Ge Betz Inc. v. Moffitt-Johnson

301 F. Supp. 3d 668
CourtDistrict Court, S.D. Texas
DecidedJune 6, 2014
DocketCIVIL ACTION NO. H–13–0459
StatusPublished
Cited by5 cases

This text of 301 F. Supp. 3d 668 (Ge Betz Inc. v. Moffitt-Johnson) is published on Counsel Stack Legal Research, covering District Court, S.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ge Betz Inc. v. Moffitt-Johnson, 301 F. Supp. 3d 668 (S.D. Tex. 2014).

Opinion

VANESSA D. GILMORE, UNITED STATES DISTRICT JUDGE

Pending before the Court are Plaintiff and Counter-Defendant GE Betz, Inc., d/b/a GE Water & Process Technologies ("GE" or "Plaintiff")'s Motions for Summary Judgment on Defendants' counterclaims for business disparagement (Instrument No. 71 ) and tortious interference with customer contracts (Instrument No. 72 ) and employment contracts (Instrument No. 73 ). Also pending is Defendants and Counter-Plaintiffs AMSPEC Services, L.L.C. ("AmSpec") and Michelle Moffitt-Johnston ("Moffitt") (collectively, "Defendants")'s Motion for Summary Judgment on Plaintiff's claims (Instrument No. 74 ).

I.

A.

Moffitt was previously employed by GE's distressed fuels team, which provides chemistry and services to upgrade fuel for export. Moffitt founded GE's distressed fuels team in 2009, and left GE to become *678a Vice President at AmSpec in 2012. GE has brought thirteen causes of action against Moffitt and AmSpec, alleging that Moffitt has breached the non-solicitation provision of her Employment Contract with GE and that Moffitt and GE have disclosed trade secrets, breached various fiduciary duties, and competed unfairly, among other claims. AmSpec and Moffitt have brought counterclaims against GE, alleging that GE has tortiously interfered with their employment agreement and disparaged their business.

B.

Moffitt was hired at Betz Laboratories, which eventually came to be owned by GE, as a phase separation engineer in 1996. (Instrument No. 74-1 at 4-5). In approximately 2009, Moffitt became the first leader of GE's Distressed Fuels Team ("DFT"), which performs chemical and fuel treatments on ships, called cargo treatments, and in storage tanks and terminals. (Instrument No. 74-1 at 6-7, 8-9). GE's DFT consisted of Moffitt, six sales people, and fourteen technicians who performed treatments at customer sites. (Instrument No. 74-1 at 10). Each treatment was inspected by a third party, like AmSpec, which conducted inspections and laboratory testing to ensure that the final product met desired specifications. (Instrument No. 74-2 at 10). GE's DFT and AmSpec's inspection and testing team often marketed to the same customers and engaged in joint marketing efforts, such as renting a yacht for a yearly customer appreciation cruise at the New York Harbor Show. (Instrument No. 74-2 at 3).

In connection with her employment at GE, Moffitt executed an employment contract titled, "GE Infrastructure Water & Process Technologies Employment and Confidential Information Agreement" (the "Employment Agreement"). (Instrument No. 74-9 at 2-5).1 As part of the Employment Agreement, she agreed that she would have access to trade secrets, proprietary information and confidential information (collectively referred to in the Agreement as "confidential information"). (Instrument No. 74-9 at 2, Section I(A) ). The Employment Agreement defined this confidential information as "any information ... regarding the Company, its business, its plans, its customers, its contracts, its suppliers, its products and its strategies, that is not generally known, provides the Company an actual or potential competitive advantage over those who do not know it, and is the subject of reasonable measures to maintain secrecy." (Instrument No. 74-9 at 2, Section I(A) ). Moffitt agreed to hold confidential information in trust both during and after her employment with GE. (Instrument No. 74-9 at 2, Section II(A) ).

In addition to provisions concerning non-disclosure of confidential information, Moffitt agreed to a non-solicitation covenant regarding customers and prospective customers. The Agreement defines "customer" broadly as any current customer of GE, including any of its employees, with whom Moffitt had contact or learned confidential information during the eighteen months prior to the termination of her employment. (Instrument No. 74-9 at 2, Section I(B) ). The Agreement defines "prospective customer" as any entity Moffitt assisted in making a written proposal for or any entity Moffitt made two or more prospect calls on, within twelve months prior to termination of her employment. (Instrument No. 74-9 at 2, Section I(C) ). The non-solicitation covenant *679requires that Moffitt, for eighteen months following her departure from GE, refrain from communicating with GE customers or prospective customers "regarding products or services that are similar to or competitive with those I have gained knowledge of while employed by the Company." (Instrument No. 74-9 at 4, Section I(V) ). Moffitt further agreed not to "engage in any subterfuge to circumvent this prohibition," including supervising others in soliciting customers or prospective customers or providing others with confidential information to assist in soliciting customers or prospective customers. (Instrument No. 74-9 at 4, Section I(V) ).

Moffitt's Employment Agreement also contains a section on her duties upon termination or resignation. (Instrument No. 74-9 at 4, Section IV). These duties include returning all confidential information, participating in the exit interview process, and advising GE "in writing of the nature of any new business position I accept during the eighteen (18) months following the termination of my employment with the Company." (Instrument No. 74-9 at 4, Section IV).

On September 19, 2012, Moffitt resigned her position with GE, but she agreed to remain with GE until October 19. (Instrument No. 74-1 at 14; Instrument No. 74-5 at 5). Moffitt's supervisor asked her on September 28 to "let me know where you are going to be working post GE-we have some specific processes we need to go through if you are going to a competitor." (Instrument No. 80-1 at 7). GE's Human Resources Manager Maria Iragorri stated in an affidavit that these procedures include immediately terminating access to GE's data network and ending employment the same day. (Instrument No. 80-1 at 10). On October 4, 2012, Moffitt asked GE if she could resign effective October 17, and GE agreed. (Instrument No. 80-2 at 16; Instrument No. 74-5 at 5).

After resigning her position, Moffitt began to seek out other employment by contacting customers and other companies who had expressed a previous interest in hiring her. (Instrument No. 74-1 at 15). Matthew Corr, the chief operating officer of AmSpec, called her on September 27, 2012, after hearing that she was leaving GE. (Instrument No. 74-1 at 15; Instrument No. 80-1 at 28, 59-60). Corr interviewed her in person soon thereafter. (Instrument No. 74-1 at 15-16; Instrument No. 80-1 at 61). Before the interview, Moffitt prepared a one-page proposed business plan using her GE laptop. (Instrument No. 80-2 at 4, 9). The plan included projected revenue for upcoming years, estimated cost of equipment needs, personnel needs, and targeted fuel treatment types by geographic region. (Instrument No. 80-2 at 4, 9). It also included a list of "needs to accomplish": "Hard Hitting Solid Team; Chemical Supply Gulf Coast; Equipment; Balance of Higher Margin/Lower Margin Business-Product Mix; Strong EHS Safety Culture; Approvals at 'Target' Terminals/Refineries; [and] Minimize Inventory While Executing at Low COGs for Additives." (Instrument No. 80-2 at 4). Corr offered Moffitt a job as Vice President at AmSpec sometime in early October and sent her a formal offer on October 9, which she accepted on October 10 or 11. (Instrument No. 74-4 at 2; Instrument No.

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