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Vickery v. Ardagh Glass Inc.

Court of Appeals of Indiana

October 13, 2017

Craig Vickery, Appellant-Defendant,
v.
Ardagh Glass Inc., Appellee-Plaintiff

         Appeal from the Marion Superior Court, Indiana Commercial Court The Honorable Heather A. Welch, Judge Trial Court Cause No. 49D01-1606-PL-23465

          Attorneys for Appellant Kevin W. Betz Sandra L. Blevins Benjamin C. Ellis Betz Blevins

          Attorneys for Appellee Adam Arceneaux Derek R. Molter Kaitlyn J. Marschke Ice Miller LLP

          Baker, Judge.

         [¶1] Craig Vickery appeals the trial court's order granting Ardagh Glass, Inc.'s (Ardagh), motion for a preliminary injunction. Vickery raises the following arguments on appeal: (1) the trial court erred in granting a temporary restraining order when allegedly insufficient notice was provided to Vickery; and (2) the trial court erred in entering a preliminary injunction preventing Vickery from going to work for one of Ardagh's competitors.

         [¶2] We find that Vickery received insufficient notice of the temporary restraining order proceeding, but that he has waived the right to seek relief on the issue. We further find that the trial court did not err by entering the preliminary injunction. We affirm and remand for further proceedings.

         Facts[1]

         [¶3] Ardagh is a manufacturer of glass containers and bottles; it sells its products to companies in the food and beverage industries. It is the North American business unit of the international holding company Ardagh Group.

         [¶4] Through a share purchase agreement executed in January 2013 and closed in April 2014, Ardagh Glass Containers, Inc., purchased 100% of the stock of Saint-Gobain Containers, Inc. (SGCI), which is a wholly-owned subsidiary of Saint-Gobain Corporation (SGC). Following the purchase, the two companies merged and became known as Ardagh Glass, Inc.

         [¶5] Vickery began working for SGCI on September 8, 2004, as a temporary employee. Two days later, he was hired by SGCI as a full-time mould engineer. That day, September 10, 2004, Vickery signed a Noncompete Employee Agreement (the Noncompete). The Noncompete explicitly states that Vickery signed it "'in consideration of my employment, continued employment, increased compensation, change in responsibility, or other benefit . . . .'" Prelim. Inj. Order p. 5 (quoting Noncompete). Among other things, the Noncompete provided that Vickery could not work for a competitor for one year following his departure from SGCI:

"I shall not, without written consent signed by an officer of the Company, directly or indirectly (whether as owner, partner, consultant, employee or otherwise), at any time during the one-year period following termination of my employment with the company, engage in or contribute my knowledge to any work or activity that involves a product, process, apparatus, service or development (i) which is then competitive with or similar to a product, process, apparatus, service or development on which I worked or (ii) with respect to which I had access to Confidential Information while at the Company at any time during the period prior to such termination."

Id. (same). The Noncompete also required Vickery to protect the company's trade secrets and confidential information.

         [¶6] In 2012, Vickery was promoted to Senior Mould Engineer; he held that position until he left the company in June 2016. As part of his responsibilities, Vickery designed mould equipment for the company's manufacturing process, designed replacement moulds, and designed moulds for new products. He supplied mould vendors with detailed engineering drawings; the vendors would then create equipment to match the drawings. Vickery was also involved in "trouble shooting, " or coming up with remedies for problems with the company's mould designs. Id. at 9. Additionally, he interacted with manufacturing plants and the product design department, and was involved with the implementation of Ardagh's European design engineering standards and best practices throughout its North American plants.

         [¶7] After Vickery was passed over for a promotion in February 2016, he began looking for a new employer. His uncle works for Owens-Illinois, one of Ardagh's primary competitors. Vickery interviewed with Owens-Illinois for the position of Mould Design Specialist and provided Owens-Illinois with a copy of the Noncompete in advance. On June 1, 2016, he was offered and accepted that position with Owens-Illinois. That position would include duties that are substantially similar to Vickery's duties at Ardagh.

         [¶8] On June 6, 2016, Vickery tendered his resignation letter to Ardagh; he omitted the fact that he was going to work for Owens-Illinois. He then engaged in additional communications with Owens-Illinois employees, including his uncle, regarding the potential impact of the Noncompete. On June 16, 2016, Vickery disclosed to Ardagh's upper management that he was going to work for Owens-Illinois. Ardagh advised Vickery to review his Noncompete to ensure he would remain in compliance and worked to persuade Vickery to stay with Ardagh. On June 22 or June 23, Ardagh informed Vickery it intended to enforce the Noncompete. On June 23, Ardagh gave Vickery a letter from outside counsel requesting that Vickery provide the details of his new position at Owens-Illinois and threatening a lawsuit that would include a request for injunctive relief. Vickery never responded.

         [¶9] On the morning of June 30, 2016, the last day of Vickery's employment with Ardagh, Ardagh's counsel notified Vickery via email that it would be filing suit with the Commercial Court later that day, requesting a temporary restraining order (TRO) and injunction, and attached the pleadings it intended to file. Vickery did not respond, instead emailing his uncle that "things just got serious on the legal front as of 11:00 a.m. today." Id. at 28.

         [¶10] On June 30, 2016, Ardagh filed a complaint against Vickery to enforce the Noncompete and to protect its trade secrets. That same afternoon, without holding a hearing, the trial court issued an ex parte TRO directing Vickery to cease and desist from "using Ardagh's trade secrets and confidential information to compete against Ardagh;" to refrain from "communicating with or recruiting any of Ardagh's employees;" and to cease and desist from "participating or working on mould engineering, bottle design, or similar roles on behalf of Ardagh's main competitor, Owens-Illinois, Inc." Appellant's App. Vol. II p. 48. The trial court scheduled a hearing for July 8, 2016.

         [¶11] On July 5, 2016, Vickery's counsel entered an appearance and requested an extension on all TRO deadlines. The trial court granted the request, noting that Vickery "agrees to a continuance of the TRO entered by the Court on June 30, 2016 until the preliminary injunction hearing and to combining the hearing on the TRO with a hearing on the request for a preliminary injunction." Appellee's App. Vol. II p. 32. The order scheduled the combined TRO/preliminary injunction hearing for a full day on July 27, 2016, and a half-day on July 28, 2016.[2]

         [¶12] On July 27, 2016, Vickery filed a motion to vacate the TRO and to dismiss the complaint. Among other things, Vickery argued that he did not receive sufficient notice of the TRO proceeding and that Ardagh did not have standing to enforce the Noncompete. On August 12, 2016, Ardagh filed a motion for partial summary judgment, seeking judgment as a matter of law that it has standing to enforce the Noncompete. The trial court granted Ardagh's motion for partial summary judgment and denied Vickery's motion to dismiss on November 15, 2016. On January 13, 2017, the trial court issued a detailed sixty-three-page order granting Ardagh's motion for preliminary injunction. Vickery now brings this interlocutory appeal.

          Discussion and Decision

         I. Indiana Commercial Court

         [¶13] On September 25, 2017, the day on which we held oral argument, Vickery filed a motion to dismiss the entire lawsuit for lack of constitutional jurisdiction. He raises the following arguments in his motion: (1) our Supreme Court exceeded its authority by establishing the Commercial Court; (2) our Supreme Court lacks the authority to appoint the Commercial Court judges; (3) the Commercial Court bestows unconstitutional privileges on business entities; and (4) the Commercial Court permits corporate plaintiffs to compel individual defendants to distant venues, creating an extreme hardship.

         [¶14] Vickery acts as though litigating in the Commercial Court is compulsory if the plaintiff files a complaint there. That, however, is patently untrue. Our Supreme Court has promulgated Interim Commercial Court Rules, and Interim Rule 4(D)(3) plainly states that if a party to litigation that was filed in a Commercial Court files a Refusal Notice within thirty days of being notified that the case was filed in Commercial Court, then the clerk "shall transfer and assign the case to a non-Commercial Court Docket . . . ." (Emphasis added). Indeed, the Commentary to Interim Rule 4 even emphasizes that "every other party has an absolute veto" of the placement of a case on the Commercial Court docket. Interim Rule 4 cmt. 1. Only where, as here, no Refusal Notice is timely filed will the case be permanently assigned to a Commercial Court docket.

         [¶15] In this case, Vickery did not file a Refusal Notice within thirty days. And not until now did he object to the jurisdiction of the Commercial Court. He attempts to argue that he is raising questions regarding the subject matter jurisdiction of the Commercial Court, which can be raised at any point in time, but that is not what he is actually challenging. The Commercial Court is (in this case) part of the Marion Superior Court, which unquestionably has subject matter jurisdiction over this litigation. See Ind. Code § 33-29-1-1.5 (providing that all standard superior courts have original and concurrent jurisdiction in all civil cases). Despite Vickery's attempt to reframe the issue otherwise, he is actually challenging the Commercial Court's personal jurisdiction over him, which is a waiveable argument. E.g., Harris v. Harris, 31 N.E.3d 991, 995 (Ind.Ct.App. 2015). And here, indeed, he has consented to the Commercial Court's personal jurisdiction over him by failing to object to it and by failing to file a Refusal Notice. Under these circumstances, Vickery has waived the right to challenge the Commercial Court's jurisdiction or authority and we deny his motion to dismiss by separate order.

         II. TRO

          [¶16] Vickery first argues that the preliminary injunction should be reversed because it is based upon a TRO that he claims violated Indiana Trial Rule 65(B) and his constitutional right to due process.

         [¶17] Initially, Ardagh responds that the propriety of the TRO is not properly before this Court and we should not even consider it. A TRO is not appealable as of right. Witt v. Jay Petroleum, Inc., 964 N.E.2d 198, 203 (Ind. 2012). Here, Vickery did not request that the trial court certify the TRO for a discretionary interlocutory appeal. Furthermore, Ardagh notes that the TRO was superseded by the preliminary injunction, meaning that any issues with respect to the TRO are moot. Nordman v. N. Manchester Foundry, Inc., 810 N.E.2d 1071, 1073 n.2 (Ind.Ct.App. 2004). We acknowledge the issues surrounding the reviewability of the TRO, but elect to consider the process that took place in this case because it is an issue of utmost public importance that is likely to recur in the future.

         [¶18] Generally, a party taking action in a legal proceeding against another party must provide notice to the adverse party. See Ind. Trial Rules 3 (commencement of an action), 4-4.17 (process and summons), 5 (service of pleadings and other papers). Under certain exceptions, however, a TRO may be granted without notice to the adverse party. Indiana Trial Rule 65(B) sets forth the requirements for the notice exception to apply:

A temporary restraining order may be granted without written or oral notice to the adverse party or his attorney only if:
(1) it clearly appears from specific facts shown by affidavit or by the verified complaint that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party or his attorney can be heard in opposition; and
(2) the applicant's attorney certifies to the court in writing the efforts, if any, which have been made to give notice and the reasons supporting his claim that notice should not be required.
Every temporary restraining order granted without notice shall be indorsed with the date and hour of issuance; shall be filed forthwith in the clerk's office and entered of record; shall define the injury and state why it is irreparable and why the order was granted without notice; and shall expire by its terms within such time after entry, not to exceed ten [¶10] days, as the court fixes, unless within the time so fixed the order, for good cause shown, is extended for a like period or unless the whereabouts of the party against whom the order is granted is unknown and cannot be determined by reasonable diligence or unless the party against whom the order is directed consents that it may be extended for a longer period. The reasons for the extension shall be entered of record. In case a temporary restraining order is granted without notice, the motion for a preliminary injunction shall be set down for hearing at the earliest possible time and takes precedence of all matters except older matters of the same character; and when the motion comes on for hearing the party who obtained the temporary restraining order shall proceed with the application for a preliminary injunction and, if he does not do so, the court shall dissolve the temporary restraining order. On two (2) days' notice to the party who obtained the temporary restraining order without notice or on such shorter notice to that party as the court may prescribe, the adverse party may appear and move its dissolution or modification and in that event the court shall proceed to hear and determine such motion as expeditiously as the ends of justice require.

         Our Supreme Court has noted that when a TRO is sought, "the basic safeguards provided by Trial Rule 65(B) are essential to due process and must be followed." In re Anonymous, 43 N.E.3d 568, 570 (Ind. 2015) (noting that both attorneys and judges have ethical obligations to ensure compliance with Trial Rule 65(B)).

         [¶19] Here, at 11:00 a.m. on June 30, 2016, Ardagh's counsel notified Vickery via email that it would be filing a lawsuit with the Commercial Court later that day and attached the pleadings it intended to file. While the attachments indicated that the lawsuit would be filed in a Commercial Court in Marion County, they did not indicate the date, time, or specific location of a hearing. ...


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