The Court, for the sake of completeness, considers Defendants' argument as if asserted under Ohio law. Under that law, βa non-compete clause's enforceability is a matter of law for the court.β Chi. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 990 (6th Cir.2007). β[A] noncompete covenant is enforceable to the extent it is reasonable.β
The parties' competing motions and related briefing address the scope of what discovery this Court should permit upon remand from the Sixth Circuit. That appellate court previously affirmed in part, reversed in part, and remanded this litigation for a new trial on compensatory damages. Chicago Title Ins. Corp. v. Magnuson, 487 F.3d 985 (6th Cir. 2007). The parties are now arguing over the scope of that remand and what discovery is necessary to meet the court of appeals' directive.
The covenant must: (1) be "no greater than is required for the protection of the employer"; (2) "not impose undue hardship on the employee"; and (3) not be "injurious to the public." Chi. Title Ins. Corp. v. Magnuson , 487 F.3d 985, 991 (6th Cir. 2007) (quoting Raimonde , 325 N.E.2d at 547 ). Union Home must establish each factor by "clear and convincing evidence."
novo review though has never meant the appellate court starts over. Rather, it means the appellate court takes the facts as presented to the court below and reviews whether summary judgment is justified without giving special deference to the decision below. See, e.g., Chicago Title Ins. Corp. v. Magnuson, 487 F.3d 985, 995 (6th Cir. 2007) (stating on summary judgment review that Sixth Circuit looks at factual record as presented by the non-movant to district court); 1 Steven Alan Childress & Martha S. Davis, Federal Standards of Review Β§ 2.14 (3d ed. 1999) ("[W]hat is meant [by de novo review] is merely appellate power, ability, and competency to come to a different conclusion on the record as determined below.") (emphasis added)
The enforceability of Wilson's noncompete agreement turns on whether it is "reasonable." Chi. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 990 (6th Cir. 2007). A noncompete agreement is reasonable under Ohio law if it satisfies three factors.
However, the cases Accenture citesβChi. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 990, 998-1001 (6th Cir. 2007); Inter Med. Supplies, Ltd. v. EBI Med. Sys., Inc., 181 F.3d 446, 463-70 (3d Cir. 1990)βare distinguishable. The punitive damages award in Magnuson was three times the amount of the compensatory damages award, see 487 F.3d at 990; the punitive damages award in EBI was $2 million more than the compensatory damages award, see 181 F.3d at 450.
. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 991 (6th Cir. 2007) (quoting Raimonde, 325 N.E.2d at 547).
The Sixth Circuit has interpreted the repeated conduct factor as requiring "`that the similar reprehensible conduct be committed against various different parties rather than repeated reprehensible acts within the single transaction with the plaintiff.'" Chi. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 1000 (6th Cir. 2007) (quoting Bach v. First Union Nat'l Bank, 149 F. App'x 354, 356 (6th Cir. 2005)). Here, Fastenal argues that this factor is met because, though there was only one sale of goods, the Tri-State Defendants have "continued to reap the benefits of the goods and the information they obtained from Fastenal."
See Romano v. U-Haul Int'l, 233 F.3d 655, 673 (1st Cir. 2000) (defendant's actions were reprehensible where it violated plaintiffs rights and then attempted to conceal the violation); Hopkins v. Dow Corning Corp., 33 F.3d 1116, 1127 (9th Cir. 1994) (punitive damages award was constitutionally permissible where defendant concealed studies relating to product defects); cf. Hawkins v. Allstate Ins. Co., 152 Ariz. 490, 497, 733 P.2d 1073, 1080 (1987) (in calculating "a punitive damage award that is reasonable under the circumstances," the trier-of-fact may consider the "duration of the misconduct, the degree of defendant's awareness of the harm or risk of harm, and any concealment"). ΒΆ 100 Security Title also argues First American has engaged in similar bad acts elsewhere, citing Chicago Title Insurance Corp. v. Magnuson, 487 F.3d 985 (6th Cir. 2007). In Chicago Title, as here, First American was sued for its conduct in seeking to staff its newly formed Talon division.
Compare TQL/EDA, 685 F.Supp.3d at 575 (party seeking enforcement "must establish reasonableness under [Ohio law] test by clear and convincing evidence"), with id. at 578-80 (discussion of money damages); see also Chi. Title Ins. Corp. v. Magnuson, 487 F.3d 985, 991 n.3 (6th Cir. 2007).