Mickey's Linen v. Fischer

Filing 56

MEMORANDUM Opinion and Order signed by the Honorable Sheila M. Finnegan on 9/8/2017.Mailed notice(sxw, )

IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
MICKEY’S LINEN
Plaintiff,
v.
DONALD FISCHER,
Defendant.

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Case No. 17 C 2154
Judge Robert W. Gettleman
Magistrate Judge Sheila Finnegan

MEMORANDUM OPINION AND ORDER
Plaintiff Mickey’s Linen (“Mickey’s”) brings this four-count action against its former
employee, Defendant Donald Fischer, for breach of an employment agreement (Count I),
misappropriation of trade secrets under the Defend Trade Secrets Act 18 U.S.C. § 1836,
et seq. (“DTSA”) and Illinois Trade Secrets Act, 765 ILCS 1065/1 et seq. (“ITSA”) (Count’s
II and III), and breach of duty of loyalty (Count IV). (Doc. 24). Mickey’s originally filed
this action in March 2017 (Doc. 1), and then sought a temporary restraining order and
preliminary injunction. (Doc. 5). The parties thereafter agreed to a standstill (obviating
any need for a TRO) and expedited discovery (Docs. 19, 22), and consented to this
Court’s jurisdiction to rule on Mickey’s motion for preliminary injunction. (Docs. 31-32).
The Court held an evidentiary hearing on Mickey’s preliminary injunction motion on June
7, 2017, after which the parties filed their respective briefs. (Docs. 42, 46, 48, 50-51).
Having considered those briefs and the evidence presented at the June 7 hearing, for the
reasons explained below, the Court now grants in part and denies in part Mickey’s motion
for preliminary injunction (Doc. 6).

The parties are directed to submit a proposed

injunction order consistent with this Opinion within ten days of its issuance.

BACKGROUND
I.

FISCHER’S HIRING AND EMPLOYMENT AGREEMENT WITH MICKEY’S
Mickey’s is in the business of leasing and laundering various linens (such as mats,

table cloths, napkins, and similar products) for hospitality providers and food service
establishments (such as restaurants, country clubs, banquet halls, and similar
businesses). (Doc. 50, 6/7/2017 Preliminary Injunction Hearing Transcript (“Tr.”), at 1819). Mickey’s also has a division known as “Medclean,” which provides similar services
to the retail medical industry, although its primary business is in the hospitality and food
service area. (Tr. at 186, 210). One of Mickey’s direct competitors in the hospitality and
food service area is Fischer’s new employer, Alsco, Inc. (“Alsco”). (Tr. at 19).
Among other locations, Mickey’s has long had facilities in Chicago and Villa Park,
Illinois and Milwaukee, Wisconsin. (Tr. at 109-10). In October 1997, Mickey’s hired
Fischer as a “route representative” (which Fischer described as a “delivery driver”) in
Mickey’s Chicago facility, which then serviced its customers in Cook, Lake, and DuPage
counties. (Tr. at 19-21). At the time of his hiring, Fischer signed an Employment
Agreement which defined Mickey’s “Business” for purposes of that agreement as “uniform
and linen rentals, the sale of restroom supplies, paper products and similar items.” (Doc.
54, at 11; see also Doc. 24-1 for a clearer copy). This agreement included, among other
provisions, a Non-Competition provision (Paragraph No. 6), a Non-Solicitation of
Customer and Prospects provision (Paragraph No. 7), and a Confidentiality provision
(Paragraph No. 5). (Id. at 11-12). The Non-Competition provision prohibited Fischer
from engaging in the same “Business” as Mickey’s in the counties then serviced by
Mickey’s Chicago facility (Cook, Lake, and DuPage) for eighteen months after the
termination of Fischer’s employment, as follows:
2

NON-COMPETITION. For a period of eighteen months after the
effective date of the termination of Employee's employment,
Employee shall not, directly or indirectly, engage in any business,
enterprise or employment located in the geographic areas
designated below [Cook, Lake, and DuPage Counties], whether as
owner, partner, officer, director, shareholder, independent
contractor, consultant, employee, agent, advisor, investor or
otherwise (collectively “Participant”), which directly or indirectly
engages in the same or a similar business to the Business or any
other activity in which the Company is engaged or which otherwise
competes with the Company.
(Doc. 54, at 11, ¶ 6). The Non-Solicitation provision similarly recited an 18-month term:
NON-SOLICITATION OF CUSTOMERS AND PROSPECTS. For
a period of eighteen months after the effective date of the
termination of Employee's employment, Employee shall not,
directly or indirectly, individually or as a Participant with any Person,
solicit or accept business from any Customer or Prospect; for the
purposes of this Employment-Agreement, a “Customer” is any
Person for whom the Company provided any service within
eighteen months prior to the effective date of the termination of
Employee's employment with the Company, and a “Prospect” is any
Person whom Employee contacted or solicited to do business with
the Company within six months prior to the effective date of the
termination of Employee's employment with the Company as
evidenced by Employee's “diary”, “call sheets” or sales activity
reports.
(Id. at 12, ¶ 7).

The Confidentiality provision, however, included no geographic or

temporal limitation, providing in relevant part, as follows:
CONFIDENTIALITY. Except in the performance of Employee’s
employment duties, Employee shall not at any time, both while
employed by the Company and thereafter, use or divulge to any
Person any information received by Employee during the course of
Employee's employment with regard to the Business, the
Company's Customers, “Prospects” (hereinafter defined),
employees and agents . . . (collectively the “Confidential
Information”). Employee acknowledges that the Confidential
Information is not generally available in the Company's industry or
to the Company's competitors, are assets of the Company, has
independent economic value to the Company and must be kept
strictly confidential in order to preserve and enhance the Business
and the Company's productivity, profitability and good will. . . .
(Id. at 11, ¶ 5).
3

In addition to the foregoing, Fischer’s Employment Agreement also included a
Severability provision, providing as follows:
SEVERABILITY. Whenever possible, each provision of this
Employment Agreement shall be interpreted in such manner as to
be valid and enforceable under applicable law, but if any provision
of this Employment Agreement shall be held to be invalid or
unenforceable by a court of competent jurisdiction, such provision
shall be deemed severed herefrom and such invalidity or
unenforceability will not affect any other provision of this
Employment Agreement, the balance of which will remain in and
have its intended full force and effect; provided, however, if such
invalid or unenforceable provision, including, without limitation, the
geographic scope described in Section 6 or the time periods
described in Sections 5, 6, 7 or 8, may be modified so as to be valid
and enforceable as a matter of law, such provision will be deemed
to have been modified so as to be valid and enforceable to the
maximum extent permitted by law.
(Id. at 12, ¶ 13). Also relevant is the Employment Agreement’s Remedies provision:
REMEDIES. Employee acknowledges and agrees that the
Company's remedies at law may be inadequate to redress a default
in the performance of Employee’s employment duties or
Employee’s covenants, agreements or obligations contained in this
Employment Agreement, and therefore, the Company shall be
entitled to equitable relief, including, without limitation, temporary,
preliminary and permanent injunctive relief, specific performance or
other equitable remedies, in addition to any and all other remedies
available to the Company pursuant to this Employment Agreement,
at law or in equity. . . .
(Id. at ¶ 9).
II.

FISCHER’S ADVANCEMENT AND INCREASING ACCESS TO MICKEY’S
CONFIDENTIAL INFORMATION
Fischer admitted at the June 7 hearing that his entry position as a route

representative for Mickey’s was “very customer-focused.” (Tr. at 21). He was “the face
of the company” to the customers he serviced and responsible for their contract renewals
and any other issues they might have. (Id. at 21-22). In that role, Fischer had access
to the contact information, contracts and expiration dates, and pricing for the customers
4

he serviced. (Id. at 22-24). Fischer remained a route representative for about two years
until 2000, when he was promoted to the position of route supervisor. (Id. at 24). In this
position, Fischer was responsible for supervising three or four route representatives and
coaching them to engage their customers for contract renewals, but spent the bulk of his
time meeting with customers himself, addressing their issues, handling contract renewals,
and selling Mickey’s services. (Id. at 26-27).
By 2003, Fischer was promoted to District Manager, which was the next upward
position within Mickey’s Service Department.

(Tr. 29, 178).

As District Manager,

Fischer was responsible for supervising both route representatives and route supervisors.
(Id. at 27-30, 178). But again, Fischer spent the majority of his time as District Manager
meeting with customers and addressing their issues, soliciting contract renewals, selling
services to new and existing clients, and handling any other aspects of customer
relationships. (Id. at 28-30). And again, Fischer had access to substantial customer
information in this role, including the products and services they purchased and the
pricing at which they did so, and their contract expiration dates. (Id.).
Fischer was next promoted to Service Manager for Mickey’s entire Chicago facility
in 2012 or 2013. (Tr. at 32-33). As Service Manager, Fischer was responsible for all
functions of Mickey’s Service Department, the focus of which was customer service,
customer retention, and growing Mickey’s customer base. (Id. at 32-37). Fischer was
responsible for all route supervisors (two to four) and route representatives (about
eighteen) in the Service Department and any significant customer service issues they
were unable to handle, as well as signing up new customers. (Id.). In this role, Fischer
reported only to the General Manager of Mickey’s Chicago facility, Chris Brown, and on
occasion the President of the company. (Id. at 33-34).
5

III.

FISCHER’S ROLES DURING AND AFTER MICKEY’S TERRITORY REROUTE
In 2014, Mickey’s began transferring part of the territory then handled by its

Chicago facility to its Milwaukee facility. (Tr. 112-15, 121). This “reroute” took place in
three phases which were completed by year-end (id.); and Fischer prepared for,
designed, and oversaw that transition. (Id. at 203). According to Mickey’s Chris Brown,
Fischer was entrusted with that responsibility because that was “his area of expertise,”
since he “knew that customer base very, very well.” (Id.). In preparation for this reroute,
Fischer assured (personally or through his staff) that every affected customer’s contract
was renewed so that the Milwaukee facility “would have a clean customer base, all with
fresh renewals,” and that any customers who used products or services unavailable
through the Milwaukee facility were converted into product and service lines handled out
of Milwaukee. (Tr. at 187). This reroute moved the northern border of Mickey’s Chicago
facility south from the Wisconsin state line to a line that roughly traces Illinois State Routes
120 and 137. (Id. at 120-21, 212-13). As a result, when the transition was complete in
2014, Mickey’s Chicago facility (and thus, Fischer) no longer handled customers north of
Routes 120 and 137. (Id.).
Following this reroute, in 2015, Fischer was promoted again, this time to Regional
Service Manager, in which he retained his responsibilities for the Service Department in
Mickey’s Chicago facility and assumed the same responsibilities for Mickey’s Villa Park
facility.

(Tr. at 38-39, 185).

As such, Fischer was responsible for the service

departments in both locations, managed the route supervisors who oversaw the route
representatives in both locations, and was ultimately responsible for all routes and all
customers serviced out of both locations. (Id. at 39-41, 185-86). Fischer also assumed
a larger leadership role within the company in other respects, including managing its truck
6

fleet and paper inventory program and participating in the negotiation of its Collective
Bargaining Agreement. (Id. at 46-47, 51, 187-88).
Fischer’s access to Mickey’s confidential information increased in this larger role,
as well. He now attended weekly manager’s meetings for both the Chicago and Villa
Park facilities along with the leaders of each Department at those facilities, at which
particular customer challenges, strategies for addressing them, marketing plans, and
other customer issues were addressed. (Id. at 46-50, 186-90). Fischer also attended
company profit and loss meetings, at which the financial data for each Department and
other budgetary and profitability information for the company was distributed and
evaluated. (Id.) And as before, Fischer enjoyed wide access to and routinely utilized
extensive confidential customer information, including customer contacts, contract terms,
pricing, and discounts, contract expiration dates and renewal terms, strategies for
marketing and adding new products and services, new customer install schedules, lists
of the company’s highest revenue producing customers and problem or at-risk customers,
and bad debt listings. (Id. at 52-57, 180-86). Fischer acknowledged at the June 7
hearing that all of this information was confidential; indeed, the financial information
distributed at company profitability meetings was deemed so sensitive that it was not
allowed to leave the meeting room. (Id. at 50, 52-57).
Finally, in October 2016, Fischer became Mickey’s “key account representative.”
(Tr. at 41-42, 191-92). The parties disagree about who initiated this change – Mickey’s
says Fischer requested it; Fischer says Mickey’s offered it – but Fischer admits he
welcomed it. (Id.). In this position, Fischer was entrusted with maintaining and growing
the Chicago facility’s “key accounts” (meaning the top 150 revenue producing customers
serviced out of that location), which were the company’s “largest dollar customers.” (Id.
7

at 41-43, 147, 192). To that end, Fischer was responsible for making “goodwill visits” to
the key Chicago customers that had issues to be addressed, and thus retained access to
Mickey’s confidential information relating to these customers, including key contacts,
contract terms and expiration dates, pricing, volumes, and purchasing histories. (Id. at
42-43, 192). But Fischer stresses (and Mickey’s does not appear to dispute) that all of
these customers were south of the Route 120-Route 137 line, due to Mickey’s ChicagoMilwaukee reroute in 2014. (Doc. 48, at 7; Tr. 131, 212-13).
IV.

FISCHER’S DEPARTURE FROM MICKEY’S TO WORK FOR ALSCO
Shortly after becoming Mickey’s Key Account Representative, in December 2016,

Fischer engaged in discussions with Mickey’s key competitor, Alsco, about joining its
sales force. (Tr. 67, 146-47, 151, 221, 224). Fischer’s initial contact was with one of
Alsco’s sales consultants who had himself previously worked for Mickey’s, Dominick
Castaldo. (Id.). Castaldo then recommended Fischer to Alsco’s Regional Manager,
Dave Carman, to fill an open sales consultant position that serviced Alsco’s customers in
all of Wisconsin and along the Illinois-Wisconsin border. (Id. at 221-23).
Fischer spoke with Carman later in December 2016, and Carman found him “very
knowledgeable about the industry” and asked to reconvene their discussion after the
holidays. (Id.). In their second conversation in early January 2017, the “main topic of
discussion” was Fischer’s non-compete agreement with Mickey’s. (Id. at 223). Carman
knew to raise this issue because “most people” who work in their industry have a noncompete agreement, and Alsco had by then already hired two of Mickey’s other
employees who had signed two different versions of a non-compete agreement—an
“older version” that prohibited work for a competitor in a specific geographic area, and a
“newer version” that prohibited work for any competitor. (Id. at 223-25). Knowing all
8

this, Carman asked Fischer during their January 2017 conversation if he had signed “the
older or the newer version of Mickey’s non-compete,” and Fischer answered that he had
signed the older version (which prohibited work for a competitor within a specific
geographic area). (Id.). Carman asked Fischer for a copy of the agreement, but Fischer
did not have one and declined to ask Mickey’s for one, for fear “that Mickey’s would be
concerned that he was going to be employed by a competitor.” (Id.). Nevertheless,
despite lacking reliable information about the scope of Fischer’s non-compete agreement
with Mickey’s, Carman directed Fischer to fill out an employment application online, and
Fischer did so. (Id. at 226-27, 231).
Shortly after this second conversation with Mr. Carman, and having been invited
to submit an employment application to Alsco, Fischer resigned from his job with Mickey’s
on January 9, 2017. (Id. at 68). Surprised by this news, Mickey’s Chris Brown asked
Fischer directly if he was going to go to work for Alsco, but Fischer denied any such
intention and instead claimed he was leaving the industry to work in his family’s tile
business. (Id. at 69-72). Fischer notes that he had not yet secured employment with
Alsco when he made this misstatement (he did not submit his application to Alsco until
January 20, and did not receive his offer letter from Alsco until February 3 or 4). (Id.)
But still, Fischer admits that he was untruthful when he told Mickey’s that he was leaving
the industry to work for his family’s tile business, since he knew at the time that he was
trying to land a job with Alsco and Alsco had expressed an interest in hiring him and
invited him to submit an application. (Id. at 71-72, 79, 85).
Fischer continued working for Mickey’s for another few weeks after his resignation,
until January 26 or 27, 2017. (Id. at 69). And given his representation that he was
leaving the industry (and not heading to a competitor), Mickey’s made no effort to shield
9

Fischer from its confidential information or clients during this period. (Id. at 72, 195-96).
Instead, Chris Brown asked Fischer how many weeks he could remain in his position,
and asked him to visit some specific customers during the remaining three weeks that
Fischer agreed to stay in order to assure that all outstanding issues with those customers
were resolved.

(Id.).

Had Mickey’s known that Fischer was going to work for a

competitor, however, its normal process would have been to ask for the employee’s keys,
company phone, and confidential company information in their possession “and take them
to the door.” (Id. at 197). But Mickey’s took no such measures with Fischer, believing
him to be leaving the industry. As a result, Fischer was not called upon to return his
company cellphone or any confidential company information until the time of his
departure. And even then, Fischer failed to return much information at all, and worse,
he failed to explain (at least convincingly) why.
For instance, before returning his company-issued cell phone, Fischer wiped all
information from it—including his customer contacts and other company information—
claiming that he had been unable to delete some personal information and photos from
the phone, and so (without seeking permission or help from Mickey’s IT department) he
deleted all information from the phone instead.

(Tr. 74-75, 102, 198-99).

This left

Mickey’s unable to retrieve the company and customer information that Fischer had on
the phone or determine whether and to whom he might have sent it. (198-99, 202-03).
Similarly, despite a requirement to return all company documents in his possession,
Fischer returned a mere inch of paperwork on his last day. (Id. at 78, 200-01). When
Chris Brown asked about the substantial volume of paperwork he believed Fischer had
accumulated over the last twenty years, Fischer first claimed that someone else had
cleaned out his office for him. (Id. at 200-02). And when that proved false, Fischer
10

claimed he had shredded the few documents in his possession on his last day of work on
his way to meeting with Brown, and had routinely shredded all of the other paperwork he
received over the last twenty years.

(Id. at 78-80, 142-43, 201-02).

Finally, when

Fischer later located additional company documents in his car after his last day, he failed
to return those too, claiming that he destroyed them. (Id. at 142-43).
V.

FISCHER’S SOLICITATION OF MICKEY’S CUSTOMERS FOR ALSCO
Fischer started work with Alsco on February 20, 2017 (Doc. 10-2, ¶ 7), and Alsco’s

Regional Manager (Dave Carman) was responsible for determining the territory he would
service and the customers and prospective customers he would visit. (Tr. at 227). But
again, while Carman knew Fischer had a non-compete agreement with Mickey’s, he had
no copy of it, and thus no way to determine what territory it covered. (Id. at 236). So
Carman questioned Fischer on his first day with Alsco about “each city that he had
recently worked in, not recently worked in, or never worked in.” (Id. at 227-28). Based
on that conversation, Carman assigned Fischer a sales territory that included all of
Wisconsin and the cities along the Illinois-Wisconsin border. (Id.).
Importantly, this territory included at least some of Lake County, where Fischer
had previously serviced customers for Mickey’s, and where his non-compete agreement
with Mickey’s precluded him from competing for eighteen months after his departure. (Id.
at 93-96, 100-01). Equally important, there is nothing to suggest that Carman or anyone
else at Alsco prohibited Fischer from calling on Mickey’s customers. (Id. at 83-85, 235).
Even more troubling, at least one of Alsco’s other sales consultants (Lori Orlov)
expressed an interest in seeking information from Fischer about which of Mickey’s
customers she should contact in Chicago. (Id. at 229). And while Mr. Carman testified
that he directed Ms. Orlov not to seek such information from Fischer because he and
11

Fischer “did not want to violate a non-compete” (id. at 229), neither Fischer nor Alsco has
pointed to any other preventive measures by Alsco to assure that its employees did not
solicit, and Fischer did not disclose, any of Mickey’s confidential information.
Within a month of starting at Alsco, Fischer was actively soliciting Mickey’s
customers on behalf of Alsco in Lake County and elsewhere. (Id. at 87, 92-93, 101-03;
Doc. 54, at 27). One prime example was Serbian Monastery, a Lake County customer
for which Fischer had written up an agreement and set pricing and other details while he
was employed by Mickey’s. (Tr. at 87-88, 124, 153, 161-62). As a result of his contacts
with this customer while in Mickey’s employ, Fischer immediately recognized his in-house
contact when he visited Serbian Monastery on behalf of Alsco, in addition to noting
Mickey’s logo on the customer’s floor mat. (Id. at 135-36, 162). Fischer thus knew
before he called on that customer on behalf of Alsco that Serbian Monastery had been
one of Mickey’s customers, a fact that he relayed to his Alsco colleague (Ann Walsh) who
accompanied him on that visit.

(Id. at 92).

Serbian Monastery’s status as one of

Mickey’s current customers was then confirmed during the meeting that ensued, when
Fischer asked the customer for one of Mickey’s invoices so he could provide a competitive
bid on behalf of Alsco. (Id. at 89-92). Based on that competitive bid, Fischer and Ms.
Walsh succeeded in soliciting Serbian Monastery’s business away from Mickey’s, if only
temporarily. (Id. at 208-09). After Serbian Monastery moved its business, Mickey’s
lowered its prices to beat Alsco’s and regain that business. (Id).
Fischer’s interrogatory answers in this action list sixteen other customers of
Mickey’s that Fischer also solicited on behalf of Alsco, four of which are in Lake County,
Illinois, while the others are in McHenry County, Illinois and Wisconsin. (Id. at 101-02;
Doc. 54, at 14-20). Fischer stresses, however, that each of these customers was located
12

north of the Route 120-Route 137 line, for which he had no direct responsibility when
working for Mickey’s after its 2014 reroute. (Doc. 48, at 7-10 and n.1). Fischer also
insists that he did not “target” these customers, but rather called on them “as part of his
general canvassing and prospecting efforts” for Alsco. (Id. at n.1). Finally, Fischer also
maintains that he did not use any of Mickey’s confidential information to solicit these
customers. Rather, Fischer argues, he asked some of these customers for information
about their prior usage with Mickey’s and then used that information to prepare a
competitive bid, as he did with Serbian Monastery (id. at 10), although that explanation
begs the question of how he knew what to ask for and who to ask for it.
VI.

FISCHER’S REPRESENTATIONS IN THIS LAWSUIT
Having learned that Fischer did not join his family’s tile business after all and

instead went to work for Mickey’s direct competitor Alsco, Mickey’s filed suit in March
2017 and sought a TRO against Fischer on April 12. Fischer responded on April 19,
2017, with a sworn Declaration (Doc. 10-2) containing several statements that he now
admits were false. (Tr. at 102). First, Fischer attested in paragraph 3 of his Declaration
that he had held the position of Key Account Representative “for the last 46 months,”
suggesting that he had surrendered his Service Manager and Regional Service Manager
roles within Mickey’s—and the hefty responsibility and access to its confidential customer
and company information that they entailed—years earlier than he did. (Doc. 10-2, ¶ 3).
Fischer admitted that this was false, but claimed it was due to a typographical error when
he attempted to say that he had held his Key Account Representative position for the last
4-6 months, rather than 46. (Tr. 65-66, 102). But even that assertion would have been
untrue, given Fischer’s further admission that he had held that position for four months at
the longest (October 2016 to January 2017). (Id. at 41-42, 66, 191-92).
13

Second, Fischer asserted in paragraph 5 of his declaration that as of January 2017
when he resigned from Mickey’s employ, he thought he “might work with [his] father-inlaw in a tile business, or [he] might apply for a job in the linen industry.” (Doc. 10-2, ¶ 5).
But this assertion is difficult to square with the admitted fact that by January 2017 Fischer
was trying to get hired by Alsco, already had several conversations with Alsco personnel,
and had been invited to apply for a job there. (Tr. at 68, 226). Indeed, even Fischer
admits that his story to Chris Brown in January 2017 that he was not going to Alsco and
was instead heading to the family tile business was a lie. (Id. at 71-72, 79, 85). The
same assertion in his Declaration must be viewed similarly.
Third, Fischer stated in paragraph 10 of his Declaration: “I do not know of any
Mickey’s trade secrets or other similar, confidential information.” (Doc. 10-2, ¶ 10). But
Fischer admitted at the June 7 hearing that this statement was at the very least
inaccurate, given all of the confidential information he had learned and used in the twenty
years he worked for Mickey’s. (Tr. at 50-57, 103). And while Fischer claimed at the
hearing that he did not believe this statement in his Affidavit was false when he made it,
that claim is difficult to square with the many categories of confidential information he
admitting having accessed while in Mickey’s employ. (Id).
Finally, in paragraph 19 of his Declaration, Fischer stated: “to the extent I conduct
work in Lake County, I do not solicit Mickey’s customer’s [sic].” (Doc. 10-2, ¶ 19). And
in Paragraph 21, Fischer stated: “Since resigning from Mickey’s, I have never solicited
or attempted to solicit any Mickey’s customer. . . . Specifically, I have not solicited any of
my former Mickey’s customers to leave Mickey’s, alter their business with Mickey’s, or to
move to Alsco or anywhere else.” (Id. at ¶ 21). Here again, Fischer claimed at the June
7 hearing that he did not believe these statements were false when he made them; he
14

simply “misunderstood the language,” mistakenly believing it to refer only to the
customers for which he was responsible in his last 18 months of his employment with
Mickey’s. (Tr. at 94). But as even Fischer admitted at the hearing, the claim in his
Declaration that he never solicited or attempted to solicit any of Mickey’s customers for
Alsco was plainly false, since he knew within moments of calling on Serbian Monastery
for Alsco (nearly a month before signing his Declaration) that it was Mickey’s customer;
indeed he asked his prior Serbian Monastery contact for a Mickey’s invoice so Alsco could
beat it. (Id. at 89-90, 92, 135-36, 162; Doc. 48, at 10). By the same token, Fischer’s
Declaration statement that he does not solicit Mickey’s customers “to the extent” he works
for Alsco in Lake County was similarly untrue, given that Serbian Monastery was in Lake
County, and four of the other customers that Fischer solicited for Alsco in Lake County
were Mickey’s as well. (Id. at 101-02; Doc. 54, at 14-20).
In sum, contrary to these statements in his Declaration, Fischer admitted at the
June 7 hearing that he solicited or attempted to solicit at least 17 of Mickey’s customers
along the Illinois-Wisconsin border, five of which were in a county covered by Fischer’s
non-compete agreement with Mickey’s (Lake County). Fischer nevertheless claimed he
had believed these customers were in an area where he was allowed to work because
he “didn’t have any responsibility for them for several years,” after they were transferred
to one of Mickey’s other locations in 2014. (Id. at 98-101). After being confronted with
his Employment Agreement in this litigation, however, Fischer stopped calling on any of
Mickey’s customers in Illinois. (Id. at 105). Indeed, both Fischer and his new employer
conceded at the June 7 hearing that Fischer could work successfully and profitably for
Alsco if limited to servicing its customers in Wisconsin, and completely refraining from
soliciting any of Mickey’s customers in Illinois. (Id. at 105-07, 236-37).
15

DISCUSSION
With the foregoing background in mind, the Court now considers Mickey’s request
for a preliminary injunction. The Seventh Circuit requires a two-step analysis to decide
whether a preliminary injunction is warranted. Turnell v. CentiMark Corp., 796 F.3d 656,
661-62 (7th Cir. 2015). “In the first phase, the party seeking a preliminary injunction must
make a threshold showing that: (1) absent preliminary injunctive relief, he will suffer
irreparable harm in the interim prior to a final resolution; (2) there is no adequate remedy
at law; and (3) he has a reasonable likelihood of success on the merits.” Id. “If the
movant makes the required threshold showing, then the court proceeds to the second
phase, in which it considers: (4) the irreparable harm the moving party will endure if the
preliminary injunction is wrongfully denied versus the irreparable harm to the nonmoving
party if it is wrongfully granted; and (5) the effects, if any, that the grant or denial of the
preliminary injunction would have on nonparties (the ‘public interest’).” Id. In other
words, once the party seeking the injunction has made the required threshold showing,
“the court weighs the factors against one another, assessing whether the balance of
harms favors the moving party or whether the harm to other parties or the public is
sufficiently weighty that the injunction should be denied.” BBL, Inc. v. City of Angola, 809
F.3d 317, 323-24 (7th Cir. 2015).
I.

LIKELIHOOD OF SUCCESS ISSUES
Mickey’s predicates its injunction demand on three of its four claims in this case:

the breach of contract claim (Count I) and the ITSA and DTSA trade secret claims (Counts
II and III). (Doc. 46, at 36). The Court turns first to Mickey’s likelihood of succeeding
on its claims under the ITSA and DTSA. 1
1

As the DTSA is based on the same Uniform Act as the ITSA and other state trade secret
16

A.

TRADE SECRETS CLAIMS

To establish a claim for misappropriation of trade secrets under the ITSA, “a
plaintiff must show that (1) a trade secret existed; (2) it was misappropriated through
improper acquisition, disclosure, or use; and (3) the misappropriation damaged the trade
secret’s owner.” Allied Waste Servs. of N.A., LLC v. Tibble, 177 F. Supp. 3d 1103, 1112
(N.D. Ill. 2016). Similarly, the DTSA creates a private cause of action in favor of the
owner of a trade secret that is misappropriated “if the trade secret is related to a product
or service used in, or intended for use in, interstate or foreign commerce.” 18 U.S.C.
§ 1836(b)(1).

Both statutes also provide for injunctive relief to prevent “threatened

misappropriation.” 18 U.S.C. § 1836 (b)(3); 765 ILCS 1065/3(a). There is no dispute
that the information Mickey’s claims as trade secrets is used, or intended for use, in
interstate commerce.

Rather, Fischer disputes whether the information comprises

trades secrets and whether he misappropriated or will inevitably disclose it.
1.

The Trade Secrets at Issue

Under the ITSA, a “trade secret” is defined as “information, including but not limited
to, technical or non-technical data, a formula, pattern, compilation, program, device,
method, technique, drawing, process, financial data, or list of actual or potential
customers or suppliers, that: (1) is sufficiently secret to derive economic value, actual or
potential, from not being generally known to other persons who can obtain economic
value from its disclosure or use; and (2) is the subject of efforts that are reasonable under

laws, the Court considers Mickey’s claims under both statutes together. CF Veronica Foods Co.
v. Ecklin, No. 16-cv-07223, 2017 WL 2806706, at *13 (N.D. Cal. June 29, 2017) (“Due to the
overlap between the statutes, several courts have addressed the DTSA claims in conjunction with
claims under the CUTSA and other states’ versions of the Uniform Trade Secrets Act.”) (collecting
cases from California, Nevada, and Oregon); Kuryakyn Holdings, LLC v. Ciro, LLC, 15-cv-703,
2017 WL 1026025, at *5 (Mar. 15, 2017) (“the parties agree that substantively the [Wisconsin]
UTSA and DTSA are ‘essentially the same”).
17

the circumstances to maintain its secrecy or confidentiality.” 765 ILCS 1065/2(d). The
DTSA imposes the same requirements. 18 U.S.C. § 1839(3). Illinois courts also refer
to six common law factors when determining whether a trade secret exists: “(1) the
extent to which the information is known outside of the plaintiff's business; (2) the extent
to which the information is known by employees and others involved in the plaintiff's
business; (3) the extent of measures taken by the plaintiff to guard the secrecy of the
information; (4) the value of the information to the plaintiff's business and to its
competitors; (5) the amount of time, effort and money expended by the plaintiff in
developing the information; and (6) the ease or difficulty with which the information could
be properly acquired or duplicated by others.” Intertek USA Inc. v. AmSpec, LLC, No.
16 CV 6160, 2014 WL 4477933, at *5 (N.D. Ill. Sept. 11, 2014).

There are three

categories of trade secrets at issue here.
a. Customer Identities
In response to Mickey’s contention that its customer lists alone are protected trade
secrets, Fischer argues that “customer identities are not a trade secret because they are
readily ascertainable by all competitors in the restaurant linen service industry.” (Doc.
48, at 12). Fischer also argues that “a customer’s linen service provider is often readily
visible on the floor mats rented with the linen service.” (Id. at 15). Accordingly, because
this information may be ferreted out through publicly available means, Fischer contends
that it lacks the necessary confidentiality to warrant trade secret protection. But Mickey’s
counters that customer lists have been long held to warrant trade secret protection, and
that the lists of its top 150 revenue producing customers, highest revenue producing
customers, and problem or at risk customers deserve trade secret protection here. (Doc.
51 at 1-2). The Court agrees with Mickey’s.
18

Both the ITSA and cases decided under it recognize that “customer lists” can
constitute trade secrets where that information is maintained in confidence. 765 ILCS
1065/2(d) (including “list of actual or potential customers” within the definition of a trade
secret); Allied Waste Servs. of N.A., LLC v. Tibble, 177 F. Supp. 3d at 1112 (recognizing
in denying motion to dismiss that “customer lists that are not readily ascertainable” can
constitute trade secrets) (citing Mintel Int’l Group, Ltd. v. Neergheen, No. 08-cv-3939,
2010 WL 145786, at *11 (N.D. Ill. Jan 12, 2010) (“prospective clients (and their
addresses)” were trade secrets)); APC Filtration, Inc. v. Becker, 646 F. Supp. 2d 1000,
1010 (N.D. Ill. 2009) (N.D. Ill. Aug. 4, 2008) (noting the “obvious and well recognized”
value of customer and potential customer contact information, granting summary
judgment on trade secrets claim, and holding plaintiff entitled to injunction). 2 And while
some customer identities may be publicly ascertainable (if one knows what to look for),
Mickey’s customer lists identifying its top 150 customers, its highest revenue producing
customers, and its problem or at risk customers go beyond mere public customer
identifies.

Given Mickey’s (Chris Brown’s) testimony regarding the value of that

information, and Fischer’s concession that Mickey’s treated it as confidential, at the very
least, these select customer lists qualify as trade secrets. (Tr. at 52-55, 175-89).
b. Other Customer Information
Mickey’s also seeks trade secret protection for other information about its
customers, such as purchasing preferences, quality control programs, contract terms,
pricing, expirations, and renewal terms and discounts, marketing strategies, install
schedules, and profitability and margins. (Doc. 51, at 1). Fischer responds that such

2

Although the DTSA does not expressly include customer lists within its definition of a trade
secret, its definition includes any valuable business information for which reasonable measures
are taken to maintain secrecy, and is therefore applicable to customer lists. 18 U.S.C. § 1839(3).
19

information “is probably not a trade secret either based on the undisputed record evidence
that customers freely share competitors’ information and competitors obtain and compile
and use it.” (Doc. 48, at 12, emphasis added). For example, according to Fischer,
pricing information is not a trade secret because “customers were at liberty to divulge
such information to a competitor of plaintiff’s, or to anyone for that matter.” (Doc. 48, at
14-15, quoting Carbonic Fire Extinguishers v. Heath, 190 Ill. App. 3d 948, 953-54, 547
N.E.2d 675, 678 (2d Dist. 1989)). The Court again agrees with Mickey’s that such
valuable customer-specific information warrants trade secret protection so long as it was
maintained in confidence, as even Fischer admitted Mickey’s confidential customer
information was here. (Tr. 53-57). 3
This is so, moreover, regardless of whether a customer to which the information
pertains might share it with one of Mickey’s competitors. Putting aside the fact that the
competitor must know what to ask for and who to ask (such as Fischer did here based in
large measure on his work for Mickey’s), the preeminent advantage of such customer
profiles is that they are “gathered in one place” to reference as the need arises and “before
they are given to the customers. That is where the obvious confidentiality truly lies.”
Lifetec, Inc. v. Edwards, 377 Ill. App. 3d 260, 270, 880 N.E.2d 188, 197 (4th dist. 2007)
(emphasis added). Accordingly, so long as the information meets the requirements for
trade secret protection at the outset (and it does here), “the information may be treated

3

See Allied Waste, 177 F. Supp. 3d at 1112 (recognizing in denying motion to dismiss that
pricing, distribution information, marketing plans and analyses, and sales data can constitute
trade secrets); Packaging v. Hein, No. 14 C 09670, 2015 WL 6164957, at *4 (Oct. 20. 2015)
(recognizing in denying motion to dismiss that information compiled “for the purposes of setting
prices” is “entitled to trade secret protection when not generally known to others and could not be
acquired through general skills and knowledge common in the industry”) (citing cases); Mintel Int’l
Group, 2010 WL 145786, at *11 (same); APC Filtration, 646 F. Supp. 2d at 1010 (finding
misappropriation of, inter alia, customer product preferences, deviated pricing, details of pending
quotes, and cost and profit information, warranting injunction).
20

as confidential regardless of what the customer ultimately does with the information.”
SFK USA, Inc. v. Bjerkness, 636 F. Supp. 2d 696, 713 (N.D. Ill. 2009).
c. Mickey’s Company Information
Finally, Mickey’s claims trade secret protection for its own financial information,
including profitability and financial data for each department, budgetary details, labor
percentages, and other financial information that was so sensitive it was not allowed to
leave the profit and loss management meetings that Fischer attended. (Doc. 51, at 1;
Tr. at 49-50, 189-90). Regarding this highly sensitive information, Fischer complains that
Mickey’s “has not presented any evidence of any specific company information, such as
a profitability percentage, for example, that Fischer might even recall.” (Doc. 48, at 18).
But whether Fischer admits to recalling the information without the benefit of documents
he claims he does not have (an issue addressed further below) says nothing of its
undisputed confidentiality and valuable use in Mickey’s business, as both Fischer and
Mickey’s Chris Brown confirmed. (Tr. at 49-50, 182-83, 189-90, 211-12). And while
Fischer complains that Mickey’s “has only identified its company information in the most
vague and general of terms” (Doc. 48, at 18), Fischer himself had no difficulty identifying
the information at issue during the June 7 hearing:
Well, typically, the person who led the meeting, which was Chris
Brown, would conduct those meetings on a monthly basis, one
week out of the month; and he would distribute the budgets for each
department and everybody would have their own department and
look at it and what you were budgeted to spend or budgeted for
labor and what you actually spent or what your labor percentage
ran for that department. So we would go through it and look at it
and talk about it and make sure we were in line. . . . Those reports
that were given to us were for a brief time. When we left that
meeting, they were all brought -- sent back to Chris Brown, and he
would count them and we left. . . . It could not leave that meeting,
no. Nothing privy -- nothing that was on that report that we looked
at while we were in that meeting could leave.
21

(Tr. at 49-50).

Such closely guarded financial information plainly qualifies for trade

secret protection. See Intertek USA Inc. v. AmSpec, LLC, No. 14 V 6160, 2014 WL
4477933, at *5 (N.D. Ill. Sept. 11, 2014) (concluding that “financial information” contained
in “P&L statements” constituted trade secrets and granting preliminary injunction against
corporate defendant); Covenant Aviation Sec., LLC v. Berry, 15 F. Supp. 3d 813, 818
(N.D. Ill. 2014) (in denying motion to dismiss, acknowledging that “profit and loss
information, internal costs and overhead, operational information . . . and specific bid and
proposal information” constituted trade secrets).
2.

Whether Fischer Misappropriated Mickey’s Trade Secrets

Fischer next challenges Mickey’s proof of misappropriation. According to Fischer,
there is no evidence that he downloaded or emailed any of Mickey’s trade secrets to
himself, or that he retained possession of any of Mickey’s trade secret documents, instead
crediting his own testimony that he regularly disposed of such materials through Mickey’s
shredding system after using them. (Doc. 48, at 15-17). Fischer similarly contends that
there is no evidence that he used any of Mickey’s trade secrets to solicit its customers,
including Serbian Monastery. (Id.). Rather, Fischer says, he used only an invoice that
Serbian Monastery supplied (although it was one of Mickey’s invoices), just as other
customers (Illinois Beach Resort, Holiday Inn Gurnee, and Tuscan Tavern and Grill)
offered to do. (Id. at 17). And, to the extent Fischer had access to any trade secrets
during his tenure with Mickey’s, Fischer insists he could not possibly recall them
sufficiently to use them in the future, just as Mickey’s counsel insisted during the
deposition of its 30(b)(6) rep (Christopher Brown), and as Brown testified during the PI
hearing: “It’s impossible to remember thousands and thousands of inventories and items
and prices.” (Id. at 18-19, citing Tr. at 166-67).
22

Mickey’s responds that misappropriation must often be proved through
circumstantial evidence, and that the weight of the evidence here justifies an inference
that Fischer misappropriated its trade secrets. (Doc. 51, at 3-4). Specifically, Mickey’s
points to the following facts indicating that Fischer took Mickey’s trade secrets when he
left the company: (1) without permission and in violation of Mickey’s company policy,
Fischer wiped all customer and other company information from his company-issued cell
phone before returning it, rendering it impossible to determine whether that information
was sent to anyone (Tr. 75, 102, 198-99); (2) he returned only an inch of documents at
the time of his departure, although Chris Brown testified that Fischer frequently had many
company documents in his briefcase daily and substantial company documents in his
office (Tr. at 78-80, 200-01); and (3) Fischer also failed to return more company
documents found in his car after his departure, claiming he destroyed them rather than
returning them (Tr. at 143).
Mickey’s also points to the following marks against Fischer’s credibility, thus
providing reason to reject his seeming explanations of the foregoing circumstantial
evidence of misappropriation: (1) he lied about his plans to go to work for Mickey’s key
competitor (Alsco), falsely claiming that he was going to work for the family tile business
(Tr. 71-72, 79, 85); (2) when Chris Brown asked why Fischer returned so few documents
at the time of his departure, he falsely claimed that a co-worker (Peter Brown) had cleaned
out his office for him (Tr. 202); (3) when it was later established that Peter Brown had not
cleaned out his office, Fischer changed his story and claimed that he had shredded the
remaining documents in his possession on his way to his final meeting with Chris Brown,
again in violation of company policy (Tr. at 142); and (4) his affidavit in opposition to
Mickey’s motion for a TRO contained several admitted falsehoods, including (a) that he
23

knew no confidential information belonging to Mickey’s, (b) the number of months he was
in his last position at Mickey’s, and (c) that he never solicited any Mickey’s customers for
Alsco. (Tr. 64-67, 93-103; Doc. 10-2).
Many of these facts are undisputed. For instance, Fischer admits that he returned
only an inch of documents when he left Mickey’s employment after 20 years, that he
turned in a wiped cell phone, that he lied about going to work for Alsco, and that his
affidavit inaccurately denied his knowledge of Mickey’s confidential information,
incorrectly stated the number of months he was in his last position with Mickey’s, and
inaccurately claimed that he had not solicited any of Mickey’s customers and that he had
not done so in Lake County. (Tr. 64-67, 75-80, 93-103). On these facts, Illinois case
law squarely allows for discounting Fischer’s seemingly innocent explanations of this
conduct and instead inferring that he misappropriated Mickey’s trade secrets.
As Mickey’s argues, Illinois decisions have repeatedly held that a plaintiff “can rely
on circumstantial evidence to prove misappropriation by drawing inferences perhaps from
ambiguous circumstantial evidence,” since “direct evidence of theft and use of trade
secrets is often not available.” RKI, Inc. v. Grimes, 177 F. Supp. 2d 859, 876 (N.D. Ill.
2001).

Illinois case law is equally clear in holding that a defendant’s elimination of

computer files (which Fischer admits he did on his company cell phone, and which might
have revealed his improper transfer of company information), also allows for an inference
of misappropriation. 4 Likewise, a defendant’s stated reason for deleting company files

4

Liebert Corp. v. Mazur, 357 Ill. App. 3d 265, 282-83, 827 N.E.2d 909, 926-27 (1st Dist.
2005) (“The fact that Mazur attempted to destroy any indication of his downloading activities when
plaintiffs filed suit also suggests improper acquisition.... We can infer from [defendant’s] spoliation
of the evidence on the laptop that he destroyed evidence of misappropriation”) (citing RKI, 177 F.
Supp. 2d at 877) (“the defendants’ spoliation of evidence on their computer supports a negative
inference that defendants destroyed evidence of misappropriation.... Therefore, the Court could
find misappropriation even without the direct evidence supplied by [other witnesses]”)).
24

may be discounted where it is not credible, which is also the case here. Liebert, 357 Ill.
App. 3d at 283, 827 N.E.2d at 927 (noting that defendant’s “explanation that he deleted
thousands of files because they weren’t needed anymore rings hollow”).
Accordingly, Fischer’s unconvincing explanations for wiping all of the data off of
his company issued cell phone (purportedly because he couldn’t determine how to delete
his personal information from it, and he opted not to seek company technical support to
do so), and his shredding and destruction of all confidential documents in his possession
(which he claimed only after his initial story that someone else cleaned out his office for
him proved false) are rejected as not credible.

The Court instead infers from the

substantial circumstantial evidence of Fischer’s misappropriation that he improperly took
at least some of Mickey’s trade secret documents with him, and downloaded and/or
transferred some of Mickey’s trade secrets from his company cell phone before he
deleted all evidence of such transfers from that device.
3.

Inevitable Disclosure

Wholly apart from the circumstantial evidence of Fischer’s misappropriations, both
the ITSA and DTSA provide that “threatened” (as well as “actual”) misappropriation may
be enjoined. 18 U.S.C. § 1836(b)(3); 765 ILCS 1065/3(a). In Illinois, such “threatened
misappropriation” may be addressed under the “inevitable disclosure” doctrine, whereby
“a plaintiff may prove trade secret misappropriation by demonstrating that defendant’s
new employment will inevitably lead him to rely on the plaintiff’s trade secrets.” Liebert,
357 Ill. App. 3d at 284, 827 N.E.2d at 927 (quoting PepsiCo, Inc. v. Redmond, 54 F.3d
1262, 1269 (7th Cir. 1995)). Fischer resists such a finding here, arguing that the doctrine
requires a “high probability” that he will use Mickey’s trade secrets and that Mickey’s
cannot meet that burden. (Doc. 48, at 20). The Court disagrees.
25

“The factors to determine whether disclosure of trade secrets is inevitable are:
1) the level of competition between the former employer and the new employer;
2) whether the employee’s position with the new employer is comparable to the position
he held with the former employer; and 3) the actions the new employer has taken to
prevent the former employee from using or disclosing trade secrets of the former
employer.” RKI, 177 F. Supp. 2d at 876. The first two factors are not seriously disputed
here.
Mickey’s Chris Brown testified without contradiction that Alsco is its strongest
competitor (Tr. at 197); and even Fischer does not dispute that his position at Alsco is
comparable to his former position with Mickey’s. Both companies provide the same
goods and services to customers in the same industry. (Doc. 48, at 6). And while
Fischer held service and service management positions with Mickey’s, and is now a sales
consultant for Alsco, the positions in both companies have included substantial customer
contact and sales activities.

(Tr. 188: Chris Brown: “He was one of the top sales

producers in our company while he was in a service sales role.”). Indeed, Alsco’s Dave
Carman testified that Fischer was recommended to him to fill the sales consultant position
that Alsco then had open precisely because of the substantial industry experience he
gained in Mickey’s employ, and at least one Alsco sales consultant wanted to ask Fischer
what customers she should call on in Chicago in light of his experience with Mickey’s.
(Tr. 221-22; 229). Thus, only the third factor—whether Fischer’s new employer (Alsco)
has taken measures to prevent him from using or disclosing Mickey’s trade secrets—is
disputed here; and the record supports Mickey’s position that the purported preventive
measures taken by Alsco were decidedly inadequate.

26

While Alsco may have attempted to carve out a territory for Fischer that would not
violate his covenant not to compete, that effort was far less than thorough, given that
Alsco had not seen, and made little attempt to acquire, a copy of his Employment
Agreement with Mickey’s.

(Tr. 228, 235-36).

And even if Alsco had carved out a

territory permissible under Fischer’s non-compete, that measure did little to prevent him
from using or disclosing Mickey’s trade secrets, given that Alsco never prohibited Fischer
from pursuing Mickey’s customers or using its trade secrets to do so. (Id.) Finally,
although Fischer claims that “Alsco has prohibited other sales reps from asking [him]
about Mickey’s information” (Doc. 48, at 9), Alsco’s Dave Carman testified only that he
told one sales consultant (Ms. Orlov) that Fischer would not discuss what customers or
prospects she should call on (Tr. 228-29), not that Alsco implemented any broader
measures to prevent others from inquiring about, or Fischer from disclosing or using,
Mickey’s trade secrets. Indeed, Fischer admits that he visited one of Mickey’s former
customers (Serbian Monastery) with still a different Alsco employee (Ann Walsh)
and discussed the fact that Serbian Monastery had been one of Mickey’s customers
(Tr. at 92); yet the record contains no indication that Fischer’s communications with Ms.
Walsh about Serbian Monastery or any of Mickey’s other customers were in any
way curtailed by Alsco.
Moreover, even putting aside the inadequacy of Alsco’s preventive measures,
case law supports discounting Fischer’s claim that he would not or could use or divulge
Mickey’s trade secrets in the performance of his job at Alsco, given his “history of deceit.”
Lakeview Tech., Inc. v. Robinson, 446 F.3d 655, 656-58 (7th Cir. 2006) (reversing district
court’s denial of preliminary injunction on inevitable disclosure theory under Illinois law).
In Lakeview, the Seventh Circuit reversed the district court’s denial of a preliminary
27

injunction and remanded with instructions “to craft appropriate equitable relief with
dispatch,” where the employee had lied about his reason for leaving the plaintiff software
company, concealed his acceptance of employment with a competitor, falsely claimed
that he was going to pursue a career in real estate, and thereby continued his employment
with the plaintiff and access to its confidential information during that time. Id. On these
facts, the Seventh Circuit held that the district court improperly accepted the defendant’s
assurances that he had not and would not disclose the plaintiff company’s trade secrets
or solicit its customers. Id. And while the court faulted the district court for failing to hold
an evidentiary hearing to determine the credibility of the defendant’s promises, it ordered
no hearing on remand, and instead ordered the lower court to grant an appropriate
injunction. Lakeview thus demonstrates that a defendant’s bare assurances that he will
not misappropriate his former employer’s trade secrets may be discounted when he has
such a “history of deceit,” with or without an evidentiary hearing.
Liebert v. Mazur is similar. There, the trial court rejected the plaintiff’s inevitable
disclosure claim, finding that the defendant “could not disclose” his former employer’s
“pricing structure” without a copy “because the books were too complex,” Liebert, 357 Ill.
App. 3d at 285, 827 N.E.2d at 928, just as Fischer argues here. (Doc. 48, at 18-20).
But the appellate court in Liebert reversed that ruling for reasons which are equally
applicable here. First, it relied on the defendant’s destruction of evidence that “would
have decisively answered the question” of whether he had copied electronic files
containing the plaintiff’s trade secrets. Id. at 286, 827 N.E.2d at 928-29 (“Where a party
has deliberately destroyed evidence, a trial court will indulge all reasonable presumptions
against the party.” (quoting R.J. Mgmt. Co. v. SRLB Dev. Corp., 346 Ill. App. 3d 957, 965,
806 N.E.2d 1074, 1081 (2d Dist. 2004)). Fischer did the same here when he wiped his
28

company cellphone, allowing for the reasonable presumption that he already
misappropriated Mickey’s trade secrets. Further, the Liebert court also relied upon “the
circumstances surrounding” the defendant’s departure from his former employer (the
plaintiff), including his failure to disclose his intention to work for a competitor until he quit,
and his offer to solicit one of the plaintiff’s customers for his new employer. Id. at 286,
827 N.E.2d at 929. The Illinois appellate court held these facts (which are also present
in the instant case) similarly supported a finding of “inevitable use.” Id. 5
Just as these decisions concluded, the facts in this case compel the conclusion
that Fischer will inevitably use or disclose Mickey’s trade secrets during his employment
with Alsco if he is not enjoined from doing so. Thus, in sum, Mickey’s has demonstrated
a likelihood of success on its trade secrets claims under the ITSA and DTSA, having
shown that it possesses protectable trade secrets, that there is substantial circumstantial
evidence that Fischer already improperly acquired and used its trade secrets, that there
is a high probability that he will do so again in the future, and that Mickey’s has been (and
would be) damaged by such misconduct. Allied Waste, 177 F. Supp. 3d at 1112; 18
U.S.C. § 1836; 765 ILCS 1065/3(a).

5

Fischer’s unconvincing explanation of why he returned a wiped company cellphone to
Mickey’s (that he needed to delete some personal information, but never sought the assistance
of Mickey’s IT department in doing so) supplies further reason to doubt both his claimed inability
to remember Mickey’s trade secrets and the effectiveness of any measures that Alsco might
implement to prevent his disclosure or use of Mickey’s trade secrets. See Tate & Lyle Ingredients
Americas LLC v. Craig, 2017 IL App (4th) 160886-U, at ¶¶ 40-45 (where former employee’s
testimony regarding his downloading of files “was not credible,” court was unpersuaded by
defendant’s claim that “he cannot disclose information he no longer has” and his new employer’s
claim that it “sought to prevent any harm” to the former employer plaintiff, and court therefore
declined “to fashion a remedy that relies on [defendant’s] credibility in refraining to divulge
[plaintiff’s] trade secrets with or without [his new employer’s] knowledge”). Although Tate is
unpublished and therefore non-precedential, this Court may (and does) consider its reasoning
and logic. See Zahn v. N. Am. Power & Gas, LLC, 815 F.3d 1082, 1093 (7th Cir. 2016) (although
not precedential, unpublished Illinois decisions may be cited for their “reasoning and logic”).
29

B.

BREACH OF CONTRACT CLAIM

Mickey’s seeks preliminary injunctive relief also for its breach of contract claim,
which asserts three restrictive covenants in Fischer’s Employment Agreement with
Mickey’s: a non-competition provision, a non-solicitation of customers provision, and a
confidentiality provision. Under Illinois law, a post-employment restrictive covenant is
enforceable if it was ancillary to a valid employment relationship and contains a
reasonable restraint. Reliable Fire Equip. Co. v. Arrendondo, 2011 IL 111871, at ¶¶ 1617, 965 N.E.2d 393, 396. 6 There is no dispute here that Fischer’s restrictive covenants
were ancillary to a valid employment relationship, since he worked for Mickey’s for nearly
twenty years after signing his Employment Agreement. (Doc. 54, at 5, 11-12). Allied
Waste Servs. of N.A., LLC v. Tibble, 177 F. Supp. 3d 1103, 1107 (N.D. Ill. 2016)
(continued employment for two years after executing restrictive covenant constitutes valid
employment relationship) (citing cases). Rather, the parties dispute whether each of
these covenants contains a reasonable restraint.
Illinois law requires consideration of three factors to determine whether a restrictive
covenant contains a reasonable restraint: (1) whether the restraint is greater than required
to protect a legitimate business interest of the employer-promisee, (2) whether it imposes
an undue hardship on the employee-promisor, and (3) whether it poses an injury to the
public. Reliable Fire, 2011 IL 111871, at ¶ 17, 965 N.E.2d at 396. The first of these

6

As Fischer’s Employment Agreement contains an Illinois choice of law provision (Doc. 54,
at 12), and both sides assume Illinois law to be controlling, the Court similarly applies Illinois law
to determine the enforceability of the covenants at issue, although the Court applies federal law
to determine the appropriateness of injunctive relief. See Turnell, 796 F.3d at 661 (affirming
district court’s application of federal law regarding injunction requirements, but Pennsylvania law
to determine enforceability of asserted restrictive covenant, where agreement contained
Pennsylvania choice of law provision and parties did not address the choice of law issue).
30

factors, in turn, is “based on the totality of the facts and circumstances of the individual
case,” including without limitation “the near-permanence of customer relationships, the
employee’s acquisition of confidential information through his employment, and time and
place restrictions.” Id. at ¶ 43, 965 N.E.2d at 403. None of these subsidiary factors
“carries any more weight than any other,” rather, the importance of each is fact
dependent. Id. Accordingly, while geographic and time limitations are relevant to the
determination of whether a restrictive covenant is reasonable, “they are only
considerations that may impact the first of the three reasonableness factors: the Court’s
assessment of the employer’s purported ‘legitimate business interest’ for instituting the
restrictions in the manner in which it did.” Traffic Tech, Inc. v. Kreiter, No. 14-cv-7528,
2015 WL 9259544, at *6 (N.D. Ill. Dec. 18, 2015).
Although each of the foregoing requirements must be met to enforce a restrictive
covenant as drafted, Illinois law allows a court to modify or “blue pencil” a covenant that
is overbroad in some respect, in order to afford it a reasonable scope, rather than
invalidate it. Brown & Brown, Inc. v. Ali, 592 F. Supp. 2d 1009, 1046 (N.D. Ill. 2009).
But a court should refuse to modify (and thereby save) a restrictive covenant that would
require drastic modifications, or when it was so unreasonably overbroad to begin with as
to render it unfair. Montel Aetnastak, Inc. v. Miessen, 998 F. Supp. 2d 694, 718 (N.D. Ill.
2014); Joy v. Hay Group, Inc., No. 02 C 4989, 2003 WL 22118930, at *10 (N.D. Ill. Sept.
11, 2003); AssuredPartners, Inc. v. Schmitt, 2015 IL App (1st) 141863, ¶ 52, 44 N.E.3d
at 463, 477. Similarly, courts must also consider the equities involved, including any
overreaching by the plaintiff in the covenant originally required, and conversely, any
injustice that would result from rejecting the covenant in its entirety, such as where a
defendant accepted employment with the plaintiff’s direct competitor. Saddlers Row,
31

LLC v. Dainton, 2012 IL App (2d) 120941-U, at ¶¶ 15-16, 2012 WL 7989526, at *4-5 (Apr.
23, 2013) (unreported, canvassing cases). “Additionally, a court deciding whether to
modify an agreement should consider the severability of the provision in the agreement
– whether the provisions operate independently of each other.” Hay Group, 2003 WL
22118930, at *10; Brown & Brown, 592 F. Supp. 2d at 1046 (judicial modification is
considered more appropriate “when the agreement contains a severability clause”).
With these principles in mind, the Court now turns to the enforceability of the three
restrictive covenants that Mickey’s seeks to enforce here.
1.

The Covenant Not to Compete

As shown above, Fischer’s covenant not to compete prohibits his engagement “in
the same or a similar business to the Business or any other activity in which the Company
is engaged or which otherwise competes with the Company,” and the term “Business” is
defined in the Agreement as “the business of uniform and linen rentals, the sale of
restroom supplies, paper products and similar items.”

(Doc. 54, at 11-12).

The

prohibition lasts for 18 months after the termination of Fischer’s employment and applies
to Cook, Lake, and Du Page counties. (Id.). Fischer argues that “this covenant imposes
an impermissible ‘blanket prohibition on competition’” because it precludes former
employees from working in any capacity in the industry in which Mickey’s does business.
(Doc. 48, at 24). Fischer also maintains that the geographic scope is overbroad as
applied to him to the extent it covers the portion of Lake County north of the Route 120Route 137 line, because he did not service any customers in that territory for the last two
years of his tenure with Mickey’s. (Id. at 25-26). According to Fischer, his absence from
this territory for more than two years before his resignation satisfied Mickey’s interest in

32

“shoring up its customer relationships” over the 18-month period contemplated by the
covenant. (Id.). The Court disagrees with each argument.
First, neither Mickey’s nor the Court construes this covenant as imposing a
“blanket prohibition on competition.” As Mickey’s argues, the covenant restricts Fischer
“from engaging in competitive business activities in the very narrow business in which
Mickey’s operates, defined in the Agreement in the opening paragraph as ‘uniform and
linen rentals and sales.’” (Doc. 46, at 17). Thus, the covenant’s reference to “any other
activity in which the company is engaged” adds nothing to the narrow definition of
“Business” recited in the agreement. And to the extent that language could conceivably
be read to embrace any other activities, the Court exercises its discretion to restrict the
scope of that language to the same definition of “Business” recited in the agreement,
which is all that Mickey’s seeks to enforce. See Hay Group, 2003 WL 22118930, at *11
(“the scope of the activity restricted could be limited without changing the parties’
intentions at the time of execution”). This result is also supported by the agreement’s
severability provision, which requires construing every provision “in such manner as to be
valid and enforceable under applicable law” whenever possible. (Doc. 54, at 12, ¶ 13).
Further, while Fischer may not have had frontline responsibility for customers north
of the Route 120-Route 137 line for the last two years of his employment with Mickey’s,
his substantial responsibility for those customers before then, and his integral role in
resituating them with Mickey’s Wisconsin facility, demonstrate Mickey’s need for
protection from Fischer’s competition throughout Lake County (not merely south of the
120/137 line).

Indeed, Fischer’s solicitation of several of Mickey’s Lake County

customers for Alsco in the very short time after he left Mickey’s employment exemplifies
that need. And the covenant’s 18-month term for such protection (of which only ten
33

months remain) is “ostensibly reasonable,” as well. See OptionsCity Software, Inc. v.
Baumann, No. 15 C 5019, 2015 WL 3855622, at *4 (N.D. Ill. June 19, 2015) (“OptionsCity
notes that less than 10 months remain on initial 18–month period spelled out in the
restrictive covenant. Given that Illinois courts uphold restrictive covenants that last for
years, e.g., Mohanty v. St. John Heart Clinic, S.C., 866 N.E.2d 85 (Ill. 2006), the duration
is ostensibly reasonable.”); Brown & Brown, 592 F. Supp. 2d at 1046-47 (citing cases
holding that a two-year restriction is reasonable).
Accordingly, the Court concludes that Fischer’s non-compete provision is
enforceable to the full extent sought by Mickey’s.

That is, as to the definition of

“Business” recited, for the three counties identified (Cook, DuPage, and Lake counties),
and for the remainder of the 18 months stated in Fischer’s Employment Agreement.
2.

The Non-Solicitation Covenant

Similar considerations warrant enforcement of Fischer’s non-solicitation of
customers covenant, although with certain modifications.

As shown above, this

covenant prohibits Fischer from soliciting or accepting business from any “Customer” or
“Prospect,” with “Customer” defined as anyone who Mickey’s serviced within 18 months
before the termination of Fischer’s employment, and “Prospect” defined as anyone who
Fischer contacted or solicited within 6 months before the termination of his employment.
(Doc. 54, at 12). Although this covenant contains the same 18-month limitation included
in Fischer’s covenant not to compete, it includes no geographic limitation and thus applies
to all of Mickey’s customers. Fischer therefore complains that the covenant is unduly
broad because it would restrict his contacts with approximately 3,600 customers in
territories where he never worked, contrary to Illinois law. (Doc. 48, at 22-23). And
Fischer again argues that the purpose of the 18-month term in this provision has already
34

been fulfilled, given that he has not serviced any customers north of the 120/137 line
where he now works for Alsco for more than two years. (Id.).
Mickey’s counters that the covenant “is reasonable on its face, particularly given
Fischer’s status with the Company, his involvement in high level meetings and decisionmaking, and his full access to sensitive protected information.”

(Doc. 51, at 9).

Nevertheless, Mickey’s seeks to enforce the covenant only as to customers of the two
facilities in which Fischer had significant responsibility—Villa Park and Chicago, including
those in Lake County where Fischer admittedly had direct responsibility within months of
his departure. (Id.; Tr. at 41). Mickey’s argues that limiting a non-solicitation provision
to the customers for which a former employee was responsible has been repeatedly
upheld in Illinois, and that such a limitation is required here in view of the agreement’s
severability provision mandating that any term deemed overbroad or unenforceable be
modified so as to allow for its enforcement. (Doc. 51, at 9 and n.8).
Both sides are partly right. Fischer is correct that Illinois decisions frown on nonsolicitation provisions that restrict contacts with customers that a former employee never
serviced for his former employer, but Mickey’s is also correct that Illinois decisions support
modifying a non-solicitation provision to cover only those customers for which the former
employee had responsibility, and that the severability provision in Fischer’s Employment
Agreement makes that result particularly appropriate here. E.g., Brown & Brown, 592 F.
Supp. 2d at 1046. Such modification is appropriate here also in light of the other bluepenciling factors that must be considered:

(1) the covenant is not unreasonable in

scope, Traffic Tech., 2015 WL 9259544, at *6 (“a non-solicitation provision’s lack of
geographical limitations or limitations on the customers to which it applies does not render
it per se unreasonable”); (2) there is no evidence of overreaching by Mickey’s, which
35

seeks to enforce the covenant only for the facilities where Fischer had the greatest
responsibility, Saddlers Row, 2012 IL App (2d) 120941-U, at ¶¶ 15-17 (no overreaching
where former employer sought to protect only the customer relationships that defendant
threatened by going to work for a direct competitor); and (3) the equities favor Mickey’s,
given Fischer’s move to work for a direct competitor, his deceit about that decision, and
his similar lack of candor regarding the Mickey’s customers that he solicited in Lake
County and elsewhere. Id.
Moreover, as so modified, the covenant meets all three reasonableness factors
required under Illinois law: it protects Mickey’s legitimate interest in its customer
relationships and confidential information in the facilities where Fischer had a leading role;
and it imposes no undue hardship on Fischer or injury to the public, given his and Alsco’s
concessions that Fischer can work effectively if limited to Wisconsin. Brown & Brown,
592 F. Supp. 2d at 1046 (no undue hardship to employee or public injury where modified
covenant still allowed employee “to work in his chosen field”). Accordingly, the Court
concludes that Fischer’s non-solicitation of customers covenant may be enforced for the
full remainder of its 18-month term, but only as to the customers serviced by Mickey’s
Villa Park and Chicago facilities, including those in Lake County. Regarding the method
for determining which customers are now covered by the provision, however, the Court
rejects the mechanism in Mickey’s proposed preliminary injunction order requiring Fischer
to consult Mickey’s counsel in advance regarding any questioned customer. (Doc. 48,
at 28-29). As explained in the balance of harms discussion below, the Court will arrive
at an alternative means of determining the customers covered by this non-solicitation
provision after hearing from the parties.

36

3.

The Confidentiality Covenant

Finally, Mickey’s seeks to enforce the confidentiality provision in Fischer’s
Employment Agreement. As shown above, this provision prohibits use or disclosure of
“any information received by Employee during the course of Employee’s employment with
regard to the Business, the Company’s Customers, ‘Prospects’ . . ., employees and
agents.” (Doc. 54, at 11). Fischer persuasively argues that this sweeping definition
would cover virtually every piece of information he encountered during his employment
with Mickey’s, without regard to its confidentiality. (Doc. 48, at 21-22). To support this
assertion, Fischer cites the testimony of Mickey’s Chris Brown acknowledging several
types of information covered by the provision which Fischer claims are not confidential.
(Id., citing Tr. at 215-16 and Doc. 38-1 at 70-76). Fischer also notes that the covenant
contains no geographic or temporal limitation. And while the ITSA might allow for a
confidentiality provision unlimited in time or geographical scope to protect trade secrets,
Fischer argues that the same is not true of a provision like this one that covers nonconfidential information as well. (Doc. 48, at 22 n. 4). The Court agrees with Fischer.
Indeed, even Mickey’s developed little (if any) argument in support of its
confidentiality provision in its opening brief (Doc. 46); not until its reply brief did Mickey’s
argue that the confidentiality provision may be enforced at least as to the confidential
information it covers, and despite its lack of a geographic or temporal limitation. (Doc.
51, at 7 and n.6). That lapse, by itself, is reason enough to reject the point. See Wagner
v. Teva Pharm. USA, Inc., 840 F.3d 355, 360 (7th Cir. 2016) (undeveloped arguments,
and arguments first made in a reply brief, are waived) (citing cases). But further, the
argument in Mickey’s reply brief falls woefully short.

As Fischer argues, while

confidentiality provisions may not necessarily require geographic and temporal
37

limitations, the provision at issue here reaches farther, instead restricting “any information
received” during his employment.

Fischer is correct that Illinois decisions have

repeatedly denied enforcement of such overbroad confidentiality provisions. 7 And while
Mickey’s urges that it only seeks to protect the information covered by the clause that
truly is confidential, and which Fischer conceded is confidential (Doc. 51, at 8), that expost interpretation is too nebulous to enforce, nor can the Court imagine any workable
modification that might further that end.
The equities also disfavor blue penciling the covenant into a reasonable scope.
As even Mickey’s concedes, it retains sufficient protection for its trade secrets without
burdening Fischer with a confidentiality provision of ambiguous scope. (See Doc. 51, at
7 n.5: “the confidentiality section would just be severed per paragraph 13 of the
Agreement, and Fischer’s obligation to comply with state and federal law regarding the
protection of confidential and proprietary information would remain”). Accordingly, just
as Mickey’s relied chiefly upon its ITSA and DTSA claims to protect its confidential
information in its opening brief, and conceded in its reply brief that the confidentiality
provision could be severed without sacrificing such protection, the confidentiality provision
should be severed under paragraph 13 of the Employment Agreement, and protection of
Mickey’s confidential information in this case should depend upon its ITSA and DTSA
claims. Cf. Allied Waste, 177 F. Supp. 3d at 1111-12 (where confidentiality provision
lacking geographic or temporal scope was limited to non-public information, protection of
such confidential information in turn depended upon plaintiff’s trade secret claim).

7

See, e.g., Carlson Group, Inc. v. Davenport, No. 16-cv-10529, 2016 WL 7212522, at *4
(N.D. Ill. Dec. 13, 2016) (confidentiality provision lacking durational or geographic limitation that
covered “all information of or concerning” plaintiff was overbroad); AssuredPartners, Inc. v.
Schmitt, 2015 IL App (1st) 141863, ¶ 46, 44 N.E.2d at 476 (same).
38

In sum, the Court concludes that Mickey’s has demonstrated a likelihood of
success on its breach of contract claim with respect to the covenant not to compete and
non-solicitation of customers covenant, but not the confidentiality provision in Fischer’s
Employment Agreement; rather, any protection for Mickey’s confidential information must
be afforded through its trade secret claims. The Court now turns to the remaining factors
requiring consideration for granting injunctive relief with respect to the breach of contract
and trade secret claims for which Mickey’s has demonstrated a likelihood of success.
II.

REMAINING INJUNCTION REQUIREMENTS
A.

IRREPARABLE HARM AND INADEQUATE REMEDY AT LAW

Regardless of Mickey’s likelihood of success on the merits, Fischer contends that
injunctive relief is nevertheless inappropriate because Mickey’s has an adequate remedy
at law and its injury is not irreparable. According to Fischer, Mickey’s knows how much
the temporary loss of Serbian Monastery’s business cost, and would similarly know from
its contract with any other customer how much the loss of that business was worth or how
much it had to cut its prices to get that customer back. Therefore, Fischer argues,
Mickey’s can be made whole through money damages in the event he succeeds in
soliciting away additional customers.

(Doc. 48, at 33).

Of course, the argument

assumes that Fischer would do just that, if permitted, which reinforces Mickey’s need for
injunctive relief. But also, Mickey’s convincingly argues that money damages would be
inadequate because it would be “impossible to determine at this time the extent to which
Mickey’s confidential information will be ‘pirated away’ by Fischer and his new employer.”
(Doc. 46, at 30-32). Mickey’s also explains that “the patronage of [its] clients and the
development of its confidential information have been secured through the expenditure
of significant financial resources and time” which would also be impossible to ascertain
39

with any degree of certainty. (Id.). Further, Mickey’s legitimately asks, if Fischer were
not enjoined and Mickey’s were relegated to money damages for his ensuing violations,
“how is he going to be in a position to compensate Mickey’s for these damages?” (Id.).
The Court shares Mickey’s concerns.
As an initial matter, Mickey’s is right that the loss of business that Fischer has
caused and threatens to cause and the profits lost with such business are unquantifiable
at this time, and “it is precisely the difficulty of pinning down what business has been or
will be lost that makes an injury ‘irreparable.’” Hess Newmark Owens Wolf, Inc. v.
Owens, 415 F.3d 630, 632-33 (7th Cir. 2005); Petrzilka v. Gorsak, 199 Ill. App. 3d 120,
124-25, 556 N.E.2d 1265, 1268 (2d Dist. 1990) (“The lost profits arising from potential
sales are incapable of adequate computation, and thus money damages are not an
adequate remedy .... The loss of customers and sales and the threat of the continuation
of such losses to a legitimate business interest are sufficient to show a plaintiff will suffer
irreparable injury.”). As the Seventh Circuit explained in Hess, “[c]ompetition changes
probabilities,” making it difficult to identify or predict which customers have or will slip
through a company’s “grasp.”

415 F.3d at 632-33.

Both federal and Illinois law

therefore treat “ongoing competition itself as a sufficient basis for relief.”

Id. (citing

cases). Moreover, in addition to the difficulty quantifying the sales and profits that have
been and would be lost due to Fischer’s conduct, other “intangible” damages associated
with such losses similarly justify injunctive relief. Petrzilka, 199 Ill. App. 3d at 124-25,
556 N.E.2d at 1268 (“The loss of a competitive position is an intangible but real damage
not readily measurable, and therefore, the harm suffered by plaintiffs cannot be
adequately remedied in law.”); OptionsCity Software, 2015 WL 3855622, at *4 (“losing
customers impacts the company’s overall value to potential investors or purchasers”).
40

That Mickey’s may be able to quantify some of the damages it has incurred already
(for example, due to the loss of Serbian Monastery and the financial accommodations
required to regain that business) does nothing to change this analysis.

Monetary

damages (where they are subject to calculation) and equitable relief (for other
unquantifiable damages) are neither mutually exclusive nor incompatible. YTB Travel
Network of Ill., Inc. v. McLaughlin, No. 09-cv-369-JPG, 2009 WL 1609020, at *5 (N.D. Ill.
June 9, 2009). “This is especially true when the language of the agreement indicates
that ‘the parties contemplated injunctive relief to prevent future violations, in addition to
the damages for past violations.’” Id. (quoting McRand, Inc. v. van Beelen, 138 Ill. App.
3d 1045, 1055, 486 N.E.2d 1306, 1313 (1st Dist. 1985)). That is the situation here. The
Remedies provision in Fischer’s Employment Agreement expressly “acknowledges and
agrees that the Company's remedies at law may be inadequate to redress a default in the
performance of Employee's employment duties or Employee's covenants, agreements or
obligations contained in this Employment Agreement, and therefore, the Company shall
be entitled to equitable relief, including, without limitation, temporary, preliminary and
permanent injunctive relief, specific performance or other equitable remedies, in addition
to any and all other remedies available to the Company pursuant to this Employment
Agreement, at law or in equity.” (Doc. 54, at 12).
Mickey’s is also right that Fischer’s status as an individual defendant matters too.
Although Fischer argues that Mickey’s “could readily calculate its losses based on the
terms of the contract that had been in place” for any customer that Fischer “were to
successfully solicit away,” Fischer says nothing of his ability or commitment to
compensate Mickey’s for such damages.

(Doc. 48, at 33).

“Ability to calculate

damages does not make that remedy adequate, however, if the plaintiff cannot collect the
41

award.” Lakeview Tech., 446 F.3d at 657 (monetary damages, even if calculable, were
inadequate remedy where nothing in the record suggested that the individual
defendant/former employee “would be good” for a damages award, and his new employer
was not a party and therefore could not “be ordered to pay from corporate funds”).
Moreover, where a defendant is perhaps “judgment-proof” or otherwise has no funds at
risk, “some other remedy (such as the contempt power) may be essential.” Id.
B.

BALANCE OF HARMS AND PUBLIC INTEREST

The balance of harms tips in Mickey’s favor for similar reasons. Fischer argues
otherwise, contending that Mickey’s proposed injunction would “eliminate” him as a
competitor for all of Mickey’s clients, including those in Wisconsin, even though he never
worked for Mickey’s in Wisconsin. (Doc. 48, at 33).

But Fischer’s covenant not to

compete does not cover Wisconsin, and Mickey’s does not seek to enforce his nonsolicitation of customers covenant in Wisconsin either. Given Fischer’s and Alsco’s
concession that Fischer can work successfully in Wisconsin without soliciting Mickey’s
customers in Illinois, the injunction Mickey’s seeks (no competition in Cook, Lake, and
DuPage counties, and no solicitation of its Chicago and Villa Park facility customers)
poses little (if any) downside to Fischer. Mickey’s, on the other hand, stands to suffer
considerable non-compensable and/or uncollectable losses if an injunction were denied.
See Lakeview, 446 F.3d at 657-58 (balance of harms favored plaintiff where former
employee defendant had already committed to honor his restrictive covenant and an
injunction requiring him to keep that commitment therefore “cost[] him nothing,” whereas
plaintiff would be subject to “substantial injury” if he failed to do so). The public interest
is also served by such an injunction, since Fischer admittedly retains the right “to work
[successfully] in his chosen field.” Brown & Brown, 592 F. Supp. 2d at 1046.
42

There is one respect, however, in which Fischer would be unduly burdened by the
injunction Mickey’s seeks – the requirement that he seek Mickey’s approval whenever he
“has a question of whether a customer qualifies as restricted.” (Doc. 48, at 28). Such a
requirement is not only unduly burdensome to Fischer (and, indirectly, Alsco), it provides
fertile ground for satellite litigation regarding which customers are restricted, when
questions are warranted, and Alsco’s obligations and exposures in that process.
Accordingly, the Court declines to impose this condition, and will instead hear from the
parties regarding potential alternative methods for identifying the customers covered by
the injunction to issue, including potentially requiring Mickey’s (which has the best
command of that information and the greatest incentive to provide it) to bear that burden. 8
C.

INJUNCTION BOND

Finally, the Court addresses the parties’ arguments concerning the requirement of
an injunction bond. Mickey’s argues that no bond should be required, since it only seeks
to enforce Fischer’s contractual and legal commitments. (Doc. 46, at 38 n.2). But when
Mickey’s first sought a TRO in this case, it argued that any required bond should be no
more than the $25,000 bond that Judge Pallmeyer required in Newbauer. (Doc. 13, at
27). This Court adopts Mickey’s original proposal of a $25,000 bond.

8

Indeed, Mickey’s own authority demonstrates the potential for harm in imposing such a
provision upon Fischer and his new employer. In Mickey’s v. Newbauer, Case No. 12-cv-9437,
on which Mickey’s heavily relies for the enforceability of its restrictive covenants, Judge Pallmeyer
imposed a requirement that the defendant and his new employer identify on an attorneys’ eyes
only basis certain customers to be excluded from the court’s injunction. (Doc. 24, in Case No.
12-cv-9437). But the process did not go smoothly. The new employer refused to name the
customers; the defendant lost his job with that company due to the injunction; and contempt
proceedings ensued. (Id. at Docs. 32 and 41). Thus, while this Court has not relied upon Judge
Pallmeyer’s TRO or preliminary injunction orders in Newbauer to support its rulings in this case
(due to the sparsity of the record in Newbauer), it does take note from that proceeding of the
potential for harm to both sides that such a customer identification provision can cause, and
therefore seeks more information from the parties here before imposing one.
43

As Fischer notes, Rule 65(c) provides for a preliminary injunction “only if the
movant gives security in an amount that the court considers proper to pay the costs and
damages sustained by any party found to have been wrongfully enjoined or restrained.”
Fed. R. Civ. P. 65(c).

The Seventh Circuit has warned that an injunction bond or

equivalent security is normally “essential” to serve this purpose, especially for a
preliminary injunction. Roche Diagnostics Corp. v. Med. Automation Sys., Inc., 646 F.3d
424, 428 (7th Cir. 2011).

That is because injunctions “can injure litigants,” and

preliminary injunctions “are more likely to be erroneous than injunctions issued at the
close of the litigation.” Id. “Judges therefore should take care that the bond is set high
enough to cover the losses that their handiwork could cause. A limit of zero—the upshot
of an injunction without a bound—is bound to be too low.” Id.
Accordingly, Mickey’s request for an injunction with no required bond is denied.
But still, given the admissions of both Fischer and Alsco that Fischer can work effectively
and successfully for the next ten months under the injunction that Mickey’s seeks, it
appears that a relatively low bond would be sufficient to ameliorate any “slight risk” of
harm to Fischer. See Lakeview, 446 F.3d at 657-58 (any “slight risk” posed by injunction
against former employee who already committed to honor his restrictive covenants “can
and should be ameliorated by an injunction bond”).

Moreover, Fischer’s failure to

support or propose a higher bond indicates that the $25,000 bond that Mickey’s originally
proposed (and which Judge Pallmeyer required in Newbauer) would be similarly
adequate here. Mickey’s will thus be required to post a $25,000 bond with the Clerk of
Court within ten days of the Court’s entry of an appropriate injunction order.

44

CONCLUSION
For the foregoing reasons, Mickey’s Motion for Preliminary Injunction (Doc. 6) is
granted in part and denied in part. The motion is granted as to Mickey’s trade secrets
claims under the ITSA and DTSA and as to its claim for breach of the covenant not to
compete and covenant not to solicit Mickey’s customers in Fischer’s Employment
Agreement, but denied as to Mickey’s claim for breach of the confidentiality provision in
that agreement. The parties shall jointly submit a proposed injunction order consistent
with this Opinion within ten days (identifying any areas of disagreement as to its form),
and a status hearing is set for September 27, 2017, to address any disputes regarding
the form of the injunction order and possible means for identifying the Illinois customers
that Fischer will be precluded from soliciting pursuant to the non-solicitation provision to
be enforced by the injunction. Mickey’s is required to post a $25,000.00 bond with the
Clerk of Court within ten days of the entry of the injunction order.
ENTER:

Dated: September 8, 2017

_____________________________
SHEILA FINNEGAN
United States Magistrate Judge

45