Sprint Corp. v. DeAngelo

12 F. Supp. 2d 1188, 1998 U.S. Dist. LEXIS 10929, 1998 WL 400089
District Court, D. Kansas·Decided June 30, 1998·No. CIV. A. 98-2237-KHV·Published·Cited by 3 cases

Opinion

MEMORANDUM AND ORDER

VRATIL, District Judge.

Sprint Corporation brings suit against its former employee, Dominick DeAngelo, claiming that he breached a contract of employment which contained a confidentiality agreement and covenant not to compete. On May 29,1998, Sprint filed its complaint, seeking to prohibit defendant from working for IXC Corporation pending a final decision in this case. The Court held a hearing on June 9, 1998, and took the matter under advisement. After fully considering the parties’ briefs, oral arguments, testimony at the hearing, and exhibits, the Court on June 20, 1998 advised the parties that it intended to deny Sprint’s application for preliminary injunctive relief. For reasons stated more fully below, that application is hereby overruled.

Preliminary Injunction Standard

The purpose of a preliminary injunction is “to preserve the status quo pending the outcome of the ease.” Tri-State Generation and Transmission Ass’n. Inc. v. Shoshone River Power, Inc., 805 F.2d 351, 355 (10th Cir.1986). A preliminary injunction is a drastic and extraordinary remedy, and courts do not grant it as a matter of right. Paul’s Beauty College v. United States, 885 F.Supp. 1468, 1471 (D.Kan.1995); 11A Charles Alan Wright, Arthur It- Miller & Mary Kay Kane, Federal Practice and Procedure § 2948, at 128-29 & nn. 3, 6-7 (1995). We must deny injunctive relief if the moving party fails to establish any requisite element, Packerware Corp. v. Corning Consumer Products Co., 895 F.Supp. 1438, 1446 (D.Kan.1995), and the moving party must establish that it is entitled to injunctive relief by clear and unequivocal proof. Penn v. San Juan Hospital, Inc., 528 F.2d 1181, 1185 (10th Cir.1975); Paul’s, 885 F.Supp. at 1471.

In order to obtain a preliminary injunction, movant must establish that (1) the moving party will suffer irreparable injury unless the injunction issues; (2) the threatened injury to the moving party outweighs whatever damage the proposed injunction may cause the opposing party; (3) the injunction, if issued, will not be adverse to the public interest; and (4) there is a substantial likelihood that the moving party will eventually prevail on the merits. Tri-State, 805 F.2d at 355 (citing Lundgrin v. Claytor, 619 F.2d 61, 63 (10th Cir.1980)); Heatron, Inc. v. Shackelford, 898 F.Supp. 1491, 1498 (D.Kan. 1995). Courts disfavor certain types of preliminary injunctions, including ones that afford the movant substantially all the relief it may recover at the conclusion of a full trial on the merits. SCFC ILC, Inc. v. Visa USA, Inc., 936 F.2d 1096, 1098-1099 (10th Cir.1991); Paul’s, 885 F.Supp. at 1471. When a movant seeks this type of preliminary injunction, courts require the movant to satisfy the even heavier burden of showing that the four factors listed above weigh heavily and compellingly in movant’s favor before such an injunction may issue. Visa, 936 F.2d at 1098-1099; Paul’s, 885 F.Supp. at 1472.

*1190 Factual Summary

A. Background

Sprint, a Kansas corporation with its principal place of business in Kansas, is a common carrier which sells telecommunications services. It also sells Internet access and support systems. On December 12, 1995, defendant entered into an employment contract with Sprint. The contract, entitled “Agreement Regarding Special Compensation and Post Employment Restrictive Covenants,” specified certain terms and conditions of defendant’s employment. The agreement contained the following confidentiality provision:

Executive acknowledges that during the course of his employment he has learned or will learn to develop Confidential Information _[and] that unauthorized disclosure or use of such Confidential Information, other than in discharge of Executive’s duties, will cause employer irreparable harm.
* * * * * X
Except in the course of his employment and in the pursuit of the business of Employer ... Executive shall not, during the course of his employment, or for a period of eighteen (18) months following termination of his employment, for any reason, directly or indirectly, disclose, publish, communicate or use on his behalf or another’s behalf, any proprietary information or data of Employer ....

The agreement also contained the following non-eompete provision:

Executive acknowledges that use or disclosure of Confidential Information ... is likely if Executive were to perform telecommunications Junctions related to long distance services on behalf of a competitor of Employer. Therefore, Executive shall not, for eighteen (18) months following termination of employment for any reason ... perform any services for any entity ... where Executive dedicates any time or efforts to managing, controlling, participating in ... or otherwise assisting any person or entity in the long distance business or performing junctions relating to long distance services.
X X X X X X
This section shall not prevent Executive from using general skills and experience developed during employment with Employer or other employers; or from accepting a position of employment with another company ... which competes with Employer, if its business is diversified and executive is employed in a part of the business that is not related to long distance services ....

(emphasis added.)

In consideration for defendant’s employment agreement, Sprint gave defendant restricted stock and other valuable consideration. Defendant worked for Sprint as Assistant Vice President for Internet Protocol Services (“IP Services”), and he supervised the development and marketing of Sprint’s Internet telecommunications services in the United States. In that regard, he developed strategic information, methods and techniques for providing Internet services, marketing plans, research and development plans, business plans and forecasts, personnel information, pricing and financial information, current and prospective customer lists, and information concerning purchases of major equipment. Sprint has not made this information generally available to the public; it considers such information to be proprietary and confidential information which is extremely valuable to its business.

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Sprint Corp. v. DeAngelo, 12 F. Supp. 2d 1188, 1998 U.S. Dist. LEXIS 10929, 1998 WL 400089 (D. Kan. 1998).

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