Biomet 3i, LLC et al v. Land

Filing 107

OPINION AND ORDER: The Court OVERRULES the Defendant's Objections to the Report and Recommendation of United States Magistrate Judge 88 and ADOPTS the Magistrate Judge's Report and Recommendation 85 on the Plaintiffs' Motion for Pr eliminary Injunction. Accordingly, the Court now GRANTS the Plaintiffs' Motion for Preliminary Injunction 8 MOTION for Preliminary Injunction , as outlined in Opinion and Order. The Defendan t is required to file with the Court and serve on the Plaintiffs periodic written reports every thirty (30) days after service of the Preliminary Injunction, under oath, as outlined in Opinion and Order. Signed by Chief Judge Theresa L Springmann on 3/30/2017. (lhc)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
BIOMET 3i, LLC and ZIMMER US, INC.,
Plaintiffs,
v.
HEATHER LAND,
Defendant.

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CAUSE NO.: 1:16-CV-125-TLS

OPINION AND ORDER
This matter is before the Court on Defendant Heather Land’s Objections to the Report
and Recommendation of the United States Magistrate Judge [ECF No. 85]. The Plaintiffs,
Biomet 3i, LLC (“Biomet 3i”) and Zimmer US, Inc. (“Zimmer”), filed a Motion for a
Preliminary Injunction [ECF No. 8] and accompanying Brief in Support [ECF No. 9] on April
12, 2016. The Plaintiffs are requesting injunctive relief to enforce a restrictive covenant (the
“Covenant”) of their Non-Solicitation Agreement for Sales Managers and Representatives (the
“Agreement”) against the Defendant, who currently is employed by their competitor, Keystone
Dental (“Keystone”). The Court referred this matter to Magistrate Judge Susan Collins on May
10, 2016. The Defendant filed her Response [ECF No. 47] on July 7, 2016. The Magistrate Judge
held an Evidentiary Hearing on July 11, and July 12, 2016. The Plaintiffs filed their Post-Hearing
Brief in Support [ECF No. 58] on September 8, 2016, to which the Defendant filed her Response
[ECF No. 62] on September 9, 2016. The Plaintiffs filed their Post-Hearing Reply [ECF No. 65]
and the Defendant filed a Post-Hearing Brief Response [ECF No. 66] on September 15, 2016.
The Magistrate Judge issued the Report and Recommendation (“R&R”) on January 10, 2017.
The Defendant filed her Objections to the Report and Recommendation [ECF No. 88] on January

24, 2017, to which the Plaintiffs filed their Brief in Opposition [ECF No. 97] on February 9,
2017. This matter is now ripe for ruling.

STANDARD OF REVIEW
In accordance with the Federal Magistrate’s Act, as amended, 28 U.S.C. § 636(b),
Federal Rule of Civil Procedure 72(b), and Local Rule 72-1, a judge may designate a magistrate
judge to hear and determine any pretrial matter pending before the court, including dispositive
motions, and the magistrate judge must enter a recommended disposition, including any
proposed findings of fact. The parties then have fourteen days after being served with a copy of
the recommended disposition to file written objections to the proposed findings and
recommendation. 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b)(2). “The district judge must
determine de novo any part of the magistrate judge’s disposition that has been properly objected
to.” Fed. R. Civ. P. 72(b)(3); see also 28 U.S.C. § 636(b)(1); Harlyn Sales Corp. Profit Sharing
Plan v. Kemper Fin. Servs., 9 F.3d 1263, 1266 (7th Cir. 1993). The district judge must look at all
the evidence contained in the record and may accept, reject, or modify the recommended
disposition. Fed. R. Civ. P. 72(b)(3); Harlyn, 9 F.3d at 1266.
DISCUSSION 1
The Defendant objects to the R&R on several grounds. First, the Defendant argues that
the Magistrate Judge in the R&R applied an incorrect standard. The Defendant contends that
under the correct standard, the Plaintiffs are not likely to succeed on the merits because

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The Defendant “for purposes of these objections only,” (Def.’s Br. 2, ECF No. 88), relies on the
findings of fact set forth in the R&R (R&R 1–10; ECF No. 85), “even though the Defendant may disagree
with them” (Def’s Br. 2). The Court notes the Defendant reserves her right to object to findings of fact
outside of the scope of the preliminary injunction and adopts the Magistrate Judge’s finding of fact in the
R&R as the Court’s own.

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protection of the Plaintiffs’ legitimate interest does not require injunctive relief. Furthering that
point, the Defendant secondly argues that the Plaintiffs already have an adequate remedy at law
that does not require injunctive relief. Third, the Defendant argues that the Plaintiffs do not
suffer from irreparable harm. Fourth, the Defendant argues that the balance of harms weighs
against injunctive relief. Fifth the Defendant argues that the public interest is not served by
issuing an injunction. Sixth, the Defendant argues that the Plaintiffs should be estopped from
enforcing the Covenant because such injunction would be inequitable. Seventh and last, the
Defendant argues that any preliminary injunction should be more limited than that recommended
by the Plaintiffs. The Court addresses each objection in turn.

A.

Proper Standard
The Defendant argues that the Magistrate Judge applied the incorrect standard for a

preliminary injunction, and under the correct standard, the Plaintiffs are not likely to succeed on
the merits because protection of the Plaintiffs’ “legitimate interest” does not require injunctive
relief. The Defendant argues that the Magistrate Judge erred in applying “a standard akin” to a
Rule 12(b)(6) motion by assuming that the Defendant only sought a facial challenge to the
enforceability of the Covenant. The Defendant contends that the R&R does not evaluate the
Covenant’s application to the evidentiary facts. The Plaintiffs point out that the Defendant does
not support this contention with any legal authority and does not proffer an alternative standard
than the one the Magistrate Judge used. Furthermore, the Plaintiffs argue that the Magistrate
Judge applied the proper standard in the case.
The Magistrate Judge set forth the proper standard in the R&R:
“A preliminary injunction is an extraordinary remedy never awarded
as of right.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24
(2008) (internal citations omitted). “In assessing whether a
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preliminary injunction is warranted, we must consider whether the
party seeking the injunction has demonstrated that ‘1) it has a
reasonable likelihood of success on the merits; 2) no adequate
remedy at law exists; 3) it will suffer irreparable harm if it is denied;
4) the irreparable harm the party will suffer without injunctive relief
is greater than the harm the opposing party will suffer if the
preliminary injunction is granted; and 5) the preliminary injunction
will not harm the public interest.’” St. John’s United Church of
Christ v. City of Chi., 502 F.3d 616, 625 (7th Cir. 2007) (quoting
Linnemeir v. Bd. of Trs. of Purdue Univ., 260 F.3d 757, 761 (7th
Cir. 2001)). The district court must exercise its discretion to arrive
at a decision “based on a subjective evaluation of the import of the
various factors and a personal, intuitive sense about the nature of the
case.” Lawson Prods., Inc. v. Avnet, Inc., 782 F.2d 1429, 1436 (7th
Cir. 1986). The decision-making process also involves a “sliding
scale” analysis, at least to the extent that “the more likely it is the
plaintiff will succeed on the merits, the less the balance of
irreparable harms need weigh toward its side; the less likely it is the
plaintiff will succeed, the more the balance need weigh towards its
side.” Abbott Labs. v. Mead Johnson & Co., 971 F.2d 6, 12 (7th Cir.
1992) (citations omitted). “The sliding scale approach is not
mathematical in nature, rather ‘it is more properly characterized as
subjective and intuitive, one which permits district courts to weigh
the competing considerations and mold appropriate relief.’” Ty, Inc.
v. Jones Grp., Inc., 237 F.3d 891, 895-96 (7th Cir. 2001) (quoting
Abbott Labs., 971 F.2d at 12). But there is still a threshold to be met.
A total failure to meet any one of the test’s requirements cannot be
compensated by a strong showing with respect to another. See, e.g.,
East St. Louis Laborers’ Local 100 v. Bellon Wrecking & Salvage
Co., 414 F.3d 700, 703 (7th Cir. 2005) (holding that, if a moving
party cannot show that there is irreparable harm and no adequate
remedy at law, “a court’s inquiry is over and the injunction must be
denied”); Jolivette v. Husted, 694 F.3d 760, 765 (6th Cir. 2012)
(“Although no one factor is controlling, a finding that there is simply
no likelihood of success on the merits is usually fatal.”).
(R&R 10–11; ECF No. 88.) Accordingly, upon review of the record, the Court agrees with the
Magistrate Judge and adopts as its own the findings of fact and analysis of the Magistrate Judge
in applying the standard of review for the preliminary injunction.

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B.

Existence of a Protectible Interest
The Defendant objects to the Magistrate Judge’s finding in the R&R that the Plaintiffs

have a legitimate protectible interest. The Defendant argues that the Plaintiffs have not proven
that a portion of the files the Defendant uploaded on to the USB drive contains confidential
information as alleged, or that the Defendant does not have influence over customers that she
once had. The Defendant argues that absent the Plaintiffs establishing either, the Plaintiffs have
not established a legitimate protectible interest, but rather only a “theoretical” one. 2 The
Plaintiffs argue that they have established a protectible interest, and have established both that
the Defendant took confidential information and that the Defendant threatens their customer
relationships.
The Magistrate Judge found that the Plaintiffs have established a legitimate protectible
interest to enforce an injunction against the Defendant. The Plaintiffs must show “some reason
why it would be unfair to allow the employee to compete with the former employer.” Unger v.
FFW Corp., 771 N.E.2d 1240, 1244 (Ind. App. 2002) (citing Titus v. Rheitone, Inc., 758 N.E.2d
85, 92 (Ind. Ct. App. 2001)). The Agreement is designed to prevent an employee from using his
or her knowledge of the Plaintiffs’ confidential information to solicit business from the
Plaintiffs’ customers or active prospects in competition with the Plaintiffs. To allow an employee
to leave employment with the Plaintiffs and then do those things immediately as an employee of
a competitor would be unfair to the Plaintiffs. Upon review of the record, the Plaintiffs have
established a legitimate protectible interest on these grounds.
As the Magistrate Judge discussed, the Defendant’s argument for whether the Plaintiffs
took proper steps to establish that the alleged confidential documents she took were indeed

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It appears that the crux of the Defendant’s objections concerning the proper standard applied by
the Magistrate Judge for a preliminary injunction involved the “theoretical” protectible interest argument.

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“confidential” for the purposes of establishing a legitimate protectible interest is irrelevant
because the Plaintiffs have already established a legitimate protectible interest under Indiana
law—to prevent the Defendant from stealing clients or lending an unfair competitive advantage.
Zimmer US, Inc. v. Keefer, No. 3:12-CV-395-JD-CAN, 2012 WL 5268550, at *8 (N.D. Ind. Oct.
23, 2012) (citing Hahn v. Drees, Perugini & Co., 581 N.E.2d 457, 460 (Ind. Ct. App. 1991)).
Accordingly, upon review of the record, the Court agrees with the Magistrate Judge and adopts
as its own the findings of fact and analysis of the Magistrate Judge in finding that the Plaintiffs
have established a legitimate protectible interest for injunctive relief under Indiana law.

C.

Temporal Scope
The Defendant next objects to the temporal scope of the injunction. The Defendant

argues that in holding that an 18-month length of the restriction is reasonably likely to succeed
on the merits, the Magistrate Judge did not test its reasonableness against the facts adduced at the
hearing.
Indiana courts have upheld time restrictions equal to and longer than the 18-month
restriction contained in the Agreement. See Standard Register Co. v. Cleaver, 30 F. Supp. 2d
1084, 1098 (N.D. Ind. 1998); Coffman v. Olson & Co., 906 N.E.2d 201, 208 (Ind. Ct. App.
2009); Gleason v. Preferred Sourcing, LLC, 883 N.E.2d 164, 174 (Ind. Ct. App. 2008). “The fact
that the [a]greement contains a provision tolling this period during any violation by [the
Defendant] does not change this result . . . .” Gleeson, 883 N.E.2d at 174 (citing Century Pers.,
Inc. v. Brummett, 499 N.E.2d 1160, 1162 (Ind. Ct. App. 1986)). The Defendant argues that the
R&R did not provide an in-depth as applied factual analysis as to why the temporal scope of the
injunction is reasonable. However, the Defendant does not proffer an argument for why this
duration would be unreasonable given the facts set forth in the R&R. Instead, the Defendant in a
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footnote provides several citations to the transcript, her Post-Hearing Brief, and her Brief in
Response arguing that the Defendant had “no influence over Plaintiffs’ customers,” and “does
not possess the customer relationships asserted by the Plaintiff.” (Def’s Resp. to Pls.’ Post
Hearing Br. 9, ECF No. 66.) That the Defendant was unsuccessful in recruiting clients away
from the Plaintiffs is unavailing. The findings of fact in the R&R demonstrate that the Plaintiffs
have a legitimate protectible interest in enforcing the restrictive period in the Agreement the
Defendant entered into, a time period that is well settled under Indiana law to be reasonable. The
Court finds on review of the R&R that the temporal scope of the restriction is reasonable given
the record set forth in the R&R and the contractual term.

D.

Breadth of Activity Restriction
The Defendant next objects to the R&R on the grounds that the Magistrate Judge failed to

evaluate the reasonableness of the activity restriction in light of the facts presented. The
Defendant argues that the Magistrate Judge improperly determined that the breadth of the
activities restricted was reasonable. The Defendant argues that the R&R failed to take a next
step, to determine whether the restriction is unreasonable in relation to the legitimate interest it is
designed to protect. In turn the Plaintiffs argue that the restricted activities are reasonable and
necessary to protect their legitimate business interests. The Magistrate Judge found in the R&R
that the Agreement does not prohibit the Defendant from working for a competitor in all
capacities, but only from working directly in a capacity analogous to the one in which she
worked for the Plaintiffs. See Gleeson, 883 N.E.2d at 175–76. The Magistrate Judge noted that
the Agreement does not prevent the Defendant from working for a competitor in a different
capacity from the one in which she worked for the Plaintiffs during her last two years of
employment, and also noted that the Plaintiffs are likely to succeed on the issue.
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It is well settled under Indiana law that restrictive covenants are considered reasonable if
they prohibit a former employee from engaging or promoting unfair competition or working a
role similar to the role they held with their former employer. Id. Here, the Defendant was
employed with the Plaintiffs as a regional sales manager and corporate sales manager promoting
and selling dental products in a region that is substantially similar to that in her current position
with Keystone. Furthermore, as the Magistrate Judge stated, the Agreement does not prevent the
Defendant from working in a different capacity with a competitor, and the Plaintiffs are likely to
succeed on the issue. Accordingly, upon review of the record, the Court agrees with the
Magistrate Judge and adopts as its own the findings of fact and analysis of the Magistrate Judge
to conclude that the breadth of activity restricted is reasonable and necessary to protect the
Plaintiffs’ legitimate business interests.

E.

Adequate Remedy
The Defendant next argues that the Magistrate Judge erred in finding that the Plaintiffs

had a legitimate interest in enforcing the Covenant to protect against use of their confidential
information because the Plaintiffs already have an adequate monetary remedy at law. The
Defendant contends that the Plaintiffs have not provided any evidence that they have lost
customers due to the Defendant’s actions. The Plaintiffs in turn argue that they have presented
evidence to the Magistrate Judge showing that any amount of damages assessed at this point
would be somewhat “speculative.” (Tr. 101.) 3 The Plaintiffs also argue that the purpose of the
injunction is not only to remedy existing harm, but to prevent future harm as well. Washel v.

3

As referenced in the R&R, the unredacted transcript from the July 11–12, 2016, Evidentiary
Hearing has been filed in the record in two parts, with one part for each day of the hearing [ECF Nos. 72–
73]. A redacted version of the transcript has also been filed in the record in two parts [ECF Nos 81–82].

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Bryant, 770 N.E.2d 902, 906 (Ind. Ct. App. 2002) (“[I]njunctive remedy [is] meant to prevent
future violations of the agreement.”)
In the R&R, the Magistrate Judge found that there is no adequate remedy of law in this
case “because money damages will be both very difficult to calculate, and will almost certainly
be inadequate to remedy the harm caused to Zimmer Biomet by Land’s employment with
Keystone Dental.” (R&R 24.) The Magistrate Judge noted that under Indiana law, it is “virtually
impossible to quantify” the damage caused by an employee’s breach of a non-competition
agreement. Cent. Ind. Podiatry, P.C. v. Krueger, 882 N.E.2d 723, 733 (Ind. 2008). The
Magistrate Judge concluded that “[b]ecause it is unlikely that Zimmer Biomet will be able to
determine the full extent of harm resulting from [the Defendant’s] employment with its
competitor, and because any attempt to calculate a monetary amount of damages will be largely
speculative,” Zimmer Biomet does not have an adequate remedy at law. (R&R 24–25.) Upon
review of the record, the Court agrees with the Magistrate Judge and adopts as its own the
findings of fact and analysis of the Magistrate Judge in finding that the Plaintiffs do not have an
adequate remedy at law.

F.

Irreparable Harm
The Defendant next objects to the Magistrate Judge’s finding that her continued

employment with a competitor in violation of the Agreement will cause irreparable harm. The
Defendant argues that any loss of customers that may occur in the future can be remedied by an
award of damages. The Defendant also argues that the Defendant “does not possess any legally
‘confidential’ information,” and therefore her “knowledge of Zimmer Biomet’s practices,
customers, and strategy” fall outside the scope of the Agreement. (Def.’s Br. 7.) In response, the

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Plaintiffs argue that they do not need to demonstrate a specific harm, but can establish
irreparable harm
“The irreparable harm requirement does not mandate that the party demonstrate specific
losses in its business.” Keefer, No. 3:12-cv-395-JD-CAN, 2012 WL 5268550, at *12 (first
quoting AGS Capital Corp., v. Prod. Action Int’l, LLC, 884 N.E.2d 294, 312 (Ind. Ct. App.
2008); then citing Norlund v. Faust, 675 N.E.2d 1142, 1149 (Ind. Ct. App. 1997)) (quotations
omitted). Irreparable harm is “necessarily intangible—a loss of goodwill, a need to start over
again on building personal relationships . . . , etc.—but that does not make it any less real.” Id.
“The fact that it cannot be quantified in a dollar amount is an argument in favor of equitable
relief, not against it.” Id.
The Magistrate Judge in the R&R found that the Defendant’s continued employment with
a competitor in violation of the Agreement will cause irreparable harm to Zimmer Biomet. Upon
review of the record, the Court agrees with the Magistrate Judge and adopts as its own the
findings of fact and analysis of the Magistrate Judge in finding that the Plaintiffs would have
irreparable harm caused to them by the Defendant if she continues in her current employment.

G.

Balancing of Harms
The Defendant objects to the Magistrate’s finding in the R&R that the balance of harms

supports entry of injunctive relief. The Defendant argues that the Magistrate’s determination was
based on two conclusions. First, that the Defendant’s “knowledge of Zimmer Biomet’s products
and operations, combined with her experience and reputation within the community, could create
a significant competitive advantage for Keystone” (R&R. 26.) And second, that in response to
the question of whether she would commit that she would not personally solicit any of the
Plaintiffs’ customers, the Defendant answered, “[i]f that’s what’s deemed by the Court, a
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hundred percent.” (Id. at 28.) The Defendant argues that her experience in the industry and
reputation in the community is hers and not the Plaintiffs, and therefore the Plaintiffs cannot
protect human capital that is not theirs. The Defendant also argues that the Defendant’s
testimony relied upon by the Magistrate Judge in the R&R was taken out of context.
In turn, the Plaintiffs argue that the Magistrate Judge relied upon the entire record, and
that Indiana law supports the Magistrate Judge using an employee’s experience and reputation in
the community in the balance of harms analysis. See McGlothen v. Heritage Envtl. Servs.,
L.L.C., 705 N.E.2d 1069, 1075 (Ind. Ct. App. 1999) (employee’s “intelligen[ce]” and “many
years of experience” factored into the balance of harms). Additionally, the Plaintiffs argue that
the Magistrate Judge relied on the totality of the record in forming her analysis, as evidenced by
the preceding paragraphs before the quote the Defendant maintains was taken out of context.
The Magistrate Judge found that the potential harm if the preliminary injunction is not
issued is great. The Defendant is already working for a direct competitor. The Defendant
contacted and offered Keystone products to at least one customer she had interacted with while
employed by the Plaintiffs. The Defendant directed Keystone sales representatives who report to
her to target the Plaintiff’s customers. The Defendant uploaded to a flash drive 5,948 files—
much of which included confidential information—within a few days of Keystone offering her a
job. The Defendant later accessed some of these documents during her employment at Keystone.
The 15-state region that the Defendant covered for the Plaintiffs, which makes up a large portion
of the Plaintiffs’ business in the United States, directly overlaps with the region she now is
covering for Keystone. The Defendant’s knowledge of the Plaintiffs’ products and operations are
harmful to the Plaintiffs. Her years of experience and reputation in the community can also be

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factored into the balance of harms analysis under Indiana law. See McGlothen, 705 N.E.2d at
1075.
But irrespective of the Defendant’s argument that her knowledge cannot be protectible to
the Plaintiffs, the Court finds that the balance of harms still weigh in favor of injunctive relief.
When balancing the harms, “the more likely it is the plaintiff will succeed on the merits, the less
the balance of irreparable harms need weigh towards its side; the less likely it is the plaintiff will
succeed, the more the balance need weigh towards its side.” Abbot Labs. v. Mead Johnson &
Co., 971 F.2d 6, 12 (7th Cir. 1992). Furthermore, the Defendant’s willingness to voluntarily
comply with her own extended courtesy not to solicit any of Plaintiffs’ accounts is undercut by
the totality of the Defendant’s actions in the record. Upon review of the record, the Court agrees
with the Magistrate Judge and adopts as its own the findings of fact and analysis of the
Magistrate Judge in finding the balance of harms weighs in favor injunctive relief.

H.

Public Interest
The Magistrate Judge in the R&R found that the preliminary injunction recommended in

this case would be consistent with the public interest. The Defendant argues that the R&R’s
discussion of what is in the public interest is premised on erroneous conclusions, and that it
would ultimately be in the public interest to deny a preliminary injunction. The Plaintiffs argue
that the public interest is not disserved with the entry of an injunction order. 4

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The Plaintiffs also note that the Defendant generally objects to the Magistrate Judge’s finding
on the injunction being in the public interest, and does not provide any reasoning beyond that. Mario v.
P&C Food Markets, Inc., 313 F.3d 758, 766 (2d Cir. 2002) (finding the objection was “not specific
enough to preserve [the] claim for review” because the object was nothing more than a “bare statement,
devoid of any reference to specific findings or recommendations to which he objected and why, and [it
was] unsupported by legal authority”).

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“Noncompetition agreements or covenants not to compete are in restraint of trade and are
not favored by” Indiana law. Gleeson, 883 N.E.2d at 172. But that concern is alleviated where
“the employer has asserted a legitimate interest that may be protected,” and where “the scope of
the agreement is reasonable in terms of time, geography, and types of activity prohibited.” Id.
The Magistrate Judge found the preliminary injunction in this case would be consistent with the
public interest, given the Defendant’s breach of the Agreement. Upon review of the record, the
Court agrees with the Magistrate Judge and adopts as its own the findings of fact and analysis of
the Magistrate Judge in finding that the preliminary injunction in this case is consistent with
public policy.

I.

Estoppel
The Defendant next argues that the Magistrate Judge incorrectly found in the R&R that

the Plaintiffs are not estopped from enforcing the Agreement. The Defendant argues that
estoppel is warranted because it is inequitable that the Plaintiffs were uniquely in control of their
decision whether to enforce the agreement and made representations to the Defendant that they
would not enforce the Covenant. The Defendant argues that if she had knowledge of that
enforcement decision, she could have “prevented the very breach that forms the basis of” the
Plaintiffs’ lawsuit against her, and that the record uncontrovertibly shows that she would have
reconsidered accepting the job at Keystone. (Def. Br. 9.) The Defendant contends that the
Plaintiffs’ selective enforcement is magnified by the fact that Jim Gerson, her territory Team
Lead, only expressed concern about whether the Defendant would be working institutional
accounts at Keystone, and expressed no further concern once the Defendant told him she would
not be handling those. The Defendant contends that the “record facts demonstrate that [the
Defendant] relied on both Gerson’s statements and [the] Plaintiffs’ silence, in the context of her
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prior understanding about the unenforceability of non-compete agreements in California, and
reasonably interpreted that [the] Plaintiffs had no objection to her working at Keystone in a
position that did not involve institutional customers.” (Def.’s Br. 10 n.11.)
Furthermore, the Defendant contends that the law on this particular set of facts is
uncertain, and cites to Ikon Office Solutions., Inc. v. American Office Products, Inc., 178 F.
Supp. 2d 1154, 1165 (D. Or. 2001), for the proposition that the Plaintiffs’ conduct after the
Defendant announced her intent to resign induced her to believe that the Plaintiffs did not object
to the job she was taking at Keystone, so long as she did not deal with institutional accounts. The
Plaintiffs argue that this is an unusual case, for which neither party has found case authority
directly on point, because after the Defendant accepted Keystone’s employment offer and
announced her intention to resign, the Plaintiffs asked the Defendant to remain employed, to
which she agreed. The Defendant argues that during this eight day period that she remained
employed by the Plaintiffs, they never made representations that they would enforce the
Covenant.
In response, the Plaintiffs argue that they never waived their right to enforce the
Covenant, and the legal authority on the matter is clear. Furthermore, the Plaintiffs contend that
even if their silence between the Defendant informing them of her offer from Keystone, and their
informing her of their legal position, the record unequivocally shows that the Defendant had
decided to work for Keystone before ever informing the Plaintiffs.
Under Indiana law, “[t]he elements of equitable estoppel are: (1) a representation or
concealment of a material fact, (2) made by a person with knowledge of the fact and with the
intention that the other party act upon it, (3) to a party ignorant of the fact, (4) which induces the
other party to rely or act upon it to his detriment.” Clark v. Crowe, 778 N.E.2d 885, 840 (Ind. Ct.

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App. 2002) (citing Wabash Grain, Inc. v. Smith, 700 N.E.2d 234, 237 (Ind. Ct. App. 1998)). The
Magistrate Judge found in the R&R that the Defendant’s acceptance of the position at Keystone
and resignation from her position at Zimmer Biomet occurred prior to almost all of the Plaintiffs’
“actions and silence” that she claims to have relied on. The Magistrate Judge noted that all of the
defendant’s conversations with Biomet 3i human resources occurred prior to its acquisition by
Zimmer and prior to the Defendant signing the Agreement—the controlling agreement in this
case. The Court notes that the Defendant at this objection stage still does not explain why she
relied on Biomet 3i’s pre-acquisition actions knowing the Agreement was signed under postacquisition, Zimmer Biomet policy. Furthermore, the Defendant’s reliance on non-enforcement
against previous Biomet sales representatives in California fails to account for the fact that her
regional sales position with Zimmer Biomet encompassed many more states than just California.
The Magistrate Judge also noted that contrary to the Defendant’s characterization of her
conversations with Gerson, the exchanges should have been a sign to the Defendant that Zimmer
Biomet was concerned about her role with Keystone. Lastly, the Magistrate Judge also noted that
the Defendant had specifically forwarded the Agreement to Keystone, and its legal team
reviewed the contract. Keystone’s lawyer emailed the Defendant on February 15, 2016—a week
before she resigned from Zimmer Biomet—and advised her that Zimmer Biomet could not
enforce the Covenant. The Magistrate Judge found that this fact discredits the Defendant’s
argument that she detrimentally relied on Zimmer Biomet’s alleged acts or omissions.5

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The Plaintiffs point to six facts to show that the Defendant unequivocally decided to work for
Keystone before informing the Plaintiffs: (1) the Defendant accepted her position at Keystone within four
hours, having already been told by Keystone days earlier the offer was coming, (2) the Defendant
informed the Plaintiffs of her resignation the day after she had accepted her offer, (3) the Defendant’s
resignation letter to the Plaintiffs did not inquire whether the Plaintiffs approved of her new role with
Keystone, (4) the Defendant admits she never asked whether the Plaintiffs approved of her position, (5)
when one of the Defendant’s colleagues asked her whether “there is anything [he] can do to keep [her]” at
Zimmer Biomet, the Defendant responded, “No, I’ve made up my mind. I’m going to Keystone”

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The Defendant objects to the Magistrate’s reasoning because the Defendant believes that
the Magistrate Judge conflated a legal “duty” imposed by the Agreement not to work on
institutional accounts with what the Defendant thought was a courtesy extended by her to the
Plaintiffs. The Defendant also objects to the Magistrate Judge’s finding that the Defendant relied
on the legal position of Keystone rather than perceived representations of non-enforcement of the
Agreement as “conjecture.” (Def’s Br. 11.) Both arguments are unavailing. It is not an “error of
law” that the Magistrate Judge would rely on the Defendant’s actions and conversations
developed in the record to determine whether the Defendant was induced by the Plaintiffs to rely
on their representations.
Furthermore, the Defendant’s continued reliance on Ikon Office Solutions, is equally
unavailing. As the Magistrate Judge discussed in the R&R, that case, filed in Oregon District
Court, is distinguishable because the employer there expressly informed one of the defendant
employees that he did not sign a non-competition agreement when in fact that employee had
signed one, but then sought to enforce that agreement after the employee left. Ikon Office
Solutions., Inc., 178 F. Supp. 2d at 1161. Upon review of the record, the Court agrees with the
Magistrate Judge and adopts as its own the findings of fact and analysis of the Magistrate Judge
in finding that the Plaintiffs were not equitable estopped from enforcing the Agreement against
the Defendant.

J.

Overbreadth
Lastly, the Defendant argues in the alternative that if the Court grants the injunction, the

relief awarded should be more limited in scope than recommended by the Magistrate Judge. The

(Tr. 241), and (6) when given the opportunity at the Hearing to discuss how overt conduct by the
Plaintiffs would have changed her decision, the Defendant only said she would have “taken pause.” (Id. at
150.)

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Defendant contends that the injunction should not “exceed protection of specified information
found to be ‘confidential’ . . . and protection of Plaintiffs’ institutional customer relationships—
the only customer relationships arguably at risk.” (Def.’s Br. 12, ECF No. 88.) The Defendant
argues that this is because there is no basis in the record facts or the law for a complete bar to the
Defendant’s employment in her current position. The Defendant argues that she should be
permitted to remain in her current position, subject to a limited injunction as to the use and
disclosure of confidential information and solicitation of the Plaintiffs’ institutional accounts. In
turn, the Plaintiffs argue that the restricted activities are reasonable and necessary to protect their
legitimate business interests.
As discussed above, the Magistrate Judge found that the Agreement does not prevent the
Defendant from working for a competitor in a different capacity from the one in which she
worked for the Plaintiffs in her last two years of employment. Upon review of the record, the
Court agrees with the Magistrate Judge that the breath of the restrictions is reasonable as
previously found above.

CONCLUSION
The Court has reviewed the entire record of this case, including the various motions with
the accompanying briefing, the Magistrate’s Report and Recommendation, and the Defendant’s
objections to the Report and Recommendation. Having made a de novo review of the arguments
presented by the parties, the Court agrees with and adopts as its own the findings and analysis of
the Magistrate Judge. For the foregoing reasons, the Court OVERRULES the Defendant’s
Objections to the Report and Recommendation of United States Magistrate Judge [ECF No. 88]
and ADOPTS the Magistrate Judge’s Report and Recommendation [ECF No. 85] on the
Plaintiffs’ Motion for Preliminary Injunction. Accordingly, the Court now GRANTS the
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Plaintiffs’ Motion for Preliminary Injunction [ECF No. 8]. The Defendant is enjoined pursuant to
the Non-Solicitation Agreement for Sales Mangers and Representatives from the following:
A.

Working, for eighteen (18) months, for Keystone in the
Restricted Territory she covered as Zimmer Biomet
Corporate Sales Manager, which consists of: Alaska,
Arizona, California, Colorado, Hawaii, Idaho, Minnesota,
Montana, Nevada, North Dakota, Oregon, South Dakota,
Utah, Washington, Wisconsin, and Wyoming;

B.

Directly or indirectly soliciting, for eighteen (18) months,
any person, corporation or other entity serviced, sold to,
approached or solicited, directly or indirectly, by Land
during the last eighteen (18) months of her role as a Zimmer
Biomet manager;

C.

Soliciting, recruiting, enticing, or taking away or assisting
others in recruiting, soliciting, or hiring (a) current Zimmer
Biomet employees, sales representatives, or consultants or
(b) individuals who were employees, sales representatives,
or consultants for Zimmer Biomet within the preceding two
(2) years, for a period of eighteen (18) months; and

D.

Disclosing or using any Confidential Information, as defined
in the Agreement.

E.

Possessing any
Information

of

Zimmer

Biomet’s

Confidential

The Defendant is required to file with the Court and serve on the Plaintiffs periodic
written reports every thirty (30) days after service of the Preliminary Injunction, under oath,
setting forth the manner and form in which the Defendant has complied with the Preliminary
Injunction.

SO ORDERED on March 30, 2017.
s/ Theresa L. Springmann
CHIEF JUDGE THERESA L. SPRINGMANN
UNITED STATES DISTRICT COURT

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