Cumulus Serious About Enforcing Non-Competes
This story may serve as a warning to employees about jumping to another company after signing a non-compete and thinking they are unenforceable. Of course, all states are different and it depends on whether a company wants to come after you, but this proves that if a company does decide to make an example of you it has the deep pockets to do so.
From 2000 to 2008 Kristen Okesson (pictured) was a GSM for Cumulus in Bridgeport, CT. From October 2008 to October 2009 she was Market Manager for Cumulus in Danbury CT. That same month, Okesson took another job, for Cox Media, as the Vice President/General Manager in Stamford. She was eventually promoted to Market Manager for Cox in Milford, a job she still has today, according to the CMG corporate office. Okesson's departure from Cumulus apparently did not sit well with the company went after her.
Cumulus, citing the employment agreement Okesson signed, went after their former employee. They accused her of taking confidential documents and trying to steal another employee (the business manager). Cumulus wanted nearly $400,000 in attorney's fees from Okesson. This week, a judge ordered Okesson to pay Cumulus $80,000 of those fees. The court also agreed with Cumulus that Okesson removed confidential documents from Cumulus and tried to hire a Cumulus employee away from the company. A Cumulus executive told Radio Ink yesterday, "This case made clear that Cumulus is serious in the enforcement of our contracts and in the protection of our confidential information. In the end, it was a good win for us. Not so good for Ms. Okesson and Cox."
Although the court did not declare one side or the other a winner, here are damaging details to Okesson, taking directly from the court's decision: "The employer prevailed on its claim that: (1) its former employee wrongfully removed, disclosed and/or used certain of employer’s confidential documents in violation of the Employment Agreement; and (2) its former employee solicited one of employer’s other employees in violation of the Employment Agreement."
The court did not rule completely in favor of Cumulus. Judge Hall limited the geographic scope of the non-compete clause to the Danbury market. And, Judge Hall held that Cumulus did not carry its burden regarding its claim that Okesson violated the non-compete by soliciting customers within the Danbury market. Judge Hall made clear that the entry of the preliminary injunction was appropriate where money damages could not compensate for plaintiff‘s harm.
This case was actually settled between Okesson and Cumulus, before going to court. However, the employment agreement provided for the employee to pay attorneys fees in the event that her employment agreement had to be enforced, and since the court did find that two violations of the employment agreement occurred, the court finds that the plaintiff is entitled to some attorneys fees. You may also want to make sure an attorney reads over your employment agreement. In this case, it appears that there was not a mirror provision in the employment agreement entitling the employee to similar attorneys fees for her enforcement of the employment agreement. Perhaps an attorney would have insisted that be put in. Or, a bad attorney did read the agreement, and did not insist this was added. If it were added, there might not have been a one-sided award of attorneys fees in this case.