Waguespack v. Medtronic Inc. et al
Filing
51
ORDER granting Motions for Preliminary Injunction and Order denying Motions to Transfer. This preliminary injunction shall be in effect through the trial on the merits of this case. The parties are directed to contact Magistrate Bourgeois as soon as possible to set up a scheduling conference; and Plaintiffs shall furnish security in the form of a bond set at $ 500.00, which may be posted as a cash bond with the Clerk of this Court. Signed by Judge James J. Brady on 5/11/201. (LLH)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
ROBBY J. WAGUESPACK
VERSUS
MEDTRONIC, INC., ET AL.
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CASE NO. 3:16-CV-00241-JJB-RLB
C/W
STEPHEN POWELL
VERSUS
MEDTRONIC, INC., ET AL.
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CASE NO.: 3:16-CV-00242-JJB-EWD
C/W
LLOYD LILE LINDSEY, III
VERSUS
MEDTRONIC, INC., ET AL.
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CASE NO.: 3:16-CV-00243-JJB-RLB
ORDER GRANTING MOTIONS FOR PRELIMINARY INJUNCTION AND
ORDER DENYING MOTIONS TO TRANSFER
This matter came before the Court on Wednesday, May 4, 2016, at 9:30 a.m. for a hearing
on (1) Defendants’ Motions to Transfer to the United States District Court for the District of
Minnesota (“Transfer Motions”) and (2) Plaintiffs’ Motions for Preliminary Injunction (the
“Preliminary Injunction Motions”) relative to Plaintiffs’ actions seeking a declaratory judgment
that certain provisions in their Employment Agreements are null and void.1 K2M, Inc. intervened
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The Plaintiffs filed separate cases: Waguespack v. Medtronic, Inc., et al, 3:16-CV-00241-JJB-RLB;
Powell v. Medtronic, Inc., et al, 3:16-CV-00242-JJB-EWD; and Lindsey v. Medtronic, Inc., et al, 3:16-CV00243-JJB-RLB. Because the Preliminary Injunction Motions and the Transfer Motions in each case are
substantially similar, the Court issued a single Memorandum Opinion granting all three Preliminary
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FINANCE
in the Plaintiffs’ declaratory judgment actions on the basis that it cannot tortiously interfere with
the null and void Employment Agreements at issue and such a claim against it is not valid. The
following counsel were present at the hearing:
Thomas J. McGoey II, on behalf of Plaintiffs, Robby J. Waguespack, Stephen A. Powell,
and Lloyd Lile Lindsey, III (“Plaintiffs”);
Eric Miller and Shannon Hampton Sutherland, on behalf of Intervenor. K2M, Inc.
(“K2M”);
William Z. Pentelovitch, Sarah Horstmann, Matthew Bailey, and Kelly Juneau Rookard,
on behalf of the Defendants, Medtronic, Inc., and Medtronic Sofamor Danek USA, Inc.
(collectively, “Defendants”).
Having considered the Transfer Motions and the Preliminary Injunction Motions, the
arguments of counsel, the evidence in the record, the testimony presented during the hearing, and
the applicable law; the Court finds as follows, as more fully set forth in the Court’s Memorandum
Opinion (16-cv-241: Doc. 47; 16-cv-242: Doc. 43; and 16-cv-243: Doc. 47), which is incorporated
by reference:
1.
Plaintiffs’ counsel provided notice of the Preliminary Injunction Motions to
Defendants’ counsel pursuant to Rule 65(a)(1) of the Federal Rules of Civil Procedure and Rule
65 of this Court’s Local Civil Rules;
2.
Defendants’ counsel provided notice of the Transfer Motions to Plaintiffs’ counsel
pursuant to the applicable Rules;
Injunction Motions and denying all three Transfer Motions and hereby issues these Orders in all three cases.
On May 10, 2016, the Court entered an order consolidating the three cases.
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3.
Waguespack signed the Louisiana Employment Agreement at 16-cv-241: Doc. No.
4-6; Powell signed the Louisiana Employment Agreement at 16-cv-242: Doc. No. 5-6; and Lindsey
signed the Employment Agreement at 16-cv-243: Doc. No. 5-6;
4.
Defendants contend that each of the Plaintiffs received good and valuable
consideration for signing the Employment Agreements;
5.
Each of the Plaintiffs has taken a position with Intervenor and wishes to sell
products for Intervenor in a position that Defendants claim would be in contravention of each of
their Employment Agreements;
6.
Each of the Plaintiffs contends that the choice of law, choice of forum, non-
competition, and non-solicitation covenants in his respective Employment Agreement are null,
void and unenforceable;
7.
Plaintiffs and Intervenor have demonstrated a substantial likelihood of success on
the merits of their underlying claims;
8.
La. Rev. Stat. § 23:921(A)(2) provides:
The provisions of every employment contract or agreement, or
provisions thereof, by which any foreign or domestic employer or any
other person or entity includes a choice of forum clause or choice of law
clause in an employee's contract of employment or collective bargaining
agreement, or attempts to enforce either a choice of forum clause or
choice of law clause in any civil or administrative action involving an
employee, shall be null and void except where the choice of forum
clause or choice of law clause is expressly, knowingly, and voluntarily
agreed to and ratified by the employee after the occurrence of the
incident which is the subject of the civil or administrative action.
9.
Plaintiffs are and were, at all relevant times, residents of Louisiana;
10.
Plaintiffs are and were, at all relevant times, Louisiana employees;
11.
Plaintiffs did not expressly, knowingly, or voluntarily agree to or ratify a choice of
forum clause or choice of law clause in their Employment Agreements after the occurrence of the
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incidents which are the subject of these actions;
12.
La. Rev. Stat. §§ 23:921(C) provides, in pertinent part:
Any person, including a corporation and the individual shareholders of such
corporation, who is employed as an agent, servant, or employee may agree
with his employer to refrain from carrying on or engaging in a business
similar to that of the employer and/or from soliciting customers of the
employer within a specified parish or parishes, municipality or
municipalities, or parts thereof, so long as the employer carries on a like
business therein, not to exceed a period of two years from termination of
employment.
13.
La. Rev. Stat. § 23:921 applies to Plaintiffs’ Employment Agreements.
14.
Defendants’ First Amendment objections and Dormant Commerce Clause
argument are insufficient to overcome Plaintiffs’ demonstrated likelihood of success on the merits
of invalidating the forum selection and choice of law clauses.
15.
Plaintiffs’ Employment Agreements do not comply with La. Rev. Stat. § 23:921(C).
16.
Plaintiffs will suffer immediate and irreparable harm before a trial on the merits can
be held due to Defendants’ ex parte and other efforts to enforce, and Defendants’ continued stated
intention to enforce, the choice of forum, choice of law, non-competition, and non-solicitation
provisions in Plaintiffs’ Employment Agreements, including by filing suit in Minnesota and
seeking injunctive relief against Plaintiffs proceeding with this first-filed action;
17.
Unless Defendants are enjoined from proceeding with such actions, Plaintiffs will
likely be prohibited from litigating in the state in which they live and work and competing against
Defendants in contravention of La. Rev. Stat. § 23:921 and Louisiana’s strong public policy against
overly broad non-competition agreements, and Louisiana’s strong public policy and reasonable
conditions concerning choice of law and forum clauses in employment agreements with Louisiana
employees, even though it is substantially likely that they are not bound by the terms of the
aforementioned provisions of their Employment Agreements;
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18.
The harm that Plaintiffs would suffer if they are denied the protections afforded to
Louisiana employees by being forced to litigate in and under the laws of Minnesota far outweighs
any harm that Defendants could possibly suffer if they are enjoined, since the practical effect of
the injunction would simply be to require Defendants to comply with labor laws in and affecting
Louisiana, a state in which they have chosen to do business and from which they have benefited
from sales;
19.
The issuance of a preliminary injunction will promote, rather than disserve, the
public interest in this case by preventing the waste of judicial resources in Minnesota, a State with
only an attenuated connection to this case, and upholding Louisiana’s strong public policy against
overbroad non-competition agreements and strong public policies expressed in La. Rev. Stat. §
23:921; Accordingly,
IT IS HEREBY ORDERED that the Preliminary Injunction Motions are GRANTED,
and a preliminary injunction shall issue herein restraining, enjoining, and prohibiting Medtronic,
Inc., Medtronic Sofamor Danek USA, Inc., their respective officers, agents, servants, employees,
attorneys, and anyone else acting in concert with the aforementioned individuals (including, but
not limited to, Medtronic Sofamor Danek, Inc.), as follows:
(a)
from appearing; filing any pleadings, motions, or other papers; seeking or obtaining
any order, ruling, or relief; or proceeding in any manner with the action styled Medtronic, Inc., et
al. v. Stephen Powell, et al., originally filed as Civil Action No. 02-CV-16-1617, in the Tenth
Judicial District Court, Anoka County, State of Minnesota, and subsequently removed to the
United States District Court for the District of Minnesota and docketed as Civil Action No. 0:16-
cv-00918-JNE-TNL (the “Minnesota Action”), or any other similar action heretofore filed or
contemplated to be filed in the future against Plaintiffs and/or K2M;
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(b)
from enforcing or attempting to enforce the choice of forum, choice of law, non-
competition, or non-solicitation provisions contained in Sections 4.1, 3.6, and 7.1-7.4 of Plaintiffs’
Employment Agreements, or asserting any claims arising out of or related to those Employment
Agreements, outside of the proceedings currently pending before this Court, against Plaintiffs
and/or K2M; and
(c)
from taking any action that directly or indirectly restricts, limits, or interferes in any
way with this Court’s jurisdiction over the claims which have been asserted by Plaintiffs and/or
K2M in this lawsuit, or which otherwise arise out of or relate in any way whatsoever to Plaintiffs’
prior employment with Medtronic Sofamor Danek USA, Inc. or their current employment with
K2M;
IT IS FURTHER ORDERED that this preliminary injunction shall be in effect through
the trial on the merits of this case. The parties are directed to contact Magistrate Bourgeois as soon
as possible to set up a scheduling conference; and
IT IS FURTHER ORDERED that Plaintiffs shall furnish security in the form of a bond
set at $ 500.00, which may be posted as a cash bond with the Clerk of this Court; and
IT IS FURTHER ORDERED that Defendants’ Transfer Motions shall be, and hereby
are, denied, for the reasons set forth in the Court’s Memorandum Opinion (16-cv-241: Doc. 47;
16-cv-242: Doc. 43; and 16-cv-243: Doc. 47).
THUS DONE AND SIGNED in Baton Rouge, Louisiana, on this 11th day of May, 2016,
at 3:00 PM.
JUDGE JAMES J. BRADY
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
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