The Pennsylvania Superior Court has held that the enforcement of noncompete agreements in a case involving employees of a crane company was the correct decision.
A three-judge Superior Court panel consisting of Judges Correale F. Stevens, Paula Francisco Ott and Victor P. Stabile affirmed the holding of the Bucks County Court of Common Pleas.
The Superior Court denied the appeals of defendants Harvey Ray Graham, Kristian B. Bruu, Robbin O. Rainey and Thomas Newell, along with co-defendants Crane & Rig Services and A Crane Rental (called ACrane in the opinion), in which they contested a preliminary injunction prohibiting the individual defendants from working in the crane rental industry in limited geographic areas, soliciting customers of plaintiffs AmQuip Crane Rental and Maxim Crane Works, and using AmQuip’s confidential information, according to Stabile’s opinion.
The individual defendants previously worked for AmQuip, but left to work for ACrane. They argued that Newell did not breach his duty of loyalty to AmQuip, that the Bucks County court made erroneous factual rulings, and that the court abused its discretion in enforcing noncompetition agreements that Graham, Bruu and Rainey entered into with AmQuip.
The Superior Court did not find their arguments compelling.
“The individuals insist that any difficulties incurred by AmQuip are miniscule compared to the difficulty that the individuals will face in finding new employment after working in the crane industry for decades,” Stabile said. ”Nevertheless, Rainey, Bruu and Graham brought this problem on themselves by breaching their noncompetition covenants. … To accept the individuals’ argument would be to frustrate large employers who have substantial interests in safeguarding against employees who would otherwise betray them,” Stabile said.
The appellate panel began its analysis with Newell.
“In their first argument, the individuals assail the entry of a preliminary injunction against Newell, the only Individual who did not enter into a written covenant not to compete with AmQuip,” Stabile said. “We hold that Newell breached his common law duty of loyalty to AmQuip by diverting AmQuip’s customers to ACrane while still employed by AmQuip and inducing the other Individuals to breach the covenants not to compete that they entered into with AmQuip.”
As for the trial court’s factual conclusions, Stabile said none were made erroneously as the defendants had claimed. The court rejected their contention that they were duped into signing a noncompete agreement.
Additionally, “the evidence demonstrated that the Individuals had access to AmQuip’s confidential business information, the value of which was shown by ACrane’s exponential growth after the Individuals joined this fledgling company,” Stabile said. “Enforcement of the noncompetition covenants was necessary to prevent additional misuse of this information.”
Stephen Corr of Begley Carlin & Mandio represents the defendants and did not return a call seeking comment. Lauri Kavulich of Clark Hill represents the plaintiffs and also did not return a call seeking comment.