PROTEGGA LLC Breach Of Contract
NOTE: PROTEGGA LLC respects the privacy of all parties involved in each of its cases and; therefore, will not disclose cause numbers, company or individual credentials, or other items that may lead to identification.
Scenario
Type of Case: Civil Litigation
County: Collin
Plaintiff: Security Company – “ABC”
Defendant: Security Monitoring Company – “XYZ”
Description: ABC is a contracted reseller of security monitoring services provided by XYZ. XYZ hires VP of Sales employed by ABC in violation of the reseller agreement.
Summary
Timeline
Contract execution date: June 2, 2004
Date VP of Sales terminated employment with ABC: January 17, 2005
Date VP of Sales hired by XYZ: January 26, 2005
Section of Contract Violated
“The parties agree that during the Term of this Agreement and for a period of one (1) year after its expiration or termination, they shall not, without the prior written consent of the other party, hire, or directly or indirectly solicit the full-time or part-time employment of any officer, director, employee, agent, contractor or consultant of such other party.”
Defendants’ Response
VP of Sales was hired after he quit ABC Company; therefore, there was no violation of the contract.
Computer Forensic Evidence Recovered
The laptop belonging to ABC Company, and in use by the VP of Sales, was the only computer investigated. All data was removed from the system, including emails, temporary internet files, cookies, Word, Excel, and PowerPoint. The recycle bin was emptied and the Windows defrag utility was executed. ABC Company utilized Outlook 2003 for corporate mail.
Following is a small example of the data recovered from the laptop showing the use of a private yahoo.com email account.
- Email from VP of Sales to XYZ on December 26, 2004
“…I would first like to thank you for taking the time to review my Resume. I am very excited about the opportunity and feel that I will be a valuable asset to your organization. Should you have any questions please feel free to contact me via e-mail or on my cell phone. I hope to hear from you soon...” - Email from XYZ to VP of Sales on December 27, 2004
“…I just tried to contact you by phone but got your voice mail. Please spend a quick 5 minutes answering the questions in the attached document (print it, answer the questions with pen, and fax to 999 999 9999). Let me know with an email when you fax it.” - Email from VP of Sales to XYZ on December 28, 2004
“…I wanted to follow up with you and make sure that you received the fax that was sent. If not please let me know and I will send it again. I look forward to meeting with you in person. Thanks again for the opportunity...” - Email from VP of Sales to XYZ on January 9, 2005
“After much thought regarding my current situation I want to make sure that I am clear with you. I very much want to see myself as part of the XYZ team. I already have an established contact base within the DFW area, as well as previous sales experience in surrounding states and other cities in Texas. I am sure you can understand my predicament after our conversation on Friday. I had hoped that we could find a mutual place to meet or continue via telephone…As I stated earlier I would love to be a part of your growing company and believe that I would be a key asset in your organization. I know that you have a busy week with your other hire but do hope to hear from you when you get a moment…”
Conclusion
The “he wasn’t an ABC Company employee anymore” defense did not hold up with the computer forensic evidence at hand. It was clear that the VP of Sales was solicited, either directly or indirectly, prior to his termination of employment with ABC Company. The computer forensic evidence was substantial enough, on this and other charges, to warrant a civil suit and to justify a Temporary Restraining Order. Wisely, the defendants determined further litigation and the e-discovery process would prove too damaging and settled within 3 months.
For more information about PROTEGGA LLC or this case study, feel free to contact us:
Ask The Pman
214.988.9240
[back]
