Bonds v. Phillips Electronic North America et al

Filing 64

OPINION and ORDER Granting Defendant's 41 Motion for Summary Judgment and Denying Defendnt's 38 Motion for Sanctions. Signed by District Judge Gerald E. Rosen. (Loury, R)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
RICK BONDS,
Plaintiff/Counter-defendant,
No. 2:12-cv-10371
Hon. Gerald E. Rosen

vs.
PHILIPS ELECTRONIC
NORTH AMERICA,
Defendant/Counter-plaintiff.
___________________________________/

OPINION AND ORDER GRANTING DEFENDANT’S
MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANT’S
MOTION FOR SANCTIONS
I. INTRODUCTION
In the span of less than nine-months, Plaintiff Rick Bonds went from being
employed as a long-time medical imaging equipment repairman by Defendant
Philips Electronic North America (Philips),1 to also working for one of
Defendant’s competitors, Barrington Medical Imaging, LLC (Barrington), to being
fired by both. Nearly two and a half years later, Plaintiff commenced this instant
litigation.

His one-count Complaint asserts that after Defendant terminated

Plaintiff’s employment, its attorney communicated with Barrington regarding
Plaintiff’s obligations under confidentiality and non-disclosure agreements in a
1

Though captioned as “Phillips,” Defendant’s papers make clear that the proper
spelling is “Philips.”
1

manner that resulted in Barrington terminating his employment. Consequently,
Plaintiff claims that Defendant tortiously interfered with his business relationship
in violation of Michigan law. Defendant has now moved for summary judgment,
as well as for sanctions relating to Plaintiff’s discovery conduct. Having reviewed
and considered the parties’ briefs and supporting documents, supplemental briefs,2
and the entire record of this matter, the Court has determined that the pertinent
allegations and legal arguments are sufficiently addressed in these materials and
that oral argument would not assist in the resolution of these motions.
Accordingly, the Court will decide Defendant’s motions “on the briefs.” See Local
Rule 7.1(e)(2), U.S. District Court, Eastern District of Michigan. This Opinion and
Order sets forth the Court’s ruling.
II. PERTIENT FACTS
A.

Plaintiff’s employment with Defendant
Defendant hired Plaintiff in 19963 as a field service engineer to maintain and

repair medical imaging equipment -- x-ray machines, CT scanners, etc. (Plf’s

2

Three months after filing its two motions, Defendant sought leave to file a
Supplemental Reply Brief In Support of Motion for Sanctions, to which Plaintiff
timely respond. (Def’s Mtn., Dkt. # 57; Plf’s Resp., Dkt. # 60). The Court
GRANTS this Motion.
3
Defendant’s predecessor, Picker International, Inc. (Picker), originally hired
Plaintiff. Picker then changed its name to Marconi Medical Systems (Marconi). In
2001, Royal Philips Electronics acquired Marconi and subsequently became
known as Philips Medical Systems. Philips Medical Systems is a business unit in
2

Dep., Dkt. # 39, at 24-27).

Plaintiff signed several documents concerning

Defendant’s confidential information upon hire, including a “Service Engineer
Confidentiality Agreement” and an “Employee Invention and Confidential
Information Agreement.”

(Id. at 218-22, Dep. Ex. M).

Plaintiff worked for

Defendant until July 2009, primarily serving lower Michigan and northwest Ohio.
(Plf’s Dep., Dkt. # 39, at 24-26). During this time period, Plaintiff had access to a
variety of Defendant’s confidential, sensitive, proprietary, and trade secret manuals
and other information about Defendant’s equipment. (Id. at 306-08; Ex. C to Def’s
Mtn., Dkt. # 41-4, at ¶ 4).
B.

Plaintiff secures a second job with Barrington and Defendant fires
Plaintiff
Plaintiff’s employment with Defendant was uneventful until late 2008/early

2009, when Plaintiff obtained a second job with Barrington, unbeknownst to
Defendant. Barrington sold and serviced medical imaging equipment, including, in
some instances, Defendant’s equipment. (Plf’s Dep., Dkt. # 39, at 232, 247-48;
Ex. D to Def’s Mtn., Dkt. # 41-5, at ¶ 3).

Beginning in December 2008,

Barrington began recruiting Plaintiff for an open field service engineer position.
(Plf’s Dep., Dkt. # 39, at 32-34). This led to several interviews, and ultimately

the Philips Electronics North America corporation. (Ex. B to Def’s Def’s Mtn.,
Dkt. # 41-3, at ¶ 6).
3

resulted in Plaintiff receiving an employment offer from Barrington in January
2009. (Id. at 33-34, 248).
As part of the terms of Plaintiff’s employment with Barrington, Plaintiff
agreed to the following non-competition clause:
You hereby warrant that, in entering into this agreement with
[Barrington], you are in no manner in violation of a previous contract
with respect to a non-compete clause, nor that you are under any
contract with another company, with the exception of your current
contract agreement with Philips Medical Systems, person or entity,
which might conflict with the [Barrington] Businesses.
(Ex. G to Plf’s Dep., Dkt. # 39-7) (emphasis added).4 Plaintiff did not inform
Defendant that he had taken a full-time job with Barrington. (Plf’s Dep., Dkt. #
37, at 282).

4

There is significant dispute as to whether the terms of Plaintiff’s employment
with Barrington contained this non-competition clause. According to affidavits
submitted from Barrington, a January 12, 2009 offer letter from Barrington -which Plaintiff signed and returned to Barrington on January 13, 2009 -- governed
Plaintiff’s terms of employment. (Ex. D to Def’s Mtn., Dkt. # 41-5, at ¶ 6 (and
accompanying exhibits)). While this letter also contains a nearly identical noncompetition clause, it omits the reference to Defendant:
You hereby warrant that, in entering into this agreement with
[Barrington], you are in no manner in violation of a previous contract
with respect to a non-compete clause, nor that you are under any
contract with another company, person or entity, which might conflict
with the [Barrington] Businesses.
(Id.). Moreover, Barrington asserts that Plaintiff informed Barrington that he had
resigned from Defendant, that it was not aware that Plaintiff kept his job with
Defendant while at Barrington, and that Barrington “would not have permitted”
4

Plaintiff maintained his dual-employment until July 2009. At that time,
Defendant learned from one of its customers of Plaintiff’s employment with
Barrington. (Ex. B to Def’s Mtn., Dkt. # 41-3, at ¶ 7). Defendant then terminated
Plaintiff’s employment on July 16, 2009 for violating Defendant’s employment
policies and the terms of Plaintiff’s non-competition agreement. (Plf’s Dep., Dkt.
# 39, at 36, 280; Ex. B. to Def’s Mtn., Dkt. # 41-3, at ¶¶ 7-10). Importantly,
Plaintiff does not assert any claims against Defendant for its termination of his
employment in this case and even concedes that he believed some amount of
discipline was appropriate for his actions. (Plf’s Dep., Dkt. # 39, at 281). It is,
rather, what happened next that forms the basis of this lawsuit.

Plaintiff to be employed both by Defendant and Barrington. (Id. at ¶ 10; Ex. E to
Def’s Mtn., Dkt. # 41-6, at ¶ 10).
Plaintiff has put forth evidence to the contrary. He does not dispute that he
executed the January 12, 2009 letter. Instead, Plaintiff claims that this was an
accident, that he told Barrington about his employment with Defendant, and that a
subsequent version of the employment agreement codified this understanding (as
well as an additional change not relevant here.) (Plf’s Dep., Dkt. # 39, at 260-66,
275). The stark differences between these two accounts are troubling as they drip
of claims of manufactured evidence. See also Def’s Supp. Reply Brief, Dkt. # 572. Such differences, however, do not create a genuine issue of fact in this regard
because the Court assumes Plaintiff’s version of the events for the purposes of this
Motion. Lastly, it is worth noting that before commencing this litigation, Plaintiff
filed a claim for unemployment compensation against Barrington, which
Barrington disputed. During the unemployment hearing, Plaintiff testified that
these changes Plaintiff requested were “never” reduced to writing. (Ex. D to Plf’s
Dep., Dkt. # 39-5, at 15).
5

C.

Defendant’s alleged act of interference
A month after Defendant terminated Plaintiff’s employment, on August 19,

2009, Gerald Whitcomb, Defendant’s Senior Counsel, sent a letter to Plaintiff and
copied Barrington via fax. The whole text of the letter, titled “your ongoing duty
of confidentiality to Philips,” is set forth below:
I am writing to remind you of your continuing obligation to Philips
Healthcare, (“Philips”) pursuant to the agreements you signed. As
successor in interest to Picker, Philips is entitled to enforce these
agreements against you, if necessary. A copy of the Service Engineer
Confidentiality Agreement and the Employee Invention and
Confidential Information Agreement are enclosed for your reference.
Under these Agreements, you are precluded from disclosing Philips
(sic) confidential information, including but not limited to customer
and pricing information.
We understand that you have been and are now employed by
Barrington Medical. As you were employed by both companies
simultaneously, from January until July of this year, we are naturally
concerned about the potential disclosure of Philips (sic) confidential
information. Please confirm in writing that you have not furnished
Barrington with any such information. By copy of this letter, we are
also asking Barrington Medical to confirm in writing that: 1) you have
not provided Philips (sic) confidential information to Barrington
Medical; and 2) that if you have, it will be returned immediately.
Please send the confirmations to my attention.
Your conduct since your termination is equally concerning. We
understand that you contacted Philips RTAC on August 17th and
attempted to use your RTAC Pin to obtain Tier 2 support for
Universal Imaging in Dearborn, Michigan. In attempting to use
Philips (sic) resources in furtherance of your work at Barrington or
otherwise, you are violating the above agreements.
(Id. at Ex. R).

6

Less than a week later, on August 24, 2009, Barrington terminated
Plaintiff’s employment. (Plf’s Dep., Dkt. # 39, at 35; Ex. D to Def’s Mtn., Dkt. #
41-5, at ¶ 11; Ex. E to Def’s Mtn., Dkt. 41-6, at ¶ 11). No one from Defendant
requested that Barrington terminate Plaintiff’s employment. (Ex. D to Def’s Mtn.,
Dkt. # 41-5, at ¶ 13; Ex. E to Def’s Mtn., Dkt. # 41-6, at ¶ 14). According to
Plaintiff, Barrington terminated his employment because “they were afraid that
Philips was going to follow through with the lawsuit.” (Plf’s Dep., Dkt. # 39, at
36).5 He knows this because Plaintiff’s managers told him that “they were going to
let [him] go because [he was] working two jobs and [Philips was] threatening
[Barrington] with [a] lawsuit” and that Barrington could not “afford it.” (Id. at 37,
294, 297-301).6 Plaintiff also claims that he received a letter from his supervisor,

5

Plaintiff testified in the unemployment hearing that he believed that Barrington
discharged him “because they lost the major account” on which he was hired to
work. (Ex. D to Plf’s Dep., Dkt. #39-5, at 20). He made no mention of alleged
“threats” by Defendant.
6
Both Defendant and Barrington absolutely deny that anyone from Defendant
made any kind of threat -- litigation or otherwise -- against Barrington as a result of
Barrington’s employment of Plaintiff. (Ex. B to Def’s Mtn., Dkt. # 41-3, at ¶ 11;
Ex. D to Def’s Mtn., Dkt. # 41-5, at ¶ 14; Ex. E to Def’s Mtn., Dkt. # 41-6, at ¶ 15;
Ex. F to Def’s Mtn., Dkt. # 41-7, at ¶ 10). Rather, Barrington claims that it
terminated Plaintiff’s employment because he violated the terms of his
employment agreement and Barrington’s policies by working for Defendant and
Barrington at the same time. (Ex. D to Def’s Mtn., Dkt. # 41-5, at ¶ 12; Ex. E to
Def’s Mtn., Dkt. # 41-6, at ¶ 12). Similar to the facts surrounding Plaintiff’s terms
of employment with Barrington as set forth in footnote 4, this factual discrepancy
does not create an issue of fact because Plaintiff’s claim fails even accepting
Plaintiff’s version of the events.
7

Barrington’s Vice President of Service Operations, Michael Mercer, dated August
25, 2009, stating:
I’m sorry that your employment with Barrington didn’t work out as
agreed. I hope you understand that the threat of a lawsuit that Philips
may place upon us is too costly if we were to keep you employed. I
wish it had worked out differently. You will soon receive information
on any reimbursements, expenses, and your last paycheck in weeks to
follow.
(Id. at 301-03, Dep. Ex. S.).7
Plaintiff filed his one-count Complaint on January 27, 2012. (Compl., Dkt.
# 1).

As noted above, Plaintiff does not assert a claim arising out of his

termination from Defendant. Nor does Plaintiff make a claim against Barrington.
He only brings one count against Defendant: tortious interference with a business
relationship. Defendant also asserts four counterclaims against Plaintiff -- breach
of two contracts, unfair competition, and misappropriation of trade secrets -- on
which the parties have not filed dispositive motions. (Answer & Countercl., Dkt. #
16). After an apparently contentious discovery process, Defendant has now moved
7

Notwithstanding this assertion, Plaintiff also received a letter from one of
Barrington’s owners dated September 8, 2009, stating that Barrington terminated
his employment “for cause” and offering severance benefits. (Plf’s Dep., Dkt. #
39, at 289-91, 298-99; Ex. E to Def’s Mtn., Dkt. # 41-6, at Ex. 3). This September
8 letter does not reference Mercer’s August 25, 2009 letter. Instead, it mentions a
September 2, 2009 letter that Plaintiff admits he received from Barb Byrnes that
included a “typical termination packet,” like “insurance stuff.” (Plf’s Dep., Dkt. #
39, at 290, 298). Finally, as referenced in footnote 6, Mercer attested that
Barrington decided to terminate Plaintiff because he was working for two
companies at once “and not because of any threat from Philips.” (Ex. D to Def’s
Mtn., Dkt. # 41-5, at ¶ 12).
8

for summary judgment, as well as for sanctions relating to Plaintiff’s discovery
conduct. For the reasons set forth below, the Court GRANTS Defendant’s Motion
for Summary Judgment and DENIES Defendant’s Motion for Sanctions.
III. DISCUSSION
A.

Rule 56 Standard
Summary judgment is proper if the moving party “shows that there is no

genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a). As the Supreme Court has explained, “the
plain language of Rule 56[] mandates the entry of summary judgment, after
adequate time for discovery and upon motion, against a party who fails to make a
showing sufficient to establish the existence of an element essential to that party’s
case, and on which that party will bear the burden of proof at trial.” Celotex Corp.
v. Catrett, 477 U.S. 317, 322 (1986). In addition, where a moving party -- here,
Defendant -- seeks an award of summary judgment in its favor on a claim or issue
as to which it bears the burden of proof at trial, this party’s “showing must be
sufficient for the court to hold that no reasonable trier of fact could find other than
for the moving party.” Calderone v. United States, 799 F.2d 254, 259 (6th Cir.
1986) (internal quotation marks, citation, and emphasis omitted).
In deciding a motion brought under Rule 56, the Court must view the
evidence in a light most favorable to the nonmoving party. Pack v. Damon Corp.,

9

434 F.3d 810, 813 (6th Cir. 2006). Yet, the nonmoving party may not rely on mere
allegations or denials, but must “cit[e] to particular parts of materials in the record”
as establishing that one or more material facts are “genuinely disputed.” Fed. R.
Civ. P. 56(c)(1). But, “the mere existence of a scintilla of evidence that supports
the nonmoving party’s claims is insufficient to defeat summary judgment.” Pack,
434 F.3d at 814 (alteration, internal quotation marks, and citation omitted).
B.

Defendant did not tortiously interfere with Plaintiff’s business
relationship
To make out a claim for tortious interference with a business relationship, a

plaintiff must prove the following elements: (1) the existence of a valid business
relationship; (2) knowledge of the relationship on the part of the defendant; (3) an
intentional interference by the defendant inducing or causing a breach or
termination of the relationship; and (4) resultant damage to the plaintiff. Cedroni
Assoc., Inc. v. Tomblinson, Harburn Assoc., Architects & Planners, Inc., 492
Mich. 40, 45 (2012). Because Plaintiff cannot prove the third element, the Court
only discusses this element.8
“To fulfill the third element, intentional interference inducing or causing a
breach of a business relationship, a plaintiff must demonstrate that the defendant
acted both intentionally and either improperly or without justification.” Dalley v.

8

Defendant does not dispute the first two elements, but does dispute that Plaintiff
suffered damages.
10

Dykema Gossett, 287 Mich. App. 296, 323 (2010). A plaintiff may do so by either
“proving (1) the intentional doing of an act wrongful per se, or (2) the intentional
doing of a lawful act with malice and unjustified in law for the purpose of invading
plaintiff’s contractual rights or business relationship.” Advocacy Org. for Patients
& Providers v. Auto Club Ins. Ass’n, 257 Mich. App. 365, 383 (2003).

“A

wrongful act per se is an act that is inherently wrongful or an act that can never be
justified under any circumstances.” Prysak v. R.L. Polk Co., 193 Mich. App. 1, 1213 (1992). To find an act with malice and without justification, there must be
“specific[], affirmative acts by the defendant that corroborate the improper motive
of the interference.” Dalley, 287 Mich. App. at 324 (citation omitted). Finally,
“[w]here the defendant’s actions were motivated by legitimate business reasons, its
actions would not constitute improper motive or interference.”

Id. (citation

omitted).
Plaintiff has put forth no evidence that Defendant committed a per se
wrongful act. Accordingly, this Court turns to whether Plaintiff can prove “the
intentional doing of a lawful act with malice and unjustified in law for the purpose
of invading plaintiff’s contractual rights or business relationship.” Advocacy Org.,
257 Mich. App. at 383. Plaintiff cannot so prove for a multitude of reasons.
Initially, Plaintiff rests his claim on the central premise that Barrington told
him -- orally and in writing -- that it fired him because Defendant threatened to sue

11

Barrington. As Defendant correctly asserts, albeit in an argument relegated to a
footnote, Plaintiff may not rely on these hearsay -- and double hearsay -statements. It is well-settled that courts must disregard hearsay used to counter a
motion for summary judgment. Alexander v. CareSource, 576 F.3d 551, 558-59
(6th Cir. 2009); Sperle v. Mich. Dept. of Corrections, 297 F.3d 483, 495 (6th Cir.
2002) (“A party opposing a motion for summary judgment cannot use hearsay or
other inadmissible evidence to create a genuine issue of material fact”); United
States v. Gibson, 409 F.3d 325, 337 (6th Cir. 2005) (“[I]n order for double-hearsay
statements to be admissible, both statements must be excluded from the hearsay
definition.”). Without these statements, Plaintiff has no evidence that Defendant
maliciously and unjustifiably interfered with Plaintiff’s employment with
Barrington.9

9

Though Rule 56 does not mandate that Plaintiff “produce evidence in a form that
would be admissible at trial” in order to defeat a motion for summary judgment,
Celotex, 477 U.S. at 324, it does require that he present evidence that is “capable of
being converted into admissible evidence” at trial. DeBiasi v. Charter Cnty. of
Wayne, 537 F. Supp. 2d 903, 911 (E.D. Mich. 2008) (citation omitted). Stated
differently, “[t]he proffered evidence need not be in admissible form, but its
content must be admissible.” Bailey v. Floyd Cnty. Bd. of Educ., 106 F.3d 135,
145 (6th Cir. 1997) (emphasis omitted). “For instance, deposition testimony will
assist a plaintiff in surviving a motion for summary judgment, even if the
deposition itself is not admissible at trial, provided substituted oral testimony
would be admissible and create a genuine issue of material fact.” Id. Here,
however, the content -- i.e., Plaintiff’s own statements as to what Barrington’s
employees told him -- are hearsay and “live” testimony at trial from Barrington’s
employees cannot cure this evidentiary hurdle.
12

Even considering these statements, Plaintiff’s claim still fails. Viewing the
evidence in the light most favorable to Plaintiff, Barrington’s alleged knowledge of
Plaintiff’s concurrent employment with Defendant undermines any causal link
between Whitcomb’s letter and Plaintiff’s termination. According to Plaintiff,
Barrington was not only aware of Plaintiff’s employment with Defendant, it agreed
to limit the terms of Plaintiff’s non-competition clause by expressly referencing
Plaintiff’s employment with Philips. This Court cannot dismiss this material fact.
It is simply not logical to conclude that Whitcomb’s letter caused Barrington to
become aware of the threat of litigation by one of its competitors so as to justify
terminating Plaintiff’s employment given Barrington’s alleged knowledge of
Plaintiff’s employment with Defendant.
And, even if Whitcomb’s letter caused Plaintiff’s termination, he has not
presented any specific, affirmative acts that corroborate an improper motive of
interference. It is not enough for Plaintiff to point to Whitcomb’s letter; he must
show that Whitcomb sent it with the improper motive of seeking to interfere with
Plaintiff’s business relationship with Barrington. Instructive here is the Michigan
Court of Appeals case of Prysak. In that case, the plaintiff worked for a publishing
and research company. 193 Mich. App. at 4. Separately, the plaintiff and one of
his employer’s customers, a car dealership, were involved in a car repair dispute.
Id. During the course of mediating the dispute, the plaintiff allegedly threatened to

13

distribute letters indicating that his car was a “lemon” to the dealership’s
customers. Id. The plaintiff was to accomplish this by using his employer’s
customer lists. Id. at 4-5. In response, the dealership wrote a letter to the employer
regarding the alleged threat, and “expressed concern regarding the improper use of
its customer lists and requested assurance from [the employer] that ‘[the plaintiff]’s
stated plan does not come to fruition.” Id. at 5. Plaintiff’s employer terminated his
employment after receiving this information. Id.
The Michigan Court of Appeals affirmed the trial court’s determination that
the dealership did not tortiously interfere with his contractual relationship with his
employer:
Plaintiff asserts on appeal that Crestwood’s letter “unjustifiably” led
to plaintiff’s termination. However, plaintiff has not presented any
facts to suggest that Crestwood’s action in sending the letter was
wrongful conduct per se or was lawful conduct that was done with
malice and that sending the letter was an unjustified act done for the
purpose of invading his contractual relationship with Polk.
In light of the evidence presented, we hold that the trial court correctly
determined that there was no genuine issue of material fact in regard
to plaintiff’s claim. The letter itself is merely an expression of
Crestwood’s concern over the alleged threats made by plaintiff. The
letter, while employing strong language, does not call for the
discharge of plaintiff. Rather, Crestwood sought assurances that its
customer lists would not be misused. There is no indication that
Crestwood was acting with a wrongful or malicious intent to interfere
with plaintiff's employment. To the contrary, Crestwood appears to
have been acting solely to protect the confidentiality of its customer
lists.

14

Id. at 13-14 (emphasis added). Similarly, Whitcomb’s letter also contains strong,
assertive language, but does not call for Plaintiff’s discharge and Plaintiff has no
evidence that anyone from Defendant specifically requested his discharge.
Whitcomb’s letter raises concerns regarding Plaintiff’s obligations under his
confidentiality agreements, and more specifically, “the potential disclosure of
Philips (sic) confidential information.” These concerns are of course magnified by
the fact that Defendant did not disclose his concurrent employment with
Barrington to Defendant. Therefore, “[Philips] appears to have been acting solely
to protect . . . [its] confidential information,” and Plaintiff has put forth no
evidence of an improper motive of interference. Id. at 14; see also Hollings v.
TransactTools, Inc., 128 F. App’x 820, 821-22 (2d Cir. 2005) (no tortious
interference where former employer sent letter to plaintiff’s new employer
“expressing concerns” regarding the possibility of disclosure of former employer’s
“proprietary confidential and trade secret information” and requesting assurances
from new employer that plaintiff not work on competitive products or solicit its
employees, which caused the new employer to terminate the plaintiff’s
employment).10

10

Plaintiff’s Response also insinuates that one of Barrington’s owners testified at
the unemployment hearing that Whitcomb’s letter and Plaintiff’s employment “put
[Barrington] at risk with Philips.” (Plf’s Resp., Dkt. #47, at 6). Upon review of
this testimony, however, Plaintiff lifts the testimony completely out-of-context.
Instead, the co-owner’s testimony was clearly in the context of why Barrington
15

Plaintiff’s assertion that the facts and circumstances surrounding
Whitcomb’s letter corroborate an improper motive of interference is not
persuasive.

First, Plaintiff underscores the fact that Whitcomb’s letter just

reiterates its “concern” regarding “potential disclosure” and asserts that Whitcomb
did not have “concrete evidence” to justify sending the letter. (Plf’s Resp., Dkt. #
47, at 13). In so doing, he points to the part of Whitcomb’s letter regarding
Plaintiff contacting “Philips RTAC,” attempting to use his “RTAC Pin” to support
“Universal Imaging in Dearborn, Michigan.” Though Plaintiff disputes this -- he
claims that this was not the case and that he was working somewhere else at this
time -- he provides no record evidence for this assertion. And, even if he did, as

would never have entered into an employment agreement permitting dual
employment:
Q:

Did [Plaintiff] tell you about [the] agreement [to work
concurrently for Barrington and Philips]?

A:

No. And it’s -- we would never do this. It’s -- it’s not industry
standard. . . . We would never have agreed to that kind of
dishonest dealings. It would have put us at risk with Phillips
(sic). We just don’t do business that way. You work for one
company at a time. . . . [I] absolutely would not have agreed to
have him work for two companies at once.

(Ex. D to Plf’s Dep., Dkt. # 39-5, at 19-20). Plaintiff’s reliance on this testimony
is therefore immaterial.
16

discussed below, concern about potential disclosure is exactly the kind of
legitimate business reason that insulates Defendant from liability.11
Second, Plaintiff raises timing issues with Whitcomb’s letter.

He

emphasizes that he worked for Barrington for several months without Defendant
expressing concern about its confidential information. (Id.). What he conveniently
omits, however, is that he hid his employment with Barrington from Defendant,
only to be discovered in July. That Whitcomb’s letter came less than one month
after his termination is of no consequence. Plaintiff has put forth no authority
indicating that a one-month delay between terminating an employee and sending a
letter confirming his obligations under an agreement to preserve confidential
information evidences an improper motive.

Nor can this Court second-guess

Defendant’s business judgment concerning when such communications should be
sent. Cf Hazle v. Ford Motor Co., 464 Mich. 456, 475-76 (2001) (courts cannot
question whether an “employer is wise, shrewd, prudent, or competent;” rather,

11

Plaintiff’s Response also claims that Whitcomb submitted “false” statements in
his affidavit supporting Defendant’s Motion. Specifically, Plaintiff takes issue
with Whitcomb’s statement that he was involved in investigating Plaintiff’s
employment with Barrington before Defendant terminated Plaintiff. (Plf’s Resp.,
Dkt. # 47, at 14-15). For support, Plaintiff relies upon his deposition testimony
concerning who was present at the time Defendant terminated Plaintiff. This is a
non-issue because Plaintiff has no evidence as to Whitcomb’s role in an
“investigation” -- as opposed to being present at the time of Plaintiff’s termination.
More importantly, whether there was an investigation or not bears no relevance to
whether Whitcomb had an improper motive when sending the letter to Plaintiff and
Barrington.
17

“[t]he only requirement is that, ‘when evaluating its employees, employers are to
evaluate them on the basis of their merits, in conjunction with the nature of their
businesses at the time of the evaluation, and not on the basis of any discriminatory
criterion’”) (citation omitted); Lee v. City of Columbus, 636 F.3d 245, 258 (6th Cir.
2011) (courts may not “act as super personnel departments to second guess an
employer’s facially legitimate business decisions”) (citation omitted).
Third, Plaintiff argues that Defendant “does not indicate that they made this
kind of request” -- to confirm that he had not provided Defendant’s confidential
information to Barrington -- “for all employees.” (Plf’s Resp., Dkt. # 47, at 14).
There is no record evidence regarding how Defendant treated other employees, let
alone similarly situated employees and the Court declines to shift this burden to
Defendant.
Notwithstanding this entire discussion, Defendant’s actions cannot be
improper because they were motivated by legitimate business reasons. “[U]nder
Michigan law, preventing the anticompetitive use of confidential information is a
legitimate business interest.” Rooyakker & Sitz, P.L.L.C. v. Plante & Moran,
P.L.L.C., 276 Mich. App. 146, 158 (2007) (citation omitted). No reasonable juror
would find that Whitcomb’s letter -- even construed as a threat of litigation -- was
improper because “[t]here is nothing illegal, unethical or fraudulent in filing a

18

lawsuit, whether groundless or not.” Dalley, 287 Mich. App. at 324.12 The Court
finds that this is especially true in today’s society where agreements to maintain an
employer’s information as confidential are part and parcel to many employment
relationships. Indeed, even without these agreements, former employees are bound
at common law from using a former employer’s trade secrets or confidential
information for his own benefit or to compete against that former employer.
Hayes-Albion Corp. v. Kuberski, 421 Mich. 170, 180-81 (1985); Follmer,
Rudzewicz & Co., P.C. v. Kosco, 420 Mich. 394, 404 (1984). It is not this Court’s
role to strip employers of the ability to enforce their right to prevent the disclosure
of confidential information in instances similar to those presented here.
Accordingly, Defendant is entitled to Summary Judgment on Plaintiff’s
Complaint.
C.

Defendant’s Motion for Sanctions
Defendant’s Motion for Sanctions, filed a day before Defendant’s Motion

for Summary Judgment, requests that this Court sanction Plaintiff and his attorney
for their discovery conduct. It primarily requests that this Court dismiss Plaintiff’s
Complaint pursuant to Federal Rules of Civil Procedure 37(b) and 41(b). Because
this Opinion and Order dismisses Plaintiff’s Complaint on the merits, such a
12

Because this Court determines that Plaintiff has failed to establish the elements
of a claim for tortious interference with a business relationship, the Court declines
to address Defendant’s alternative argument that the Noerr-Pennington doctrine
bars Plaintiff’s claim.
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request is therefore moot. To the extent Defendant requests alternative relief, this
Court is not persuaded that additional sanctions are necessary.
IV. CONCLUSION
For all of the foregoing reasons,
IT IS HEREBY ORDERED that Defendant’s Motion for Summary
Judgment (Dkt. # 41) is GRANTED and Plaintiff’s Complaint is dismissed, with
prejudice.
IT IS HEREBY FURTHER ORDERED that Defendant’s Motion for
Sanctions (Dkt. # 38) is DENIED.
IT IS HEREBY FURTHER ORDERED that Defendant’s Emergency
Motion for Leave to File Supplemental Reply Brief in Support of Motion for
Sanctions (Dkt. # 57) is GRANTED.
IT IS SO ORDERED.

Dated:

January 21, 2014

s/Gerald E. Rosen
GERALD E. ROSEN
CHIEF, U.S. DISTRICT COURT

I hereby certify that a copy of the foregoing document was mailed to the attorneys
of record on this date, January 21, 2014, by electronic and/or ordinary mail.
s/Julie Owens
Case Manager, 313-234-5135

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