Top Quality Badges, Inc. v. Regina Smith, Nina Ponder, d/b/a Global Badge Company

Annotate this Case









June 2, 2004


NO. CV-02-1-4,



Sam Bird, Judge

Appellant Top Quality Badges, Inc., (Top Quality) brings this appeal from an order granting appellees' motion for summary judgment. Appellant contends that the court erred in granting the motion because a genuine issue of material fact existed. We dismiss the appeal for lack of a final order.

Because we do not reach the merits of this case, only a recitation of the facts pertinent to the finality of the order is discussed. On January 2, 2002, Top Quality filed a complaint against appellees Regina Smith and Nina Ponder, d/b/a Global Badge Company (Global), contending that Global had stolen certain trade secrets from appellant in violation of Ark. Code Ann. § 4-75-601. The complaint stated that Top Quality engages in the manufacture and distribution of badges, pins, and buttons. It stated that Global started in the same business in 2001 by manufacturing and distributing badges, pins, and buttons, and that the two companies are competitors. The complaint alleged that Ponder is a former employee of Top Quality and while employed with Top Quality, Ponder learned information about its supply sources for materials used in manufacturing badges, pins, and buttons; its manufacturing techniques; and its customer base. Top Quality alleged that this information is highly proprietary and a trade secret. It also stated that Global had been successful in soliciting business from Top Quality's customers, and that Top Quality has suffered a financial loss. Appellant requested an injunction seeking to prevent Global from manufacturing and distributing badges, pins, and buttons or engaging in any other type of business that is engaged in by Top Quality. Top Quality also sought a judgment for lost profits.

Global answered the complaint admitting their status as owners of Global, but denying the allegations of Top Quality that trade secrets were involved in this case. In addition, Global filed a counterclaim, requesting that Top Quality be ordered to pay their costs, and reimburse them for business interruption and loss of reputation, which they stated amounted to $50,000. Top Quality replied to the counterclaim, denying the allegations.

Global then filed a motion for summary judgment, contending that the information that Top Quality alleges was misappropriated is not a trade secret and is not protected by Ark. Code Ann. § 4-75-601. Attached to the motion were several affidavits of former employees of Top Quality. The motion stated, "These Affidavits and plaintiff's own Answers to Interrogatories show that there is no material fact which remains in dispute concerning whether the information allegedly misappropriated by defendants was a trade secret. In fact, as a matter of law any such information which may have been acquired by the defendants during their employment with plaintiff are not trade secrets." The motion then asked the court to enter a judgment in its favor pursuant to Rule 56 dismissing the complaint as filed therein by the plaintiff against them.

Top Quality then filed a response to the motion for summary judgment stating that based upon the affidavits,

it appears that there is a fact question to be resolved by the jury relative to theft of trade secrets, if nothing else, theft of the pricing schedule of Top Quality Badges. Further, there is a question of fact as to whether the mailing list utilized by Regina Smith and Nina Ponder was obtained from information obtained by Nina Ponder while she was employed by Top Quality Badges.

After a hearing on the motion, the court entered an order granting Global's motion for summary judgment. The order found that the information obtained by Global was not a trade secret in that the information was readily available and not protected. This appeal followed.

Even though the question of a final order was not raised by the parties, a violation of Ark. R. Civ. P. 54(b) relates to the subject-matter jurisdiction of this court, and we must raise the issue on our own. City of Corning v. Cochran, 350 Ark. 12, 84 S.W.3d 439 (2002). Under Rule 54(b), an order is not final for purposes of appeal when it adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties. Id. The policy behind Rule 54(b) is to avoid piecemeal appeals. Id. The court order in this case failed to address Global's counterclaim. We have held that where the trial court did not rule on a counterclaim, it was not a final order. Id. See also Stockton v. Sentry Ins., 332 Ark. 417, 965 S.W.2d 762 (1998); Jordan v. Thomas, 332 Ark. 268, 964 S.W.2d 399 (1998); Maroney v. City of Malvern, 317Ark. 177, 876 S.W.2d 585 (1994); String v. Kazi, 312 Ark. 6, 846 S.W.2d 649 (1993). To be final and appealable, the order must put the judge's directive into execution, ending the litigation, or a separable branch of it. City of Corning v. Cochran, supra.

From the record before this court, it appears that the Global's counterclaim is still pending before the trial court. The court's order granting Global's motion for summary judgment did not address Global's counterclaim. For the reasons stated above, the circuit court's order granting Global's motion for summary judgment was not a final, appealable order; therefore, this appeal must be dismissed.


Vaught and Crabtree, JJ., agree.