RELIANCE WHOLESALE V. GODFREY, ET AL.

SUPREME COURT CASES

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State: Florida

Court: Florida Third District Court

Docket No: 10-0082

Case Date: 12/22/2010

Preview:Third District Court of Appeal
State of Florida, July Term, A.D. 2010
Opinion filed December 22, 2010. Not final until disposition of timely filed motion for rehearing. ________________ No. 3D10-82 Lower Tribunal No. 08-75790 ________________

Reliance Wholesale, Inc.,
Appellant, vs.

Samantha Godfrey, et al.,
Appellees.

An Appeal from a non-final order from the Circuit Court for Miami-Dade County, Gill S. Freeman, Judge. Littler Mendelson, P.C., and Courtney B. Wilson, for appellant. Richard S. Ross, for appellee Samantha Godfrey; Greenspoon Marder and Peter R. Siegel and Mitchell D. Adler, for appellees Anthony Minnuto and Allied Medical Supply, Inc.

Before WELLS, ROTHENBERG, and SALTER, JJ. ROTHENBERG, J.

The plaintiff, Reliance Wholesale, Inc. ("Reliance"), appeals from a nonfinal order denying its Renewed Motion for Temporary Injunction. We reverse and remand for entry of an order granting the motion. In 2008, Reliance filed suit against Samantha Godfrey ("Godfrey"), Anthony Minnuto ("Minnuto"), and Allied Medical Supply, Inc. ("Allied"), seeking temporary and permanent injunctive relief and damages, stemming from the alleged breach of two Non-Compete, Non-Solicitation, and Non-Disclosure Agreements allegedly executed by Godfrey in 2005 ("2005 Agreement") and 2008 ("2008 Agreement").1 In early 2009, the trial court denied Reliance's initial request for injunctive relief without prejudice to renew after conducting discovery. In August 2009, Reliance filed its Renewed Motion for Temporary Injunction. Following an evidentiary hearing on Reliance's Renewed Motion for Temporary Injunction, the trial court entered an order making the following findings of fact. In 2005, when Godfrey started working for Reliance, a licensed distributor of hard-to-find pharmaceuticals, she executed the 2005 Agreement, which is "valid and binding." While at Reliance, Godfrey was a senior staff

Godfrey acknowledged that she executed the 2005 Agreement, but argued below that she did not execute the 2008 Agreement. The trial court found that the "authenticity of the [2008 Agreement] is subject to question, and may well be [a] forger[y]." Reliance does not challenge this finding of fact and, therefore, relies solely on the 2005 Agreement. 2

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member, attending tradeshows at Reliance's expense, which allowed her to establish personal, business relationships with customers and potential customers. Further, Godfrey had an expense account to meet and entertain prospective customers. As part of its operations, Reliance purchased a computer database program which is available on the open market. However, as Reliance did business, it updated the database with information such as the name and e-mail addresses of the purchasing agent, and the product that was purchased. This information was used for future sales. The name and e-mail addresses of the purchasing agent for each hospital or entity are readily available by contacting the hospital or entity. Although Godfrey did not keep sales records, she knew which customers were the most profitable. In early 2008, Reliance deducted $58,000 from Godfrey's commissions because it believed that it had overpaid Godfrey two years earlier, and it also charged her $10,500 for "bad debts." Based on a chart presented by Godfrey, Reliance was unjustified in taking Godfrey's commissions and Reliance actually owed Godfrey money. Godfrey left Reliance after it instituted a new commission structure, substantially reducing Godfrey's commissions. After the trial court entered its initial order denying injunctive relief, Godfrey went to work for Reliance's competitor, Allied, whose principal is

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Minnuto. Allied, however, fired Godfrey on the same day that the hearing on the Renewed Motion for Temporary Injunction commenced--August 31, 2009. Based on these findings of fact, the trial court denied the Renewed Motion for Temporary Injunction, concluding that Reliance failed to carry its burden of establishing a substantial likelihood of success on the merits because its "unilateral recovery of commissions allegedly overpaid to [Godfrey] two years earlier, presents a viable and unrebutted defense to [Reliance's] entitlement to enforcement of the non-compete agreement." The trial court further concluded that Godfrey rebutted the presumption of irreparable injury; Reliance has an adequate remedy at law because the value of any business loss is ascertainable through discovery; and the value of any information that Godfrey and the other defendants have used subsequent to Godfrey leaving Reliance is limited and "minimal at best." This appeal followed. Reliance contends that the trial court abused its discretion by denying its Renewed Motion for Temporary Injunction where it established the prerequisites for entry of a temporary injunction. We agree. See Carricarte v. Carricarte, 961 So. 2d 1019, 1020 (Fla. 3d DCA 2007) (quoting Jackson v. Echols, 937 So. 2d 1247, 1249 (Fla. 3d DCA 2006)) ("A trial court is afforded broad discretion in granting, denying, dissolving or modifying injunctions, and unless a clear abuse of discretion is demonstrated, an appellate court must not disturb the trial court's

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decision."). "A temporary injunction is an extraordinary and drastic remedy which should be sparingly granted." Cordis Corp. v. Prooslin, 482 So. 2d 486, 489 (Fla. 3d DCA 1986). To grant a temporary injunction, the moving party must plead and establish: (1) a likelihood of irreparable harm and the unavailability of an adequate remedy at law; (2) a substantial likelihood of success on the merits; (3) that the threatened injury to the petitioner outweighs any possible harm to the respondent[;] and (4) that the granting of a temporary injunction will not disserve the public interest. Id. at 489-90 (footnote and citations omitted). We first address the trial court's conclusion that Reliance failed to establish that it had a substantial likelihood of success on the merits. In doing so, we look to section 542.335(1), Florida Statutes (2009), which addresses the enforceability of a restrictive covenant and provides in relevant part as follows: (b) The person seeking enforcement of a restrictive covenant shall plead and prove the existence of one or more legitimate business interests justifying the restrictive covenant. The term "legitimate business interest" includes, but is not limited to: 1. Trade secrets, as defined in s. 688.002(4). 2. Valuable confidential business or professional information that otherwise does not qualify as trade secrets. 3. Substantial relationships with specific prospective or existing customers, patients, or clients. 4. Customer, patient, or client goodwill associated with: a. An ongoing business or professional practice, by way of trade name, trademark, service mark, or "trade dress"; b. A specific geographic location; or c. A specific marketing or trade area. 5

5. Extraordinary or specialized training. Any restrictive covenant not supported by a legitimate business interest is unlawful and is void and unenforceable. Here, the trial court's findings of fact reflect that Reliance established the existence of two "legitimate business interests." First, Reliance's database

qualifies as "[v]aluable confidential business or professional information that otherwise does not qualify as trade secrets."

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