Torie Spinks v. Automation Personnel Services, Inc.

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REL: 04/09/2010 Notice: T h i s o p i n i o n i s s u b j e c t t o f o r m a l r e v i s i o n b e f o r e p u b l i c a t i o n i n t h e advance s h e e t s o f Southern R e p o r t e r . R e a d e r s a r e r e q u e s t e d t o n o t i f y t h e R e p o r t e r o f D e c i s i o n s , A l a b a m a A p p e l l a t e C o u r t s , 300 D e x t e r A v e n u e , M o n t g o m e r y , A l a b a m a 3 6 1 0 4 - 3 7 4 1 ((334) 2 2 9 - 0 6 4 9 ) , o f a n y t y p o g r a p h i c a l o r o t h e r e r r o r s , i n o r d e r t h a t c o r r e c t i o n s may b e made b e f o r e t h e o p i n i o n i s p r i n t e d i n Southern R e p o r t e r . SUPREME COURT OF ALABAMA OCTOBER TERM, 2009-2010 1081379 Torie Spinks v. Automation Personnel S e r v i c e s , I n c . Appeal SMITH, Court Justice. Torie Court from S h e l b y C i r c u i t (CV-09-900286) Spinks insofar appeals as the from an o r d e r order granted o f t h e Shelby Circuit the motion for a p r e l i m i n a r y i n j u n c t i o n f i l e d by Automation Personnel S e r v i c e s , Inc. ("APS"). We r e v e r s e and remand. 1081379 I. On court against PeopleLink other and P r o c e d u r a l 9, April Facts 200 9, APS Spinks HR ("PeopleLink"). 2 0 0 3 ; t h a t , on J a n u a r y that clause a APS; March the that 2009 agreement were complaint declaratory of and Spinks that relief contract her on A p r i l a both of which agreement a f t e r to suffer three counts: against both count and in clause i n by nonsolicitation the irreparable defendants; Spinks; 2 of APS employed s h e was violations APS against the would employment with became violated APS; noncompetition employment immediately 14, into a written of the noncompetition also among agreement") w i t h clause, Spinks's causing asserted trial alleged, entered contained resigned agreement, that complaint the termination of Spinks's i n t h e employment PeopleLink; breach upon and, i n v i o l a t i o n PeopleLink; clause agreement Spinks employment i n the b e c a m e e m p l o y e d b y APS nonsolicitation become e f f e c t i v e with The ("the e m p l o y m e n t employment and complaint 11, 2006, S p i n k s agreement the a and C o m p e n s a t i o n S o l u t i o n s , I n c . , d/b/a t h i n g s , that Spinks employment filed History employed by employment harm. one The requested c o u n t two a l l e g e d count three alleged 1081379 tortious interference with contractual relations against PeopleLink. On May 4, 2 0 0 9 , APS restraining order injunction, seeking employment enjoin with current June 16, a enjoin a motion motion Spinks PeopleLink" or, from 2009, Spinks to dismiss or and the motion, Spinks and [('the that and [d]efendant arbitration Spinks to both for a for a "from in the temporary preliminary her continued alternative, contacting any of to APS'[s] customers." On [APS] ("TRO") ... "either filed Spinks is governed by agreement')] an ... submitted required contended to binding "[a]s arbitration, i t court]," thus, and, agreement Spinks that [ S p i n k s ' s ] employment w i t h that, compel arbitration." executed 2003." of to arbitration o r a b o u t N o v e m b e r 10, out "motion stay pending arbitration the arising a contended that "[t]he r e l a t i o n s h i p arbitration on filed should arbitration." this case not Spinks have filed contended, the 3 [APS] also "[a]ny ... trial the in and contended dispute will Furthermore, i s properly been between agreement by [APS] In Spinks subject [the court be of trial "should 1081379 dismiss [APS's] claims subject to After entered an against Spinks because a l l claims are arbitration." a b r i e f h e a r i n g , the t r i a l order " 1 . The evidentiary injunction. p r o v i d i n g as c o u r t , on J u n e 3 0 , 2009, follows: C o u r t f i n d s t h a t [ A P S ] has s a t i s f i e d t h e burden for obtaining a preliminary "2. The Court orders Defendant Spinks to i m m e d i a t e l y cease her employment r e l a t i o n s h i p w i t h [PeopleLink]. The Court further orders Defendant S p i n k s t o i m m e d i a t e l y c e a s e c o n t a c t i n g any e m p l o y e e s of [ A P S ] ; c e a s e c o n t a c t w i t h any c u r r e n t c u s t o m e r s of [ A P S ] ; and to otherwise cease violating her employment agreement w i t h [ A P S ] . "3. The Court orders Defendant Spinks and [PeopleLink] not to resume their employment r e l a t i o n s h i p u n t i l a f i n a l r e s o l u t i o n of t h i s matter is reached. "4. The Court hereby grants Defendant Torie S p i n k s ' [ s ] M o t i o n t o Compel A r b i t r a t i o n and hereby compels the p a r t i e s to a r b i t r a t e and stays a l l proceedings indefinitely. "[5]. This case i s hereby removed from the court's trial docket. The Court will retain jurisdiction for purposes of enforcing this Preliminary Injunction." Spinks granted 1 this appeals APS's motion from the t r i a l court's order i n s o f a r as i t for a preliminary injunction. The o t h e r d e f e n d a n t appeal. below, PeopleLink, 4 i s not 1 a party to 1081379 II. Standard of Review "'"[T]he grant of, or refusal to grant, a preliminary injunction rests largely i n the discretion of the t r i a l court and t h a t court's l a t i t u d e i n t h i s a r e a i s c o n s i d e r a b l e ; i f no a b u s e o f t h a t d i s c r e t i o n i s shown, i t s a c t i o n w i l l n o t be d i s t u r b e d on a p p e a l . " ' Appalachian Transp. Group, Inc. v. Parks, 738 So. 2d 878 , 882 ( A l a . 1 9 9 9 ) ( q u o t i n g T e l e p r o m p t e r o f M o b i l e , I n c . v. Bayou C a b l e TV, 428 S o . 2 d 1 7 , 19 ( A l a . 1 9 8 3 ) ) . T h i s C o u r t has d e f i n e d an a b u s e o f d i s c r e t i o n a s d i s c r e t i o n that '"exceed[s] t h e bounds o f reason, a l l the circumstances before the lower court being c o n s i d e r e d . " ' A p p a l a c h i a n T r a n s p . G r o u p , 738 S o . 2 d at 882. ' " D i s c r e t i o n e x e r c i s e d by t h e t r i a l court with respect to a preliminary injunction i s a legal o r j u d i c i a l one w h i c h i s s u b j e c t t o r e v i e w f o r a b u s e or i m p r o p e r e x e r c i s e , as where t h e r e has been a violation o f some established rule of law or p r i n c i p l e of equity, or a c l e a r misapprehension of c o n t r o l l i n g law,"' and where i t i s c l e a r t h a t t h e t r i a l court exceeded i t s d i s c r e t i o n , the a p p e l l a t e c o u r t w i l l r e v e r s e t h e o r d e r o r t h e j u d g m e n t . 738 So. 2 d a t 8 8 2 - 8 3 ( q u o t i n g T e l e p r o m p t e r o f M o b i l e , 428 S o . 2 d a t 1 9 ) ( e m p h a s i s o m i t t e d ) . " Butler v . Roome, 907 S o . 2 d 4 3 2 , 434 III. Spinks dispositive the t r i a l injunction order, and raises issues five (Ala. 2005). Issues issues on may b e s u m m a r i z e d appeal; however, as f o l l o w s : the (1) w h e t h e r court retained j u r i s d i c t i o n to issue the preliminary against the t r i a l PeopleLink Spinks court and P e o p l e L i n k c o m p e l l e d APS's to a r b i t r a t i o n and s t a y e d 5 when, claims i n t h e same against Spinks a l l proceedings; and 1081379 (2) whether injunction the trial without court erred r e q u i r i n g APS IV. A. any appeal, legal Spinks to Specifically, requires that issue Spinks bond. submitted exception court any Spinks's for brief, p. 16; may Spinks jurisdiction to Spinks "the says, Conversely, 3d 1173 issue be the out of her the arbitration and "the awarded by the (Ala. 2008), "carve the argues American trial 6 that, out injunctive relief," the Holiday the circuit Arbitration th[at] arbitrator." court was Id. without p r e l i m i n a r y i n j u n c t i o n , and, citing with that neither employment d i s p u t e s p r o v i d e i n j u n c t i o n m u s t be APS, agreement employment "provide emergency that injunction. agreement or to without arbitration contends, the was that to b i n d i n g a r b i t r a t i o n ; governing Accordingly, court citation preliminary a u t h o r i t y to provide relief trial injunctive relief" A s s o c i a t i o n Rules interim the specific arising that a l l disputes m u s t be without the argues employment agreement nor So. a Discussion argues, authority, jurisdiction an to post preliminary Jurisdiction On APS i n i s s u i n g the thus, dissolved." Id. Isle, Adkins, LLC "despite v. the 12 existence 1081379 o f an the enforceable trial arbitration court agreement," APS's b r i e f , nonetheless had preliminary injunction in this between the parties. jurisdiction case to preserve Specifically, APS to the p. 24, issue status a quo argues: "In t h i s case, ' s t a t u s quo' means t h a t APS should be allowed to continue to operate its business without i n t e r f e r e n c e from Spinks. Spinks s h o u l d n o t be a l l o w e d t o a l t e r t h e o r i g i n a l s t a t u s q u o , i . e . , t h a t APS c a n o p e r a t e i t s b u s i n e s s without Spinks t r y i n g to s t e a l i t s c l i e n t s or employees, or o t h e r w i s e c o m p e t e a g a i n s t APS w i t h t h e b e n e f i t s o f p r o p r i e t a r y and confidential information obtained d u r i n g h e r e m p l o y m e n t w i t h APS. That i s the s t a t u s w h i c h , i n t h e a b s e n c e o f an i n j u n c t i o n , c a n n o t be otherwise protected. S h o u l d APS be f o r c e d t o a w a i t a r e s o l u t i o n of t h e d i s p u t e by a r b i t r a t i o n , with Spinks c o n t i n u i n g to s o l i c i t business from c u r r e n t c l i e n t s o f APS and t o e n t i c e away APS employees, then i r r e p a r a b l e damage w o u l d be done t o APS's business." APS's b r i e f , In federal a Adkins, courts binding seeking remedies p. 26. this ... have arbitration emergency in Isle, 2007)). This noted concluded clause 12 537 F. Court also that not relief So. L.L.C., that does injunctive court.'" Holiday Court 3d at Supp. noted s p e c i f i c a l l y adopted the r e a s o n i n g 7 the in limited bar or a that situations "[t]he 1221 Drago v. (S.D. Ala. in Drago Circuit Court court of the F o u r t h from provisional (quoting 1219, of plaintiff other 1177 2d "'majority 1081379 of Appeals Bradley, 756 concluding arbitral F.2d award status 537 F. uncontested the could not return the Adkins, 12 at C i r . 1980) v. Barry, As the Mach. (citing 419 F.2d federal at to least very " 537 court's the quo award Yeargin Servs. Corp., & Washington 472, 476 court in arbitral award c o u l d quo would s i m i l a r to the analysis Supp. 2d 1222. i n j u n c t i o n was likely because, at as could the not Fourth Co. In commencement Circuit Parsons F.2d 829, 831 Club, Drago noted: r e t u r n the of to be the identical irreparable case, i f the harm trial issued, parties stated "The parties in to an the Bradley: "When [a f o r m e r e m p l o y e e ] b r e a c h e s h [ e r ] e m p l o y m e n t contract by soliciting h[er] former employer's customers, a nonsolicitation clause requires immediate application to have any effect. An 8 & 1969)). appropriately return "last Basketball appear this an Drago, the v. 609 Cir. for 'where is the Capitols (9th v. a basis (quoting quo Constr. Inc. s u b s t a n t i a l l y to 1177 status status preliminary arbitral status F. The at district a n a l y s i s o f w h e t h e r an substantially parties 3d as relief parties preceding See Alabama So. 1222). & Smith, C i r . 1985), equitable s t a t u s " of the Inc. (4th order 2d (5th or 1052 Fenner may controversy. Whittemore Pierce, i t quo.'" Supp. Lynch, 1048, that the of in Merrill 1081379 i n j u n c t i o n e v e n a few d a y s a f t e r s o l i c i t a t i o n has b e g u n i s u n s a t i s f a c t o r y b e c a u s e t h e damage i s d o n e . The c u s t o m e r s c a n n o t be ' u n s o l i c i t e d . ' I t may be impossible f o r the arbitral award to r e t u r n the p a r t i e s s u b s t a n t i a l l y t o t h e s t a t u s quo a n t e b e c a u s e the prevailing party's damages may be too speculative." 756 F.2d court at had preserve 1054. Accordingly, jurisdiction the status to quo we issue conclude that a preliminary the trial injunction to p e n d i n g c o m p l e t i o n of the a r b i t r a t i o n proceeding. B. Payment On 838 of appeal, 294 trial court because, the i t be Ala. erred Spinks's Rule 65(c), Fowler, 2d 431 (1975), the "[t]he Order requires damages, and improperly argues no pp. mandatory 17-18. Ala. R. So. 2d enjoined, We Civ. bond that from fees and the evidence requirement Order that exists." provides: "No r e s t r a i n i n g order or preliminary injunction s h a l l i s s u e e x c e p t upon t h e g i v i n g of s e c u r i t y by 9 APS should agree. P., the injunction bond attorneys' f i n d i n g b a s e d upon competent the 423 preliminary costs, to brief, v. v. K e n s i n g t o n M o r t g a g e & F i n a n c e So. S p i n k s was specific Anders issuing by payment of exception 315 says, found that citing Lightsey 281, Spinks m a k e s no an Spinks, ( A l a . 1 9 8 2 ) , and Corp., for bond 1081379 the a p p l i c a n t , i n such sum a s t h e c o u r t deems p r o p e r , f o r t h e payment o f such c o s t s , damages, and reasonable attorney fees a s may b e i n c u r r e d o r s u f f e r e d b y a n y p a r t y who i s f o u n d t o h a v e b e e n wrongfully enjoined or restrained; provided, h o w e v e r , no s u c h s e c u r i t y s h a l l b e r e q u i r e d o f t h e S t a t e o f A l a b a m a o r o f an o f f i c e r o r a g e n c y t h e r e o f , and provided further, i n the d i s c r e t i o n of the c o u r t , no s u c h s e c u r i t y may be r e q u i r e d i n d o m e s t i c relations cases." Also, "'there absolute holding requiring only impecunious the Anders, Civil & Arthur necessary i n a l l cases a t 2 8 5 , 315 Wright [other] a nominal or concern.'" Ala. are exceptions under s e c u r i t y , o r where issue is one of 423 S o . 2 d a t 840 So. 2d R. Rule Miller, Federal 65(c), overriding an such as public Lightsey, i n turn Practice such the l i t i g a n t i s (quoting a t 434, c i t i n g to and Charles 294 A. Procedure, § 2954, p. 5 2 9 ) . APS does above a p p l y i n this authorities, that this APS's not contend case; contends requirement brief, p. 12. that any o f t h e e x c e p t i o n s i n s t e a d , APS, c i t i n g that "there [of posting listed several federal i s authority f o r the a bond] Specifically, APS i s not notes fact absolute." that 2 certain I t i s u n c l e a r w h e t h e r APS i s r e f e r r i n g t o R u l e 6 5 ( c ) , A l a . R. C i v . P., o r R u l e 6 5 ( c ) , F e d . R. C i v . P., o r b o t h , when i t states that "there i s a u t h o r i t y f o r the fact that this r e q u i r e m e n t [ o f p o s t i n g a bond] i s n o t a b s o l u t e . " 2 10 1081379 f e d e r a l d e c i s i o n s have h e l d t h a t , under c e r t a i n circumstances, district with courts have t h e d i s c r e t i o n requirement of Rule contends that rationale set forth says, this 65(c), Court to dispense F e d . R. C i v . P . should i n those apply 3 t h e bond A d d i t i o n a l l y , APS i n this federal decisions case the b e c a u s e , APS "Alabama c o u r t s have r e l i e d upon f e d e r a l c a s e l a w i n t h e interpretation of Rule 65." APS's brief, p. 12 (citing APS c i t e s t h e f o l l o w i n g f e d e r a l cases i n support o f i t s a r g u m e n t : I n t e r n a t i o n a l C o n t r o l s C o r p . v . V e s c o , 490 F . 2 d 1 3 3 4 , 1 3 5 6 ( 2 d C i r . 1 9 7 4 ) ("[W]e h a v e s t a t e d t h a t , e s p e c i a l l y i n v i e w o f t h e p h r a s e -- 'as t h e c o u r t deems p r o p e r ' -- t h e d i s t r i c t c o u r t may d i s p e n s e w i t h s e c u r i t y w h e r e t h e r e h a s b e e n no p r o o f of l i k e l i h o o d o f harm to the party enjoined." ( c i t a t i o n s omitted)); Doctor's Assocs., I n c . v . D i s t a j o , 107 F . 3 d 1 2 6 , 136 ( 2 d C i r . 1 9 9 7 ) ( " R u l e 6 5 ( c ) [ , F e d . R. C i v . P.,] g i v e s t h e d i s t r i c t c o u r t w i d e d i s c r e t i o n t o s e t t h e amount o f a b o n d , a n d e v e n t o d i s p e n s e w i t h t h e b o n d r e q u i r e m e n t 'where t h e r e h a s b e e n no p r o o f o f l i k e l i h o o d o f h a r m , o r w h e r e t h e i n j u n c t i v e o r d e r was i s s u e d " t o a i d a n d p r e s e r v e t h e c o u r t ' s j u r i s d i c t i o n over the subject matter i n v o l v e d . " ' " (citation o m i t t e d ) ) ; P o p u l a r B a n k o f F l o r i d a v . B a n c o P o p u l a r de P u e r t o R i c o , 180 F.R.D. 4 61 , 4 63 ( S . D . F l a . 1 998) ("Although t h e l a n g u a g e o f R u l e 6 5 ( c ) [ , F e d . R. C i v . P.,] a p p e a r s t o b e mandatory, over t h e p a s t twenty y e a r s , f e d e r a l c o u r t s have come t o r e c o g n i z e t h a t t h e d i s t r i c t c o u r t p o s s e s s e s d i s c r e t i o n over whether to r e q u i r e the p o s t i n g o f s e c u r i t y . " ) ; and C l a r k s o n C o . v . S h a h e e n , 544 F . 2 d 6 2 4 , 632 ( 2 d C i r . 1 9 7 6 ) ( " B e c a u s e no r e q u e s t f o r a b o n d was e v e r made i n t h e d i s t r i c t c o u r t , a n d b e c a u s e , u n d e r F e d . R. C i v . P. 6 5 , t h e a m o u n t o f any bond t o be g i v e n upon t h e i s s u a n c e of a preliminary i n j u n c t i o n r e s t s w i t h i n t h e sound d i s c r e t i o n o f t h e t r i a l c o u r t ... , t h e d i s t r i c t c o u r t may d i s p e n s e w i t h t h e f i l i n g o f a bond." ( c i t a t i o n s o m i t t e d ) ) . 3 11 1081379 Lightsey, contends 294 A l a . a t 2 8 5 , 315 S o . 2 d a t 4 3 4 ) . Moreover, APS that "[t]he rationale from the federal decisions i s c o n s i s t e n t w i t h t h e express language of [Rule 6 5 ( c ) , Ala. R. C i v . P . ] , w h i c h o n l y r e q u i r e s t h e g i v i n g o f s e c u r i t y ' i n s u c h sums a s t h e c o u r t deems proper.' F u r t h e r , as n o t e d b y t h e f e d e r a l c o u r t s , t h e b u r d e n s h o u l d b e on t h e e n j o i n e d p a r t y t o r e q u e s t a b o n d . S p i n k s d i d n o t make a n y r e q u e s t o f t h e t r i a l court for a bond p r i o r t o f i l i n g h e r appeal i n t h i s case." APS's b r i e f , p. 15. Alabama law, however, clearly m a n d a t o r y t h a t s e c u r i t y be g i v e n trial court makes evidence that exist.'" Ala. a t 2 8 5 , 315 1215 Energy (Ala. "mandatory"). the above-stated approval So. Corp. 2d a t 840 based that " [ i ] ti s 'unless the upon competent stating t h e m , do (quoting (emphasis v. C i b a - G e i g y (stating Lightsey, added); Corp., rule. the provisions ... u n t i l i n Anders, See Ex p a r t e (1901) (stating t h e bond Miller, that has been recognized 129 A l a . 1 3 0 , "[t]here given") APS's arguments f a i l 12 also of Rule 65(c) c a n be no (quoted 423 S o . 2 d a t 8 4 0 , a n d L i g h t s e y , 4 3 3 , 315 S o . 2 d a t 2 8 4 ) . see 294 503 S o . 2 d 1 2 1 1 , F u r t h e r m o r e , t h i s Court has l o n g 30 S o . 6 1 1 , 612 injunction finding So. 2d a t 434) 1987) are 133, specific 423 that under Rule 65(c), one o r more o f t h e e x c e p t i o n s , Anders, Chunchula at a provides with 294 A l a . to convince 1081379 us that this we should issue. Here, without alter this one the trial requiring "a s p e c i f i c or Anders, court APS of to give 423 So. 2d until at upon 84 0. So. a t 612, q u o t e d w i t h 315 So. 2d a t 4 3 4 ) . (quoting Ex p a r t e of security by the court them, noted, "there Miller, given." Accordingly, "[u]nder Rule f a i l e d to do can that exist." be Anders, decisions no 423 30 294 A l a . a t 2 8 5 , the c l e a r of t h i s and remand." Chunchula Energy Corp., " i s defective mandate court, Anders, we 423 503 S o . 2 d a t an i n j u n c t i o n i s s u e d w i t h o u t applicant by 129 A l a . a t 1 3 3 , i n Lightsey, and t h e p r e v i o u s (stating that mandated approval 2d a t 840; s e e a l s o 1215-16 on injunction competent evidence has been h a v e no a l t e r n a t i v e b u t t o r e v e r s e So. as stating As the bond 2 d a t 840 65(c), preliminary security exceptions, So. Rule a Furthermore, the t r i a l the ... issued f i n d i n g based more injunction of rule 4 6 5 ( c ) , A l a . R. C i v . P. make Court's well established and the g i v i n g due to be reversed"). We n o t e t h a t , a l t h o u g h f e d e r a l a u t h o r i t i e s a r e p e r s u a s i v e when this Court interprets the Alabama Rules of Civil P r o c e d u r e , f e d e r a l a u t h o r i t i e s a r e n o t b i n d i n g on t h i s C o u r t . See F i r s t B a p t i s t C h u r c h o f C i t r o n e l l e v . C i t r o n e l l e - M o b i l e Gathering, I n c . , 409 S o . 2 d 7 2 7 , 729 ( A l a . 1 9 8 1 ) . 4 13 1081379 V. Based order on the foregoing, insofar as i t g r a n t e d injunction, a n d we directions to enter Because law remand we reverse APS's of the t r i a l a bond, see Anders, Miller, court's appeal. that the See A n d e r s , court without with erred issuing other holding issues requires r a i s e d by these R E V E R S E D AND REMANDED Cobb, that WITH C . J . , and Woodall, (quoting Ex parte pretermit (concluding a bond we p r e t e r m i t as Spinks's that the injunction and stating discussion of appeals"). DIRECTIONS. Parker, 14 opinion. t o r e q u i r e APS t o the preliminary t o post with as a m a t t e r o f i s s u e s r a i s e d by 4 2 3 S o . 2 d a t 841 by court this S o . a t 6 1 2 ) , we requiring the applicant "[o]ur failure 4 2 3 S o . 2 d a t 840 129 A l a . a t 1 3 3 , 30 court's f o r a preliminary to the t r i a l consistent unnecessary d i s c u s s i o n of the other trial motion t h e cause an o r d e r the t r i a l the preliminary injunction i s i n v a l i d as a r e s u l t post Conclusion a n d Shaw, J J . , c o n c u r .

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