Ally Financial, Inc. v. Sandra Gutierrez and Homeward Residential ( 2014 )

COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-13-00108-CV
ALLY FINANCIAL, INC. APPELLANT
V.
SANDRA GUTIERREZ AND APPELLEES
HOMEWARD RESIDENTIAL
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FROM THE 67TH DISTRICT COURT OF TARRANT COUNTY
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MEMORANDUM OPINION 1
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Appellant Ally Financial, Inc., appeals from the trial court’s order granting
summary judgment in favor of appellees Sandra Gutierrez and Homeward
Residential. We affirm the trial court’s judgment. See Tex. R. App. P. 43.2(a).
1
See Tex. R. App. P. 47.4.
I. BACKGROUND
A. GUTIERREZ’S EMPLOYMENT AT ALLY
Ally, which is incorporated in Delaware and headquartered in Michigan, is
a “leading vehicle financial services company” and “operates as a bank holding
company.” Ally also originates and sells mortgages. Gutierrez began working for
Ally in 2004 and was an “IT Leader” in Ally’s Lewisville, Texas, office. The IT
department was responsible for managing personnel and “ensuring work
performed adheres to company standards and . . . business requirements.”
Gutierrez supervised “approximately 89 information technology employees” and
evaluated their performance. She was responsible for “all aspects” of the
operation of the IT department. Gutierrez had access to personnel records for
those employees she supervised and to Ally’s strategic and confidential business
plans.
In 2008, Ally adopted a “Long-Term Equity Compensation Incentive Plan”
(the CIP) under which certain employees would receive award payments “based
on Common Stock Value.” The CIP’s purpose was to “motivate certain
employees [of Ally and its subsidiaries] to put forth maximum efforts toward the
growth, profitability, and success of [Ally and its subsidiaries] by providing [stock]
incentives to such employees.” By its explicit terms, the CIP was governed by
Michigan law: “The Plan, all Awards granted hereunder, and all actions taken in
connection herewith shall be governed by and construed in accordance with the
laws of the State of Michigan without reference to principles of conflict of laws,
2
except as superseded by applicable federal law.” The CIP also included a non-
solicitation covenant:
While the Participant is employed by the Company or a Subsidiary,
and during the 2-year period immediately following the date of any
termination of the Participant’s employment with the Company or a
Subsidiary, such Participant shall not at any time, directly or
indirectly, whether on behalf of . . . herself or any other person or
entity (i) solicit any client and/or customer of the Company or any
Subsidiary with respect to a Competitive Activity or (ii) solicit or
employ any employee of the Company or any Subsidiary, or any
person who was an employee of the Company or any subsidiary
during the 60-day period immediately prior to the Participant’s
termination, for the purpose of causing such employee to terminate
his or her employment with the Company or such Subsidiary.
If a CIP participant violated the non-solicitation covenant, the CIP required the
participant to repay any award payments under a claw-back provision (the claw-
back provision). A participant also could forfeit her rights to unvested awards
under the CIP if she voluntarily resigned her employment: “[I]f a Participant’s
employment is terminated by the Participant prior to a Payment, then the
Participant’s Unvested Awards shall be immediately forfeited as of the date of
such termination of employment” (the automatic-forfeiture provision).
In 2009, Ally was affected by the downturn in the economy and accepted
bailout funds from the federal government. Ally had to lay off several IT
employees, which “caused genuine concern amongst employees at [the IT
department in Lewisville] regarding Ally’s financial instability.” On March 18,
2009, Gutierrez received her first award letter under the CIP (the 2009 award
letter). On April 9, 2009, Gutierrez signed and returned the 2009 award letter to
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accept the award, which would vest and be paid in four installments over a four-
year period:
• 25% on December 31, 2009: [to be paid] within 75 days of
[December 31, 2009;]
• 25% on December 31, 2010: [to be paid] within 75 days of
[December 31, 2010;]
• 25% on December 31, 2011: [to be paid] within 75 days of
[December 31, 2011;]
• 25% on December 31, 2012: [to be paid] within 75 days of
[December 31, 2012.]
The 2009 award letter, above Gutierrez’s signature line, specified: “I accept and
agree to become a participant in the [CIP] and will abide by the terms and
conditions of the [CIP] and this award letter.”
Gutierrez accepted a second award under the CIP on February 24, 2010,
under which she would receive three, deferred payments with different vesting
and payment dates:
• 1/3rd vests on February [illegible], 2011 and will be paid as soon as
practical following February [illegible], 2013;
• 1/3rd vests on February [illegible], 2012 and will be paid as soon as
practical following February [illegible], 2013;
• 1/3rd vests on February [illegible], 2013 and will be paid as soon as
practical following February [illegible], 2014.
Gutierrez accepted a third award under the CIP on March 7, 2011, which
similarly provided for three, deferred payments:
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• 1/3rd vests on February 14, 2012 and will be paid as soon as
practical following February 14, 2014;
• 1/3rd vests on February 14, 2013 and will be paid as soon as
practical following February 14, 2014; and
• 1/3rd vests on February 14, 2014 and will be paid as soon as
practical following February 14, 2015.
Gutierrez received the first two payments under the 2009 award letter on
February 14, 2010, and February 13, 2011. Based on the vesting and payment
dates, Gutierrez apparently never received payments under the second and third
award letters.
B. GUTIERREZ’S EMPLOYMENT AT
HOMEWARD AND CONTACT WITH ALLY EMPLOYEES
On October 14, 2011, Gutierrez left her employment with Ally and began
working for one of Ally’s competitors in the mortgage market—Homeward—as its
chief technology officer. Ally and Homeward “provide the same or substantially
similar mortgage services to customers in similar locations throughout the
country.” At Homeward, Gutierrez assumed similar duties as those she
performed for Ally and was tasked with “driv[ing] all aspects of staff management,
including recruiting.” Gutierrez stated, however, that she was never asked to
recruit for Homeward.
During the first few months of Gutierrez’s employment with Homeward,
approximately eight Ally employees left to work at Homeward. Five of those
employees—Danny Travis, Sherri Lee Bolling, Terry L. Webb, Aaron Weiss, and
Heath Mitchell—contacted Gutierrez to get information about possible job
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opportunities at Homeward. Gutierrez forwarded to them relevant job
descriptions for openings at Homeward. Gutierrez told each of the five
employees that she could not solicit or recruit them for employment with
Homeward. The other three employees—Kimberly Beasley, George Biddle, and
Todd Coffey—pursued employment with Homeward on their own and without
contacting Gutierrez based on Ally’s perceived financial instability. Indeed,
Beasley began working with a recruiter to find a new job before Gutierrez left
Ally. All eight, however, left Ally to work for Homeward within approximately
seven months after Gutierrez left Ally.
After Beasley left Ally to work for Homeward, she contacted Tyler Burkey,
who was still employed at Ally, “at [his] request about a potential job opportunity
at [Homeward].” Beasley told Burkey that Gutierrez “was throwing [Burkey’s]
name out quite a bit at Homeward, and [Gutierrez] had asked [Beasley] about
[Burkey’s] . . . skills.” Burkey sent Beasley his resume but ultimately decided not
to leave his job at Ally.
Another Ally employee, Augustine Hidalgo, contacted Gutierrez after
Gutierrez left Ally to ask “how[’]s it going up there.” Gutierrez told Hidalgo that
there was a system-engineer position available at Homeward if he knew of
anyone looking for a job. After Hidalgo and Gutierrez discussed via email details
of the position, Gutierrez told Hidalgo to send his resume to her “[s]ince you just
formally just asked me and I did not recruit you.” Hidalgo forwarded his resume
to Gutierrez. It appears Hidalgo is still employed by Ally.
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C. DEMAND LETTER AND THIRD PAYMENT UNDER 2009 AWARD LETTER
On March 12, 2012, after Beasley and Weiss resigned from Ally to work for
Homeward, Ally sent Gutierrez a letter to “remind” her of the “terms and
conditions of [the CIP],” specifically the non-solicitation covenant. The letter
stated that Gutierrez had “solicited at least four (4) Ally employees from our
Lewisville, TX facility,” 2 and warning that necessary “enforcement action” would
be taken. Ally based its allegations on the fact “[t]hat the employees were all out
of the same location, all went to work at the same new company, all under Ms.
Gutierrez’s leadership.” Ally further stated that any violation of any contractual
restrictive covenant (including the non-solicitation covenant) would result in the
forfeiture of “any Award that has not yet been paid” and require Gutierrez to
“repay any Award Payments made within 24-months of an enforcement action.”
Ally sent a copy of the letter to Homeward’s human-resources department.
Between March 17 and 27, 2012, Bolling, Webb, Travis, and Mitchell resigned
from Ally to work at Homeward.
On April 22, 2012, Gutierrez received a third payment under the 2009
award letter. Gutierrez believed this payment under the CIP meant Ally had
concluded that she, in fact, had not violated the non-solicitation covenant:
I assumed Ally had determined that I had not breached the non-
solicitation covenant . . ., or that Ally did not intend to pursue me for
2
Ally’s corporate representative later stated that three of these employees
were Bolling, Webb, and Beasley. But Bolling and Webb did not resign until
March 17, 2012.
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any violation of the [CIP] that Ally thought had occurred. At the time
I received the Demand Letter and the final award payment under the
[CIP], I was aware that Ally had waived the Non-Solicitation
Provision for other employees in the past. I also knew that several
former high-level Ally employees were already working at Homeward
when I accepted employment there.
After Ally made its third payment to Gutierrez under the 2009 award letter, Biddle
and Coffey left Ally to work for Homeward.
D. THE UNDERLYING LAWSUIT
On July 9, 2012, and after “several more employees voluntarily left,” Ally
filed suit against Homeward and Gutierrez, raising claims for unfair competition,
tortious interference with contractual relations, tortious interference with
employment relations, 3 and conspiracy. Ally also alleged Gutierrez breached the
CIP and misappropriated Ally’s trade secrets. Ally’s suit against Gutierrez was
the first time it had sought to enforce the CIP against a former employee.
Homeward and Gutierrez moved for summary judgment and asserted that
they were entitled to judgment as a matter of law because the non-solicitation
covenant was unenforceable as overly broad and as unrelated to a business
interest of Ally. They alternatively argued that even if the covenant was
enforceable, Ally waived its right to seek its enforcement. Based on these
arguments, Homeward and Gutierrez contended that a finding that the covenant
3
Ally asserted Homeward and Gutierrez interfered with Ally’s business
relationship with Beasley, Weiss, Bolling, Webb, Travis, Mitchell, Biddle, and
Coffey by preventing Ally from “continuing its employment relationship” with
these employees.
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was unenforceable would dispose of all of Ally’s claims against both Homeward
and Gutierrez.
Homeward and Gutierrez also separately addressed Ally’s tortious-
interference and conspiracy claims. They asserted summary judgment was
appropriate as to Ally’s tortious-interference-with-contractual-relations claim
because the underlying contract was unenforceable and because Gutierrez could
not be found to have tortiously interfered with a contract to which she was a
party. As to Ally’s tortious-interference-with-employment-relations claim,
Homeward and Gutierrez argued that there was no evidence of willful and
intentional interference and that any interference was legally justified. Homeward
and Gutierrez contended that Ally’s derivative conspiracy claims failed as a
matter of law because the underlying claims also failed.
After extensive briefing, the trial court granted Homeward and Gutierrez’s
motion and rendered judgment in their favor “on all of [Ally’s] claims.” Ally timely
filed a notice of appeal and now argues in a single issue that the trial court erred
in granting the summary-judgment motion based on the arguments raised in
Homeward and Gutierrez’s motion. See Tex. R. App. P. 38.1(f); Malooly Bros.,
Inc. v. Napier, 461 S.W.2d 119, 121 (Tex. 1970). See generally Rogers v.
Ricane Enters., Inc., 772 S.W.2d 76, 79 (Tex. 1989) (“When a trial court’s order
granting summary judgment does not specify the ground or grounds relied on for
the ruling, summary judgment will be affirmed on appeal if any of the theories
advanced are meritorious.”).
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II. STANDARD OF REVIEW
A. TRADITIONAL OR MATTER-OF-LAW MOTION
In their summary-judgment motion, Homeward and Gutierrez did not
specify whether they were urging a no-evidence motion or a matter-of-law
motion, and the trial court did not so specify in its order. See Tex. R. Civ. P.
166a(b), (c), (i). On appeal, however, they solely argue the propriety of the
summary judgment under rule 166a(c). Because their appellate argument
defends the summary judgment solely on the basis of rule 166a(c) and because
their arguments regarding their affirmative defenses of legal justification and
waiver could not have been raised in a no-evidence motion under rule 166a(i),
we will solely review the trial court’s grant of summary judgment under the
standards applicable to a traditional or matter-of-law motion under rule 166a(c).
See Tex. R. Civ. P. 166a(i) (stating party may move for no-evidence summary
judgment on “one or more essential elements of a claim or defense on which an
adverse party would have the burden of proof at trial” (emphasis added)); Harrill
v. A.J.’s Wrecker Serv., Inc., 27 S.W.3d 191, 194 (Tex. App.—Dallas 2000, pet.
dism’d w.o.j.) (holding defendant improperly asserted no-evidence motion for
summary judgment on affirmative defense of preemption).
B. GUTIERREZ AND HOMEWARD’S MOTION AS TO ALLY’S CAUSES OF ACTION
We review a summary judgment de novo. Travelers Ins. Co. v. Joachim,
315 S.W.3d 860, 862 (Tex. 2010). Likewise, we determine the enforceability of a
contract under a de-novo standard of review. See DaimlerChrysler Motors Co. v.
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Manuel, 362 S.W.3d 160, 170 (Tex. App.—Fort Worth 2012, no pet.). When, as
here, a trial court does not specify the grounds on which the judgment is based,
we will affirm the summary judgment if it is correct on any legal theory advanced
by the parties and supported by the evidence. See Tex. R. Civ. P. 166a(c); Dow
Chem. Co. v. Francis, 46 S.W.3d 237, 242 (Tex. 2001). We consider the
evidence presented in the light most favorable to the nonmovant, crediting
evidence favorable to the nonmovant if reasonable jurors could, and disregarding
evidence contrary to the nonmovant unless reasonable jurors could not. Mann
Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex.
2009). We indulge every reasonable inference and resolve any doubts in the
nonmovant’s favor. 20801, Inc. v. Parker, 249 S.W.3d 392, 399 (Tex. 2008). A
defendant who conclusively negates at least one essential element of a cause of
action is entitled to summary judgment on that claim. Frost Nat’l Bank v.
Fernandez, 315 S.W.3d 494, 508 (Tex. 2010); see Tex. R. Civ. P. 166a(b), (c).
Once the defendant produces sufficient evidence to establish the right to
summary judgment, the burden shifts to the plaintiff to come forward with
competent controverting evidence that raises a genuine issue as to any material
fact. Van v. Pena, 990 S.W.2d 751, 753 (Tex. 1999).
C. GUTIERREZ AND HOMEWARD’S MOTION AS TO THEIR AFFIRMATIVE DEFENSES
A defendant is entitled to summary judgment on an affirmative defense if
the defendant conclusively proves all the elements of the affirmative defense.
Frost Nat’l Bank v. Fernandez, 315 S.W.3d 494, 508–09 (Tex. 2010), cert.
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denied, 131 S. Ct. 1017 (2011); see Tex. R. Civ. P. 166a(b), (c). To accomplish
this, the defendant-movant must present summary judgment evidence that
conclusively establishes each element of the affirmative defense. See Chau v.
Riddle, 254 S.W.3d 453, 455 (Tex. 2008). If the defendant establishes that she
was entitled to judgment as a matter of law on an affirmative defense, the burden
to raise a genuine issue as to any material fact shifts to the plaintiff. See City of
Houston v. Clear Creek Basin Auth., 589 S.W.2d 671, 678–79 (Tex. 1979).
III. DISCUSSION
A. ENFORCEABILITY OF COVENANT
1. Choice-of-Law Provision 4
Homeward and Gutierrez asserted in the trial court that Ally’s claims were
subject to summary dismissal because the non-solicitation covenant was
unenforceable under Texas law either as overly broad and unrelated to a
legitimate business interest of Ally or because Ally waived enforcement of the
covenant. Thus, Homeward and Gutierrez argued that Texas law applied to the
enforceability of the non-solicitation covenant despite the parties’ agreement that
the CIP would be governed by Michigan law. Ally responded that under Michigan
law, which expressly covered all terms of the CIP, the non-solicitation covenant
4
We emphasize that the issue in this case implicates a choice-of-law
provision and not a forum-selection provision. See generally In re AutoNation,
Inc., 228 S.W.3d 663, 669 (Tex. 2007) (orig. proceeding) (refusing to
“superimpose” choice-of-law analysis onto the law regarding forum-selection
clauses).
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was reasonable and, thus, enforceable. We review de novo the trial court’s
determination of which state’s law governed the CIP. See Torrington Co. v.
Stutzman, 46 S.W.3d 829, 848 (Tex. 2000); In re Chestnut Energy Partners, Inc.,
300 S.W.3d 386, 398 (Tex. App.—Dallas 2009, pet. denied).
Before determining the choice-of-law question raised by Ally, we must first
determine if the applicable law of the two jurisdictions differ. If the result would
be the same under the law of either jurisdiction, there is no need to resolve the
choice-of-law problem. Duncan v. Cessna Aircraft Co., 665 S.W.2d 414, 419,
421 (Tex. 1984); Fraud-Tech, Inc. v. Choicepoint, Inc., 102 S.W.3d 366, 378
(Tex. App.—Fort Worth 2003, pet. denied); accord Bailey v. Shell W. E&P, Inc.,
609 F.3d 710, 722–23 (5th Cir.), cert. denied, 131 S. Ct. 428 (2010). Other than
stating that the CIP’s non-solicitation covenant satisfies Michigan’s enforceability
requirements, Ally fails to argue how the Michigan test differs from the Texas
test. Indeed, both tests evaluate such a covenant’s enforceability by looking at
its reasonableness, which includes its duration, its geographical reach, the
employer’s business interest sought to be protected, and the scope of the barred
activity. 5 Compare Mich. Comp. Laws Ann. § 445.774a (West 2011), with Tex.
5
Ally argues in its reply brief that even if Texas law applies to determine the
enforceability of the non-solicitation covenant, it is not determined through the
prism of section 15.50. But Ally fails to state what enforceability test is applicable
in the absence of a section 15.50 analysis. Indeed, the purpose of section 15.50
was to return Texas law to the common-law standard for the enforceability of
covenants not to compete. Marsh USA Inc. v. Cook, 354 S.W.3d 764, 772 (Tex.
2011) (op. on reh’g). Further, the more persuasive case law applies section
15.50 to non-solicitation covenants as well as non-competition covenants. E.g.,
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Bus. & Com. Code Ann. § 15.50(a) (West 2011). Further, both Texas and
Michigan recognize that a course of affirmative conduct can amount to a waiver
of a contractual provision. Compare Quality Prods. & Concepts Co. v. Nagel
Precision, Inc., 666 N.W.2d 251, 261 (Mich. 2003), with Ulico Cas. Co. v. Allied
Pilots Ass’n, 262 S.W.3d 773, 778 (Tex. 2008). Therefore, we need not
determine which law applies because they are functionally the same.
2. Waiver
Ally next asserts that the trial court erred by implicitly concluding that it
waived its right to enforce the non-solicitation covenant. Waiver is an affirmative
defense; thus, Homeward and Gutierrez bore the burden to conclusively
establish all its elements. See Tex. R. Civ. P. 94. When the facts and
circumstances surrounding the alleged waiver are not disputed, waiver is a
question of law reviewable de novo. See Tenneco Inc. v. Enter. Prods. Co., 925
S.W.2d 640, 643–44 (Tex. 1996); Palladian Bldg. Co. v. Nortex Found. Designs,
Inc., 165 S.W.3d 430, 434 (Tex. App.—Fort Worth 2005, no pet.).
Homeward and Gutierrez were entitled to summary judgment on their
affirmative defense of waiver if they proffered evidence conclusively establishing
(1) an existing right, benefit, or advantage held by a party, (2) the party’s actual
knowledge of its existence, and (3) the party’s actual intent to relinquish, or
Rimkus Consulting Grp., Inc. v. Cammarata, 255 F.R.D. 417, 438–39 (S.D. Tex.
2008); Marsh, 354 S.W.3d at 768; York v. Hair Club for Men, L.L.C., No. 01-09-
00024-CV, 2009 WL 1840813, at *4 (Tex. App.—Houston [14th Dist.] June 25,
2009, no pet.) (mem. op.).
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intentional conduct inconsistent with, the right. Ulico, 262 S.W.3d at 778; see
also Sefzik v. City of McKinney, 198 S.W.3d 884, 895 (Tex. App.—Dallas 2006,
no pet.) (applying summary-judgment standard to affirmative defense of waiver).
Regarding this third element, “[w]aiver is largely a matter of intent, and for implied
waiver to be found through a party’s actions, intent must be clearly demonstrated
by the surrounding facts and circumstances.” Jernigan v. Langley, 111 S.W.3d
153, 156 (Tex. 2003). Ally focuses on this element in attacking the trial court’s
summary judgment. Homeward and Gutierrez assert that the third payment
under the 2009 award letter was an intentional relinquishment of, or intentional
conduct inconsistent with, Ally’s intent to enforce the non-solicitation covenant.
The undisputed evidence before the trial court showed that Gutierrez left
her employment with Ally in October 2011. Ally notified Gutierrez in March 2012
that it believed Gutierrez violated the terms of the CIP by soliciting Ally
employees for employment with Homeward. In this letter, Ally raised the terms of
the CIP, which contained both the claw-back provision for violations of the non-
solicitation covenant and the automatic-forfeiture provision upon voluntary
resignation. In April 2012, Ally paid Gutierrez a third payment under the 2009
award letter. Ally was aware at that time that Gutierrez had voluntarily resigned
before the third payment under the 2009 award letter had vested and that
Gutierrez was allegedly violating the non-solicitation covenant contained in the
CIP.
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Therefore, Ally represented to Gutierrez that although it believed she had
violated the CIP and had forfeited her rights to all unvested payments by
voluntarily resigning, it was awarding her incentive compensation as provided by
the CIP. Ally’s action in paying Gutierrez a third payment under the 2009 award
letter was inconsistent with its previously stated intention to enforce the non-
solicitation covenant. Further, Gutierrez was aware that Ally repeatedly had
declined to enforce the non-solicitation covenant against other Ally employees
who resigned. Ally’s intentional conduct, inconsistent with its attempted
enforcement of the CIP, waived its right to seek enforcement of the non-
solicitation covenant. 6 See, e.g., Riley v. Meriwether, 780 S.W.2d 919, 922 (Tex.
App.—El Paso 1989, writ denied) (“Waiver can be inferred from intentional
conduct which is inconsistent with claiming a known right.”); KMI Cont’l Offshore
Prod. Co. v. ACF Petroleum Co., 746 S.W.2d 238, 243 (Tex. App.—Houston [1st
Dist.] 1987, writ denied) (“[A] waiver can occur if a party knowingly possessing
the right acts in such manner that the party misleads the opposing party into
believing that a waiver has occurred.”); Alford, Meroney & Co. v. Rowe, 619
S.W.2d 210, 213 (Tex. Civ. App.—Amarillo 1981, writ ref’d n.r.e.) (finding waiver
6
Because waiver can be based either on the party’s intentional action
inconsistent with the right sought to be enforced or on the party’s actual intent to
relinquish the right, we do not agree with Ally that evidence of inconsistent action
without evidence of actual intent dooms a waiver argument. See Tenneco, 925
S.W.2d at 643. It appears Ally is relying on cases interpreting estoppel in the
context of a breach of contract, which is distinct from waiver. See Ulico, 262
S.W.3d at 778.
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“where one dispenses with the performance of something which he has a right to
exact, and occurs where one in possession of any right, whether conferred by
law or by contract, with full knowledge of the material facts, does or forbears to
do something, the doing of which or the failure or forbearance to do which is
inconsistent with the right or his intention to rely upon it”); cf. Brannan Paving GP,
LLC v. Pavement Markings, Inc., Nos. 13-11-00005-CV, 13-11-00013-CV, 2013
WL 3832717, at *6 (Tex. App.—Corpus Christi July 25, 2013, pet. filed) (finding
no waiver where no evidence party seeking to enforce terms of subcontract “was
aware of [opponent’s] failure to comply with the subcontract”).
Homeward and Gutierrez conclusively established through undisputed
evidence that Ally waived its right to seek enforcement of the non-solicitation
covenant based on its inconsistent action in issuing the third payment to
Gutierrez under the 2009 award letter after Gutierrez forfeited the unvested
award upon her resignation from Ally and after Ally notified Gutierrez that she
had breached the non-solicitation covenant. See, e.g., Bekins Moving & Storage
Co. v. Williams, 947 S.W.2d 568, 576 (Tex. App.—Texarkana 1997, no pet.).
Thus, the burden to raise a genuine issue as to any material fact regarding
waiver shifts to Ally. See Clear Creek Basin, 589 S.W.2d at 678–79. Ally
attempts to raise a genuine issue as to a material fact regarding waiver by
asserting that the third payment under the 2009 award letter alone cannot
establish waiver because “payment of the funds due was nothing more than a
ministerial act by Ally” under the terms of the CIP. In short, Ally contends that
17
because it was contractually obligated to pay Gutierrez under the CIP, it was
required to pay her even though it had expressed to Gutierrez that she was in
violation of the CIP. This argument is unpersuasive.
As laid out above, Gutierrez’s resignation in October 2011 automatically
forfeited her right to any unvested payments, which included Ally’s third payment
to Gutierrez. Ally’s third payment to Gutierrez under the 2009 award letter after it
expressed its intention to enforce the non-solicitation covenant and after
Gutierrez voluntarily resigned was inconsistent with the terms of the CIP and was
more than a ministerial act. See Tenneco, 925 S.W.2d at 643–44 (holding
complaining parties waived right to enforce contract when they knew of
opponent’s breach and “elected not to enforce any [contractual] rights” for three
years). Ally has failed to raise a genuine issue of material fact in response to
these conclusively established facts. Therefore, the trial court correctly granted
summary judgment in Homeward and Gutierrez’s favor on Ally’s claims based on
the affirmative defense of waiver.
3. Unreasonable
Even if Ally had not waived its right to seek enforcement of the CIP based
on its intentional actions inconsistent with enforcement of the CIP, the non-
solicitation covenant was unreasonable in scope and, thus, unenforceable. 7 An
7
Before addressing reasonableness of a non-solicitation covenant, it must
first be determined that the covenant is part of an otherwise valid agreement and
that the covenant is ancillary to that agreement. See Marsh, 354 S.W.3d at 773–
75. No party argues that these two requirements were not met.
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enforceable non-solicitation covenant will contain reasonable limitations as to
time, geographical area, and scope of activity to be restrained. Tex. Bus. & Com.
Code Ann. § 15.50(a). Further, a non-solicitation covenant is unreasonable if it is
greater than required for the protection of the person for whose benefit the
restraint is imposed or imposes undue hardship upon the person restricted. Zep
Mfg. Co. v. Harthcock, 824 S.W.2d 654, 660 (Tex. App.—Dallas 1992, no writ).
Here, the non-solicitation covenant barred Gutierrez, for a two-year period,
from soliciting or employing (1) all Ally employees who work for Ally or any of
Ally’s subsidiaries and (2) all former Ally employees who worked for Ally or any of
Ally’s subsidiaries between August 14 and October 14, 2011. While it might be
considered reasonable to limit Gutierrez’s solicitation of Ally’s employees located
in the IT department, which was where Gutierrez worked, the non-solicitation
covenant in the CIP was not so limited. Gutierrez was barred for two years from
soliciting or employing both all current Ally employees and all former Ally
employees who were so employed in late 2011. The undisputed summary-
judgment evidence showed that in 2012, Ally had approximately 14,000
employees located across the nation, with some located in foreign countries.
These 14,000 employees were included in the scope of Ally’s non-solicitation
covenant. This covenant goes beyond what was necessary to protect Ally’s
goodwill or other business interest of Ally. See Peat Marwick Main & Co. v.
Haass, 818 S.W.2d 381, 386–88 (Tex. 1991) (holding covenant not to compete
that included “any of [the employer’s] clients worldwide, not just those with whom
19
Haas had some actual contact,” unenforceable as overly broad and oppressive);
McNeilus Cos., Inc. v. Sams, 971 S.W.2d 507, 510–11 (Tex. App.—Dallas 1997,
no pet.) (holding covenant not to compete “in any capacity” for employer’s
competitors unenforceable as unreasonably broad in scope); cf. Arthur J.
Gallagher & Co. v. Babcock, 703 F.3d 284, 289–90 (5th Cir. 2012) (holding non-
compete covenant enforceable because covenant limited to “accounts
[employees] worked while employed”); Am. Express Fin. Advisors, Inc. v. Scott,
955 F. Supp. 688, 692–93 (N.D. Tex. 1996) (holding non-compete covenant
enforceable under section 15.50 because covenant specified one-year duration
and only limited defendant from contacting customers he served while working
for plaintiff). Thus, the trial court correctly granted summary judgment on
Gutierrez and Homeward’s argument that the covenant was not enforceable.
4. Tortious Interference with Employment Relations
To the extent Ally’s claim raising tortious interference with its employment
relations does not arise solely from Gutierrez’s obligations under the CIP as
Ally’s other claims do, we separately address this claim. 8 Homeward and
Gutierrez argued in the trial court that they conclusively negated that there was
8
Ally does not clearly argue that this tort is independent of Gutierrez’s non-
solicitation covenant with Ally and, in fact, asserts that Gutierrez’s actions were
tortious because she “deliberately tried to circumvent her Agreement with Ally.”
To the extent Ally’s claim likewise rests on the unenforceable covenants in the
CIP, it was appropriately dismissed as discussed above. We merely address this
claim in an abundance of caution and do not hold that Ally’s claim is a claim
separate from its other contractually based claims.
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any interference and also raised the affirmative defense of legal justification in
response to this claim. See Kipp v. LTV Aerospace & Defense, 838 F. Supp.
289, 295 (N.D. Tex. 1993) (recognizing defense of legal justification to claim for
tortious interference with employment relations); see also Prudential Ins. Co. of
Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74, 77–78 (Tex. 2000) (applying
affirmative defense of justification to claim for tortious interference with an
existing contract).
First, Homeward was correct that it could not have interfered with Ally’s
continued employment of Beasley, Weiss, Bolling, Webb, Travis, Mitchell, Biddle,
or Coffey: “[A] claim of tortious interference cannot be premised merely on the
hiring of an at-will employee, without more.” Lazer Spot, Inc. v. Hiring Partners,
Inc., 387 S.W.3d 40, 53 (Tex. App.—Texarkana 2012, pet. denied). It was
undisputed that Homeward did not ask Gutierrez to recruit Ally employees. To
hold Homeward liable for tortious interference for merely hiring Ally employees
would “grind to a halt . . . the economy in the State of Texas.” Id. at 53 n.23.
Second, it was undisputed that Beasley, Biddle, and Coffey never spoke
with Gutierrez before leaving Ally to work for Homeward. Thus, Gutierrez
conclusively negated an essential element of tortious interference, namely, that
Gutierrez actually caused Beasley, Biddle, or Coffey to leave their employment
with Ally. See Diesel Injection Sales & Servs., Inc. v. Renfro, 656 S.W.2d 568,
573 (Tex. App.—Corpus Christi 1983, writ ref’d n.r.e); Custom Drapery Co. v.
21
Hardwick, 531 S.W.2d 160, 166 (Tex. Civ. App.—Houston [1st Dist.] 1975, no
writ).
Finally, Gutierrez conclusively proved the affirmative defense of
justification as to Weiss, Bolling, Webb, Travis, and Mitchell. Because the non-
solicitation covenant was either waived or unenforceable as overly broad, nothing
prevented Gutierrez from lawfully contacting these employees regarding possible
employment at Homeward. See Lazer Spot, 387 S.W.3d at 53 (holding mere
hiring of another’s at-will employee legally insufficient to prove tortious
interference); Sterner v. Marathon Oil Co., 767 S.W.2d 686, 691 (Tex. 1989)
(stating elements of affirmative defense). See generally Restatement (Second)
of Torts § 768(2) cmt. i (1979) (explaining contracts terminable at will are not
breached by voluntary termination; therefore, a competitor “may offer better
contract terms, as by offering an employee of the plaintiff more money to work for
him . . . and he may make use of persuasion or other suitable means, all without
liability”). Gutierrez conclusively established that she had a bona fide right to
contact Weiss, Bolling, Webb, Travis, and Mitchell about employment with
Homeward. Ally failed to raise a genuine issue as to any material fact regarding
Gutierrez’s affirmative defense once the burden shifted; thus, the trial court
correctly granted summary judgment on this claim.
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B. SCOPE AND TIMING OF SUMMARY JUDGMENT
1. Inclusion of All Claims
Ally asserts that the trial court erred by granting summary judgment on all
of its claims because Homeward and Gutierrez failed to move for judgment as a
matter of law on Ally’s claim for unfair competition against Homeward and
Gutierrez and on its claims for misappropriation of trade secrets against
Gutierrez. In their motion for summary judgment, Homeward and Gutierrez
argued that a conclusion that the non-solicitation covenant was not enforceable
“disposes of all of Ally’s claims . . . [b]ecause all of Ally’s claims against Gutierrez
and Homeward are based on Gutierrez’s alleged violation of the non-solicitation
[covenant].”
A trial court cannot grant summary judgment on a cause of action not
addressed in the summary-judgment motion. Johnson v. Brewer & Pritchard,
P.C., 73 S.W.3d 193, 204 (Tex. 2002); Chessher v. Sw. Bell Tel. Co., 658
S.W.2d 563, 564 (Tex. 1983). See generally Tex. R. Civ. P. 166a(c). But Ally’s
unfair-competition and misappropriation-of-trade-secrets claims were based on
Gutierrez’s actions that allegedly were in breach of the CIP, specifically the non-
solicitation covenant. Further, any damages Ally suffered based on Gutierrez’s
post-resignation actions would be derived from the obligations in the CIP and
Gutierrez’s alleged breach of those obligations. 9 As such, Ally’s claims sound
9
In pleading each claim, Ally incorporated the facts regarding Gutierrez’s
actions that Ally alleged were in violation of the non-solicitation covenant.
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only in contract. See Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494–95
(Tex. 1991); Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617, 618 (Tex. 1986).
Indeed, both unfair-competition and misappropriation-of-trade-secrets claims
require evidence that “the trade secret was acquired through a breach of a
confidential relationship,” which could not occur in this case apart from
Gutierrez’s alleged breach of a contractual provision. Parker Barber & Beauty
Supply, Inc. v. The Wella Corp., No. 03-04-00623-CV, 2006 WL 2918571, at *14
(Tex. App.—Austin Oct. 11, 2006, no pet.) (mem. op.). Because Ally’s claims are
contractual, the trial court’s implicit conclusion that Ally waived its right to enforce
the non-solicitation covenant or, alternatively, that the non-solicitation covenant
was unenforceable because it was overly broad in scope, necessarily disposed
of Ally’s contractual claims for unfair competition and misappropriation of trade
secrets, as argued by Homeward and Gutierrez in their summary-judgment
motion. The trial court did not err by granting summary judgment on all of Ally’s
claims.
2. Need for Additional Discovery
Ally argues that the summary judgment was premature because the trial
court did not allow Ally to conduct additional discovery regarding Gutierrez’s
alleged spoliation of evidence and because it was not able to take the deposition
of Homeward’s representative. Ally points out that after it sent the demand letter
to Gutierrez, Gutierrez “deleted several emails . . . that she had received from
former Ally employees” after changing her email address to prevent “Ally
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employees from contacting her about employment with Homeward.” Gutierrez
was able to recover “almost all of the emails” and produced them to Ally during
discovery. Based on Gutierrez’s actions, Ally asserts that it is entitled to a
spoliation presumption, which “prevents a granting of summary judgment.”
First, Ally’s spoliation argument applied solely to Gutierrez’s alleged
violation of the non-solicitation covenant and the fact that the spoliation
presumption raised a genuine issue of material fact as to whether she violated
the covenant. Because we have determined that the non-solicitation covenant
was unenforceable based on Ally’s waiver and, alternatively, based on the
overbroad scope of the covenant, Gutierrez’s violation of the covenant is not an
issue. The deleted emails did not affect waiver or enforceability; thus, the
summary judgment was justified on grounds unaffected by the allegedly spoliated
evidence, which removes it from the purview of the spoliation presumption. See
Mangham v. YMCA of Austin, Tex.-Hays Cmtys., 408 S.W.3d 923, 930–31 (Tex.
App.—Austin 2013, no pet.) (“[W]e are not inclined to presume the trial court
considered and rejected a spoliation argument in every grant of summary
judgment, as this would ignore the possibility that the summary judgment was
justified on grounds or in reliance on elements unaffected by the allegedly
spoliated evidence.”); see also Ham v. Equity Residential Prop. Mgmt. Servs.
Corp., 315 S.W.3d 627, 634–35 (Tex. App.—Dallas 2010, pet. denied) (affirming
summary judgment because spoliated evidence was cumulative and not relevant
to issue upon which summary judgment granted).
25
Second, Ally failed to properly request additional time for discovery. See
Tex. R. Civ. P. 166a(g). In its response to Homeward and Gutierrez’s motion for
summary judgment, Ally asserted that it “has not been permitted to take
Homeward’s deposition” but averred that it had “filed for review of objections to
Homeward’s deposition which is currently pending review by the [trial] [c]ourt.”
The clerk’s record does not contain these objections. See Tex. R. App. P. 34.5.
Be that as it may, Ally was required to file either an affidavit explaining the need
for further discovery or a verified motion for continuance. See Tenneco, 925
S.W.2d at 647; see also Elizondo v. Krist, 56 Tex. Sup. Ct. J. 1074, 2013 WL
4608558, at *7 & n.27 (Aug. 30, 2013). Neither Ally’s objections nor its reference
to the lack of discovery in its summary-judgment response are sufficient to render
the summary judgment premature based on Ally’s lack of “affidavit facts essential
to justify [its] opposition” to Homeward and Gutierrez’s summary judgment. Tex.
R. Civ. P. 166a(g).
IV. CONCLUSION
Because Homeward and Gutierrez conclusively established under Texas
law that Ally waived enforcement of the non-solicitation covenant and because
Ally failed to raise a genuine issue as to any material fact regarding waiver, the
trial court correctly granted summary judgment on Ally’s claims seeking a remedy
for Gutierrez’s actions that allegedly violated the non-solicitation covenant.
Alternatively, because Gutierrez and Homeward conclusively negated an
essential element of Ally’s causes of action by proffering undisputed evidence
26
that the non-solicitation covenant was unenforceable as overly broad in scope,
the trial court correctly granted summary judgment. We overrule Ally’s issue and
affirm the trial court’s judgment.
/s/ Lee Gabriel
LEE GABRIEL
JUSTICE
PANEL: LIVINGSTON, C.J.; GARDNER and GABRIEL, JJ.
DELIVERED: January 23, 2014
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