimate but there would be appeal overturning part nix’s of the and his question employee as to whether the injunction, preliminary contends “professional staff.” entitled, “prevailing party” he is provision agreement, statutory lack definition of the term attorney appeal. an award of fees incurred “professional presents problem staff’ thus empowered areWe to order such an award. likely litigation. that will arise in future Be- Zambruk v. Perlmutter 3rd Generation (1) noncompetition cause and nonsolicitation Builders, Inc., Colo.App. agreements are in wide circulation busi- (1978). ongoing Given the ness, expensive litigation concerning such case, however, nature of the we think it best significant employers issues is a risk for both determine, appro- that the trial employees, agreements such time, priate Do- whether and to what extent impede employee’s ability could to work attorney is “prevailing party” well entitled to living employment, earn future I fees, including appeal. fees incurred this commend this issue attention See C.A.R. 39.5. Assembly. General

The court’s is vacated to extent order preliminarily enjoins soliciting

it Dowell from Otherwise,

Phoenix’s order customers. affirmed, and the case is remanded for proceedings

further consistent with the views expressed in opinion. this RINGQUIST Ringquist, Steve Diana Plaintiffs-Appellees,

Judge CARPARELLI concurs. Judge TERRY specially concurs. HOMES, LLC, CUSTOM WALL David Judge specially concurring. TERRY Wall, Carter and William Winston Wall, Defendants-Appellants. concur in analysis I the result and majority opinion. separately bring I write No. 06CA2256. issue, attention to an not resolved this Appeals, Colorado Court of decision, likely that will result in future liti- Div. V. gation. Dec. appeal primarily by resolve focus- ing on whether Dowell was “staff to execu- personnel.”

tive and We do

Case Details

Case Name: Phoenix Capital, Inc. v. Dowell
Court Name: Colorado Court of Appeals
Date Published: Jul 26, 2007
Citation: 2007 WL 2128330
Docket Number: 05CA2712
Court Abbreviation: Colo. Ct. App.
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