Astro-Med, Inc. v. Nihon Kohden America, Inc., et al

Filing 920091022

Opinion

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var WPFootnote1 = ' Of the District of Maine, sitting by designation.\
'

var WPFootnote2 = '                                                      1 Astro-Med originally filed suit in Kent County Superior Court\
in Rhode Island. Asserting diversity jurisdiction, Plant timely\
removed the case to the United States District Court for the\
District of Rhode Island. \
'

var WPFootnote3 = '                 2 Neither Nihon Kohden nor Plant contests the district court’s\
exercise of jurisdiction over Plant.\
'

var WPFootnote4 = '              3 R.I. Gen. Laws § 9-5-33(a). \
'

var WPFootnote5 = '              4 The claims against Nihon Kohden sound only in tort, but the\
claims against Plant include a breach of contract claim, which was\
submitted to the jury by special interrogatory and resulted in a\
verdict against Plant. \
'

var WPFootnote6 = '              5 Plant has not challenged the court’s venue decision.\
'

var WPFootnote7 = '                 6 With regard to corporations, 28 U.S.C. § 1391(c) provides\
that, “[for] purposes of venue under this chapter, a defendant that\
is a corporation shall be deemed to reside in any judicial district\
in which it is subject to personal jurisdiction at the time the\
action is commenced.” Because we have concluded that Nihon Kohden\
is subject to personal jurisdiction in Rhode Island, we can also\
conclude that Nihon Kohden, a corporation, “resides” in Rhode\
Island pursuant to 28 U.S.C. § 1391(c).\
'

var WPFootnote8 = '              7 Defendants cite two cases in support of the proposition that\
a non-competition clause cannot be breached until it is modified: \
Durapin and Hawkins v. daly.commerce, inc., No. 2000-5740, 2003\
R.I. Super. LEXIS 14 (R.I. Super. Ct. Feb. 10, 2003). Neither\
Durapin nor Hawkins says such a thing. In Durapin, the Supreme\
Court of Rhode Island affirmed a trial court decision to invalidate\
a non-competition provision in its entirety. Durapin, 559 A.2d at\
1056-59. Durapin does not say that a party to a non-competition\
agreement cannot violate it until it is modified; it says that,\
under the circumstances, there was no need to modify an\
unenforceable restrictive covenant. Id. at 1059. In Hawkins,\
daly.commerce, inc., Richard Hawkins’s former employer, argued that\
he violated the provisions of a non-competition agreement by\
accepting employment with a business “of the type and character”\
similar to daly’s. Hawkins, 2003 R.I. Super. LEXIS 14, at *4-5. \
The Superior Court concluded that the new employment was not of the\
type and character engaged in by daly, and refused to enforce the\
non-competition provision. Hawkins, at *13-14. The Hawkins court\
quoted the familiar teaching that restrictive covenants “will only\
be enforced when reasonable and where restrictions do not extend\
beyond what is apparently necessary for the protection of the\
employer’s business,” id., but this statement, which defendants\
quote, does not begin to suggest that a non-competition provision\
cannot be violated until after there has been a judicial\
determination of its proper scope.\
'

var WPFootnote9 = '              8 For example, email exchanges between Plant and Nihon Kohden\
reveal that after Plant accepted the Nihon Kohden job offer, Brian\
Kehoe, a Nihon Kohden employee, wrote to Plant that he will be\
“interested to see what you have in the works with Grass” and he\
will be “happy to start communication from [Nihon Kohden] if it\
will help you on some Grass accounts.” (Grass is the product group\
for which Plant worked.) Plant replied, “Sounds good.” Plant also\
explained that Kehoe handled sales with Astro-Med customers that\
Plant was precluded from contacting by a preliminary injunction\
ordered by the district court. Given the understanding between\
Plant and Kehoe, the jury could reasonably have inferred that Plant\
disclosed to Kehoe, and Nihon Kohden (knowing the terms of Plant’s\
Employee Agreement) acquired through Kehoe, trade secrets that\
Plant had learned while subject to a duty of non-disclosure.\
'

var WPFootnote10 = '                 9 This cannot come as a surprise to defendants. Addressing the\
same contention with a similar lack of specificity, the district\
court came to the same conclusion.\
'

var WPFootnote11 = 'Nothing in the record prevents a finding that the Rhode\
Island-based plaintiff in this case has suffered injury in Rhode\
Island, both in the fact of, and as a consequence of, the breach of\
its Rhode Island-formed and -managed employment relationship with\
Plant.\
'

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