Turnell v. Centimark Corporation

796 F.3d 656 (7th Cir. 2015)

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Nature of the Case

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Facts

D is a roofing company that primarily sells and installs flat, single-ply roofing for commercial and industrial customers. D hired P as a laborer in its Chicago office in 1978 when he was eighteen years old. In 1988 D promoted him to Chicago District Operations Manager and increased his salary from $45,000 to $50,000 per year. P required him to sign an employment agreement (the 'Agreement'). P had access to D's proprietary information and trade secrets, including sales methods and materials, customer accounts, and pricing data. P agreed to a non-disclosure provision requiring him to maintain the confidentiality of D's information. P could not compete with D for two years in any of the 'regions and/or divisions and/or territories' in which he 'operated' as a D employee. P was not permitted to solicit the trade of, or trade with,' any of D's 'customers or suppliers, or prospective customers or suppliers' during his employment and for two years afterward. P eventually was promoted to Senior Vice President and Regional Manager for the Midwest Region (Western Michigan, northwest Indiana, central and northern Illinois, Wisconsin, Minnesota, and North and South Dakota). P earned over $250,000 per year in base salary and bonuses; in addition, D compensated him with shares in the company worth more than $3 million. P was fired for misappropriating company resources and for covering up fraudulent billing by Vacuum Resources, a subcontracting company owned by his wife. P claimed this was a pretext; the real reason for his termination had to do with his age, his health (he has diabetes and high blood pressure), and his high level of compensation. P interviewed with Windward Roofing and Construction, Inc., a smaller, more local roofing company in Chicago. Windward does shingled residential roofing and masonry as well. P made little effort to find a job outside commercial roofing. P began selling commercial roofing for his new employer. He was hired not to service existing accounts but to develop new business. P contacted numerous customers or former customers of D, some of whom he had personally worked with during his tenure there. P submitted two bids in head-to-head competition with d, winning one of those jobs. P sued D seeking declaratory relief. D moved for a preliminary injunction. The district court granted the motion but found D's restrictive covenants too broad, so it enforced them only to the extent it judged 'reasonably necessary for the protection of D.' It restricted the covenant to commercial roofing. The non-compete clause bans all competing business (i.e., sales of products or services similar to D's), but the injunction does not. It allows P to remain in commercial roofing, subject to restrictions on his ability to sell to D's customers. The injunction does not extend to prospective D customers or to persons who were customers in the past. The district court limited the injunction's reach to the Midwest-the region where P primarily worked throughout his career and which he managed at the time of his departure. P appealed.