Although the contracts directed that New York law should govern, the Fifth Circuit refused to apply New York law to uphold the covenants because Georgia had a public policy against such restrictive covenants. Id. at 1100 n. 5. Similarly, in Muma v. Financial Guardian, Inc., 551 F. Supp. 119 (E.D. Mich. 1982), the district court refused to apply Missouri law to an agreement that was executed in Missouri by Missouri residents. The court held that a Michigan court would not apply Missouri law when such law contravened the strong policy of the forum against covenants not to compete.
Defendants' reliance on other cases finding non-compete clauses unenforceable under § 445.761, see Monsanto Co. v. Manning, No. 87-1790, 841 F.2d 1126 (6th Cir. Mar.8, 1988) (unpublished opinion, table format only), is misplaced as the restrictive covenant at issue here is not a promise not to compete, but rather a promise not to use or disclose confidential client information and not to solicit former clients for a period of one year. Similarly, Ran's reliance on Judge Feiken's opinion in Muma v. Financial Guardian, Inc., 551 F. Supp. 119 (E.D.Mich. 1982) is not availing. The facts of Muma are distinguishable from those presented here. In that case, an insurance company removed its president and paid him a severance package.
This is not, like a list of customers that the Plaintiff might keep, the type of confidential business information that may be protected under these statutes. See Lansing-Lewis Services, Inc. v. Schmitt, 188 Mich. App. 647, 470 N.W.2d 405 (1991) (holding that exception for employer-supplied customer lists was inapplicable to one-year anti-competition clause unrelated to customer list); Muma v. Financial Guardian, Inc., 551 F. Supp. 119 (E.D.Mich. 1982) (same). Therefore, the Court determines as a matter of law that the instant covenant not to compete was illegal and void under the applicable Michigan law.
Execucom contends that the express choice of Texas law should be honored by this court. In support of their position, plaintiffs cite various cases from the federal courts of this state which have refused to enforce contracts not to compete under authority of § 445.761, see, e.g. Muma v. Financial Guardian, 551 F. Supp. 119 (E.D.Mich. 1982); May v. Mulligan, 36 F. Supp. 596 (W.D.Mich. 1939).
Further, even assuming that the construction and interpretation of this insurance policy are governed by the laws of Minnesota, Michigan courts will enforce such a policy, valid in Minnesota, only to the extent that its provisions do not contravene the public policy of Michigan, Lieberthal v. Glens Falls Indemnity Co., 316 Mich. 37, 24 N.W.2d 547 (1946). Thus, if Michigan public policy proscribes the enforcement of a coordination of benefits provision that does not conform with those set forth in the Michigan Insurance Code, Michigan courts will not enforce the provision, cf. Muma v. Financial Guardian, Inc., 551 F. Supp. 119 (E.D.Mich. 1982) (holding that Michigan courts would not enforce a covenant not to compete, which violates M.C.L.A. 445.761, even though the covenant would have been enforceable in Missouri, where the contract was executed). THE SUBROGATION PROVISION DOES NOT APPLY TO BENEFITS PAID BY CO-INSURERS
Michigan case law also evidences public policy against covenants not to compete. See Muma v. Financial Guardian, Inc., 551 F. Supp. 119, 122 (E.D.Mich. 1982); E.W. Smith Agency, Inc. v. Sanger, 350 Mich. 75, 85 N.W.2d 84, 86 (1957). Michigan law, however, makes a distinction between contracts which impose restrictions during performance of the contract and restrictions which extend beyond the expiration of the contract term.
See Dresser Indus., Inc. v. Sandvick, 732 F.2d 783, 787–88 (10th Cir.1984) (“[T]he tendency of the courts [is] to apply the policy of the forum state when parties are litigating covenants not to compete.”); Nordson Corp. v. Plasschaert, 674 F.2d 1371, 1375 (11th Cir.1982); Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Stidham, 658 F.2d 1098, 1100 n. 5 (5th Cir. Unit A 1981); Davis v. Jointless Fire Brick Co., 300 F. 1, 3–4 (9th Cir.1924); Muma v. Fin. Guardian, Inc., 551 F.Supp. 119, 121–23 (E.D.Mich.1982); Walling Chem. Co. v. Hart, 508 F.Supp. 338, 340 (D.Neb.1981); Fort Smith Paper Co. v. Sadler Paper Co., 482 F.Supp. 355, 357 (E.D.Okl.1979); Blalock v. Perfect Subscription Co., 458 F.Supp. 123, 127 (S.D.Ala.1978), aff'd per curiam, 599 F.2d 743 (5th Cir.1979); Assoc. Spring Corp. v. Roy F. Wilson & Avnet, Inc., 410 F.Supp. 967, 976–78 (D.S.C.1976); Fine v. Prop. Damage Appraisers, Inc., 393 F.Supp. 1304, 1310 (E.D.La.1975); Boyer v. Piper, Jaffray & Hopwood, Inc., 391 F.Supp. 471, 473 (D.S.D.1975); Forney Indus., Inc. v. Andre, 246 F.Supp. 333, 334–35 (D.N.D.1965); Nasco, Inc. v. Gimbert, 239 Ga. 675, 238 S.E.2d 368, 369 (1977); Std. Register Co. v. Kerrigan, 238 S.C. 54, 119 S.E.2d 533, 541–42 (1961); Temporarily Yours–Temp. Help Servs., Inc. v. Manpower, Inc., 377 So.2d 825, 827 (Fla.Dist.Ct.App.1979); see also Barnes Group, Inc. v. C & C Prods., Inc., 716 F.2d 1023, 1031–32 (4th Cir.1983); Bush v. Nat'l Sch. Studios, Inc., 139 Wis.2d 635, 407 N.W.2d 883, 886–88 (1987) (suit for u
See Dresser Indus., Inc. v. Sandvick, 732 F.2d 783, 787–88 (10th Cir.1984) (“[T]he tendency of the courts [is] to apply the policy of the forum state when parties are litigating covenants not to compete.”); Nordson Corp. v. Plasschaert, 674 F.2d 1371, 1375 (11th Cir.1982) ; Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Stidham, 658 F.2d 1098, 1100 n. 5 (5th Cir. Unit A 1981) ; Davis v. Jointless Fire Brick Co., 300 F. 1, 3–4 (9th Cir.1924) ; Muma v. Fin. Guardian, Inc., 551 F.Supp. 119, 121–23 (E.D.Mich.1982) ; Walling Chem. Co. v. Hart, 508 F.Supp. 338, 340 (D.Neb.1981) ; Fort Smith Paper Co. v. Sadler Paper Co., 482 F.Supp. 355, 357 (E.D.Okl.1979) ; Blalock v. Perfect Subscription Co., 458 F.Supp. 123, 127 (S.D.Ala.1978), aff'd per curiam, 599 F.2d 743 (5th Cir.1979) ; Assoc. Spring Corp. v. Roy F. Wilson & Avnet, Inc., 410 F.Supp. 967, 976–78 (D.S.C.1976) ; Fine v. Prop. Damage Appraisers, Inc., 393 F.Supp. 1304, 1310 (E.D.La.1975) ; Boyer v. Piper, Jaffray & Hopwood, Inc., 391 F.Supp. 471, 473 (D.S.D.1975) ; Forney Indus., Inc. v. Andre, 246 F.Supp. 333, 334–35 (D.N.D.1965) ; Nasco, Inc. v. Gimbert, 239 Ga. 675, 238 S.E.2d 368, 369 (1977) ; Std. Register Co. v. Kerrigan, 238 S.C. 54, 119 S.E.2d 533, 541–42 (1961) ; Temporarily Yours–Temp.
See Dresser Indus., Inc. v. Sandvick, 732 F.2d 783, 787-788 (10th Cir. 1984) ("the tendency of the courts [is] to apply the policy of the forum state when parties are litigating covenants not to compete")"); Nordson Corp. v. Plasschaert, 674 F.2d 1371, 1375 (11th Cir. 1982); Merrill Lynch, Pierce, Fenner Smith, Inc. v. Stidham, 658 F.2d 1098, 1100 n. 5 (5th Cir. 1981); Davis v. Jointless Fire Brick Co., 300 F. 1, 3-4 (9th Cir. 1924); Muma v. Financial Guardian, Inc., 551 F. Supp. 119, 121-123 (E.D.Mich. 1982); Walling Chem. Co. v. Hart, 508 F. Supp. 338, 340 (D.Neb. 1981); Fort Smith Paper Co. v. Sadler Paper Co., 482 F. Supp. 355, 357 (E.D.Ok. 1979); Blalock v. Perfect Subscription Co., 458 F. Supp. 123, 127 (S.D.Ala. 1978), aff'd per curiam, 599 F.2d 743 (5th Cir. 1979); Associated Spring Corp. v. Roy F. Wilson Avnet, Inc., 410 F. Supp. 967, 976-978 (D.S.C. 1976); Fine v. Property Damage Appraisers, Inc., 393 F. Supp. 1304, 1310 (E.D.La. 1975); Boyer v. Piper, Jaffray Hopwood, Inc., 391 F. Supp. 471, 473 (D.S.D. 1975); Forney Indus., Inc. v. Andre, 246 F. Supp. 333, 334-335 (D.N.D. 1965); Nasco, Inc. v. Gimbert, 239 Ga. 675, 238 S.E.2d 368, 369 (1977); Standard Register Co. v. Kerrigan, 238 S.C. 54, 119 S.E.2d 533, 541-542 (1961); Temporarily Yours-Temporary Help Services, Inc. v. Manpower, Inc., 377 So.2d 825, 827 (Fla.Dist.Ct.App. 1979); see also Barnes Group, Inc. v. C C Products, Inc., 716 F.2d 1023, 1031-1032 (4th Cir. 1983); Bush v. National School Studios, Inc., 139 W
We are unwilling to hold that the execution of a dealer contract for the granting of exclusive distribution rights constitutes the sale of a business or profession. See, generally, Muma v Financial Guardian, Inc, 551 F. Supp. 119 (ED Mich, 1982). Given these facts, no sale of a business or profession for a valuable consideration occurred.