Allegis Group, Inc. et al v. Jordan et al

Filing 85

MEMORANDUM OPINION. Signed by Judge George Levi Russell, III on 6/10/14. (hmls, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
ALLEGIS GROUP, INC., et al.,

:

Plaintiffs/Counterclaim
Defendants,

:
:

v.
:
JUSTIN JORDAN, et al.,
: Civil Action No. GLR-12-2535
Defendants,
:
v.
:
DANIEL CURRAN, et al.,
:
Counterclaim Plaintiffs.
:
MEMORANDUM OPINION
THIS

MATTER

is

before

the

Court

on

Defendants

Justin

Jordan, Daniel Curran, Ana Neto Rodrigues, Alexander Ferrello,
Michael

Nicholas,

and

Chris

Hadley’s

(collectively,

“Defendants”) Motion for Partial Summary Judgment (ECF No. 74)
and

Plaintiffs/Counterclaim

Defendants

Allegis

Group,

Inc.

(“Allegis”), Aerotek, Inc. (“Aerotek”), and TEKsystems, Inc.’s
(“TEKsystems”)

(collectively,

“Plaintiffs”)

Partial Summary Judgment (ECF No. 75).

Cross-Motion

for

This case involves six

former Aerotek employees and their activities before and after
resigning.

The issues before the Court are whether Messrs.

Jordan, Curran, and Hadley breached the restrictive covenants in
their

employment

agreements;

whether

Messrs.

Jordan,

Curran,

Hadley,

and

Allegis’s

Nicholas

Incentive

breached

the

Investment

restrictive

Plan

covenants

in

whether

Mr.

(“IIP”);

Ferrello breached his duty of loyalty to Aerotek; and whether
Messrs. Hadley and Ferrello and Ms. Rodrigues misappropriated
Aerotek’s and TEKsystems’s trade secrets in violation of the
Maryland Uniform Trade Secrets Act (“MUTSA”).
The

Court,

having

reviewed

the

pleadings

documents, finds no hearing necessary.

and

supporting

See Local Rule 105.6

(D.Md. 2011). For the reasons outlined below, the Court will
grant in part and deny in part Defendants’ Motion for Partial
Summary Judgment and grant Plaintiffs’ Cross-Motion for Partial
Summary Judgment.

The restrictive covenants in Mr. Jordan’s

employment agreement and in Section 9 of the IIP are enforceable
as a matter of law.

There is no genuine dispute that Mr.

Jordan, before his IIP obligations expired, solicited Mr. Hadley
to resign from Aerotek.

There is no genuine dispute that before

their

expired,

IIP

Nicholas

obligations
staffed

competition
that

Mr.

privilege
Aerotek.

with

Information
TEKsystems.

Ferrello
to

engaged

prepare

Finally,

or

in

Messrs.

Curran,

Technology

(“IT”)

Plaintiffs
conduct

make

proffer

that

no

and

positions

in

proffer

arrangements

Plaintiffs

Hadley,

no

would
to

evidence

defeat

compete

evidence

that

the
with
the

allegedly confidential documents in Defendants’ possession are
not publicly available or would be valuable to competitors.
2

BACKGROUND1

I.
Aerotek
Allegis

and

that

TEKsystems

engage

in

are

the

wholly-owned

business

of

subsidiaries

locating,

of

selecting,

screening, mobilizing, and placing candidates in temporary and
permanent employment positions throughout the United States at
all

levels

of

skill

and

expertise.

Aerotek

concentrates

primarily on satisfying the scientific, software, engineering,
and

administrative

needs

of

its

clients.

TEKsystems

concentrates primarily on satisfying the information technology
needs

of

positions,
scientific

its

clients.

Aerotek

While

provides

applications,

both

companies

staffing

whereas

for

TEKsystems

staff

software

engineering
provides

and

staffing

for business and IT applications.
Defendants are former Aerotek employees.

Mr. Jordan served

as a Regional Vice President until he resigned on February 21,
2009.

Mr. Curran served as a National Account Manager (“NAM”)

and a Director of Strategic Sales (“DSS”) until he resigned on
September 16, 2011.

Mr. Nicholas also served as a NAM and a

DSS until he resigned on January 3, 2012.

Mr. Hadley served as

a NAM and a Director of National Sales until he resigned on
April 6, 2012.

Ms. Rodrigues served as an Account Recruiting

Manager and Senior Account Executive until she resigned on March
1

Unless otherwise noted, the following facts are undisputed
and are viewed in the light most favorable to the nonmoving
party.
3

30, 2012.

Finally, Mr. Ferrello served as an Account Recruiting

Manager until he resigned on March 30, 2012.

At the time of

their resignations, Defendants were working in Aerotek offices
in Washington, D.C. and Northern Virginia.
When they began their employment with Aerotek, Defendants
executed

employment

restrictive covenants.

agreements,

each

of

which

contain

The restrictive covenant in Mr. Jordan’s

employment agreement is effective for two years and it contains
non-competition and non-solicitation provisions.

(See

Defs.’

Mem. Supp. Mot. Partial Summ. J. [“Defs.’ Mot. Partial Summ.
J.”] Ex. 2 [“Mr. Jordan’s Employment Agreement”], at 3-4, ECF
No. 74-3).

The non-competition provision prohibits Mr. Jordan

from:
(1) Engag[ing] in, or prepar[ing] to engage
in, or be[ing] employed by any business that
is engaging in or preparing to engage in,
any aspect of AEROTEK's Business in which
EMPLOYEE performed work during the two (2)
year period preceding his/her termination of
employment, in any state of the United
States or province of Canada where the
Aerotek conducted business during the term
of
EMPLOYEE's
employment,
or
as
much
geographic territory as a court of competent
jurisdiction deems reasonable[.]
(Id. at 3).

The client non-solicitation provision prohibits Mr.

Jordan from:
(2)
Approach[ing],
contact[ing]
solicit[ing] any individual, corporation
other entity which, at any time within
two (2) year period prior to the date
4

or
or
the
of

termination of EMPLOYEE's employment, was a
client or customer of AEROTEK in an attempt
to:
(a)
enter
into
any
business
relationship with a client or customer
of
the
Aerotek
if
the
business
relationship is competitive with any
aspect of AEROTEK's Business in which
EMPLOYEE worked during the two (2) year
period
preceding
termination
of
employment, or
(b) reduce or eliminate the business
such clients or customers conduct with
AEROTEK[.]
(Id. at 3-4).

The employee non-solicitation provision prohibits

Mr. Jordan from:
(3) Solicit[ing] or in any other manner
attempt[ing] to influence or induce any
Regular Employee2 of the Aerotek:
(a)
to
provide
services
to
any
individual, corporation or entity whose
business is competitive with any of the
Aerotek, or
(b) to leave the employ of any of the
Aerotek[.]
(Id. at 4).

2

Mr. Jordan’s employment agreement defines “Regular
Employee” as “an employee of AEROTEK who is not a ‘Contract
Employee.’”
(Mr. Jordan’s Employment Agreement at 4).
The
agreement defines a “Contract Employee” as “an employee or
candidate for employment of any of the Aerotek who is or was
employed to perform services at customers or clients of any of
the Aerotek.”
(Id.).
While the agreement contains a nonsolicitation provision that governs solicitation of Contract
Employees, Defendants do not challenge that provision.
(See
Defs.’ Mot. Partial Summ. J. at 3) (omitting summary of the
language
in
the
non-solicitation
provision
governing
solicitation of Contract Employees).
5

The non-competition and non-solicitation provisions in Mr.
Curran’s and Mr. Hadley’s employment agreements are similar to
the provisions in Mr. Jordan’s employment agreement.

They are,

however, effective for only 18 months and the non-competition
provisions only apply within a 100-mile radius from any office
in which Messrs. Curran and Hadley worked during their final two
years with Aerotek.

(See Defs.’ Mot. Partial Summ. J. Ex. 4, at

4-7, 55-57, ECF No. 74-5).
The

Allegis

board

of

directors

selected

Messrs.

Jordan,

Curran, Hadley, and Nicholas to participate in the Allegis IIP.
The

IIP

acquire

allows
a

management

financial

and

other

interest

in

high-level

Allegis

employees the equivalent of Allegis stock.
IIP

is

to

provide

a

“select

group

of

by

employees
promising

to
the

The purpose of the

management

or

highly

compensated employees . . . an incentive to promote the best
interests of the Companies,3 and . . . an incentive to promote
the long term economic growth of the Companies.”
IIP

participants

are

awarded

“incentive

(IIP at 2).

investment

units”

(“Units”), which are equivalent to a common share of Allegis
stock

but

do

not

actually

grant

equity

in

Allegis.

While

employed at Aerotek, participants receive cash dividends twice a
3

The IIP defines “Company” as “Allegis Group
subsidiary of Allegis Group” and “Companies” as “all
foregoing collectively.”
(Pls.’ Mem. Supp. Cross-Mot.
Summ. J. & Opp’n Defs.’ Mot. Partial Summ. J. [“Pls.’
Ex. 4 [“IIP”], at 2, ECF No. 75-6).
6

or any
of the
Partial
Opp’n”]

year based on the value of their Units.

In addition, once their

employment has ended, Aerotek pays participants the principle
balance of the value of their Units, known as “IIP payments,”
which are distinct from the dividend payments employees receive
while employed.

Following the termination of their employment,

Aerotek makes IIP payments to participants as follows: fivepercent of their balance is paid every quarter for ten quarters,
and then the remaining fifty-percent of their balance is paid
after thirty months.
Mr. Jordan received all his IIP payments which totaled over
$1.45 million.

At the time of their resignations, Mr. Curran

was scheduled to receive $196,470 in IIP payments, Mr. Nicholas
was scheduled to receive $138,268, and Mr. Hadley was scheduled
to receive $498,414.

Mr. Curran, however, only received two

payments of $8,851, Mr. Nicholas only received one payment of
$6,195,

and

Mr.

Hadley

Allegis

discontinued

the

did

not

IIP

receive

payments

any

IIP

because

it

payments.
contends

Messrs. Curran, Hadley, and Nicholas breached their IIP Award
Agreements.
Allegis awards Units through IIP Award Agreements, which
employees must sign each time they earn Units.

Messrs. Jordan,

Curran, Hadley, and Nicholas all signed IIP Award Agreements.
These agreements condition payment upon compliance with Section
9 of the IIP, stating “the terms and conditions set forth in
7

Section 9 of the [IIP] are material and essential terms of your
award of Units and your eligibility to receive payment for any
Units.”

(Pls.’ Opp’n Ex. 6, ECF No.75-8).

Section 9 is a

restrictive covenant that is effective for thirty months after
termination of employment.

(IIP at 6).

Defendants challenge

Sections 9(3) and 9(5) of the restrictive covenant.

Section

9(3) is an employee non-solicitation provision that prohibits
participants from:
(3)
Approach[ing],
solicit[ing], or induc[ing]
Employee of the Companies

contact[ing],
any Regular

(a)
to
provide
services
to
any
individual, corporation or entity whose
business is competitive with any of the
Companies, or
(b) to leave the employ of any of the
Companies[.]
(Id.).

Section 9(5) is a non-solicitation and non-disclosure

provision that prohibits participants from:
(5) In any way solicit[ing], divert[ing] or
tak[ing]
away
any
staff,
temporary
personnel, trade, business, or good will
from the Companies; solicit[ing] accounts or
personnel
which
became
known
to
the
Participant through his or her employment
with
the
Companies;
influenc[ing]
or
attempt[ing]
to
influence
any
of
the
Companies customers or personnel not to do
business with the Companies; divulg[ing] . .
. any information concerning any account of
the Companies . . . or disclos[ing] any
confidential
or
proprietary
information
acquired by the Participant while in the
employ of the Companies . . . .

8

(Id. at 6-7).
Mr. Jordan’s IIP obligations expired on August 21, 2011,
Mr. Curran’s on March 17, 2014, and Mr. Nicholas’s on June 4,
2014.

Mr. Hadley’s obligations will expire on October 7, 2014.

After
following
North
“ZP”);

resigning
companies:

Carolina;
Piper

from

Aerotek,

Zachary

Zachary

Enterprise

Mr.

Piper,

Piper

Jordan

LLC;

LLC;

the

Piper,

LLC

Zachary

Holdings,

Solutions,

founded

LLC

and

(collectively,

Piper

Enterprise

Solutions North Carolina, LLC (collectively, “PES”).

While the

parties dispute the work ZP performs, the parties agree PES
performs staffing and recruiting in the IT industry.
After

resigning

from

Aerotek,

Messrs.

Curran,

Hadley,

Nicholas, and Ferrello, and Ms. Rodrigues took positions with
PES.

Mr. Curran is Director of Business Development, Mr. Hadley

is Vice President of IT Infrastructure and Applications, Mr.
Nicholas is Vice President of IT Solutions, and Mr. Ferrello as
well as Ms. Rodrigues are Directors.

Messrs. Curran, Hadley,

and Nicholas are currently performing IT staffing services in or
around Raleigh, North Carolina.
are

currently

performing

IT

Mr. Ferrello and Ms. Rodrigues

staffing

services

in

or

around

Washington, D.C. and Northern Virginia.
Plaintiffs

performed

Defendants’

IT

hardware

Defendants,

before

a

forensic

devices

resigning,

in

removed
9

review
order

of
to

several

of

determine

if

confidential

documents

from Plaintiffs’ internal IT networks.

Collectively, Defendants

are

five

in

possession

of

the

following

TEKSystems CATS 2 Price Sheet; (2)

a

documents:

(1)

a

Federal Supply Service

Price List; (3) a Software Market Definitions Memorandum; (4) an
Allegis Group Internal Employee Handbook; and (5) a TEKsystems
Staffing Services Agreement.
On
Court

July 17, 2012,

for

Anne

Arundel

Plaintiffs
County,

filed

suit in

Maryland,

the

alleging

Circuit

breach

of

employment agreements, breach of IIP Award Agreements, breach of
fiduciary duties and duties of loyalty, and misappropriation of
confidential information and trade secrets.

(ECF No. 2).

On

August 23, 2012, Defendants removed the case to this Court.
(ECF No. 1).
Complaint

which

enrichment.
On

On December 19, 2012, Plaintiffs filed an Amended
claims

for

rescission

and

unjust

an

Amended

(ECF No. 26).

January

Counterclaim,
Maryland

adds

22,

alleging

Wage

2013,

Defendants

breach

of

Act,

contract,

promissory

enrichment/quantum meruit.

filed

violation

estoppel,

(ECF No. 32).

and

of

the

unjust

On February 13, 2013,

Plaintiffs moved to partially dismiss Defendants’ Counterclaim
with respect to the Maryland Wage Act (Count II), promissory
estoppel

(Count

(Count IV) claims.

III),

and

unjust

(ECF No. 35).

10

enrichment/quantum

meruit

On April 17, 2013, the Court

issued an Order granting Plaintiffs’ motion, thereby dismissing
Counts II-IV of the Amended Counterclaim.

(ECF No. 45).

Defendants now move the Court to grant summary judgment
with respect to the following claims: Allegis’s and Aerotek’s
claim that Messrs. Jordan, Curran, and Hadley breached their
employment

agreements

(Count

I

of

the

Amended

Complaint);

Aerotek’s claim that Mr. Ferrello breached his duty of loyalty
(Count V of the Amended Complaint); Aerotek’s and TEKsystems’s
claim that Mr. Ferrello misappropriated trade secrets (Count VI
of

the

Amended

Complaint);

and

TEKsystems’s

claim

that

Mr.

Hadley and Ms. Rodrigues misappropriated trade secrets (Count IV
of the Amended Complaint).

(ECF No. 74).

Plaintiffs move the

Court to grant summary judgment with respect to whether Messrs.
Jordan, Curran, Hadley, and Nicholas breached their IIP Award
Agreements (Count II of the Amended Complaint and Count I of the
Amended Counterclaim).

(ECF No. 75).
II. DISCUSSION

A.

Standard of Review
Summary judgment is only appropriate “if the movant shows

that there is no genuine dispute as to any material fact and the
movant

is

entitled

Fed.R.Civ.P. 56(a).
affect

the

outcome

to

judgment

as

a

matter

of

law.”

A “material fact” is a fact that might
of

a

party’s

case.

Anderson

v.

Liberty

Lobby, Inc., 477 U.S. 242, 248 (1986); JKC Holding Co. v. Wash.
11

Sports

Ventures,

Inc.,

264

F.3d

459,

465

(4th

Cir.

2001).

Whether a fact is considered to be “material” is determined by
the substantive law, and “[o]nly disputes over facts that might
affect the outcome of the suit under the governing law will
properly preclude the entry of summary judgment.”

Anderson, 477

U.S. at 248; Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th
Cir. 2001).

A “genuine” dispute concerning a material fact

arises when the evidence is sufficient to allow a reasonable
jury

to

return

a

verdict

Anderson, 477 U.S. at 248.

in

the

nonmoving

party’s

favor.

If the nonmoving party has failed to

make a sufficient showing on an essential element of her case
where she has the burden of proof, “there can be ‘no genuine
[dispute] as to any material fact,’ since a complete failure of
proof concerning an essential element of the nonmoving party's
case necessarily renders all other facts immaterial.”

Celotex

Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).
When

the

parties

have

filed

cross-motions

for

summary

judgment, the court must “review each motion separately on its
own merits to determine whether either of the parties deserves
judgment as a matter of law.” Rossignol v. Voorhaar, 316 F.3d
516,

523

(4th

Cir.

2003)

(quoting

Philip

Morris

Inc.

v.

Harshbarger, 122 F.3d 58,

62 n.4 (1st Cir. 1997)) (internal

quotation marks omitted).

Moreover, “[w]hen considering each

individual

motion,

the

court

must
12

take

care

to

resolve

all

factual disputes and any competing, rational inferences in the
light most favorable to the party opposing that motion.”

Id.

(quoting Wightman v. Springfield Terminal Ry. Co., 100 F.3d 228,
230 (1st Cir. 1996)) (internal quotation marks omitted).
B.

Analysis
The Court will deny Defendants’ Motion for Partial Summary

Judgment

with

respect

Messrs.

Jordan,

to

Curran,

Allegis’s

and

Hadley

and

Aerotek’s

breached

claim

their

that

employment

agreements (Count I of the Amended Complaint).

The Court will,

however,

the

grant

the

Motion

with

respect

to

following:

Aerotek’s claim that Mr. Ferrello breached his duty of loyalty
(Count V of the Amended Complaint); Aerotek’s and TEKsystems’s
claim that Mr. Ferrello misappropriated trade secrets (Count VI
of

the

Amended

Complaint);

and

TEKsystems’s

claim

that

Mr.

Hadley and Ms. Rodrigues misappropriated trade secrets (Count VI
of

the

Amended

Plaintiffs’

Complaint).

Cross-Motion

for

The
Partial

Court

will

Summary

also

Judgment

grant
with

respect to whether Messrs. Jordan, Curran, Hadley, and Nicholas
breached their IIP Award Agreements (Count II of the Amended
Complaint and Count I of the Amended Counterclaim).

13

1.

Breach of Employment Agreement by Messrs. Jordan,
Curran, and Hadley (Count I of the Amended Complaint)4

“To

prevail

in

an

action

for

breach

of

contract,

a

plaintiff must prove that the defendant owed the plaintiff a
contractual

obligation

obligation.”
(Md. 2001).
Mr.

and

that

the

defendant

breached

that

Taylor v. NationsBank, N.A., 776 A.2d 645, 651
Thus, if the restrictive covenants in Mr. Jordan’s,

Curran’s,

and

Mr.

Hadley’s

employment

agreements

are

unenforceable, and the Court cannot modify them to make them
enforceable,5 Plaintiffs’ claim would fail as a matter of law.
The Court concludes, however, after excising the employee nonsolicitation provision, the restrictive covenant in Mr. Jordan’s
employment agreement is enforceable.

Also, as the Court will

discuss in further detail below, because Defendants challenge
the non-competition provision of Mr. Curran’s and Mr. Hadley’s
employment agreements on grounds that are inconsistent with the
plain language of the provisions, the Court will not evaluate

4

It is undisputed that Messrs. Jordan, Curran, and Hadley’s
employment agreements all contain a choice of law clause
designating Maryland as the applicable law.
(See Mr. Jordan’s
Employment Agreement at 5; Defs.’ Mot. Partial Summ. J. Ex. 4,
at 9, 49, 59).
Therefore, the Court will apply Maryland law
when evaluating the restrictive covenants in these agreements.
5
“Maryland law does permit courts to ‘blue pencil,’ or
excise language from restrictive covenants that is unnecessarily
broad.”
Deutsche Post Global Mail, Ltd. v. Conrad, 292
F.Supp.2d 748, 754 (D.Md. 2003), aff’d on other grounds, 116
F.App'x 435 (4th Cir. 2004).
14

whether

those

provisions

are

enforceable.

Accordingly,

the

Court will deny Defendants’ Motion.
Under

Maryland

law,

whether

a

restrictive

covenant

is

enforceable depends upon the unique language of the covenant at
issue, Holloway v. Faw, Casson & Co., 572 A.2d 510, 515 (Md.
1990), and the specific facts of the case, Ruhl v. F.A. Bartlett
Tree Expert Co., 225 A.2d 288, 291 (Md. 1967).
restrictive

covenant

must

satisfy

the

Specifically, a
following

four

requirements in order to be enforceable: “(1) the employer must
have a legally protected interest, (2) the restrictive covenant
must

be

no

wider

in

scope

and

duration

than

is

reasonably

necessary to protect the employer's interest, (3) the covenant
cannot impose an undue hardship on the employee, and (4) the
covenant cannot violate public policy.”

Deutsche Post Global

Mail,

438

Ltd.

v.

Conrad,

116

F.App'x

435,

(4th

Cir.

2004)

(citing Silver v. Goldberger, 188 A.2d 155, 158 (Md. 1963)).
a.

Mr. Jordan

Defendants

challenge

the

non-competition,

solicitation, and employee non-solicitation
Jordan’s employment agreement.
J. at

9-11).

client

non-

provisions in Mr.

(See Defs.’ Mot. Partial Summ.

Specifically, they argue these provisions

are

wider in scope than is reasonably necessary to protect Aerotek’s
business.

(Id.).

Also,

they

argue

the

non-competition

provision imposes an undue hardship on Mr. Jordan and violates
15

public policy.

(Id. at 10).

The Court will address these

provisions in turn.
i.

Non-competition Provision
a.

Scope

The scope of the non-competition provision is not wider
than is reasonably necessary to protect Aerotek’s business or
goodwill.

Defendants

argue

the

provision’s

scope

is

unenforceable because it applies across the United States and
Canada

and

extends

to

any

aspect

of

“AEROTEK’s

Business.”

(Defs.’ Mot. Partial Summ. J. at 10).

The Court disagrees.

Because

on

Aerotek

competes

for

business

a

national

and

international level, the provision’s prohibition of competition
throughout the United States and Canada is reasonable.

Also,

the plain language of the provision only prevents Mr. Jordan
from competing with those aspects of “AEROTEK’s Business” for
which he performed worked during the two years preceding his
termination.
When a company competes for business on a national and
international level, “a restrictive covenant limited to a narrow
geographic

area

would

render

the

restriction

meaningless.”

Intelus Corp. v. Barton, 7 F.Supp.2d 635, 642 (D.Md. 1998).
Hekimian

Labs.,

Inc.

v.

Domain

Sys.,

Inc.,

664

F.Supp.

In
493

(S.D.Fla. 1987) and Intelus Corp. v. Barton, 7 F.Supp.2d 635
(D.Md. 1998), the district courts found the complete absence of
16

a geographic limitation in a non-competition provision to be
reasonably necessary for the protection of the employer where
the

employer

competed

international

for

level.

business

Aerotek

on

performs

“throughout the United States . . . .”
ECF No. 75-3).

a

national

staffing

and

services

(Hilger Aff. ¶¶ 2, 3,

When Jordan was employed at Aerotek he led

“national and global” sales efforts.

(See Pls.’ Opp’n Ex. 3

[“ZP Company Overview”], at 2, ECF Nos. 75-5, 76-1) (emphasis
added).

Thus,

the

provision’s

prohibition

of

competition

throughout the United States and Canada is not wider in scope
than is reasonably necessary to protect Aerotek’s business or
goodwill.
Moreover,

the

phrase

“in

which

EMPLOYEE

performed

work”

limits the provision’s scope to only those businesses that Mr.
Jordan supported.

Contrary to Defendants’ assertion, the plain

language of this provision does not prohibit Mr. Jordan from
competing with any aspect of “AEROTEK’s Business.”
“Construction of a contract is, in the first instance, a
question

of

Massengill,

law
661

for
A.2d

the
202,

court
208

to

resolve.”

Shapiro

(Md.Ct.Spec.App.

1995)

v.

(citing

Suburban Hosp. v. Dwiggins, 596 A.2d 1069, 1075 (Md. 1991)).
Maryland follows the objective law of contracts.

Gen. Motors

Acceptance Corp. v. Daniels, 492 A.2d 1306, 1310 (Md. 1985).
Consequently,

where

the

language
17

of

the

non-competition

provision is plain and unambiguous, the Court will presume the
parties meant what they expressed.

See id.

A written contract

is unambiguous if, when read by a reasonably prudent person, it
is not susceptible to more than one meaning.

See Calomiris v.

Woods, 727 A.2d 358, 363 (Md. 1999) (citing Heat & Power Corp.
v. Air Prods. & Chems., Inc., 578 A.2d 1202, 1208 (Md. 1990)).
The provision prohibits Mr. Jordan from competing with “any
aspect of AEROTEK's Business in which EMPLOYEE performed work
during the two (2) year period preceding his/her termination of
employment . . . .”
Mr.

Jordan’s

(Mr. Jordan’s Employment Agreement at 3).

employment

agreement

lists

a

number

of

“highly

competitive businesses” in which Aerotek, TEKsystems, and Mentor
4, Inc.

(“Mentor 4”)

“AEROTEK’s

Business.”

engage and defines these businesses as
(Id.

at

2).

Some

of

these

“highly

competitive businesses,” like providing staffing services for IT
positions, are businesses that Mr. Jordan did not support while
working for Aerotek.

Therefore, Defendants argument that the

provision is unenforceable because it prevents Mr. Jordan from
competing with any aspect of “AEROTEK’s Business” is without
merit.
b.
The

provision

Undue Hardship and Public Policy

does not

impose an undue hardship on Mr.

Jordan or violate public policy.

A non-competition provision

does not impose undue hardship when an employee is permitted to
18

undertake similar work.

Intelus, 7 F.Supp.2d at 642.

Here, the

provision permits Mr. Jordan to employ his skills and talents as
a salesman and corporate leader in a similar or related industry
as long as he does not compete with any aspect of “AEROTEK's
Business” that he supported during the two years preceding his
termination.
This Court has noted that “the public has an interest in
the enforcement of reasonable restrictive covenants.”
long

as

employers

do

not

restrict

employees

from

Id.

“As

earning

a

living and do not limit fair competition, they must be given the
opportunity

to

provide

a

service

to

their

customers

without

risking a substantial loss of business and good will every time
an employee decides to switch employment.”

Id.

This provision neither restricts Mr. Jordan’s ability to
earn

a

living

unambiguous

nor

language

limits
of

fair

the

competition.

provision

permits

The

plain

Mr.

Jordan

and
to

compete with any “AEROTEK[] Business” that he did not support
while employed with Aerotek.

It would be unfair to permit Mr.

Jordan to utilize his client contacts to compete with those
aspects of “AEROTEK’s Business” that he supported because the
success of a staffing company “depends overwhelmingly upon the
ability

of

its

employees

connections with clients.”

to

make

and

maintain

personal

TEKsystems, Inc. v. Bolton, No. RDB-

19

08-3099, 2010 WL 447782, at *6 (D.Md. Feb. 4, 2010).

Thus, the

provision only limits unfair competition.
ii.

Client Non-solicitation Provision

The client non-solicitation provision has two subsections.
Subsection (a) prohibits Mr. Jordan from soliciting clients for
the purposes of entering into a business relationship if that
business relationship would be competitive with any aspect of
“AEROTEK’s

Business”

for

which

Mr.

Jordan

during his final two years with Aerotek.
Employment Agreement at 3).

performed

worked

(See Mr. Jordan’s

Subsection (b) prohibits Mr. Jordan

from soliciting clients in attempt to reduce or eliminate the
business such clients conduct with Aerotek.

(Id. at 4).

subsections only apply to Aerotek’s customers.

(Id. at 3).

Both
The

Court concludes this provision is enforceable.
The

is

reasonably

necessary to protect Aerotek’s business or goodwill.

Defendants

contend
“prevents

provision’s

the

scope

provision’s

[Mr.

Jordan]

is

not

scope

from

is

having

wider

than

unenforceable
contact

with

because
any

it

Aerotek

clients . . . regardless of whether he worked with [them] during
his time at Aerotek.”

(Defs.’ Mot. Partial Summ. J. at 11)

(emphasis in the original).
First,

the

plain

The Court disagrees.

language

of

subsection

(a)

does

not

prohibit Mr. Jordan from soliciting all of Aerotek’s clients.
To the contrary, Mr. Jordan is only prohibited from soliciting
20

Aerotek’s clients with which a business relationship would be
competitive

any

aspect

of

during

supported

with

“AEROTEK's

his

final

two

years

Business”

with

that

Aerotek.

he

(Mr.

Jordan’s Employment Agreement at 3).
Furthermore,
when

it

is

a

narrowly

non-solicitation
tailored

to

provision

the

work

is

that

enforceable
an

employee

performed before termination.

Gill v. Computer Equip. Corp.,

292

see

A.2d

54,

59

(Md.

1972);

also

TEKsystems,

Inc.

v.

Lajiness, No. 12 C 10155, 2013 WL 3389062, at *3-*5 (N.D.Ill.
July 8, 2013) (applying Maryland law and finding a restrictive
covenant

was

prohibited

not

from

facially
engaging

overbroad
in

any

where

aspect

the
of

employee

the

was

employer’s

business for which the employee performed services during the
two years preceding termination).

In Gill, the Court of Appeals

of Maryland upheld a restrictive covenant prohibiting a former
employee from servicing all customers of the particular division
in which he worked.

See 292 A.2d at 59.

The court emphasized

the provision applied only to the “narrow area in which Gill was
employed.”

Id.

Here, subsection (a) is also tailored to the

narrow area in which Mr. Jordan was employed because it only
applies to business relationships that would be competitive with
the specific aspects of “AEROTEK’s Business” that he supported.
Therefore, subsection (a)’s scope is reasonable and enforceable.

21

Subsection (b) does not have the same narrowing language as
subsection (a).

It prohibits Mr. Jordan from soliciting any

Aerotek client that was a client during his final two years with
Aerotek.

(See Mr. Jordan’s Employment Agreement at 3).

applying

Maryland

restrictive

law

covenants

have
that

both

enforced

prohibit

a

and

down

employee

former

struck

from

soliciting all of the former employer’s clients.
Riggs-Warfield-Roloson,
(enforcing);

Conrad,

Inc.,
292

246

A.2d

F.Supp.2d

588,

at

756

Courts

See Tuttle v.

589

(Md.

(striking

Holloway, 552 A.2d at 1319-21 (striking down).

1968)
down);

In evaluating

whether subsection (b) is enforceable, the Court must consider
the unique facts and circumstances of this case.

See Ruhl, 225

A.2d at 291.
In

Holloway,

the

Court

of

Specials

Appeals

of

Maryland

struck down a provision prohibiting solicitation of all clients
because

it

was

“highly

unlikely”

the

former

employee

could

profit from his client relationships to solicit clients of other
offices with whom he had no contact.
however,

it

is

much

more

likely

552 A.2d at 1319.

that

Mr.

Jordan

could

Here,
take

advantage of his client relationships to solicit clients with
whom he did not work while at Aerotek.

Mr. Jordan won exclusive

contracts with large government prime contractors like Northrop
Grumman and Lockheed Martin.

(ZP Company Overview at 2).

Mr.

Jordan could use his relationships with key contacts at these
22

prime contractors to encourage their subcontractors to divert
their business from Aerotek.

As a result, subsection (b)’s

scope is reasonable and enforceable.
iii. Employee Non-solicitation Provision
Like the client non-solicitation provision, this provision
also has two subsections.
from

soliciting

Subsection (a) prohibits Mr. Jordan

current

employees

to

provide

services

competitive with Aerotek and subsection (b) prohibits Mr. Jordan
from soliciting current employees to resign from Aerotek.
Jordan’s Employment Agreement at 4).

(Mr.

This provision applies to

“the Aerotek” which the agreement defines as Aerotek and its
related companies, TEKsystems and Mentor 4.

(Id. at 3).

The

Court concludes this provision is unenforceable because it is
wider in scope than is reasonably necessary to protect Aerotek’s
interest.
In order to be enforceable, restrictive covenants must be
specifically
trading

on

employment.

targeted
the

at

goodwill

preventing
they

former

generated

employees

during

their

from
former

See Conrad, 116 F.App'x at 439; MCS Services, Inc.

v. Jones, No. WMN-10-1042, 2010 WL 3895380, at *3 (D.Md. Oct. 1,
2010).
infer

There is evidence from which a reasonable jury could
Mr.

Jordan

generated

goodwill

with

Aerotek

employees

because he supervised hundreds of Aerotek sales employees while
holding various executive positions.
23

(See Jordan Aff. ¶¶ 16,

17, 18, ECF No. 75-4).

There is no evidence, however, that Mr.

Jordan generated goodwill with TEKsystems or Mentor 4 employees.
Mr.

Jordan

did

not

work

for

TEKsystems

or

Mentor

4.

Furthermore, there is no evidence that he regularly interacted
with

TEKsystems

or

Mentor

4

employees

conferences, or other meetings.

at

training

sessions,

Therefore, by prohibiting Mr.

Jordan from soliciting TEKsystems and Mentor 4 employees, this
provision is not specifically targeted at preventing Mr. Jordan
from trading on his goodwill with other employees.

Accordingly,

the Court concludes this provision is unenforceable because its
scope is unnecessarily broad.
When

the

unnecessarily
offending

language
broad,

Maryland law.”

of

a

however,

contractual

rearrangement

of

any

language
language

restrictive

“‘blue

pencil’

without
is

covenant

is

excision

of

supplementation

or

entirely

in

accord

with

Fowler v. Printers II, Inc., 598 A.2d 794, 802

(Md.Ct.Spec.App. 1991); accord Conrad, 292 F.Supp.2d at 757-58
(“[B]lue penciling must be limited to the removal of offending
language and cannot include the addition of words or phrases in
an

effort

to

make

the

restrictive

covenant

reasonable.”).

Because the employee non-solicitation provision is overly broad,
the Court will use the blue pencil rule to excise that provision
from

the

rest

of

the

restrictive

employment agreement.
24

covenant

in

Mr.

Jordan’s

b.

Messrs. Curran and Hadley

In addition to challenging the non-competition

provision

and two non-solicitation provisions in Mr. Jordan’s employment
agreement,

Defendants

provisions

in

agreements.

Mr.

also

challenge

Curran’s

and

the

Mr.

non-competition

Hadley’s

employment

They do so, however, based on their interpretation

that the “Complaint implies that Aerotek may attempt to enforce
a nationwide non-competition agreement against Messrs. Curran
and Hadley.”
added).

(Defs.’ Mot. Partial Summ. J. at 11) (emphasis

Specifically, Defendants argue “[t]o the extent Aerotek

construes

the

agreements]

[non-competition

as

prohibiting

provision

Messrs.

in

Hadley

their
and

employment

Curran

from

working in the staffing industry anywhere in the United States,
such a provision is overly broad and not narrowly tailored to
protect any legitimate business interest.”

(Id.).

There are two issues with Defendants’ argument.
Plaintiffs

dispute

that

they

intend

to

enforce

First,

the

non-

competition provisions on a nationwide basis because that is
incongruent with the language of the provisions.
Opp’n at 36).

(See Pls.’

Second, the plain and unambiguous language of the

provisions demonstrates that they do not apply “anywhere in the
United

States.”

To

the

contrary,

25

they

only

apply

within

a

radius of 100 miles6 from any office at which Messrs. Curran and
Hadley

worked

during

their

final

two

years

with

(Defs.’ Mot. Partial Summ. J. Ex. 4, at 4, 55).

Aerotek.

Therefore, the

Court will not address whether these provisions are enforceable.
Based on the foregoing analysis, the Court concludes that
after

excising

restrictive

the

covenant

employee
in

Mr.

non-solicitation
Jordan’s

enforceable as a matter of law.
deny

Defendant’s

Motion

for

provision,

employment

the

agreement

is

Accordingly, the Court will

Partial

Summary

Judgment

with

respect to Count I of the Amended Complaint.
2.

Breach of IIP Award Agreements by Messrs. Jordan,
Curran, Hadley, and Nicholas (Count II of the Amended
Complaint and Count I of the Amended Counterclaim)7

The Court concludes Sections 9(3) and 9(5) of the IIP are
enforceable as a matter of law because their scope is no wider
than is reasonably necessary to protect the goodwill of Allegis
and its subsidiaries.

There is no genuine dispute that before

his IIP obligations expired, Mr. Jordan solicited Mr. Hadley to
resign from Aerotek.

Also, there is no genuine dispute that

6

If Defendants had challenged the geographic scope of 100
miles, the Court would conclude it is reasonable and enforceable
based on the same reasoning the Court outlined above with
respect to the geographic scope of the non-competition provision
in Mr. Jordan’s employment agreement.
7
It is undisputed that the IIP contains a choice of law
clause designating Maryland as the applicable law. (See IIP at
11).
Therefore, the Court will apply Maryland law when
evaluating whether Messrs. Jordan, Curran, Hadley, and Nicholas
breached their IIP Award Agreements.
26

before their IIP obligations expired, Messrs. Curran, Hadley,
and

Nicholas

TEKsystems.
Curran,

staffed

IT

positions

in

competition

with

Accordingly, the Court concludes Messrs. Jordan,

Hadley,

and

Nicholas

breached

their

IIP

Award

Agreements, and the Court will grant Plaintiffs’ Cross-Motion
for Partial Summary Judgment.
Plaintiffs argue Mr. Jordan breached IIP Sections 9(3) and
9(5), (Pls.’ Opp’n at 14-18), and Messrs. Curran, Hadley, and
Nicholas

breached

Section

9(5),

(id.

at

18-21).

Defendants

argue Sections 9(3) and 9(5) are unenforceable because they do
not

protect

legitimate

business

unreasonably broad in scope.

interests

and

they

are

(See Defs.’ Opp’n Pls.’ Cross-Mot.

Partial Summ. J. & Reply Pls.’ Opp’n Defs.’ Mot. Partial Summ.
J. [“Defs.’ Opp’n”] at 11-14, ECF No. 77).
Defendants further argue even if the Court finds section
9(3) is enforceable, there is a genuine dispute as to whether
Mr.

Jordan,

Messrs.

before

Curran

and

his

IIP

Hadley

obligations

to

leave

expired,

Aerotek.

(Id.

solicited
at

14).

Defendants contend the evidence demonstrates nothing more than
“a handful of 30,000-foot conversations between close personal
friends, which occurred right at the expiration of the 30-month
non-solicitation period.”
dispute

that

before

their

(Id.).
IIP

Defendants do not, however,
obligations

expired,

Messrs.

Curran, Hadley, and Nicholas staffed IT positions in competition
27

with TEKsystems.
No.

30)

(See Defs.’ Answer Pls.’ Am. Compl. ¶ 60, ECF

(“Defendants

admit

that

Messrs.

Curran,

Nicholas,

Ferrello and Hadley and Ms. Rodrigues have worked on positions
that

are,

to

the

best

of

their

knowledge,

positions

that

TEKsystems would staff.”).
Because

Defendants

attack

the

enforceability

of

Section

9(3) and 9(5) on the same grounds, after discussing the standard
for evaluating these provisions, the Court will evaluate them
together.
a.

Standard for Evaluating Sections 9(3) and 9(5)

Defendants argue the Court should evaluate Sections 9(3)
and

9(5)

covenants

using
in

the

reasonableness

employment

standard

agreements.

for

(Defs.’

restrictive

Opp’n

at

9).

Plaintiffs disagree8 and argue all the cases Defendants cite to
support their argument are inapposite because they deal with
liquidated

damages

clauses,

plans.

(Id. at 6).

typical

employment

forfeiture

clauses,

and

pension

Plaintiffs also argue the IIP is not a

contract

because

“this

Court

has

already

found compliance with the provisions of section 9 is a condition
prerequisite to entitlement to the IIP payments.”

8

(Id. at 5);

Plaintiffs do not, however, proffer an alternative
standard.
Instead, they argue “the IIP is reasonable even if
interpreted as an employment-context restrictive covenant.”
(Pls.’ Reply Supp. Cross-Mot. Partial Summ. J. [“Pls.’ Reply”]
at 10, ECF No. 81).
28

see Allegis Grp., Inc. v. Jordan, GLR-12-2535, 2013 WL 1701125,
at *14 (D.Md. Apr. 17, 2013).
While

only

persuasive

authority,

Capital

One

Financial

Corp. v. Kanas, 871 F.Supp.2d 520 (E.D.Va. 2012), is instructive
in determining what standard to apply in this case.
One,

the

U.S.

District

Court

for

the

Eastern

In Capital
District

of

Virginia concluded it was more appropriate to apply a stricter
employer/employee standard9 than a more liberal sale-of-business
standard

when

evaluating

the

enforceability

covenants in a separation agreement.
conclusion

because

termination

of

the

agreements

employment

and

their

of

restrictive

The court reached this
became
plain

effective

language

upon

indicated

they were attributable to the employer/employee relationship.
See Capital One, 871 F.Supp.2d at 529.
Here,

the

IIP

shares

several

separation agreements in Capital One.
to

an

IIP

participant’s

account

9

characteristics

with

the

While Units are allocated

during

the

course

of

her

The employer/employee standard under Virginia law is
nearly identical to the employment-contract standard under
Maryland law. Under Virginia law, a restrictive covenant in an
employment contract is reasonable if it is: “(1) narrowly drawn
to protect the employer's legitimate business interest, (2) not
unduly burdensome on the employee's ability to earn a
livelihood, and (3) consistent with public policy.”
Capital
One, 871 F.Supp.2d at 530 (citing Modern Env’ts, Inc. v.
Stinnett, 561 S.E.2d 694, 695 (Va. 2002)).
The analysis of
these factors “requires consideration of the restriction in
terms of function, geographic scope, and duration.”
Id.
(quoting Simmons v. Miller, 544 S.E.2d 666, 677 (Va. 2001))
(internal quotation marks omitted).
29

employment, the participant does not become entitled to receive
payments

for

those

from Service.”

units

until

(IIP at 6, 7).

the

participant’s

“Separation

Furthermore, the plain language

of the IIP indicates it is attributable to the employer/employee
relationship between Allegis and the participant.

The terms

“Employee”

the

and

“Companies”

are

used

throughout

IIP.

Therefore, the Court concludes it is appropriate to apply the
standard for employment contracts: “(1) [T]he employer must have
a legally protected interest, (2) the restrictive covenant must
be no wider in scope and duration than is reasonably necessary
to

protect

the

employer's

interest,

(3)

the

covenant

cannot

impose an undue hardship on the employee, and (4) the covenant
cannot

violate

public

policy.”

Conrad,

116

F.App'x

at

438

(citing Silver v. Goldberger, 188 A.2d 155, 158 (Md. 1963)).
b.

Enforceability of Sections 9(3) and 9(5)
i.

Legally Protected Interest
other Allegis Subsidiaries

of

Aerotek

and

Aerotek has a legally protected interest in preventing the
activities proscribed by Sections 9(3) and 9(5) of the IIP.

As

Messrs. Jordan, Curran, Hadley, and Nicholas ascended through
the

ranks

activities,

at

Aerotek,

which

gave

they
them

relationships with clients.

engaged
an

in

and

opportunity

supervised
to

form

sales
strong

See Intelus, 7 F.Supp.2d at 639

(“[E]mployers have a [sic] interest in preventing an employee

30

from using his contacts with clients to recruit those clients
after his employment has ended.”); see also Conrad, 116 F.App'x
at

438

(“[R]estrictive

legitimate
salespersons

employer
.

.

.

covenants

interest
.”

almost

when

(citing

always

they

Silver,

serve

restrict

188

A.2d

a

former

at

158)).

Furthermore, Messrs. Jordan, Curran, Hadley, and Nicholas all
held

executive-level

positions

before

leaving

Aerotek.

Consequently, to the extent these positions required supervising
and promoting other Aerotek employees, Messrs. Jordan, Curran,
Hadley and Nicholas could have significant influence over those
employees.
Aerotek

Even

employees,

if

they

their

did

former

not

directly

positions

of

supervise

other

authority

could

nonetheless permit them to exert influence over their former
colleagues, particularly those who held more junior positions.
Allegis and its subsidiaries other than Aerotek also have a
legally protected interest in the restrictions that Section 9(3)
and 9(5) impose.
Nicholas

only

Although Messrs. Jordan, Curran, Hadley and

worked

for

Aerotek,

all

Allegis

contribute to the value of IIP payments.
payments

is

determined,

in

part,

by

the

subsidiaries

The value of IIP
value

of

Allegis’s

common stock, (see IIP at 5), and the financial performance of
all

Allegis

subsidiaries

affects

the

value

of

that

stock.

Moreover, as the Court will discuss in greater detail below, the

31

purpose of the IIP is to promote the long term economic growth
of Allegis and all its subsidiaries.
Allowing Messrs. Jordan, Curran, Hadley, and Nicholas to
solicit and divert employees, clients, and business from Aerotek
and its subsidiaries would violate the purpose of the IIP and
harm

the

very

companies

that

contribute

to

IIP

payments.

Therefore, Allegis and its subsidiaries have a legally protected
interest in preventing these activities.
ii.

Scope

Sections 9(3) and 9(5) are not wider, as to scope, than is
reasonably

necessary

to

protect

the

Allegis and its subsidiaries.
these

provisions

is

business

or

goodwill

of

Defendants argue the scope of

unreasonably

broad

because

they

protect

Allegis subsidiaries for which a former employee did not work.
Specifically, Defendants contend that because Messrs. Jordan,
Curran, Hadley, and Nicholas never worked for TEKsystems, it is
unreasonable to prohibit them from soliciting clients, business,
or employees in competition with TEKsystems.
at 12-14).

(See Defs.’ Opp’n

The Court disagrees.

In order to be enforceable, restrictive covenants must be
specifically
trading

on

employment.

targeted
the

at

goodwill

preventing
they

former

generated

employees

during

their

from
former

See Conrad, 116 F.App'x at 439; Jones, 2010 WL

3895380, at *3.

By protecting all Allegis subsidiaries, Section
32

9(5)

is

Curran,

specifically
Hadley,

competition
trading

with

on

and

targeted
Nicholas

Allegis

their

at

preventing

from

subsidiaries

goodwill

with

Messrs.

staffing
other

the

positions

than

large

Jordan,
in

Aerotek

customers

by

they

supported while working for Aerotek.
Messrs.
government

Jordan,

agencies

Curran,
like

the

and

Hadley

Department

worked
of

with

Energy,

large

the

Army

Corps of Engineers, and the Department of the Navy, as well as
large

government

prime

contractors

Northrop Grumman, SAIC, and Raytheon.

like

Lockheed

Martin,

(ZP Company Overview at

2; Curran Aff. ¶ 7, ECF No. 75-23; Hadley Aff. ¶ 10, ECF No. 7524).

Mr. Nicholas worked with large commercial companies in the

private sector.

(Nicholas Aff. ¶ 8, ECF No. 75-33).

These

large customers have a wide diversity of staffing requirements
across many departments.

Consequently, two staffing companies

that specialize in filling positions in different skill areas
could have the same clients.

In fact, Andy Hilger, a Vice

President in Allegis’s Office of Strategic Management, admits
that although they are “separate business entities, Aerotek and
TEKsystems share numerous clients.”
After

resigning

from

one

of

(Hilger Aff. ¶ 5).
Allegis’s

subsidiaries,

a

former employee could exploit her goodwill with a large customer
to staff positions with that same customer in competition with
one of the Allegis subsidiaries for which the employee did not
33

work.

For example, an Aerotek recruiter could staff a hardware

engineering

position

at

Northrop

Grumman

and

then,

after

resigning from Aerotek, use the employee’s contacts at Northrop
Grumman

to

staff

an

IT-support

position

in

competition

with

TEKsystems.
Mr. Jordan’s activities at ZP demonstrate the potential to
exploit

goodwill

with

the

same

customer

to

targeted by different Allegis subsidiaries.

staff

positions

For example, while

working for Aerotek, Mr. Jordan won an exclusive contract with
Lockheed Martin.

(ZP Company Overview at 2).

Lockheed Martin

was one of ZP’s first customers and Mr. Jordan, while working
for ZP, staffed an IT position with Lockheed Martin for “T4
Graphics Support.”

(Pls.’ Opp’n Ex. 20, at 1-2, 4-6, 8, 11, 13,

15, ECF Nos. 75-22, 76-3).
Because Messrs. Jordan, Curran, Hadley, and Nicholas all
have

the

potential

to

trade

on

their

goodwill

with

large

customers to take business away from not only Aerotek, but also
other Allegis subsidiaries, Section 9(5)’s scope is not wider
than is reasonably necessary to protect the business or goodwill
of Allegis and its subsidiaries.
There is no evidence that Messrs. Jordan, Curran, Hadley,
and Nicholas generated goodwill with employees of other Allegis
subsidiaries.
employees

of

Therefore, by prohibiting them from soliciting
any

Allegis

subsidiary,
34

Section

9(3)

is

not

specifically targeted at preventing them from trading on their
goodwill.

Nevertheless,

Section

9(3)’s

scope

is

reasonable

because the purpose of the IIP is to promote the long term
economic growth of Allegis and its subsidiaries.
Aerotek and TEKsystems laterally promote and transfer their
executives.

(Hilger Aff. ¶ 6).

TEKsystems

salesperson

Operations

(“DBO”)

Aerotek

DBO,

and

for
a

Services
(Id.).

These
at

Aerotek,

to

could

subsidiary

to

a

Director

TEKsystems

Vice

Aerotek

executives
the

promoted

TEKsystems

transferred

employees

was

For example, in recent years, a

to

leverage

from

DBO

President
perform

which

of

of

the

their
they

Business

became

Government
same

role.

rapport

with

transferred

recruit those employees after leaving Allegis.

an

to

Messrs. Jordan,

Curran, Hadley, and Nicholas, however, never worked for another
Allegis subsidiary.

Furthermore, while Aerotek and TEKsystems

conduct joint training, (see id.), there is no evidence that
Messrs. Jordan, Curran, Hadley, and Nicholas had any substantial
interaction with employees of TEKsystems or any other Allegis
subsidiary.

Consequently,

because

Messrs.

Jordan,

Curran,

Hadley, and Nicholas never generated goodwill with employees of
other

subsidiaries,

Section

9(3)

is

by

not

protecting
targeted

at

all

preventing

employees from trading on their goodwill.

35

Allegis

subsidiaries,
these

former

Although
preventing

Section

Messrs.

9(3)

Jordan,

is

not

Curran,

specifically
Hadley,

and

targeted
Nicholas

at
from

trading on their goodwill, permitting them to solicit current
employees of Allegis and its subsidiaries would be completely
inconsistent with the purpose of the IIP.

The purpose of the

IIP is to provide IIP participants “an incentive to promote the
best interests of the Companies, and in particular, an incentive
to promote the long term economic growth of the Companies.”
(IIP at 2).
its

The IIP defines “Companies” as Allegis and any of

subsidiaries.

(Id.).

Allowing

Messrs.

Jordan,

Curran,

Hadley, and Nicholas to solicit top-performing current employees
of Allegis and its subsidiaries would undermine the long term
economic

growth

of

these

companies.

Consequently,

because

Section 9(3) must protect Allegis and all its subsidiaries in
order to fulfill the purpose of the IIP, Section 9(3)’s scope is
not wider than is reasonably necessary to protect the business
or goodwill of Allegis and its subsidiaries.
c.

Breach of Sections 9(3) and 9(5)

There is no genuine dispute that before his IIP obligations
expired, Mr. Jordan solicited Mr. Hadley to resign from Aerotek.
Likewise, there is no genuine dispute that before their IIP
obligations
staffed

IT

expired,

Messrs.

positions

in

Curran,

Hadley,

competition

with

and

Nicholas

TEKsystems.

Accordingly, the Court concludes Messrs. Jordan, Curran, Hadley,
36

and Nicholas breached their IIP Award Agreements by violating
Section 9 of the IIP.
i.

Mr. Jordan

There is no genuine dispute that before his IIP obligations
expired

on

August

21,

2011,

proposal to work for him.

Mr.

Jordan

sent

Mr.

Hadley

a

Therefore, the Court concludes Mr.

Jordan breached his IIP Award Agreement by violating Section
9(3) of the IIP.
On August 19, 2011, Mr. Hadley sent Mr. Curran an email
where

he

referred

to

“initial comp idea.”
Mr.

Hadley

admits

“Justin,”

“company,”

“ownership,”

and

(Pls.’ Opp’n Ex. 28, at 2, ECF No. 75-30).

that

by

“Justin”

he

was

referring

to

Mr.

Justin Jordan; by “company,” he was referring to Mr. Jordan’s
company; by “ownership,” he was referring to ownership in Mr.
Jordan’s company; and by “initial comp idea,” he was referring
to a “proposal or plan or idea of potential compensation related
to working for [Mr.] Jordan.”

(Id. Ex. 27 at 9, ECF No. 75-29).

Likewise,

to

in

his

Answers

Plaintiffs’

Second

Set

of

Interrogatories, Mr. Hadley states that “to the best of his
recollection, the ‘initial comp idea’ references Mr. Jordan’s
compensation proposal to [him].”

(Id. Ex. 29, at 12, ECF No.

75-31).
Mr. Jordan admits that he first contacted Messrs. Curran
and Hadley, for the purposes of employment with ZP or PES, in
37

the summer of 2011.

(Id. Ex. 25, at 8, ECF No. 75-27).

Because

“summer 2011” could correspond to a date after August 21, the
inference most favorable to Defendants is that Mr. Jordan did
not contact Messrs. Curran and Hadley before August 21, 2011.
Mr. Jordan further admits that he “had general conversations
with [Mr.] Curran about potentially working together prior to
August 20, 2011.”
could

have

inference

(Id. at 9).

occurred
most

before

favorable

Because these conversations

Mr.
to

Jordan

left

Defendants

Aerotek,

is

that

the
these

conversations did not occur after Mr. Jordan left Aerotek and
was subject to Section 9 of the IIP.
Mr.

Jordan

employment

does

proposal

to

not,
Mr.

however,
Hadley

deny

that

before

he

August

sent
21,

an

2011.

Moreover, Defendants present no evidence to dispute Mr. Hadley’s
admission that Mr. Jordan sent him an employment proposal before
August 21, 2011.

Therefore, there is no genuine dispute that

before his IIP obligations expired, Mr. Jordan solicited Mr.
Hadley to leave the employ of Aerotek.
ii.
Before

their

Messrs. Curran, Hadley, and Nicholas
IIP

obligations

expired,

Messrs.

Curran,

Hadley, and Nicholas all took business away from TEKsystems.
Therefore, as a matter of law, the Court concludes they breached
their IIP Award Agreements by violating Section 9(5) of the IIP.

38

In

his

affidavit,

TEKsystems

Regional

Vice

President,

Richard Waag, testifies that Lockheed Martin was a TEKsystems
client

prior

TEKsystems

to

2011

clients

and

the
to

prior

following
2012:

businesses

Atlantic

were

Business

Technologies; Peak 10; Fresenius; SciMed, Inc.; Freudenberg IT;
Iron Data; Verisk Health Partners; XS, Inc.; Burt’s Bees; INC
Research;

Rail,

Inc.;

Red

Hat;

RegEd;

SAS

Institute,

Century Link; Citrix; and Salix Pharmaceuticals.
5, 7, ECF No. 75-18).

Inc.;

(Waag Aff. ¶¶

Mr. Waag further testifies that because

TEKsystems does not have exclusivity agreements with most of its
clients, multiple staffing companies satisfy the needs of these
clients. (Id. ¶ 8).
able

to

satisfy

Therefore, to the extent a competitor is

an

IT

staffing

requirement

for

one

of

TEKsystems’s clients, that competitor takes business away from
TEKsystems.

(Id.).

Defendants present no evidence to dispute

these facts.
Mr. Curran admits that before his IIP obligations expired,
he provided IT staffing services to TEKsystems client Lockheed
Martin.

(Pls.’

Nicholas

admits

provided

IT

Opp’n
that

staffing

Ex.

before

63,

at

his

services

to

4,

IIP

ECF

No.

obligations

TEKsystems

75-65).
expired,

clients

he

Lockheed

Martin, Century Link, Citrix, and Salix Pharmaceuticals.
Ex. 37, at 4, ECF No. 75-39).

Mr.

(Id.

Mr. Hadley admits that before his

IIP obligations expired, he provided IT staffing services to
39

TEKsystems clients Peak 10, Atlantic Business Technologies, and
Sci

Med

Solutions.

(Id.

Ex.

29,

at

5,

ECF

No.

75-31).

Defendants present no evidence to dispute these admissions.
Additionally, Plaintiffs produce a series of emails between
Mr. Hadley, Mr. Jordan, and a prospective PES client.

In an

email to the prospective client, Mr. Hadley “strongly advise[d]
[them]

against

signing

an

exclusivity

agreement

Tek[systems] or any company for that matter.”
1, ECF No. 75-41).

with

(Id. Ex. 39, at

Mr. Hadley then forwarded this email to Mr.

Jordan and stated: “Tek[systems] has placed 6 people in the last
6 months. They have the lock down on this place . . . until
NOW.”

(Id.).

Mr. Jordan then responded: “I love it. Lets (sic)

take them DOWN!”
attempt

to

(Id.).

solicit

and

This is an example of an aggressive
divert

business

from

TEKsystems.10

Defendants present no evidence to dispute that Mr. Hadley sent
these emails.
Based

on

the

foregoing

analysis,

the

Court

concludes

Sections 9(3) and 9(5) of the IIP are enforceable as a matter of
law.

The

Hadley,

and

Court

further

Nicholas

concludes

breached

their

violating Section 9 of the IIP.

10

Messrs.
IIP

Jordan,

Award

Curran,

Agreements

by

Accordingly, the Court will

Plaintiffs present evidence that Mr. Jordan even planned
to reimburse Mr. Hadley for his loss of IIP payments. (See id.
Ex. 40, at 1, ECF No. 75-42).
40

grant

Plaintiffs’

Motion

for

Partial

Summary

Judgment

with

respect to Count II of the Amended Complaint and Count I of the
Amended Counterclaim.
3.

Breach of Duty of Loyalty by Mr. Ferrello (Count V of
the Amended Complaint)

The Court will grant Defendants’ Motion with respect to
Plaintiffs’ claim that Mr. Ferrello breached his duty of loyalty
to

Aerotek

because

Plaintiffs

proffer

no

evidence

that

Mr.

Ferrello engaged in any conduct that would defeat the privilege
to prepare or make arrangements to compete with Aerotek.
Plaintiffs

contend

Mr.

Ferrello

breached

his

duty

of

loyalty to Aerotek because he failed to disclose Mr. Jordan’s
plan

to

hire-away

(Pls.’ Opp’n at 26).

Aerotek’s

top-performing

account

managers

Defendants argue failing to disclose plans

for competition without perpetrating misconduct inimical to the
employer does not constitute a breach of the duty of loyalty.
(Defs.’ Mot. Partial Summ. J. at 15).

The Court agrees with

Defendants.
The duty of loyalty is an implied duty that is “read into
every contract of employment,” and requires that an “employee
act solely for the benefit of his employer in all matters within
the scope of employment, avoiding all conflicts between his duty
to the employer and his own self-interest.”

Md. Metals, Inc. v.

Metzner, 382 A.2d 564, 568 (Md. 1978) (citing C-E-I-R, Inc. v.

41

Computer Dynamics Corp., 183 A.2d 374, 379 (Md. 1962)).
determining
loyalty,

whether

an

court

must

a

employee

has

thoroughly

circumstances of the case.

breached
examine

the

the

When

duty

of

facts

and

See Weichert Co. of Md. v. Faust, 19

A.3d 393, 401 (Md. 2011) (citing Md. Metals, 382 A.2d at 570).
The Court of Appeals of Maryland recognizes a “privilege in
favor

of

employees

which

enables

them

to

prepare

or

make

arrangements to compete with their employers prior to leaving
the employ of their prospective rivals without fear of incurring
liability for breach of their fiduciary duty of loyalty.”

Md.

Metals, 382 A.2d at 569 (citing Operations Research, Inc. v.
Davidson & Talbird, Inc., 217 A.2d 375, 388 (Md. 1966)).
privilege

is,

however,

not

absolute.

Id.

Exercise

This

of

the

privilege will constitute a breach of the duty of loyalty where
an employee commits a fraudulent, unfair, or wrongful act in the
course

of

preparing

misconduct

which

misappropriation

of

to

compete.

will
trade

Id.

defeat

Specific

the

secrets,

examples

privilege

misuse

of

of

include

confidential

information, solicitation of an employer's customers prior to
cessation

of

employment,

conspiracy

to

bring

about

mass

resignation of an employer's key employees, and usurpation of an
employer's business opportunity.

Id. at 569-70.

Furthermore,

while an employee must be candid to his employer about his plans
for competition, an employee “is not bound to reveal the precise
42

nature

of

his

plans

to

the

employer

unless

he

has

acted

inimically to the employer's interest beyond the mere failure to
disclose.”

Id. at 569 (emphasis added) (citing Cudahy Co. v.

Am. Labs., Inc., 313 F.Supp. 1339, 1346 (D.Neb. 1970)).
Plaintiffs proffer no evidence that Mr. Ferrello engaged in
any conduct that would defeat the privilege to prepare or make
arrangements to compete with Aerotek.

As the Court will discuss

below,

up

while

Mr.

Ferrello

did

set

an

email

address

to

exchange documents with Mr. Jordan, (see Pls.’ Opp’n Ex. 45, ECF
No. 75-47), there is no evidence from which a reasonable jury
could

conclude

possession
proffer

the

contain

no

documents

trade

evidence

that

in

secrets.
Mr.

Defendants’

collective

Furthermore,

Plaintiffs

Ferrello

solicited

Aerotek’s

customers prior to his resignation, conspired to bring about
mass resignation of Aerotek’s key employees, or usurped any of
Aerotek’s

business

opportunities.

Mr.

Ferrello’s

deposition

does demonstrate that he knew Mr. Jordan planned to hire-away
Aerotek employees for his new companies.
68:12-21, Oct. 17, 2013, ECF No. 75-46).

(See Ferrello Dep.
Plaintiffs cite this

testimony and argue Mr. Ferrello breached his duty of loyalty
when he “remain[ed] silent” and “failed to report” Mr. Jordan’s
plan.

There is no evidence, however, that Mr. Ferrello engaged

in any inimical activity beyond this nondisclosure.

43

Accordingly,

the

Court

will

grant,

as

to

Mr.

Ferrello,

Defendant’s Motion for Partial Summary Judgment with respect to
Count V of the Amended Complaint.
4.

Misappropriation of Trade Secrets by Messrs. Ferrello
and Hadley and Ms. Rodrigues (Count VI of the Amended
Complaint)

The Court will grant Defendants’ Motion with respect to
Aerotek’s

and

TEKsystems’s

claim

that

Mr.

Ferrello

misappropriated trade secrets and TEKsystems’s claim that Mr.
Hadley

and

Ms.

Rodrigues

misappropriated

trade

secrets.

Plaintiffs do not proffer evidence from which a reasonable jury
could infer the documents Defendants allegedly misappropriated
are trade secrets.
Under Maryland law, claims for misappropriation of trade
secrets are governed by the Maryland Uniform Trade Secrets Act
(“MUTSA”), Md. Code Ann., Com. Law §§ 11-1201 et seq. (West
2014).

The MUTSA defines a trade secret as follows:
(e)
“Trade
secret”
means
information,
including a formula, pattern, compilation,
program,
device,
method,
technique,
or
process, that:
(1) Derives independent economic value,
actual or potential, from not being
generally known to, and not being
readily ascertainable by proper means
by,
other
persons
who
can
obtain
economic value from its disclosure or
use; and
(2) Is the subject of efforts that are
reasonable under the circumstances to
maintain its secrecy.
44

Id. § 11-1201 (e)(1)-(2).

The MUTSA specifies two actions that

constitute misappropriation: (1) acquisition of a trade secret
by improper means or (2) disclosure of a trade secret without
express or implied consent.

See id. § 11–1201(c)(1)-(2).

Plaintiffs allege Defendants misappropriated five specific
documents: (1) a TEKsystems CATS 2 Price Sheet; (2) a Federal
Supply Service Price List; (3) a Software Market Definitions
Memorandum; (4) an Allegis Group Internal Employee Handbook; and
(5) a TEKsystems Staffing Services Agreement.

Defendants do not

dispute their collective possession of these documents.
argue,

however,

evidence

to

Plaintiffs

raise

a

have

genuine

not

dispute

proffered
as

to

Opp’n at 20-21).
Whether

the

829

decision).

F.2d

these

(See Defs.’

The Court agrees.11
five

documents

secrets is a question of fact.
GmbH,

sufficient

whether

documents constitute trade secrets under the MUTSA.

They

1119

(4th

at

issue

qualify

as

trade

GTCO Corp. v. Kontron Elektronik
Cir.

1987)

(unpublished

table

Plaintiffs, however, bear the “burden of producing

some evidence that [the five documents] me[e]t the definition of
a trade secret.”

Trandes Corp. v. Guy F. Atkinson Co., 996 F.2d

11

Because the Court concludes there is no genuine dispute
as to whether these documents constitute trade secrets, the
Court will not address misappropriation.
45

655, 661 (4th Cir. 1993) (emphasis in the original).

Plaintiffs

have not met this burden.
a.
Pricing

CATS 2 Price
Price List
information

Sheet

is

and

Federal

protectable

as

Supply

Service

trade

secret.

a

Optic Graphics, Inc. v. Agee, 591 A.2d 578, 586 (Md.Ct.Spec.App.
1991).

Information, however, cannot qualify as a trade secret

when it is published on the Internet.

See Hoechst Diafoil Co.

v. Nan Ya Plastics Corp., 174 F.3d 411, 419 (4th Cir. 1999)
(concluding the district court in Religious Tech. Ctr. v. Lerma,
908

F.Supp.

1362

(E.D.Va.

1995),

correctly

found

that

information which had been published on the Internet lost its
trade secret status).

Both of these pricing documents have been

published on the Internet.

Compare

Price

Dep’t

Sheet,

Md.

TEKsystems, Inc.
of

CATS 2

Info.

Tech.

http://doit.maryland.gov/contracts/Documents/catsII
_laborrates/TEKsystemsInc.pdf (last visited Apr. 9, 2014), with
(Pls.’ Opp’n Ex. 51, ECF No. 75-53); compare Training Courses
for

Information

Technology

Equipment

and

Software,

Docstoc,

http://www.docstoc.com/docs/27502511/SIN-132-50---TRAININGCOURSES-FOR-INFORMATION-TECHNOLOGY-EQUIPMENT-AND

(last

Apr. 9, 2014), with (Pls.’ Opp’n Ex. 56, ECF No. 75-58).

visited
Thus,

the CATS 2 Price Sheet and the Federal Supply Service Price List
cannot qualify as trade secrets.

46

b.

Software Market Definitions Memorandum

Plaintiffs proffer no evidence that the information in the
Software Market Definitions Memorandum (“SMDM”) is not generally
known or would be valuable to competitors.
protectable as trade secrets.

Marketing plans are

Optic Graphics, 591 A.2d at 586.

Marketing plans cannot qualify as trade secrets, however, when
they

are

based

marketplace.”

on

information

“readily

available

from

the

Motor City Bagels, L.L.C. v. Am. Bagel Co., 50

F.Supp.2d 460, 478-79 (D.Md. 1999); see Optic Graphics, 591 A.2d
at 587 (affirming

the

lower court’s

ruling that

a

marketing

strategy was not a trade secret because the information “was
readily available from the marketplace” and the defendants could
obtain the same information simply by talking with prospective
clients).

Also, in order to qualify as a trade secret, this

document must be valuable to competitors.
v.

Omdahl, 179 F.Supp.2d 600,

610

Padco Advisors, Inc.

(D.Md. 2002)

(citing

Home

Paramount Pest Control Cos. V. FMC Corp./Agr. Prods. Grp., 107
F.Supp.2d 684, 693 (D.Md. 2000)).

The SMDM is not.

First, Defendants offer an unrebutted affidavit from Mr.
Jordan

where

Software

he

Market

opines

that

Definitions

the

information

Memorandum

is

in

Plaintiffs’

“readily

available

from the marketplace” because it could be “engineered through
Google searches on the two companies and the type of placements
that they make.”

(Jordan Aff. ¶ 27, ECF No. 75-32).
47

Plaintiffs

argue Mr. Jordan’s statement is not credible because it is selfserving.

(See Pls.’ Opp’n at 44).

“The function of the judge

at the summary judgment stage[, however,] is not to . . . weigh
credibility but to determine whether there is any genuine issue
of fact that can only properly be resolved by a finder of fact .
. . .”

JKC Holding Co., 264 F.3d at 465 (citing Anderson, 477

U.S. at 250).

Plaintiffs proffer no evidence to raise a genuine

dispute as to whether the information in this document is not
generally known or readily available from the marketplace.
Furthermore, while Plaintiffs argue the information in this
document would be valuable to competitors, (see Pls.’ Opp’n at
28), they proffer no evidence to support this claim.
claim is merely speculative.
no

reasonable

jury

could

Thus, the

As a result, as a matter of law,
conclude

the

Software

Market

Definitions Memorandum is a trade secret.
c.

TEKsystems
Staffing
Services
Agreement
Allegis Group Internal Employee Handbook

and

Finally, Plaintiffs offer no evidence that the information
in the agreement and the handbook is not generally known or
would be valuable to competitors.

Thus, there is no evidence

from which a reasonable jury could conclude these documents are
trade secrets.
Accordingly, the Court will grant Defendant’s Motion with
respect to Count VI of the Amended Complaint for Aerotek’s and

48

TEKsystems’s claim against Mr. Ferrello and TEKsystems’s claim
against Mr. Hadley and Ms. Rodrigues.
III. CONCLUSION
For

the

foregoing

reasons,

the

Court

will,

by

separate

Order, DENY Defendant’s Motion for Partial Summary Judgment (ECF
No.

74)

Messrs.

with

respect

Jordan,

to

Curran,

Allegis’s
and

Hadley

and

Aerotek’s

breached

claim

their

that

employment

agreements (Count I of the Amended Complaint).

The Court will,

however,

the

GRANT

the

Motion

with

respect

to

following:

Aerotek’s claim that Mr. Ferrello breached his duty of loyalty
(Count V of the Amended Complaint); Aerotek’s and TEKsystems’s
claim that Mr. Ferrello misappropriated trade secrets (Count VI
of

the

Amended

Complaint);

and

TEKsystems’s

claim

that

Mr.

Hadley and Ms. Rodrigues misappropriated trade secrets (Count IV
of

the

Amended

Complaint).

The

Court

will

also

GRANT

Plaintiffs’ Cross-Motion for Partial Summary Judgment (ECF No.
75) with respect to whether Messrs. Jordan, Curran, Hadley, and
Nicholas breached their IIP Award Agreements (Count II of the
Amended Complaint and Count I of the Amended Counterclaim).
Entered this 10th day of June, 2014
________/s/_________________
George L. Russell, III
United States District Judge

49