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Company can seek to enforce noncompete agreement.

Byline: Virginia Lawyers Weekly

A training company showed it was likely to prevail on its claim that a former employee, who went to work for one of its clients, breached a restrictive covenant, and is entitled to injunctive relief.

Background

TechINT provides intelligence and training services, including services regarding Unmanned Aircraft Systems to government and commercial clients. TechINT hired Brandon Sasnett as an intelligence analyst in 2013. On Jan. 1, 2016, Sasnett entered into three agreements with TechINT, including a services agreement that contained a non-solicitation and restrictive covenant clause.

In July 2017, TechINT performed UAS-related services for Red Six Solutions, LLC, including an exercise led by Sasnett. On Oct. 11, 2017, provided his notice of resignation to TechINT, effective immediately. Shortly thereafter, Sasnett modified his LinkedIn account to reflect that he had begun working at Red Six as Director of Threat Analysis.

TechINT asserts that it learned, on Jan. 29, 2018, that Sasnett would provide USA services for Red Six that coming week services which were the same or substantially the same as the services TechINT had planned to provide. On the same date, TechINT also learned that Sasnett was providing UAS services to another "client."

In its motion for preliminary injunction, TechINT asks the court to temporarily enjoin Sasnett from "[p]roviding competing services to TechINT's clients, as set forth in the Services Agreement, to include enjoining Sasnett from providing UAS-related and other services to Red Six Solutions, LLC."

Jurisdiction

At the hearing, Sasnett suggested that the court may not have subject matter jurisdiction over this matter. But TechINT's alleged sum includes a contract loss of $65,530, equipment loss of $13,640, the loss of legal fees, and further damages from Sasnett's provision of work to TechINT clients. "[V]iewed from the date the complaint was filed," the court determines that TechINT has made its claim exceeding $75,000 in good faith and reasonably could expect to recover the amount sought.

Injunctive relief

First, "plaintiffs seeking preliminary injunctions must demonstrate that they are likely to succeed on the merits."

Sasnett first argues that the provision at issue is unenforceable because it is susceptible to interpretations of "client" and "competing services" that render it functionally overbroad. In particular, Sasnett argues that the restrictive covenant bars him from "providing any 'intelligence analysis' services to any governmental entities to which TechINT has ever marketed." The court does not find this argument persuasive.

Sasnett next argues that, even if the court determines the provision is enforceable, he has not violated it. Sasnett asserts that he has provided services to Red Six customers rather than to Red Six directly and that he never solicited other TechINT employees for employment at Red Six. But the court rejects Sasnett's attempt to distinguish Red Six customers from Red Six as an entity. His employment by Red Six unquestionably constitutes "providing services" to it, and not just to its clients.

Second, Winter also requires that the party requesting injunctive relief demonstrate that it is likely it will suffer irreparable harm absent the preliminary injunction. TechINT has shown that it is likely to suffer irreparable harm in the absence of an injunction.

The court next weighs the harm to Sasnett if he were prevented from providing competing services to or soliciting TechINT's clientsagain, as both terms are elaborated upon aboveagainst the likelihood of immeasurable, irreparable harm to TechINT absent preliminary injunctive relief. It concludes that the balance tips in TechINT's favor. Finally, enforcing compliance with a non-solicitation provision that is not functionally overbroad and protecting TechINT's business interests are within the public interest.

The court will enjoin Sasnett from providing competing services to TechINT's clients and enjoin him from soliciting employees of TechINT to terminate their employment with TechINT. The court, however, will not require Sasnett to account for and return of property as the evidence at the hearing did not indicate a failure to return property. Furthermore, the court will not, at this time, require Sasnett to provide an accounting of all work, proceeds, and profits or to identify all third parties for whom he has performed competing services because TechINT may seek this information through the discovery process in this case.

Motion granted in part.

Techint Solutions Group LLC v. Sasnett, Case No. 18-cv-00037, Sept. 27, 2018. WDVA at Harrisonburg (Dillon). VLW No. 018-3-421, 16 pp.

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Title Annotation:Techint Solutions Group LLC v. Sasnett, U.S. District Court for the Western District of Virginia
Publication:Virginia Lawyers Weekly
Date:Oct 28, 2018
Words:729
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