13 Mass. L. Rptr. 716

William Gallagher Associates Insurance Brokers, Inc. v. Albert Everts, II et al.1

Superior Court, Suffolk, SS

No. 199900519C

Memorandum Dated September 6, 2000

*717Hinkle, J.

Plaintiff

William Gallagher Associates Insurance Brokers, Inc. seeks damages and injunctive relief from defendants Albert Everts, II and InterContinental Insurance Brokers, LLC (“InterContinental”). Plaintiff claims defendants misappropriated confidential business information and trade secrets and solicited plaintiffs customers.2 The matter is now before the court on defendants' motion for summary judgment. After a hearing, for the reasons set forth below, this motion is ALLOWED.

BACKGROUND

The undisputed material facts as established by the summary judgment record are as follows.3

Everts began working for Frank B. Hall & Co. of Boston (“Hall & Co.”) in or around 1985. At Hall & Co., Everts was an account manager.4 In this capacity, he did not sell insurance but issued certificates of insurance, sent out policies and made proposals. The nature of Everts’ work as an account manager was generally the same as the work of a “producer" but differed in that a producer is ultimately responsible for the accounts.5 Everts performed work for two clients of Hall & Co. while there, Sasaki Associates arid Envirogen.

Everts was involved in the environmental and professional liability insurance business at Hall & Co. Everts provided insurance and risk management services for environmental and professional liability risks. He would consult with clients and prospective clients concerning their insurance and then receive quotes from insurance companies for the clients. Everts also generated insurance manuscript and policy forms.

The potential market for environmental insurance and professional liability products includes hospitals, landfills, industry, manufacturing, laboratories, dry cleaners, automobile repair shops, junkyards, restaurants, supermarkets, shopping malls, gas stations, apartment buildings, farms and entities buying commercial properties. The insurance product Everts sold to such clients and the insurers providing that insurance product are well known in the industry. Everts was not in any special position to receive the quotes he obtained, because they are available to anyone with the relevant information about the client or potential client.6

In 1992, Everts moved to California and worked as a producer for the Crowell Insurance Agency of Orange County. After leaving that agency, Everts worked for Marsh & McLennan in 1993 for several months as a producer. Everts maintained contact with Sasaki Associates and Envirogen.7

In August 1993, Everts became a producer with Minet Insurance Services, Inc., a subsidiary of Minet, Inc., and worked in Los Angeles. Everts believes that at that time he required no additional training to work as a producer. He did, however, take courses to maintain his license as a property casualty broker.

Upon joining Minet Insurance Services, Inc., Everts signed a restrictive covenant agreement (the ”1993 agreement")8 with Minet International Professional Indemnity Brokers, Inc. (a sister corporation of Minet Insurance Services, Inc.).9 Only Everts’ signature appears on the 1993 agreement; this agreement was not signed by any representative of Minet Insurance Services. At the time Everts signed the 1993 agreement, Mike Newman, Senior Vice President of Minet Insurance Services, Inc., told Everts that this agreement would never be enforced by Minet Insurance Services, Inc., because non-competition agreements are unenforceable in California.10

In or around February 1996, Minet, Inc. sent Everts (in California) an offer letter11 and another restrictive covenant agreement (the “1996 agreement”). Everts signed the 1996 agreement and sent it to Minet, Inc. in New York. The 1996 agreement provided a signature line for a representative of the William Gallagher Associates Insurance Agency, Inc. That company, a Massachusetts corporation, was owned by Minet, Inc., and changed its name to Minet Insurance Brokers, Inc. in 1996. Through a series of sales and name changes, William Gallagher Associates Insurance Agency, Inc. and Minet Insurance Brokers, Inc. became the plaintiff in this action.12 No representative of Minet, Inc. or the William Gallagher Associates Insurance Agency, Inc. signed the 1996 agreement.

The offer letter stated that Everts’ relocation to Boston would be contingent on receipt of the completed 1996 agreement. The 1996 agreement, nine pages in length, states that it is an agreement between Everts and William Gallagher Associates Insurance Agency, Inc. and its parents, subsidiaries, successors, affiliates and assigns.13 The space provided for the date of the agreement is left blank. The agreement contains “mutual recitals.”14

In April 1996, Everts worked as a producer in the Boston office of Minet Insurance Brokers, Inc. The cost of Everts’ move to Boston was covered by St. Paul Insurance Co.15 Approximately one year later, in May 1997, Minet Insurance Brokers, Inc. (by way of its ownership by Minet, Inc.) was sold to Aon Corporation. In August 1997, the management of the Boston office reacquired ownership of the office, and renamed it William Gallagher Associates Insurance Brokers, Inc. See supra n.12. While Everts was aware of these corporate purchases and name changes, he was not informed of specific details regarding those transactions or their impact on Everts’ employment contracts. When he began working for Minet Insurance Services, Inc., Everts was aware that that corporation was one of a number of related corporations, but he did not know the exact corporate relationship.

Working for Minet Insurance Brokers, Inc. and then for the plaintiff, Everts provided insurance and risk *718management services for environmental and professional liability risks. He consulted with clients and prospective clients concerning their insurance and obtained insurance quotes from insurance companies for the clients. The quotes he received were obtainable by any person with the relevant information from the client. Everts also generated insurance manuscript and policy forms. The skills Everts used to perform these functions were skills that he acquired before working for plaintiff or plaintiffs predecessors, but he was still required to attend courses to maintain his license. The duties Everts performed were generally the same in Boston as they were in California.

Everts received some necessary assistance in performing his job with plaintiff (and Minet Insurance Brokers, Inc.). Specifically, Everts received assistance from persons in the typing pool (although he did much of his own typing), from account managers who performed necessary clerical tasks for Everts and from other support staff members.16 Everts’ office supplies were provided by the company. Everts also received assistance from Philip Edmundson, who brought Everts with him to. sell insurance to Instron Corporation. Everts and Edmundson were successful in selling environmental insurance to Instron. However, Everts has had no contact with Instron since he left his employment with plaintiff, and Instron Corporation has never become a client of InterContinental. Edmundson also accompanied Everts on a visit to a representative of Bank of Boston, but this visit did not generate any business for plaintiff, and there is no evidence Bank of Boston ever became a client of InterContinental. In addition, Everts was accompanied by a young assistant on client visits on four or five occasions, but Everts is unaware of any instance in which the assistant’s presence substantially helped to create a customer relationship, and plaintiff offers no evidence to contradict this. Finally, one newsletter was sent to clients and potential environmental clients by plaintiff as a marketing tool. Everts wrote this newsletter. Everts is unaware of any instance in which the newsletter helped him obtain business, and there is no evidence that the newsletter played any role in generating any business.

While working for plaintiff and Minet Insurance Brokers, Inc., Everts attended a Miller Heiman sales training program. Plaintiff paid for Everts to attend that program.17 Everts had attended three other Miller Heiman sales training programs with previous employers, beginning in or about 1990.18 This training program, along with the courses to maintain his license, are the only evidence before me of training of Everts while working for Minet Insurance Brokers, Inc. and plaintiff.

Everts does not recall any verbal or written statements being given to him regarding what type of client information should be kept confidential. No instruction was given to Everts as to how to keep information confidential. Plaintiff provided Everts with a laptop which Everts believes (and plaintiff has not contradicted this belief) encouraged Everts to bring client information, documents and flies outside the office. Everts was never instructed not to create a customer list. To Everts’ knowledge, no documents relating to clients or to services provided to clients were marked “confidential” or “trade secret” or contained any other mark requiring confidentiality. Because they were not locked, files were accessible to any person in the office including support personnel. The office was not partitioned to prevent other nonessential personnel from viewing the documents.

Everts received a base salary from plaintiff and had the potential to receive a bonus based upon new business brought in.

Everts left plaintiff in November 1998 because he did not believe plaintiff was adequately servicing the clients whose accounts Everts handled and because he was “rendered invisible,” by which Everts means that he was excluded from a sales incentive program whereby commissions were earned and was not offered an equity position or given raises in pay.19

On November 5, 1998, Everts accepted InterContinental’s offer of employment as a producer. Everts submitted his resignation to plaintiff in a memorandum dated November 13, 1998.

Everts informed some of the clients whose accounts he handled that he would be leaving employment with plaintiff. Everts did not urge these customers to leave plaintiff or solicit them to transfer their policies to InterContinental. Everts did not disparage plaintiff or state that InterContinental would be a better agency. Some customers told Everts that they wanted to continue doing business with him.

After leaving plaintiffs employ, Everts did not utilize any customer list of plaintiff to solicit clients. Everts did not consult such a list to generate potential customers. Everts did not generate a list of clients whose accounts he serviced working for plaintiff, either before or after leaving plaintiffs employ. Everts remembered the clients whose accounts he serviced while in plaintiffs employ. This consisted of approximately 25 customers. Everts had had experience with most of these customers for many years.

However, Everts did take a memorandum from plaintiff to various employees, dated November 9, 1998, regarding potential minimum revenue requirements. Attached to this memorandum was a list of approximately 200 client accounts. The memorandum states that these accounts generate less than $5,000 in revenue. According to the memorandum, in most cases the revenues generated by those accounts “do not nearly compensate for the work/service provided” by plaintiffs staff. In addition, the memorandum states:

*719Please review the list with the understanding that it is very possible that we will be implementing minimum revenue requirements for all future business as well as existing accounts as they approach renewal. Understand that no such decision has been made to date, but serious consideration will be given to the idea over the next few days/weeks. I would like you to pay particular attention to any account that has been on the books for 3 years or more which has shown no discernible growth or potential for growth. We may require that these accounts be assessed a fee or that they find another broker (in a nice way, of course!).

(Emphasis in original.) Everts does not make any money on accounts of $5,000 or less.

When he joined InterContinental, 13 of the clients whose accounts he had serviced working for plaintiff elected to continue their business relationship with Everts, terminating all or substantially all of their business relationship with plaintiff. Everts brought two of these clients, Sasaki Associates and Envirogen, to Minet Insurance Services, Inc. in 1993 and 1994.20 Everts had developed social relationships with some of the principals of these two companies, who played golf with Everts and attended Everts’ wedding in 1998. Four clients whose accounts Everts serviced, Acme Solvents, Midco Remedial Corp., Organic Chemicals and Verona Well Field, became clients while Everts was with Minet Insurance Services, Inc. in California. The remaining seven were clients whose accounts Everts serviced while be was a producer in the Boston office.

Everts does not believe he has brought any former customers of plaintiff to InterContinental, other than clients whose accounts Everts personally serviced.21 Plaintiff has offered no evidence to contradict this belief. At Everts’ suggestion, both Sasaki Associates and Envirogen have kept some accounts with plaintiff, including Sasaki’s employee benefits policies and Envirogen’s directors and officers policies. The insurance Everts writes for these 13 companies is “fairly similar” to the insurance he wrote when working for plaintiff.

When he informed these clients that he was with InterContinental, Everts did not use any specific, insider information as to whether the customers were susceptible to changing agencies (e.g., pending proposals or expiration data premium amounts). Everts only called persons within those companies and informed them he had left plaintiffs employ.22

With one exception, Everts personally solicited each of the clients who went with him to InterContinental. Those companies did not become clients through any document, referral or other resource provided by plaintiff. The exception is Environmental Project Control, which was a house account of plaintiff assigned to Everts.

After leaving plaintiff, Everts did not contact or solicit GEI consultants, Enventures Capital or Glendale Environmental. To Everts’ knowledge (uncontradicted by plaintiff), none of those companies became customers of or were contacted by InterContinental. These accounts were not “parked” at another broker, in that Everts does not now receive commissions or benefits from these accounts and has not since leaving plaintiff. In addition, Everts has no arrangement to receive benefits from these accounts in the future. He does not know what agency these companies may have gone to, if they left plaintiff. He also does not know who, if anyone, has been receiving commissions.

The names of some of plaintiff s customers appear on plaintiffs Internet Web site.

In August 1998, before Everts left employment with plaintiff, plaintiff asked Everts and the other producers to sign a 13-page restrictive covenant/non-compete agreement. Everts received a number of voice messages from Philip Edmundson requesting that he sign the agreement. Everts did not sign the agreement. In or around September 1998, Everts asked Patricia Arsenault (an employee of plaintiff) for copies of any restrictive covenant governing Everts. Arsenault provided Everts with a copy of the 1993 agreement, noting that it was the only such document in the file and had not been signed by the company.

At the time Everts accepted employment with InterContinental, he did not believe he was subject to any restrictive covenant or noncompete agreement. When it hired Everts, InterContinental did not believe Everts was subject to an enforceable restrictive covenant or noncompete agreement with a prior employer.

At InterContinental, Everts continues to place insurance with California-based insurers, and he also currently has customers based in California.

There is no evidence before me that InterContinental has sought from Everts confidential information relating to customers of plaintiff.

After Everts left, plaintiff, through its attorneys, wrote a letter to Everts and a letter to InterContinental, alleging that Everts was in violation of the 1993 agreement.

DISCUSSION

Summary judgment is appropriate where there are no genuine issues of material fact and the summary judgment record entitles the moving party to judgment as a matter of law. Cassesso v. Commissioner of Correction, 390 Mass. 419, 422 (1983); Mass.R.Civ.P. 56(c). The moving party bears the burden of affirmatively demonstrating that there is no genuine issue of material fact on every relevant issue. Pederson v. Time, Inc., 404 Mass. 14, 17 (1989). On matters for which the moving party does not bear the burden of proof at trial, it may demonstrate the absence of a triable issue either by submitting affirmative evidence negating an *720essential element of the nonmoving party’s case or by showing that the moving party has no reasonable expectation of proving an essential element of its case at trial. Kourouvacilis v. General Motors Corp., 410 Mass. 706, 716 (1991). Once the moving party establishes the absence of a triable issue, the non-moving party must allege specific facts establishing the existence of a genuine issue of material fact and cannot defeat the motion by resting on mere assertions of disputed facts. LaLonde v. Eissner, 405 Mass. 207, 209 (1989). In deciding a motion for summary judgment, the court may consider pleadings, depositions, answers to interrogatories, admissions on file and affidavits. Community Nat'l Bank v. Dawes, 369 Mass. 550, 553 (1976); Mass.R.Civ.P. 56(c). The court may only consider undisputed material facts and apply them to the law. See Kelley v. Rossi, 395 Mass. 659, 663 (1985).

I. BREACH OF CONTRACT

Plaintiff alleges that Everts breached the 1996 agreement23 by (1) soliciting insurance business from plaintiffs customers, (2) aiding another party in the solicitation of insurance business from plaintiffs customers and (3) using plaintiffs confidential information and trade secrets to plaintiffs detriment. I address this third allegation first.24

A. Analytical Framework

In Massachusetts,25 a restrictive employment covenant is enforceable if the employer demonstrates that the agreement is (1) necessary to protect a legitimate business interest of the employer, (2) supported by consideration, (3) reasonable in scope and (4) otherwise consonant with the public interest. Whitinsville Plaza v. Kotseas, 378 Mass. 85, 102-03 (1979); Alexander & Alexander, Inc. v. Danahy, 21 Mass.App.Ct. 488, 496 (1986). Legitimate employer business interests include protection of trade secrets, confidential business information and good will. All Stainless, Inc. v. Colby, 364 Mass. 773, 779-80 (1974); Kroeger v. Stop & Shop Cos., 13 Mass.App.Ct. 310, 316 (1982).

B. Confidential Information and Trade Secrets

Upon termination, an employee “may carry away and use the general skill or knowledge acquired during the course of employment.” Dynamics Research Corp. v. Analytic Sciences Corp., 9 Mass.App.Ct. 254, 267 (1980) (citations and internal quotation marks omitted). He is not, however, permitted to use trade secrets or confidential business information. To determine whether information is a “trade secret” or “confidential business information” six factors are relevant: (1) the extent to which the information is known outside plaintiff s business, (2) the extent to which the information is known by employees and others involved in plaintiffs business, (3) the extent of measures taken by plaintiff to guard secrecy of the information, (4) the value of the information to plaintiff and its competitors, (5) the amount of effort or money expended by plaintiff in developingthe information, and (6) the ease or difficulty with which the information couldbe properly acquired or duplicated by others. Jet Spray Cooler, Inc. v. Crampton, 361 Mass. 835, 840 (1972).26

The record before me is devoid of any direct evidence that Everts was in contact with confidential business information or trade secrets. Rather, the evidence indicates that Everts consulted insurance companies who did not limit their dealings to plaintiff but provided insurance quotes to others in the insurance brokerage business. The client information Everts possessed was available to any person who asked the client, assuming the client was willing to speak with such person. Besides including a very broad definition of the terms “trade secrets” and "confidential information” in the 1996 agreement, there is no evidence that plaintiff took measures to protect the secrecy of any information or designated specific information confidential. Even the November 9, 1998 memorandum which Everts took is not marked confidential. The record also indicates that Everts retained a memory of the customers he served. Nowhere in plaintiffs submissions is there evidence that establishes a disputed factual issue on this point.

Nonetheless, drawing all favorable inferences in favor of plaintiff as the non-moving party, and given the examples included in the 1996 agreement, I assume that while employed by plaintiff and its predecessors Everts was exposed to some information protected as trade secrets or as confidential business information, and I assume that the November 9, 1998 memorandum falls within this category.

However, even with this assumption in plaintiffs favor, the record does not show that Everts used any confidential information. Defendants have established that the information Everts used when he contacted the 13 companies that switched to InterContinental was his own recollection that he had serviced these accounts when working for plaintiff (and, in some cases, before working for plaintiff). The evidence does not show that this information — the fact that these companies were customers of plaintiff — is protectible information. There is no evidence, for example, that the product or service provided (insurance and risk management) is purchased only by a small percentage of potential clients, such that identity of those who buy is a valuable lead. The additional information Everts acquired — company-specific information as to insurance needs and premium quotes from insurers — was readily obtainable from the companies and from the insurers, respectively. As for the November 9, 1998 memorandum and customer list, there is no evidence Everts made any use of this. Plaintiff points to no evidence from which it can be inferred that Everts *721utilized the list or memorandum in any way that caused damage to plaintiff.

For these reasons, I conclude that defendants are entitled to summary judgment on plaintiff s claim that Everts misused confidential information or trade secrets.

C. Solicitation

Plaintiff also argues that Everts violated the 1996 agreement by soliciting insurance business from plaintiffs customers or by aiding another party (presumably InterContinental) to do the same. At issue are the 13 companies that switched to InterContinental when Everts moved there. I note at the outset that there is no evidence in the summary judgment record from which a reasonable jury could conclude that InterContinental encouraged or even knew of Everts’ contact with the 13 companies at the time Everts contacted those companies.

The terms of the non-solicitation portion of the 1996 agreement are broad. Under its terms, Everts cannot directly or indirectly “call upon, canvass, solicit or approach” companies on whose accounts he worked, for the purpose of “soliciting and/or providing to such client the type of business placed by such client” by and/or through plaintiff. The questions before me now are (1) to what extent this language is enforceable in Massachusetts, under the analytical framework applicable to restrictive employment covenants, and (2) whether the summary judgment record establishes a disputed factual issue for trial.

1. Enforceability of the Language

As I note above, legitimate business interests of an employer include protection of trade secrets and confidential information and protection of good will. The determination of whether a restriction is necessary to protect the good will of an employer often, as here, subsumes an analysis of whether the former employee has knowledge of “some business secret or confidential information.” All Stainless, Inc., 364 Mass. at 779-80. The question here is to what extent the language of the non-solicitation portion of the agreement is necessary to protect plaintiffs good will.

An employer’s good will is traditionally defined as the employer’s positive reputation with its customers or potential customers, generated by repeat business with existing customers or by referrals to potential customers. Slate Co. v. Bikash, 343 Mass. 172, 175-76 (1961).

Two considerations are relevant to determining whether a restrictive covenant is necessary to protect an employer’s good will. First, the employer must demonstrate that his business involves good will. All Stainless, Inc., 364 Mass. at 779. Second, the employee must be in a position where he can appropriate that good will. Id. An employee is in such a position when he has knowledge of the employer’s trade secrets or confidential information or where the employee’s close association with the former employer’s customers might cause the customers to associate the employee, rather than the employer, with the service or products offered. Id. at 779-80.

I conclude that a bar against solicitation of customers could reasonably be found necessary to protect plaintiffs good will. The parties agree that plaintiffs business is of a type that involves good will (although they dispute who owns the good will). See Alexander & Alexander, Inc., 21 Mass.App.Ct. at 497. Also, as the employee with responsibility for accounts, a producer is in a position where he is capable of appropriating any good will that belongs to plaintiff by his knowledge of any secret or confidential business information of plaintiff or by his close association with the customers.

While it may have been necessary for plaintiff to bar Everts from soliciting customers on whose accounts he worked, I find and rule that the language of the agreement is too broad as a matter of law. The word “solicit” denotes an attempt to obtain something by persuasion, or to ask for the purpose of receiving. Black’s Law Dictionary 1248 (5th ed. 1979). Preventing Everts from attempting to persuade clients to move their accounts from plaintiff to a competitor could be found necessary to protect plaintiffs good will. However, the remaining terms, to “call upon, canvass ... or approach” sweep too widely. I construe the 1996 agreement strictly against plaintiff, because plaintiff is the drafter of the contract and because the contract is a post-employment restraint.27 Sentry Ins. v. Firnstein, 14 Mass.App.Ct. 706, 707 (1982). Therefore, I focus on the word “solicit” and construe the non-solicitation clause to bar only this type of contact.28

2. The Summary Judgment Record

Applying the undisputed facts in the record to the 1996 agreement, I conclude that (1) the good will generated belonged to Everts, at least as to 12 companies and (2) Everts did not “solicit” any of the companies that switched to InterContinental.

As to 12 of the companies that switched to InterContinental, the undisputed facts show that the good will at issue was not that which plaintiff had previously acquired and Everts misappropriated. Rather, the good will was Everts’ “own making, which he had developed with customers as a result of his own enthusiasm, personality and abilities.” First E. Mortgage Corp. v. Gallagher, 2 Mass. L. Rptr. 350, No. 94-3727F (Suffolk Super.Ct. July 21, 1994) (Fremont-Smith, J.). See also Alexander & Alexander, Inc., 21 Mass.App.Ct. at 497 (“Good will is of great importance in the insurance brokerage business. Customers have repeated and multiple insurance needs. Prompt service, integrity, and loyalty are of some importance to customers who would tend to rely on key personnel who have demonstrated those qualities in the past”).

*722Everts came to work for plaintiff after gaming experience and skills in the insurance business. He wrote the only newsletter used as a marketing tool. While Everts was accompanied by Philip Edmundson and an assistant on several occasions, there is no evidence that these two played any role in gaining new business. More significantly, the record does not show that these two joined Everts on any visits with any of the relevant 12 companies. There is no evidence that Everts took advantage of any system or training special to plaintiff to obtain business.

Most importantly, Everts himself solicited the business of those 12 companies. Two of these companies, Sasaki Associates and Envirogen, were customers that Everts brought to plaintiff when he first joined plaintiff. “The objective of a reasonable noncompetition clause is to protect the employer’s good will, not to appropriate the good will of the employee." Sentry Ins., 14 Mass.App.Ct. at 708. See 6A Corbin, Contracts §1391B (2000 Supp.).

To argue that there is evidence that plaintiff generated the good will at issue, plaintiff points to evidence that it provided clerical staff to Everts, sponsored Everts’ attendance at the Miller Heiman sales training program and provided Everts with the office supplies he needed to conduct business. However, plaintiff does not show how this translates into good will. While hiring an employee and providing him with an infrastructure necessary for him to do his job undoubtedly gives an employer significant rights to control the employee’s conduct, this does not mean that the good will which develops belongs to the employer.29 There is no evidence from which a reasonable jury could find that this type of support served to enhance plaintiff s reputation with its customers in such a way as to generate good will. The undisputed fact that the 13 companies left plaintiff upon Everts’ mere statement that he left plaintiff, without persuasion by Everts (as I discuss below), does not show that plaintiff s support created any loyalty to plaintiff. To the contrary, it tends to indicate trust in Everts.

Plaintiff also points to a statement in an answer to an interrogatory that plaintiff provided Everts with “support and advice in relation to developing marketing plans for prospective clients.” Such evidence has the potential to show that some of the good will belongs to plaintiff. However, on the record before me, this scenario remains mere potential. Without any detail in the record to give meaning to the phrase, it adds virtually nothing to help plaintiff. A finding that plaintiff generated the good will using Everts as its intermediary, based on this record, would be speculative. At this stage, after discovery, this evidence is insufficient to create a disputed issue of fact on the issue of who owns the good will related to the 12 companies, particularly since plaintiff would possess such information.

The situation is different as to the remaining company, Environmental Project Control. This was one of plaintiffs house accounts assigned to Everts. Thus, it became a client of plaintiff without involvement by Everts. I assume, for purposes of this motion, that it was plaintiffs good will that resulted in Environmental Project Control becoming and remaining a client of plaintiff.30 On the other hand, this company left plaintiff through the same means as the other 12, i.e., contact without persuasion by Everts. However, I conclude that the evidence does create a disputed issue of fact regarding the ownership of the good will created in connection with this company.

Even though I find that there is a disputed factual issue as to ownership of the good will as to this one company, I rule that the undisputed facts do not show that Everts violated the non-solicitation portion of the 1996 agreement as to any of the 13 companies that switched to InterContinental. Rather, the facts show that Everts contacted representatives of the companies, told them he was leaving plaintiff and told them where he was going. Construing the agreement as I believe I must, the critical undisputed fact is that Everts did not actively seek to persuade the companies to stay with him. Concern with an employee appropriating his former employer’s good will is realized when the employee appeals to a customer to leave the former employer by, e.g., providing reasons to do so. Here, there is no evidence Everts disparaged plaintiff or told the customers that InterContinental would be a better firm for them. Everts merely informed the customers of facts, and the customers indicated they wished to remain with Everts. There is not even a hint of hesitation by any of the companies, or any other evidence that the companies considered remaining with plaintiff

In its brief, plaintiff argues that the circumstances of this case excuse its inability to provide direct evidence that Everts violated the 1996 agreement. Plaintiff contends there is ample circumstantial evidence from which a reasonable jury could find Everts improperly solicited plaintiffs customers. I disagree. While summary judgment does not require direct evidence, it does require enough evidence to create a genuine disputed factual issue material to the case. On the record before me, there is insufficient evidence to create a disputed factual issue as to whether Everts improperly solicited plaintiffs customers.

II. The Remaining Counts

The above analysis disposes of the remaining counts. Plaintiffs brief focuses on its breach of contract claim and only once references the remaining counts.

In Count III, plaintiff alleges that Everts breached the implied covenant of good faith and fair dealing. See Anthony’s Pier Four, Inc. v. HBC Assocs., 411 Mass. 451, 471 (1991). The undisputed facts do not support *723a claim that Everts violated this implied covenant while employed by plaintiff.

Count IV alleges that InterContinental interfered with plaintiffs contractual relations. The summary judgment record contains no evidence to sustain this count.

Count VI alleges that Everts interfered with plaintiffs advantageous relationships with its customers by soliciting insurance business from those customers and diverting them to InterContinental. As noted, the undisputed facts show that Everts only contacted those customers and did not seek to persuade them to leave plaintiff. Moreover, the facts do not support a finding that Everts’ conduct was improper in motive or means. There is simply no evidence that Everts had an ulterior motive (e.g., to injure plaintiff) or used improper means such as deceit or coercion. See Draghetti v. Chmielewski, 416 Mass. 808, 816-17 (1994); United Truck Leasing Corp. v. Geltman, 406 Mass. 811, 815 (1990).

Plaintiff argues that an improper motive may be inferred because Everts continued to work for plaintiff for more than a week after accepting an offer of employment from a competitor and before telling plaintiff he was leaving, because he kept the November 9, 1998 memorandum and attached client list, and because he contacted the 13 companies who switched to InterContinental. There is nothing improper in working for plaintiff after having accepted a job with a competitor. Augat, Inc. v. Aegis, Inc., 409 Mass. 165, 172 (1991) (at-will employee may plan to go into competition with employer and take active steps to do so while still employed; policy considerations are that “at-will employees should be allowed to change employers freely and competition should be encouraged”).

As noted, nothing appears to have resulted from Everts’ taking of the November 9, 1998 memorandum. There is simply no evidence before me that Everts ever used the list for any purpose. It is difficult to see how Everts could have had an intent to steal these customers without evidence he used the list. For this same reason, and for the additional reason that the memorandum itself suggests that plaintiff may want to lose these small accounts,31 it is difficult to infer an intent to injure plaintiff by taking the list. Finally, the facts show nothing improper in Everts’ conduct toward the 13 companies who went to InterContinental.

Counts V and VII allege the tort of conversion and misappropriation of trade secrets and confidential information. As I discuss above, there is insufficient evidence in the summary judgment record that Everts improperly used any of plaintiffs trade secrets or confidential information. Even if I assumed that the November 9, 1998 memorandum and attachment contained protectible information, there is no evidence any harm resulted from this.

Count VIII alleges that both defendants violated G.L.c. 93A. There is no evidence that InterContinental or Everts engaged in any wrongful conduct. More importantly, c. 93A does not apply to claims arising out of an employment relationship. Manning v. Zuckerman, 388 Mass. 8, 12-15 (1983); Informix, Inc. v. Rennell, 41 Mass.App.Ct. 161, 163, review denied, 423 Mass. 1110 (1996).

ORDER

For the foregoing reasons, defendants’ motion for summary judgment is ALLOWED.

William Gallagher Associates Insurance Brokers, Inc. v. Everts
13 Mass. L. Rptr. 716

Case Details

Name
William Gallagher Associates Insurance Brokers, Inc. v. Everts
Decision Date
Sep 6, 2000
Citations

13 Mass. L. Rptr. 716

Jurisdiction
Massachusetts

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