Mobile Mini, Inc. v. Vevea et al
MEMORANDUM OPINION AND ORDER granting in part Plaintiff's Preliminary Injunction Motion and denying Defendants' Motion to Dismiss. (Written Opinion) Signed by Chief Judge John R. Tunheim on July 25, 2017. (JMK)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 17-1684 (JRT/KMM)
MOBILE MINI, INC.,
LIZ VEVEA, CITI-CARGO &
STORAGE CO., INC. and LOGISTICS
MEMORANDUM OPINION AND
ORDER GRANTING IN PART
INJUNCTON MOTION AND
MOTION TO DISMISS
Patrick R. Martin, OGLETREE, DEAKINS, NASH, SMOAK &
STEWART, P.C., 90 South Seventh Street, Suite 3800, Minneapolis, MN
55402, for plaintiff.
William M. Topka, DOUGHERTY, MOLENDA, SOLFEST, HILLS &
BAUER PA, 14985 Glazier Avenue, Suite 525, Apple Valley, MN 55125,
Plaintiff Mobile Mini, Inc. (“Mobile Mini”) and Defendant Citi-Cargo & Storage
Co., Inc. (“Citi-Cargo”) are direct competitors in the portable storage business. Mobile
Mini’s former sales representative for the region encompassing Minnesota – Defendant
Liz Vevea – left Mobile Mini in November 2016 and subsequently transitioned to
working at Citi-Cargo after first possibly working for a brief period for Defendant
Logistics Services, Inc. (“LSI”), which is owned by the same parent company as CitiCargo. Mobile Mini alleges that since LSI and Citi-Cargo hired Vevea, she has violated
a number of provisions in a non-competition and non-solicitation agreement with Mobile
Mini. Mobile Mini also alleges that LSI and Citi-Cargo tortiously interfered in the
contractual relationship between Vevea and Mobile Mini.
Mobile Mini seeks a
preliminary injunction to enforce the terms of that contract.
Vevea, Citi-Cargo, and LSI (collectively, “Defendants”) move for dismissal of the
complaint pursuant to Fed. R. Civ. P. 12(b)(1). Defendants argue that the Court lacks
subject-matter jurisdiction under 28 U.S.C. § 1332(a) because the amount in controversy
does not exceed $75,000.
Because it is not legally impossible that a factfinder could award damages in
excess of $75,000, the Court will deny Defendants’ motion to dismiss. Additionally,
because Vevea likely solicited business from Mobile Mini’s customers in violation of the
contract and likely will continue to do so, and because those breaches could cause Mobile
Mini irreparable harm, the Court will order some of Mobile Mini’s requested preliminary
Vevea worked as a Sales Representative at Mobile Mini’s Lino Lakes office
starting March 25, 2013. (Compl. ¶ 16, May 19, 2017, Docket No. 1; Decl. of Eric
Martinez (“Martinez Decl.”) ¶ 9, June 22, 2017, Docket No. 23.) As a condition of her
employment at Mobile Mini, Vevea executed a Confidentiality, Non-Solicitation, NonCompete and Inventions Agreement (the “Agreement”).
(See Compl., Ex. A
Under the Agreement, Vevea agreed to certain restrictions on her
activities in the Portable Storage Business 1 after the end of her employment with Mobile
a. not to work in the Portable Storage Business at a location within fifty miles
of Mobile Mini’s Lino Lakes office for six months, (id. ¶ 3);
b. not to make any Portable Storage Business sales to Company Customers 2
for nine months, (id. ¶ 4(b));
c. not to directly or indirectly solicit Company Customers for the purpose of
making portable storage sales, (id. ¶ 5(a), (b)), or make referrals for profit
related to Company Customer, (id. ¶ 5(c)), for twelve months;
d. not to poach current or former Mobile Mini employees with whom Vevea
interacted to work for a competitor for twelve months, (id. ¶ 5(d)).
Vevea resigned from her position at Mobile Mini on November 8, 2016. (Compl.
¶ 28.) Less than six months later, Vevea started working for LSI at a location less than
The Agreement defines “Portable Storage Business” as: “the design, manufacture,
rental, sale, or lease of any of the following: portable storage containers, portable storage trailers,
portable offices, as well as components of such containers, trailers, or offices.” (Agreement at 1
The Agreement defines “Company Customer” as:
any past, present, or prospective [Mobile Mini] customer (or customer
representative or affiliate) with whom or which [Vevea] had [Mobile Mini]
business related contact (in person, by phone, by videoconference, or in writing)
at any time during the one (1) year period before [Vevea’s] employment by
[Mobile Mini] terminate[d], or about whom or which [Vevea] learned confidential
information during that one (1) year period.
(Agreement at 3 n.4.)
fifty miles from Mobile Mini’s Lino Lakes office. 3 According to Defendants, LSI is a
“logistics company that provides over the road, dedicated, and local transportation
services as well as non-asset based trucking services including freight brokerage, i.e.,
booking a load and finding someone to haul it or moving loads with other people’s
(Decl. of Allen Ofstehage (“Ofstehage Decl.”) ¶ 4, June 30, 2017, Docket
No. 34.) LSI and Citi-Cargo are owned by the same parent company, and they share the
same registered business office address, principal executive office address, and CEO.
(Compl. ¶¶ 32-33 & Exs. C-D.) The parties do not dispute that Citi-Cargo operates in the
Portable Storage Business as Mobile Mini’s direct competitor. (See id. ¶ 9; Ofstehage
Decl. ¶ 3.)
On May 11, 2017 – roughly six months after resigning from Mobile Mini – Vevea
updated her LinkedIn account to reflect that she now works at Citi-Cargo. (Compl. ¶ 36.)
The post stated:
I’m excited to have joined the Citi-Cargo Sales Team! We lease and sell
clean, safe, and solid storage containers and offices. We are locally owned
and operated, with local live voice answer. We offer same day delivery to
the Metro, and have consistent rental rates with true monthly billing. Give
me a call today for a quote. 651-295-2982.
The Court recognizes that the identity of Vevea’s true employer between November
2016 and May 2017 is a matter in dispute that will be resolved through discovery. For purposes
of evaluating the amount in controversy in relation to Defendants’ motion to dismiss, the Court
assumes that it is possible that Mobile Mini will be able to prove that in reality, Vevea worked
for Citi-Cargo before six months elapsed after her departure from Mobile Mini. However,
because Defendants submitted record evidence stating that Vevea worked for LSI and not for
Citi-Cargo until May 2017, (see Decl. of Allen Ofstehage (“Ofstehage Decl.”) ¶¶ 5-8, 11, 14,
June 30, 2017, Docket No. 34), and because Mobile Mini has not rebutted this evidence with
anything more than conjecture, the Court credits Defendants’ evidence on this point for purposes
of the motion for preliminary injunction.
(Id. & Ex. G.) The post also included photos of Citi-Cargo portable containers. (Id.,
Ex. G.) On May 17, 2017, Vevea put a second post on LinkedIn, which stated: “Call me
today for a storage container quote from the cleanest, newest, safest and best container
fleet in the State of Minnesota. Let’s connect! 651-295-2982.” (Id. ¶ 43 & Ex. H.)
Mobile Mini alleges that these posts were visible to Vevea’s 500-plus LinkedIn
connections, including one or more Company Customers or their representatives, and at
least some if not all of these connections may have received an email notification about
the new posts. (Compl. ¶¶ 37-39, 43; Decl. of Elizabeth Vevea (“Vevea Decl.”) ¶ 6,
June 30, 2017, Docket No. 33.)
Mobile Mini initiated this action on May 19, 2017. Mobile Mini asserts two legal
claims: breach of contract against Vevea (Count I) and tortious interference with
contractual relationship against Citi-Cargo and LSI (Count II). (Id. ¶¶ 52-69.) Mobile
Mini seeks declaratory, injunctive, and monetary relief. (Id. at 15-17.)
On June 1, 2017, Defendants moved to dismiss the complaint for lack of subjectmatter jurisdiction pursuant to Rule 12(b)(1).
On June 22, 2017, Mobile Mini filed a motion for preliminary injunction. 4 Mobile
Mini asks the Court to restart the clock on the non-competition and non-solicitation
Mobile Mini’s motion is styled as a motion for a temporary restraining order, or
alternatively, a preliminary injunction. Because Defendants had notice and an opportunity to
respond and because Mobile Mini seeks injunctive relief extending longer than fourteen days,
“the Court will consider [Mobile Mini’s] motion as one requesting a preliminary injunction
under [Fed. R. Civ. P.] 65(b) rather than a temporary restraining order under Rule 65(a).”
(Footnote continued on next page.)
provisions in the Agreement to commence on the date of this Order and run for the same
time periods specified in the Agreement. Alternatively, Mobile Mini asks the Court to
extend the contractual time limits until a permanent injunction hearing.
MOTION TO DISMISS
STANDARD OF REVIEW
“A motion to dismiss pursuant to [Fed. R. Civ. P.] 12(b)(1) challenges the Court’s
subject matter jurisdiction and requires the Court to examine whether it has authority to
decide the claims.” Damon v. Groteboer, 937 F. Supp. 2d 1048, 1063 (D. Minn. 2013).
Under 28 U.S.C. § 1332(a), the Court may exercise jurisdiction over completely diverse
parties 5 “where the matter in controversy exceeds the sum or value of $75,000.” “The
district court has subject matter jurisdiction in a diversity case when a fact finder could
legally conclude, from the pleadings and proof adduced to the court before trial, that the
damages that the plaintiff suffered are greater than $75,000.” Kopp v. Kopp, 280 F.3d
883, 885 (8th Cir. 2002). On the other hand, there is no subject-matter jurisdiction if an
award exceeding $75,000 is “legally impossible.” Hillesheim v. Casey’s Retail Co.,
No. 16-61, 2016 WL 3676164, at *2 (D. Minn. July 6, 2016); see also Kopp, 280 F.3d at
Lifetime Fitness, Inc. v. Wallace, No. 12-740, 2012 WL 1517262, at *2 (D. Minn. Apr. 30,
There is no dispute that there is complete diversity between Mobile Mini and
Defendants. Mobile Mini is incorporated in Delaware with its principal place of business in
Arizona. (Compl. ¶ 1.) Vevea is a citizen of Minnesota, and Citi-Cargo and LSI are both
Minnesota corporations with their principal places of business in Minnesota. (Id. ¶¶ 2-4.)
884-85 (noting that a complaint should be dismissed for lack of subject-matter
jurisdiction if there is “legal certainty” that a factfinder could not award damages
exceeding $75,000 (citation omitted)).
“If the defendant challenges the plaintiff’s
allegations of the amount in controversy, then the plaintiff must establish jurisdiction by a
preponderance of the evidence.” Kopp, 280 F.3d at 884.
In deciding a Rule 12(b)(1) motion, the Court must first “distinguish between a
‘facial attack’ and a ‘factual attack.’” Osborn v. United States, 918 F.2d 724, 729 n.6
(8th Cir. 1990) (quoting Menchaca v. Chrysler Credit Corp., 613 F.2d 507, 511 (5th Cir.
1980)). “In a facial challenge to jurisdiction, all of the factual allegations concerning
jurisdiction are presumed to be true and the motion is successful if the plaintiff fails to
allege an element necessary for subject matter jurisdiction.” Titus v. Sullivan, 4 F.3d 590,
593 (8th Cir. 1993). In a factual attack, the court “inquires into and resolves factual
disputes,” Faibisch v. Univ. of Minn., 304 F.3d 797, 801 (8th Cir. 2002), and is free to
“consider[ ] matters outside the pleadings,” Osborn, 918 F.2d at 729 n.6. The nonmoving
party in a factual challenge “does not have the benefit of 12(b)(6) safeguards.” Id.
Here, the parties have submitted declarations and exhibits that go beyond
information in the pleadings, so the challenge is a factual as opposed to a facial challenge
AMOUNT IN CONTROVERSY
Defendants argue there is no subject-matter jurisdiction because the amount in
controversy does not exceed $75,000. There are two components to a potential award for
Mobile Mini in the event of success on the merits – (a) actual damages, representing lost
profits or some other estimate of actual harm to Mobile Mini’s business as a result of
Vevea’s alleged breach of contract, and (b) attorney fees incurred litigating the breach-ofcontract claim. As explained below, the Court finds that it is “not legally impossible”
that there could be actual damages plus attorney fees at stake that exceed $75,000. See
Hillesheim, 2016 WL 3676164, at *2.
According to Mobile Mini, Vevea was responsible for over $1.2 million in sales
with roughly 254 customers over the 3.5 years that she worked as a Mobile Mini Sales
Representative. (Compl. ¶ 27; Martinez Decl. ¶ 13.) Mobile Mini also represents that at
some point after Vevea left the company, two customers Vevea worked with, who
represent a combined $130,000 in 2016 sales for Mobile Mini, have either decreased the
volume of their sales with Mobile Mini or have informed the company that they are
considering taking their business elsewhere.
(Decl. of Rebecca Lautenschlager ¶ 6,
June 22, 2017, Docket No. 22.) Based on publicly available data, Mobile Mini’s overall
profit margin was approximately 1% in 2015 and 9% in 2016. (Decl. of Al Ofstehage ¶ 6
& Ex. A, June 1, 2017, Docket No. 13.)
While there is no direct evidence before the Court at this time demonstrating that
Mobile Mini has actually lost customers or missed sales opportunities because of Vevea’s
alleged breaches of the Agreement, it does not stretch the imagination that Vevea’s
alleged solicitations of Mobile Mini customers could yield hundreds of thousands of
dollars in new business for Citi-Cargo as well as loss of customer goodwill at Mobile
Mini. While it may be unlikely that Mobile Mini will continue to generate a 9% profit
margin for the next few years, this is also “not legally impossible.” See Hillesheim, 2016
WL 3676164, at *2. Given these possibilities, along with the fact that loss of customers
may weaken a company’s sales for the years it may take to bring the customers back or to
find replacement customer, the Court finds it is not legally certain that Mobile Mini’s
actual damages due to an alleged past or threatened breach could not exceed $75,000.
In addition to the potential for actual damages exceeding $75,000, reasonable
attorney fees incurred litigating the breach-of-contract claim are recoverable damages for
tortious interference. See Kallok v. Medtronic, Inc., 573 N.W.2d 356, 363 (Minn. 1998)
(stating that courts may “award attorney fees as damages if the defendant’s tortious act
thrusts or projects the plaintiff into litigation with a third party”); see also St. Jude Med.
S.C., Inc. v. Biosense Webster, Inc., No. 12-621, 2014 WL 3573620, at *2-3 (D. Minn.
July 18, 2014) (recognizing that under Minnesota law as established in Kallok, damages
for a tortious interference claim against a new employer may include the attorney fees
incurred in enforcing a non-compete agreement against a former employee).
generally Capitol Indem. Corp. v. Miles, 978 F.2d 437, 438 (8th Cir. 1992) (recognizing
that when attorney fees are recoverable as damages, they may be taken into account to
determine whether the jurisdictional threshold has been met in a diversity case).
Mobile Mini provided the Court with a declaration stating that it has incurred
$30,000 in attorney fees thus far. (Decl. of Patrick R. Martin (“Martin Decl.”) ¶ 6,
June 22, 2017, Docket No. 27.) It is “not legally impossible” that future attorney fees
incurred to litigate the breach-of-contract claim could exceed an additional $45,000. See
Hillesheim, 2016 WL 3676164, at *2; see also Biosense Webster, Inc., 2014 WL
3573620, at *5 (awarding a successful plaintiff in a tortious interference trial related to
breach of a non-compete agreement an award of $662,018.92 in attorney fees damages
under Kallok); Ecolab, Inc. v. Ford, No. C4-94-2179, 1995 WL 238837, at *3 (Minn. Ct.
App. Apr. 25. 1995) (affirming a trial court award of $410,213.59 in attorney fees and
costs following a plaintiff’s successful litigation of a non-compete agreement). 6
To conclude, because an award of actual damages, recoverable attorney fees, or
some combination of the two could legally exceed $75,000, the Court will deny
Defendants’ motion to dismiss for lack of subject-matter jurisdiction. 7
Defendants argue that the Court should follow the Seventh Circuit’s decision in
Gardynski-Leschuck v. Ford Motor Co., 142 F.3d 955, 958-59 (7th Cir. 1998), and decline to
consider reasonable future attorney fees when determining whether the matter in controversy
exceeds $75,000 for purposes of evaluating jurisdiction. While the Eighth Circuit has not
squarely decided the matter in a reported opinion, the Court notes that the overwhelming weight
of local authority recognizes that reasonable future attorney fees, when recoverable as damages,
are part of the “amount in controversy” and should be considered to establish diversity
jurisdiction. See, e.g., Skoda v. Lilly USA LLC, 488 F. App’x 161, 164 (8th Cir. 2012); Geronimo
Energy, LLC v. Polz, No. 16-3901, 2017 WL 758924, at *2 (D. Minn. Feb. 27, 2017); Mueller v.
RadioShack Corp., No. 11-0653, 2011 WL 6826421, at *2 (D. Minn. Dec. 28, 2011); Delsing v.
Starbucks Coffee Corp., No. 08-1154, 2010 WL 1507642, at *3 (D. Minn. Apr. 14, 2010); Feller
v. Hartford Life & Accident Ins. Co., 817 F. Supp. 2d 1097, 1104-08 (S.D. Iowa 2010). The
Court finds these cases persuasive and rejects the Seventh Circuit’s position on this question.
Because the Court finds there is subject-matter jurisdiction, the Court will deny
Defendants’ request for attorney fees and costs pursuant to 28 U.S.C. § 1927.
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Rule 65 of the Federal Rules of Civil Procedure governs the issuance of
preliminary injunctions. The Court must consider four primary factors in determining
whether a preliminary injunction should be granted under Rule 65(b): (1) the likelihood
of the moving party’s success on the merits; (2) the threat of irreparable harm to the
moving party; (3) the state of balance between the alleged irreparable harm and the harm
that granting the injunction would inflict on the other party; and (4) the public interest.
Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109, 113 (8th Cir. 1981). This analysis
was designed to determine whether the Court should “intervene to preserve the status
quo” until it determines the merits of the case. Id. “The burden of establishing the
propriety of a preliminary injunction is on the movant.” Baker Elec. Coop., Inc. v.
Chaske, 28 F.3d 1466, 1472 (8th Cir. 1994).
APPLICATION OF THE DATAPHASE FACTORS
Likelihood of Success on the Merits 8
There is a relatively strong likelihood that Mobile Mini will succeed on its claim
that Vevea breached and/or will breach ¶ 5(a) of the Agreement, which bars Vevea from
directly or indirectly soliciting Company Customers for twelve months. To succeed on a
claim of breach of a non-compete contract in Delaware, a plaintiff must ultimately prove
(1) the existence of a valid, enforceable contract; (2) breach of a contractual obligation by
The parties agree that Delaware substantive law applies to the breach-of-contract claim,
while Minnesota substantive law applies to the tortious interference claim.
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the defendant; and (3) damages. 9 Greenstar, LLC v. Heller, 814 F. Supp. 2d 444, 450
(D. Del. 2011).
First of all, Defendants do not challenge, for purposes of this motion, the
enforceability of the Agreement. Without definitively deciding the issue at this point, the
Court also finds it likely that the Agreement is enforceable under Delaware law. See
Research & Trading Corp. v. Pfuhl, Civ. A. No. 12527, 1992 WL 345465, at *6 (Del. Ch.
Nov. 18, 1992) (noting that under Delaware law, a non-compete agreement is valid if it is
“[(1)] valid under ordinary contract principles . . . [; (2)] its duration is reasonably limited
temporally[; (3)] its scope is reasonably limited geographically[; (4)] its purpose is to
protect legitimate interests of the employer[; and (5)] its operation is such as to
reasonably protect those interests”). The Agreement is relatively limited in geographical
scope and duration, and Mobile Mini appears to have a legitimate interest in ensuring
Vevea’s replacement has the opportunity to establish himself or herself before Vevea
engages in robust direct competition in the same market on behalf of another company.
Here, Vevea made two blatant sales pitches on LinkedIn on behalf of Citi-Cargo
before the expiration of the Agreement’s non-solicitation provision.
Defendants’ arguments, the posts are not mere status updates announcing Vevea’s new
position and contact information – if that were the extent of the posts, then there would
likely not be a breach of contract. See Arthur J. Gallagher & Co. v. Anthony, No. 16-
To the extent Defendants argue that Mobile Mini’s likelihood of success is low for
failure to allege damages, the Court rejects this argument. Mobile Mini alleges damages in the
form of future lost profits, loss of customers, loss of customer goodwill, and harm to reputation.
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284, 2016 WL 4523104, at *15 (N.D. Ohio Aug. 30, 2016) (holding that a press release
posted on LinkedIn and Twitter announcing that an employer had hired a new employee
was not a solicitation); Invidia, LLC v. DiFonzo, No. MICV20123798H, 2012 WL
5576406, at *5 (Mass. Super. Ct. Oct. 22, 2012) (holding that a Facebook post
announcing an employee’s new job was not a solicitation).
Instead of merely announcing a job change, the language of the posts here
demonstrates that Vevea’s purpose was to entice members of Vevea’s network to call her
for the purpose of making sales in her new position at Citi-Cargo. See Bankers Life &
Cas. Co. v. Am. Senior Benefits LLC, No. 1-16-0687, 2017 WL 2799904, at *4 (Ill. App.
Ct. June 26, 2017) (noting that the key consideration when determining whether a social
media post is a “solicitation” is “the content and the substance” of the post). The Court
also finds significant a declaration from the Branch Manager at Mobile Mini’s Lino
Lakes office, which states that when Vevea worked at Mobile Mini, he and Vevea
“discussed using LinkedIn as a marketing tool, to advertise Mobile Mini’s products and
services,” and Vevea did in fact “use LinkedIn for that purpose during her employment
at Mobile Mini.” (Martinez Decl. ¶ 12.)
The information before the Court also indicates that in all likelihood, Vevea’s
LinkedIn network includes at least one, if not many, Company Customers. Thus, the
posts likely amount to direct solicitation of business from Company Customers in
violation of ¶ 5(a) of the Agreement.
In addition to the alleged past breaches of the non-solicitation provision, the Court
also finds that Defendants threaten to breach ¶ 5(a) in the future. Whereas Defendants
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assert that the Agreement’s non-solicitation provision extends for nine months, (see
Defs.’ Mem. of Law in Opp’n to Mot. for TRO and/or Prelim. Inj. at 3, June 30, 2017,
Docket No. 32), the plain language of the Agreement is clear that this restriction extends
for twelve months, (Agreement ¶ 5(a)). The Court finds Defendants’ open disagreement
with the plain language of the contract as, quite simply, a threat of future breach.
Because Vevea’s LinkedIn posts likely violated the Agreement, and because
Defendants openly misinterpret the applicable time limit for ¶ 5(a) in the Agreement in a
manner strongly implying that Vevea may begin intentionally soliciting Company
Customers after a mere nine months, the Court finds a strong likelihood of success on
Mobile Mini’s breach-of-contract claim. 10
The Court finds there is insufficient information before the Court at this time to
conclude that Mobile Mini is likely to succeed on its other claims. First, there is only very weak
circumstantial evidence that Vevea worked for Citi-Cargo before the expiration of the six-month
non-compete period in violation of ¶ 3. Second, there is no evidence at this time that Vevea has
made any sales to Company Customers on behalf of Citi-Cargo in violation of ¶ 4(b). The fact
that two Company Customers have either decreased business with Mobile Mini or are
considering taking their business elsewhere is insufficient to establish that Vevea had anything to
do with these customers’ decisions or that Mobile Mini has actually lost any customers or profits
to a competitor at all. Third, Mobile Mini makes a conclusory allegation in the complaint that
Vevea violated the prohibition on poaching Mobile Mini employees in violation of ¶ 5(d) – an
allegation neither party briefed. Mobile Mini has not demonstrated likelihood of success on that
And lastly, Citi-Cargo and LSI maintain that they have made efforts to try to ensure that
Vevea does not breach the Agreement, and there is evidence that they instructed Vevea not to
take any calls from Company Customers or to refer those calls back to Mobile Mini while the
Agreement still applies. (Compl. Ex. C; Vevea Decl. ¶ 4.) Given this as-yet undisputed
evidence, for purposes of preliminary relief, the Court finds Mobile Mini has failed to establish a
likelihood of success on the claim of tortious interference because there is little evidence
demonstrating intent. See Kjesbo v. Ricks, 517 N.W.2d 585, 588 (Minn. 1994) (laying out the
elements of a tortious interference claim, including that the tortfeasor intentionally procured the
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Irreparable Harm to Mobile Mini
To succeed in an action for a preliminary injunctive relief, a movant must first
show irreparable harm that is not compensable with money damages. Travel Tags, Inc. v.
UV Color, Inc., 690 F. Supp. 2d 785, 798 (D. Minn. 2010). “Irreparable harm occurs
when a party has no adequate remedy at law, typically because its injuries cannot be fully
compensated through an award of damages.” Gen. Motors Corp. v. Harry Brown’s, LLC,
563 F.3d 312, 319 (8th Cir. 2009). Loss of reputation and goodwill can be irreparable
harm. See Med. Shoppe Int’l, Inc. v. S.B.S. Pill Dr., Inc., 336 F.3d 801, 805 (8th Cir.
2003) (holding even though they are difficult to quantify, loss of intangible assets
constitutes irreparable injury); Iowa Utils. Bd. v. FCC, 109 F.3d 418, 426 (8th Cir. 1996)
(loss of consumer goodwill can be irreparable harm).
Vevea’s past breaches and threatened future breaches of the Agreement’s nonsolicitation provision pose a danger of irreparable harm to Mobile Mini in the form of
lost future customers and loss of goodwill and reputation. While Vevea states that she
has been referring and will continue to refer calls from Company Customers to Mobile
Mini, there is at least some chance that the fact that the LinkedIn posts have been up
since May 2017 has harmed Mobile Mini’s reputation and will lead to lost customers in
the future, so Defendants’ efforts to comply with the Agreement may be insufficient to
prevent harm. And to the extent Vevea may begin openly soliciting Company Customers
before the expiration of the twelve-month non-solicitation provision, the threat of
irreparable harm caused by that breach is clearly present. Thus, this factor also weighs in
favor of granting a preliminary injunction.
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Balance of the Equities and Public Interest
There would most likely be some impact on Citi-Cargo’s sales if Vevea is
enjoined from soliciting Company Customers for twelve rather than nine months, but this
is a harm that Vevea agreed to accept when she executed the Agreement, and that CitiCargo should have been aware of when it hired Vevea with full knowledge of the
Agreement. Moreover, simply enforcing the relatively short time limits contained in the
Agreement, including requiring that Vevea remove the offending LinkedIn posts, would
not restrict Citi-Cargo from operating in the Portable Storage Business or making sales to
Company Customers without Vevea’s involvement. Ordering such relief also would not
preclude Vevea from making a living or working in the Portable Storage Business in
Minnesota. There is also public interest in favor of enforcing valid contracts. Benfield,
Inc. v. Moline, 351 F. Supp. 2d 911, 919 (D. Minn. 2004). And the potential irreparable
harm to Mobile Mini in the event that Vevea is permitted to solicit Company Customers
before the expiration of the non-solicitation provision is not insignificant.
On the other hand, Mobile Mini seeks relief far broader than simply removal of
Vevea’s LinkedIn posts and compliance with the Agreement’s various restrictions until
their contractual expiration date. Mobile Mini asks the Court to restart the clock on most
of the key restrictions found in the Agreement, such that the six-month bar on work in the
Portable Storage Business, the nine-month bar on sales to Company Customers, and the
twelve-month bar on soliciting Company Customers’ business would all re-commence
upon the filing of this Order. Mobile Mini relies on a provision in the Agreement stating:
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[Vevea] understand[s] and agree[s] that if [she] breach[es] any provision of
this Agreement containing a term of months or years, the term may be
extended by a court if the court enters an injunction restraining further
breach or otherwise awards any kind of relief or remedy to the Company so
[Vevea doesn’t] get credit for the time [Vevea] was breaching the
(Agreement ¶ 7(e).) The Court understands this provision to allow but not require the
Court to extend the Agreement’s key terms in the event of a proven breach.
Here, the Court finds that restarting the clock on the Agreement’s key time limits
would amount to a windfall for Mobile Mini that is not in the interests of justice. See
Dataphase, 640 F.2d at 113 (“[T]he question is whether the balance of equities so favors
the movant that justice requires the court to intervene to preserve the status quo until the
merits are determined.”). To grant the sweeping relief Mobile Mini requests would
amount to not merely preserving the status quo, but expanding Mobile Mini’s rights
under the Agreement related to terms that Vevea likely has not breached. Thus, if the
Court granted the requested relief, the negative financial effects on Vevea and Citi-Cargo
would likely grow to an unacceptable level, and the balance of the equities would swing
in Defendants’ favor.
Additionally, Defendants have indicated a willingness to try to comply with the
Agreement by directing Vevea to refer Company Customer calls to Mobile Mini. 11
Defendants’ voluntary remedial action, though insufficient in this instance to ameliorate
all harms caused by Vevea’s LinkedIn posts, weighs in Defendants’ favor when
Citi-Cargo even conceded that if it had been aware that a notification of Vevea’s
LinkedIn posts would be sent to Company Customers, it would not have given Vevea permission
to make the posts. (Ofstehage Decl. ¶ 14.)
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balancing the equities. See Sanborn Mfg. Co. v. Campbell Hausfeld/Scott Fetzer Co., 997
F.2d 484, 489 (8th Cir. 1993).
While Mobile Mini has a right to protect its business from competition as set out
in the Agreement, it may not avoid competing with Vevea forever, and judicially
intervening to substantially extend the duration of the Agreement’s restrictions would not
be in the public interest. “[T]he Court notes that in Minnesota ‘[restrictive] covenants [in
employment contracts] are looked upon with disfavor because their enforcement
decreases competition in the marketplace and restricts the covenantor’s right to work and
ability to earn a livelihood.’” GreatAmerica Leasing Corp. v. Dolan, No. 10-4631, 2011
WL 334829, at *3 (D. Minn. Jan. 31, 2011) (quoting Jim W. Miller Constr., Inc. v.
Schaefer, 298 N.W.2d 455, 458 (Minn. 1980)). Thus, the Court will issue an injunction
enforcing the Agreement’s terms as written and requiring Vevea to remove the LinkedIn
posts. But given the relatively minor extent of the breaches here and the complete lack of
a showing of actual damages thus far, the Court finds little justification for granting the
broad relief Mobile Mini requests and thus will deny all other forms of requested
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
Defendants’ Motion to Dismiss for Lack of Jurisdiction [Docket No. 9] is
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Plaintiff Mobile Mini, Inc.’s Motion for Temporary Restraining Order
and/or Preliminary Injunction [Docket No. 18] is GRANTED in part and DENIED in
part, as follows:
Until further order of this Court, a preliminary injunction is hereby
entered against defendants as follows:
(1) Any posts on Vevea’s LinkedIn account that advertise CitiCargo’s products or services or request viewers to contact Vevea
for the purpose of providing such products or services (including
the provision of a quote) shall be removed. 12 Vevea is enjoined
from creating any similar posts advertising Citi-Cargo’s products
or services on LinkedIn until the expiration of the non-solicitation
provision in the Agreement, on November 8, 2017.
restriction applies with equal force to any other social media sites
other than LinkedIn to the extent that Vevea’s friend list or
network on such a site includes at least one Company Customer or
their representative. This restriction does not limit Vevea’s ability
to post mere “status updates” listing her place of work and contact
(2) Vevea is otherwise enjoined from violating any other provision in
the Mobile Mini, Inc. Confidentiality, Non-Solicitation, NonCompete and Inventions Agreement for Branch Managers, Plant
Managers, and Salespeople (“Agreement”) until that provision’s
expiration, as provided in the Agreement.
example, Vevea shall abide by the bar on making sales to
Company Customers found in ¶ 4(b) until August 8, 2017, while
This includes Vevea’s two LinkedIn posts documented for the Court, made on or
around May 11, 2017, and May 17, 2017.
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the non-solicitation provision and other provisions found in ¶ 5
remain in effect until November 8, 2017.
In accordance with Fed. R. Civ. P. 65(c), the preliminary injunction
shall become effective upon Mobile Mini’s posting a bond with the Clerk of Court
in the amount of Ten Thousand Dollars ($10,000) for the payment of such costs
and damages as may be incurred or suffered by Defendants in the event
Defendants are found to have been wrongfully enjoined.
The motion is DENIED in all other respects.
DATED: July 25, 2017
at Minneapolis, Minnesota.
JOHN R. TUNHEIM
United States District Court
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