Late last month, Judge Patti Saris of the U.S. District Court for the District of Massachusetts ruled that a noncompete was enforceable and ordered the defendant employee not to work for a competitor of the plaintiff employer for one year. In addition to determining that the noncompete was valid, Judge Saris concluded, among other things, that the employer would likely suffer “irreparable harm,” an injury that cannot adequately be compensated by money damages, if the employee were not prevented from working for the competitor. The unique facts of the case made that conclusion an easy one.
The employee, Gerald Campbell, was employed by the plaintiff Harlan Laboratories, Inc. as a sales account manager and regional manager. He signed a noncompete that restricted his post-employment opportunities for one year. After Campbell resigned from Harlan, he was hired by Charles River Laboratories International, Inc., Harlan’s direct competitor. Shortly thereafter, he received an email from a Charles River colleague for help on a market share analysis. That same night, Campbell accessed a flash drive and opened several files containing Harlan’s confidential information. He saved several of the files to his computer and then threw away the flashdrive, even though he previously had been ordered to preserve evidence for litigation that was “very likely.” Campbell did not remember reviewing or copying the information, but did remember throwing away the flashdrive. Because, “[a]s a general rule, a breach of a non-compete agreement tied to trade secrets concerns triggers a finding of irreparable harm,” Judge Saris found a strong likelihood that Harlan would suffer irreparable harm if Campbell were not enjoined.
It’s obvious what made this case easy for Judge Saris: Campbell downloaded his former employer’s confidential information, accessed it while working for a competitior after being emailed about a market analysis, and then pitched the flashdrive. The inescapable implication is that Campbell used Harlan’s confidential information to help Charles River and then destroyed the evidence. The lesson: taking a former employer’s confidential information to a competitior is never a good idea in the noncompete context, and using it for the competitor is even worse. And the last thing you ever want to do is destroy evidence. It’s unethical, and with modern computer forensics, you’ll often get caught.
The case is Harlan Laboratories, Inc. v. Campbell, C.A. No. 12-10995-PBS, 2012 WL 5285127 (D. Mass. Oct. 25, 2012).