Labor & Logistics Management Inc. v. Wallover

73 Pa. D. & C.4th 288, 2005 Pa. Dist. & Cnty. Dec. LEXIS 22
Pennsylvania Court of Common Pleas, Bucks County·Decided April 18, 2005·No. no. 2002-07933-16-5·Published

Opinion

RUFE, J., J.,

The defendants, David Wallover and Winner Logistics Inc., have served upon us a notice of appeal to the Pennsylvania Superior Court relating to rulings made in our January 24, 2005 order. In particular, the defendants challenge our decision imposing an injunction as a result of finding certain documents and information obtained by the defendants constitute misappropriated trade secrets. We offer this opinion as an explanation of our decision.

Plaintiff, Labor & Logistics Management Inc., is a New Jersey corporation in the business of providing contract truck drivers to its customers. Labor & Logistics’ customers are typically companies who do not employ truck drivers themselves or companies that need additional or replacement truck drivers to satisfy their business needs. Labor & Logistics has 10 offices in seven states to accommodate customer requirements.1 At each location, Labor & Logistics employs a location and driver manager to oversee the day-to-day operations of the business.2

In September of 2000, plaintiff hired David Wallover as a driver lease manager for their Delanco, New Jersey [291] location. The terms of Wallover’s employment were outlined in a standard offer letter dated September 21,2000.3 The offer letter explained that Wallover’s employment would be governed by an employment agreement that was discussed during the interview process with Curtis Ball, the founder and president of Labor & Logistics. At trial, Ball testified that he explained to Wallover that all management employees were required to sign an employment contract that contained nonsolicitation, noncompetition and noninterference covenants.4 Specifically, the agreement barred employees from competing with Labor & Logistics within a 50-mile radius of its Delanco, New Jersey office for a period of two years. Ball also stated no driver lease manager was ever hired without signing the agreement and that Wallover did not object to the covenants.5

While at Labor & Logistics, Wallover had access to the company’s customer lists, prospective customer lists and driver lists.6 According to Ball, these lists are the products of “years of soliciting and interacting” with present and prospective customers. He described the lists as difficult to obtain outside of Labor & Logistics and constitute more than mere name and phone number compilations. Ball explained that the lists include sales histories, products customers typically shipped, pricing data, names of competitors and other information that would assist a driver in transporting a specific customer’s [292] goods.7 After gaining employment as a driver lease manager, Labor & Logistics provided Wallover access to a copy of the list to use in the course of his employment.

To protect the privacy and confidentiality of the lists, Labor & Logistics requires employees with access to the lists to sign noncompete and nonsolicitation covenants. As a further safeguard, only the territorially relevant customer list is maintained at each location; the master list is kept only in the Labor & Logistics coiporate office.8 In addition, the list is preserved on a password-protected computer at each location9 and any hard copies of the list are to be maintained in a locked cabinet.10

In the early summer of 2002, Robert Latronica, an employee of Labor & Logistics, conducted a routine review of personnel records. At that time, Latronica informed Ball that a signed noncompete agreement was missing from Wallover’s personnel file; he also reported that Wallover’s was the only personnel file missing the noncompete agreement. As corporate records indicated Wallover had in fact signed the agreement, Ball instructed Latronica to review the file again.11 Two days later, Latronica informed Ball that Wallover’s file did not contain the agreement. Ball then told Latronica to have Wallover sign another agreement. Despite several requests by management of Labor & Logistics, including [293] Ball himself, Wallover refused to sign an agreement. At that time, on July 31, 2003, Labor & Logistics terminated Wallover for refusing to sign the agreement and requested all confidential information be returned.

In the month after Wallover was terminated from Labor & Logistics, Curt Roble incorporated Winner Logistics, a company in the same business as Labor & Logistics, i.e., the leasing of commercial truck drivers. Prior to the incorporation of Winner Logistics, Roble had no experience in the day-to-day operations or management of a truck-driver leasing company.12 The person who provided the knowledge to begin the business was Wallover, the only other Winner Logistics’ employee besides Roble at that time. Wallover drafted all the necessary forms, including the driver service agreement, owner/operator agreement, waiver and release agreement, and other marketing documents used in the contract truck-driver industry. Some of these documents were virtually identical to agreements Wallover had in his possession while employed at Labor & Logistics.13 Wallover also provided the pricing information so that Winner Logistics could set a “competitive rate” for its services.14

As Winner Logistics had no customers and Roble had little or no knowledge of the industry, the solicitation of customers became Wallover’s responsibility. Among others, Wallover began contacting businesses that he serviced while an employee of Labor & Logistics. At the time of the December 13, 2004 trial, Winner Logistics had approximately 15 customers. Of these customers, [294] no less than 10 or 11 were customers with Labor & Logistics during the course of Wallover’s employment.15 Similar to Labor & Logistics, Winner Logistics maintained these customer names within a password-protected computer database so that the information would not be disclosed to competitors.16

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Labor & Logistics Management Inc. v. Wallover, 73 Pa. D. & C.4th 288, 2005 Pa. Dist. & Cnty. Dec. LEXIS 22 (Pa. Super. Ct. 2005).

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