4D06-2463-Arch Aluminum & Glass Co. , Inc. v. Haney

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State: Florida

Court: Florida Fourth District Court

Docket No: 4D06-2463

Case Date: 09/05/2007

Preview:DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
July Term 2007

ARCH ALUMINUM & GLASS CO., INC., a Florida corporation, Appellant, v. DANNY M. HANEY, DESERT GLASS PRODUCTS, LLC, a foreign corporation, ED HAYES, and MATTHEW HALE, Appellees. No. 4D06-2463 [September 5, 2007] WARNER, J. Arch Aluminum & Glass Co. appeals an order of the trial court dismissing its complaint against Desert Glass Products, LLC, for lack of personal jurisdiction. Co-defendant Matthew Hale, a Georgia resident and former employee of Arch, cross-appeals the trial court's denial of his motion to dismiss the complaint for lack of personal jurisdiction. As Desert Glass did not commit a tort whose main focus was Florida, nor did Desert Glass have sufficient minimum contacts with Florida, we affirm the trial court's order of dismissal as to Desert Glass. We reverse, however, the trial court's denial of Hale's motion to dismiss, because Hale neither committed a tort in Florida nor was engaged in continuous business activity in the state at the time the complaint was filed. Arch is a Florida corporation that acts as a nationwide fabricator and distributor of architectural aluminum and glass. From 1995 through April 2002, defendant Matthew Hale, a Georgia resident, worked as national sales manager for Arch. As national sales manager, Hale had full and authorized access to proprietary information developed by Arch in Florida, such as client lists, sales projections, prior sales data, business plans, and financial statements for Arch's operations across the country. From approximately April 30, 2002, through April 2003, Hale worked as an independent contractor for Arch, focusing on marketing work. Danny Haney worked at Arch until late November 2002, serving as its Director of Manufacturing. In October 2002, Haney was interested in

forming a glass products company with the financial backing of Larry Jaynes of Texas. Haney ultimately asked Hale if he would provide him with copies of marketing studies that Hale had prepared on behalf of Arch concerning the glass fabricating markets in North America with the best potential for development. During the course of their communications in the fall of 2002, Hale suggested to Haney that he consider starting a glass fabricating facility in Las Vegas, Nevada. Hale made this suggestion in part because Arch did not have a fabricating facility there, though Arch did compete in the Las Vegas market from its Phoenix plant. Haney commissioned Hale to provide various marketing studies of the Las Vegas market. On December 27, 2002, when Haney resided in Florida, Hale sent Haney an e-mail attaching various marketing documents relevant to the Las Vegas market. The documents included a survey of Las Vegas glass companies conducted in December 2002 and a nationwide "Metro Area Analysis" of various markets. The Metro Area Analysis was a nationwide comparison of the competitive situation of numerous markets based on a variety of factors (such as population growth, housing starts, and the number of competing tempering facilities). Jaynes paid Hale for the Metro Area Analysis. The Metro Area Analysis determined that Las Vegas was the most attractive market. Haney recalled Hale having previously prepared a Metro Area Analysis report for Arch. Hale, however, claimed that he had created this specific Metro Area Analysis document in December 2002, though he acknowledged generating similar documents for Arch over the last three or four years of his employment there. Hale completed the analysis of the metropolitan areas while he was an independent contractor and sold it both to Arch, who was evaluating a San Francisco facility, and the incorporators of Desert Glass. Based upon the report, Jaynes and Haney decided to start a glass production business in Las Vegas. On January 13, 2003, they incorporated defendant Desert Glass Products, LLC, in Nevada. Desert Glass sells fabricated glass products, primarily in western states. Desert Glass has its principal office in Las Vegas, and it began full operations at some point after July 2003. Desert Glass is currently a direct competitor of Arch in some western geographic markets, but not in Florida. In October 2003, Hale started working as a full-time employee of Desert Glass, where he stayed until the end of 2005. Desert Glass also hired James Fendley, Arch's Phoenix area sales representative. Fendley
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met with Hale, who advised Fendley to target Arch customers in the Phoenix area. Fendley attested in his affidavit that Hale provided him with "an Arch business plan for the Phoenix region," which "contained all of Arch's customer names, prior sales, and future sales projections for the Phoenix area." This document is referred to as the "Phoenix worksheet." The Phoenix worksheet was prepared for Arch in 2001 from information supplied by Arch's sales representatives, including Fendley. It contained a customer list along with Arch's sales figures for 1999, 2000, and part of 2001. The Phoenix worksheet also includes an estimate of potential future sales that each customer would provide. Hale was in Las Vegas when he gave the Phoenix worksheet to Fendley. Fendley testified that Hale would have received this worksheet in his capacity as national sales manager of Arch. This would have occurred during Hale's full-time employment with Arch, which ended in April 2002. Arch sued Desert Glass and Hale in Florida, alleging the following tort claims against the defendants: misappropriation of trade secrets; unfair competition; aiding and abetting; and conspiracy. Arch alleged that Hale, after leaving Arch's employment, and while acting on behalf of Desert Glass, utilized Arch's confidential business information to build a business plan for Desert Glass to specifically target Arch's customers. Hale was instructed, under Arch's employee handbook, that business plans, pricing strategies and customer lists constituted proprietary information that belonged to Arch. The complaint alleges Hale misappropriated trade secrets by using this confidential information to target Arch customers and develop Desert Glass' business in areas where it did not otherwise conduct business. Nowhere in the complaint did Arch mention either the Metro Area Analysis or the Phoenix worksheet. Both Hale and Desert Glass moved to dismiss the Florida complaint for lack of personal jurisdiction. Both Jaynes and Hale filed affidavits in support of these motions. Jaynes attested that Desert Glass did no business in Florida. Hale attested that he was a non-resident, had not been in Florida for at least two years, and did not use any confidential information belonging to Arch. Haney filed an affidavit saying that he had commissioned the Metro Area Analysis and that he had seen the custom tempering analysis of all major areas when Hale had produced it for Arch. At an earlier hearing on discovery, both Hale and Fendley testified extensively on both the Metro Area Analysis and the Phoenix study. Hale testified that he had prepared the present Metro Area Analysis while he was an independent contractor and used generally available public
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information, such as housing starts and population. He had used the same general analysis of the metropolitan regions both during his employment with Arch and later in consulting work for Arch. At the evidentiary hearing, the court determined that the Metro Area Analysis was "no great secret." The court noted that "[p]robably around the same time that [the Metro Area Analysis] was generated, you could have picked up Time Magazine and learned that Las Vegas was the hottest market in the country." At the hearing on the motion to dismiss for lack of personal jurisdiction, the parties presented the affidavits and made an extensive legal argument to the court. After a full hearing on the issue, the trial court dismissed the complaint against Desert Glass because Desert Glass lacked minimum contacts with Florida. However, it denied Hale's motion to dismiss. Arch appeals the dismissal of Desert Glass, and Hale appeals the order denying his motion to dismiss. We review de novo these rulings. See Wendt v. Horowitz, 822 So. 2d 1252 (Fla. 2002). In Venetian Salami Co. v. Parthenais, 554 So. 2d 499, 502 (Fla. 1989), our supreme court set forth a two-step inquiry for determining whether a Florida court has personal jurisdiction over a nonresident. First, it must be determined that the complaint alleges sufficient jurisdictional facts to bring the action within the ambit of Florida's long-arm statute, section 48.193, Florida Statutes. Id. If so, the next inquiry is whether sufficient "minimum contacts" are demonstrated to satisfy due process requirements. Id. "Both parts must be satisfied for a court to exercise personal jurisdiction over a non-resident defendant." Am. Fin. Trading Corp. v. Bauer, 828 So. 2d 1071, 1074 (Fla. 4th DCA 2002). Under Florida's long-arm statute, a party is subject to jurisdiction in Florida by "[c]ommitting a tortious act within this state."

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