Case 2:16-cv-16872-LMA-DEK Document 28 Filed 02/23/17 Page 1 of 10

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

AFFORDABLE ROOFING, SIDING,

AND GUTTERS, INC. CIVIL ACTION

VERSUS No. 16-16872

BRAD M. ARTIGUES ET AL. SECTION I

ORDER AND REASONS

Before the Court is defendants Brad Artiguess (Artigues) and the Artigues

Roofing Companys (Artigues Roofing) motion 1 for partial summary judgment. For

the following reasons, the motion is granted in part and denied in part.

I.

Defendant Artigues used to work for plaintiff Affordable Roofing, Siding, and

Gutters, Inc (Affordable Roofing or Affordable). After either quitting or being

discharged, he started his own roofing company. Artigues then began soliciting

Affordable Roofing customers for his new business.

Affordable Roofing was none too pleased with Artiguess new venture. It has

filed suit to enforce what it claims were non-compete and non-solicitation clauses in

Artiguess employment contract, as well as recover items from Artigues that Afforable

alleges were stolen by him. The employment contract provided:

Employee agrees that during Employees employment and for a period of one
(1) year after termination of the Period of Employment . . . Employee shall not,
direct or indirectly, (i) employ, solicit for employment, or recommend for
employment any person employed by Company (or any Affiliate); and (ii)

1 R. Doc. No. 17.

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engage in any present or contemplated business activity that is or may be

competitive with Company (or any Affiliate) in any state where Company
conducts its business, unless Employee can prove that any action taken in
contravention of this subsection (ii) was done without the use in any way of
Confidential Information. Employee acknowledges that pursuit of such
activities will necessarily involve the use, disclosure or misappropriation of
Confidential Information.

R. Doc. No. 17-5, at 5.

Affordable Roofing obtained a temporary restraining order in state court,

banning Artigues and his company from, among other things:

Communicating with clients or potential clients of Affordable.

Soliciting any clients or potential clients of Affordable.

Employing or soliciting for employment any individual employed by

Affordable.

Directly or indirectly engaging in any business practice that is or may be

competitive with Affordable

Making representations that he is employed by Affordable

Directly or indirectly using or disclosing Affordables confidential information.

Soliciting any payment from Affordable clients.

R. Doc. No. 17-4.

After the state court issued the temporary restraining order, the defendants

removed the matter to this Court and the temporary restraining order expired shortly

after removal. R. Doc. No. 14. Defendants now move for partial summary judgment

arguing that (1) the non-compete provision in the contract is null and void, (2) the

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contract does not contain a non-solicitation of customers provision, and (3) plaintiff is

not entitled to injunctive relief.

II.

Summary judgment is proper when, after reviewing the pleadings, the

discovery and disclosure materials on file, and any affidavits, the court determines

that there is no genuine dispute of material fact. See Fed. R. Civ. P. 56. [A] party

seeking summary judgment always bears the initial responsibility of informing the

district court of the basis for its motion and identifying those portions of [the record]

which it believes demonstrate the absence of a genuine issue of material fact. Celotex

Corp. v. Catrett, 477 U.S. 317, 323 (1986). The party seeking summary judgment

need not produce evidence negating the existence of material fact, but need only point

out the absence of evidence supporting the other partys case. Id.; Fontenot v. Upjohn

Co., 780 F.2d 1190, 1195 (5th Cir. 1986).

Once the party seeking summary judgment carries its burden pursuant to Rule

56, the nonmoving party must come forward with specific facts showing that there is

a genuine dispute of material fact for trial. Matsushita Elec. Indus. Co. v. Zenith

Radio Corp., 475 U.S. 574, 587 (1986). The showing of a genuine issue is not satisfied

by creating some metaphysical doubt as to the material facts, by conclusory

allegations, by unsubstantiated assertions, or by only a scintilla of evidence. Little

v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citations omitted). Instead, a

genuine issue of material fact exists when the evidence is such that a reasonable

jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc.,

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477 U.S. 242, 248 (1986). The party responding to the motion for summary judgment

may not rest upon the pleadings, but must identify specific facts that establish a

genuine issue. Id. The nonmoving partys evidence, however, is to be believed, and

all justifiable inferences are to be drawn in [the nonmoving partys] favor. Id. at 255;

see also Hunt v. Cromartie, 526 U.S. 541, 552 (1999).

III.

Louisiana law permits non-compete agreements that preclude an agent,

servant, or employee from competing within a specified parish or parishes,

municipality or municipalities, or parts thereof, so long as the employer carries on a

like business therein. La. R.S. 23:921(c). Artiguess employment contract, however,

does not specify any particular parish or municipality. Instead, the contract simply

precludes Artigues from competing in any state where [Affordable] conducts its

business. R. Doc. No. 17-5, at 5 9. Therefore, defendants argue that the non-

compete clause is null and void. La. R.S. 23:921(a).

In response, Affordable concedes that it does not comply with the plain

language of La. R.S. 23:921. See R. Doc. No. 19, at 6 ([O]n its face the non-compete

provision . . . does not comply with La. R.S. 23:921 . . . .). Nonetheless, Affordable

suggests thatnotwithstanding the contracts failure to specify the parishes and

municipalities in which the non-compete provision appliesthe clause may be

enforced because Artigues knew the parishes in which Affordable operated and

therefore knew the parishes in which the non-compete provision applied. See, e.g.,

Petroleum Helicopters, Inc. v. Untereker, 731 So.2d 865, 967 (La. App. 3d Cir. 1997);

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see also Porter v. Milliken & Michaels, Inc., No. 99-199, 2001 WL 617184 (E.D. La

2001) (relying on Petroleum Helicopters). In the alternative, Affordable suggests that

the Court enforce the contracts severance clause, R. Doc. No. 17-2, at 15, and sever

and/or reform the non-compete provision so that it complies with Louisiana law.

The Court rejects Affordables position. See, e.g., Gearhead v. De Puy

Orthopaedics, Inc. No. 99-1091, 1999 WL 638582, at *4 (E.D. La. 1999) (Clement, J.)

(Louisianas approach to non-competition agreements requires mechanical

adherence to the requirements listed in the law (especially the geographical and time

limitations). (internal quotation marks omitted)). Affordables argumentand the

Louisiana Third Circuit case law on which it reliesis inconsistent with the plain

text of La. R.S. 23:921. See Aon Risk Servs. of La. v. Ryan, 807 So. 2d 1058, 1060 (La.

App. 4th Cir. 2002) (We beg to differ with the reasoning of our learned brothers of

the Third Circuit. We find that the clear language of LSA-R.S. 23:921 requires that

the agreement specify the parishes . . . . If this Court were to adopt the position

espoused by the plaintiff, there would have been no reason for the legislature to have

included the requirement that the parishes be specified.); Turner Profl Servs., Ltd.

v. Broussard, 762 So. 2d 184, 186 (La. App. 1st Cir 2000) (In our opinion, Petroleum

Helicopters goes too far, and we decline to follow it.), writ denied, 2000-1717 (La.

9/29/00), 770 So. 2d 356; see also Waguespack v. Medtronic, Inc., 185 F. Supp. 916,

930 (M.D. La. 2016) ([T]he cases cited by Defendants are from Louisianas Third

Circuit Court of Appeals, which appears to be an outlier circuit. Indeed, other

Louisiana courts of appeals have questioned the Third Circuits reasoning.);

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Ferrellgas, L.P. v. McConathy, No. 10-178, 2010 WL 1010831, at *4 (W.D. La. 2010)

([W]e find no reason to conclude that the Louisiana Supreme Court would deviate

from the approach articulated by the majority of the state appellate courts.); cf.

Restivo v. Hanger Prosthetics & Orthotics, Inc., No. 06-32, 2007 WL 1341506, at *4

(E.D. La. 2007) (While a strict interpretation of the statute can be criticized as being

overly technical, such a reading is consistent with Louisianas strong public policy

prohibiting covenants not to compete.).

Further, as the Louisiana Supreme Court has explained, the entire point of the

specify-the-parishes requirement was to transition to more objective measures of an

agreements validity. SWAT 24 Shreveport Bossier, Inc. v. Bond, 808 So. 2d 294, 304

(La. 2001); see also Waguespack, 185 F. Supp. at 929 (noting that non-compete

agreements are supposed to be clearly discernible so that employees can determine

on the front end . . . what their potential restrictions would be). Yet, Affordables

positionthat a company can make no effort at all to comply with Louisiana law and

then expect a court to interpret and/or reform the agreement so that the agreement

is as broad as is legally possiblefrustrates that goal. See, e.g., Aon Risk Servs., 807

So. 2d at 1062. After all, in such a world, employers will have every incentive to write

overbroad non-compete provisions with no discernable breadth, knowing full well

that the courts will cure defaults. See, e.g., Team Environmental Servs., Inc. v.

Addison, 2 F.3d 124, 127 (5th Cir. 1993) (Were courts to . . . enforce agreements like

those at bar, employers would be free routinely to present employees with grossly

overbroad covenants not to compete. . . . The result would be an impact on the

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employer-employee relationship not intended by the legislature.). Accordingly, both

the text of La. R.S. 23:921 as well as the policy concerns motivating adoption of the

provision preclude this Court from adopting Affordables position that the non-

compete clause is valid notwithstanding Affordables failure to strictly comply with

La. R.S. 23:921.

The Court additionally declines Affordables request to re-write the non-

compete provision. See, e.g., Kimball v. Anesthesia Specialists of Baton Rouge, Inc.,

809 So. 2d 405, 413 (La. App. 1st Cir. 2001) (We cannot simply rewrite the non-

compete clause so as to make it comply with the statute.). The severability clause

does not require a court to reform, redraft, or create a new agreement. It required

only that the offending portion of the agreement be severed. SWAT 24, 808 So. 2d at

309. 2 The Court therefore does so, and it will sever the null and void, La. R.S.

23:921(a), non-compete provision from the remainder of the employment contract.

The motion for partial summary judgment that the non-compete clause is null

and void as a matter of law will be granted.

IV.

Defendants next move for partial summary judgment in connection with their

argument that the employment contract does not contain a non-solicitation of

customers provision. In response, Affordable concedes that the contract does not have

a formal non-solicitation of customers provision, but it suggests that the provisions

2 See also Comet Indus., Inc. v. Lawrence, 600 So. 2d 85, 88 (La. App. 2d Cir. 1992)
(We therefore find the contract to be null and void and decline to reform it.).

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prohibiting Artigues from using customer lists also serve as a non-solicitation

provision. That provision provides that Employee will not, directly or indirectly,

use . . . any of Companys Confidential Information, and defines Confidential

Information to include lists of customers. R. Doc. No. 17-2, at 11. The restrictions

on the use of any such information do not expire until two years after the termination

of the employment contract. R. Doc. No. 17-2, at 12.

The Court agrees with Artigues. In the first place, if the prohibition against

using customer lists is really a non-solicitation provision in disguise, then it is invalid.

Non-solicitation of customers provisions in Louisiana are subject to the same

restrictions as non-compete provisions. See La. R.S. 23:921(C). Thus, even if there

was a non-solicitation of customers provision in the contract, it would be null and void

for failing to specify the parishes in which it applies. But even more importantly, the

prohibition against using customer lists does not prohibit soliciting customers

rather it merely prohibits using confidential company information to solicit

customers.

The contract therefore does not, as a matter of law, have a non-solicitation of

customers provision, let alone a valid and enforceable one. Accordingly, the Court will

also grant defendants motion for partial summary judgment that the contract does

not contain a non-solicitation of customers provision. 3 The Court does not address

3 The employment agreement does include a non-solicitation clause limiting the

solicitation of employees. See R. Doc. No. 17-2, at 14 (Employee shall not, directly or
indirectly, (i) employ, solicit for employment, or recommend for employment any
person employed by the Company (or any Affiliate). This non-solicitation of
employees clause, as distinct from a non-solicitation of customers clause, is not

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whether defendants violated any of the contracts restrictions on the use of customer

lists or customer information.

V.

Finally, defendants ask this Court to determine that Affordable is not entitled

to injunctive relief. This Court is not prepared to take that step as of now. While the

contract does not contain enforceable non-compete and non-solicitation of customers

provisions, Affordables claims for equitable relief are not based solely on the

allegation that Artigues violated the non-compete and supposed non-solicitation

provisions of the contract. Instead, the lawsuit alleges that Affordable is entitled to

equitable relief because Artigues and Artigues Roofing engaged in a host of activities

that violated the employment contractsuch as, for example, competing using

proprietary materials stolen from Affordable as well as holding themselves out as

Affordable Roofing. Accordingly, defendants request that this Court determine that

certain remedies are not available to Affordable is premature insofar as there are still

live allegations in the complaint that may support an injunction prohibiting certain

types of conduct by defendants. This Court therefore denies summary judgment on

the question of whether Affordable may obtain injunctive relief, and again defers the

question of attorneys fees and costs until the conclusion of this matter.

Accordingly,

subject to the requirements of La. R.S. 23:921. See Smith, Barney, Harris Upham &
Co., Inc. v. Robinson, 12 F.3d 515, 519 (5th Cir. 1994). As such, this opinion expresses
no view on the validity of the non-solicitation of employees clause.

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IT IS ORDERED that defendants motion for partial summary judgment is

granted in part and denied in part as set forth herein.

New Orleans, Louisiana, February 22, 2017.

_______________________________________
LANCE M. AFRICK
UNITED STATES DISTRICT JUDGE

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