Norton Co. v. Hess

14 Mass. L. Rptr. 162
CourtMassachusetts Superior Court
DecidedSeptember 27, 2001
DocketNo. 0100201
StatusPublished

This text of 14 Mass. L. Rptr. 162 (Norton Co. v. Hess) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Norton Co. v. Hess, 14 Mass. L. Rptr. 162 (Mass. Ct. App. 2001).

Opinion

Fecteau, J.

This matter, by which the plaintiff seeks to enforce a “non-compete” agreement against its former employee, the defendant Stephan Hess, and against his new employer, the defendant Tyrolit North America, Inc., began by the filing of the plaintiffs complaint on January 30, 2001. This matter came before the court on January 31, 2001 for consideration of the plaintiffs ex parte motion for a temporary restraining order, which the court allowed, on condition of the filing of security in the form of a bond in the amount of $65,000.00; a short order of notice was also ordered for hearing on the plaintiffs request for a preliminary injunction on February 5, 2001. A hearing was conducted at that time with the defendants appearing and arguments were made. The court shared its observation and recommendation that the hearing on the preliminary injunction be consolidated with a speedy trial on the merits, especially given that the non-compete clause had a duration of 1 year. The parties were amenable to such a course. The court extended the temporary restraining order to provide additional time to the defendants to prepare, allowed expedited discovery and granted the parties an evidentiary hearing on the dispute, given the fact-intensive nature of the controversy, to be conducted on March 1, 2001. Thereafter, the parties jointly requested additional time within which to complete discovery and requested that the hearing be postponed generally until they were ready for trial.

The parties requested in August 2001, that a further evidentiary hearing be held but that the court reconsider the consolidation of the trial on the merits with the preliminary injunction; the parties agreed that although they were not ready to proceed to a trial on the merits, circumstances were such that an expedient hearing on the preliminary injunction was necessary. The court agreed and the matter was finally convened for hearing on September 20, 2001. The parties submitted briefs and affidavits, as well as presented witnesses.

Therefore, in consideration of the pleadings, evidence, including affidavits, and arguments of the parties in support of and in opposition to the entry of a preliminary injunction, the court makes the following findings of fact and rulings of law. In determining whether to grant a preliminary injunction, this court considers the balancing test set forth in Packaging Industries Group, Inc. v. Cheney, 380 Mass. 609, 616-17 (1980). See also Planned Parenthood League of Massachusetts, Inc. v. Operation Rescue, 406 Mass. 701, 710 (1990). Also, given the agreement of the parties as to the choice of the law, the standards of Pennsylvania law are considered. Those are recognized as allowing enforcement of such agreements if the covenant not to compete is (1) ancillary to the taking of employment [including promotions], (2) supported by adequate consideration, (3) reasonably limited in time and geographic scope and (4) reasonably designed to safeguard a legitimate interest of the former employer. National Bus. Servs., Inc. v. Wright, 2 F.Sup.2d 701, 707 (E.Dist.Pa.1998); Thermo-Guard, Inc. v. Cochran, 596 A.2d 188, 192-94 (1991).

This matter specifically involves the interpretation and enforcement of clause 7 of the employee “non-compete” agreement signed by the defendant Hess on [163]*163or about March 30, 1999. (See ex. 22.) This clause states, in relevant part, that the employee “shall not without, written consent of an officer of the company, directly or indirectly (whether as owner, partner, consultant, employee, or otherwise), at any time during the one year period following termination of [his] employment . . . engage in or contribute [his] knowledge to any work or activity that involves a product, process, apparatus, service or development (i) which is then competitive with or similar to a product, process, apparatus, service or development on which [he] worked or (ii) with respect to which [he] had access to Confidential Information while at the company at any time during the period prior to such termination.”

Hess was employed by Norton Company as an engineer in its research and development group in the “vitrified” branch of its abrasives business and later as an applications engineer in the superabrasives division.1 For purposes of this discussion, that confidential information was available to Hess is assumed and that the scope of information considered confidential hereunder is inclusive of but broader than trade secrets.

First, Hess agrees that with respect to his prior work for the plaintiff, he is subject to so much of the agreement as would prevent his working in the vitrified and superabrasives areas for the restrictive period (subpart “(i)” of the clause). His intended employment for the defendant Tyrolit North America, Inc., is in its metal fabrications area, synonymous with or similar enough to the organics abrasives division of Norton. The plaintiff seeks to bar Hess from such work as well, contending that as an engineer in the R&D at Norton Company, he had access to confidential information concerning this area, notwithstanding that his only significant work for the plaintiff was in the vitrified and superabrasives branches of the business.

There has been no evidence of his having actually violated the non-disclosure or confidentiality aspects of the agreement (see clauses 2, 3 and 5), nor that he has retained any written documents of the company in violation of the requirements for the return of such documents upon his termination, nor that he has shared the contents of any such documents or confidential information with anyone in violation of his duties under this agreement. There is no question that the non-disclosure requirements of the agreement continue to be operative and the defendant recognizes and acknowledges his duty thereunder.

The subject at issue among the parties, then, is whether subpart “(ii)” of clause 7 applies to Hess’ intended work in the organic or metal fabrications area since he may have had “access” to confidential information, in R&D research reports either distributed to him or through his department, or available at the R&D library, or access to oral or written presentations at department meetings, conferences and trade shows.

The evidence appears to be that Hess worked only in the vitrified and superabrasives areas, although a small aspect of both areas have organic components; no evidence was presented that Hess had devoted any significant time or effort to organic matters.2 The critical issues of concern are the meaning of the term “access” and whether he had such “access” to Confidential Information relative to organic products, process, apparatus service or development. Until July 1997, the vitrified and organic branches of R&D worked almost entirely separately. At that point in time, some “cross-fertilization” began to occur at joint weekly meetings and in the receipt of quarterly research reports. Hess left R&D in February 1998, although he would have been allowed to attend company world meetings and may have been allowed to give or attend R&D presentations thereafter. There was no evidence that he was at any particular meeting at which organic subjects were discussed nor is there evidence that he was exposed to confidential information that was created by or on behalf of any department other than the R&D department.

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Related

Packaging Industries Group, Inc. v. Cheney
405 N.E.2d 106 (Massachusetts Supreme Judicial Court, 1980)
Planned Parenthood League of Massachusetts, Inc. v. Operation Rescue
550 N.E.2d 1361 (Massachusetts Supreme Judicial Court, 1990)
Thermo-Guard, Inc. v. Cochran
596 A.2d 188 (Superior Court of Pennsylvania, 1991)

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Bluebook (online)
14 Mass. L. Rptr. 162, Counsel Stack Legal Research, https://law.counselstack.com/opinion/norton-co-v-hess-masssuperct-2001.