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All opinions are subject to modification and technical correction prior to official publication in the North Carolina Reports and North Carolina Court of Appeals Reports. In the event of discrepancies between the electronic version of an opinion and the print version appearing in the North Carolina Reports and North Carolina Court of Appeals Reports, the latest print version is to be considered authoritative.
SUNBELT RENTALS, INC. Plaintiff-Appellee, v. HEAD & ENGQUIST
EQUIPMENT, L.L.C., d/b/a H&E HI-LIFT, ROBERT HEPLER, DOUGLAS
KLINE, MICHAEL QUINN, GREGG L. CHRISTENSEN, PATRICK C. MULDOON,
MICHELE U. DOUGHERTY, and BRIAN W. PEARSALL, Defendant-Appellants
Filed: 18 October 2005
1. Trade Secrets_compiled business information_construction equipment rental
The trial court did not err by concluding that plaintiff's compilation of business
information constitutes a trade secret. The trial court determined that the disputed information
was not generally known outside the company, was only discreetly disclosed within the company,
was guarded as a secret, was competitively valuable, was developed at significant cost; and was
difficult to acquire or duplicate.
2. Trade Secrets_construction rental companies_hiring branch managers_using
The trial court did not err in an action between construction equipment rental companies by
finding that defendants misappropriated trade secrets and violated the Unfair and Deceptive
Trade Practices Act through the hiring of branch managers who used plaintiff's confidential
information to obtain sales and convert former customers. N.C.G.S. § 66-152: N.C.G.S. § 75-
3. Unfair Trade Practices_damages_hiring of branch managers and use of confidential
data_misappropriation of trade secrets and unfair practices_lost profits and benefit
The trial court did not err by finding that defendant's hiring of plaintiff's branch managers
and their use of confidential data proximately caused of plaintiff's damages for misappropriation
of trade secrets and unfair and deceptive trade practices. Moreover, under the Unfair and
Deceptive Trade Practices Act, lost profits and the benefit defendant received are different types
of damages and the award of both is permitted.
4. Laches_misappropriation of trade secrets from purchased company_no delay in
Plaintiffs were not barred by laches from seeking relief for a competitor's hiring of its
managers and the misappropriation of trade secrets. There was no delay in bringing the action
and no prejudice.
Appeal by defendants from an order dated 13 August 2003 byJudge Ben F. Tennille in Special Superior Court for Complex
Business Cases. Heard in the Court of Appeals 3 March 2005.
Helms, Mulliss & Wicker, P.L.L.C., by E. Osborne Ayscue, Jr.,
Irving M. Brenner, Catherine E. Thompson and Paul M. Navarro,
Parker, Poe, Adams & Bernstein, L.L.P., by Jack L. Cozort,
William L. Rikard, Jr., Eric D. Welsh, Deborah L. Edney and
Heather N. Oakley, for plaintiff-appellee.
Head & Engquist Equipment, L.L.C., (d/b/a H&E Hi-Lift), Robert
Hepler, Douglas Kline, Michael Quinn, Gregg L. Christensen, and
Brian W. Pearsall, (collectively defendants) appeal from an Order
and Opinion dated 13 August 2003 finding defendants jointly and
severally liable to Sunbelt Rentals, Inc. (plaintiff) under the
North Carolina Trade Secrets Protection Act (NCTSPA) and the N.C.
Unfair and Deceptive Trade Practices Act (UDTPA). Plaintiff was
(See footnote 1)
in the amount of $16,200,000.00, plus pre- and
post-judgment interest of eight percent.
This dispute arose between corporate parties who are
competitors in the market for the rental of construction equipment,specifically aerial work platforms (AWP). The business of renting
AWP equipment and the pricing of such equipment is extremely
competitive. Sunbelt Rentals, Inc. (plaintiff) purchased BPS
Equipment Rental and Sales (BPS) in June 2000. Former employees of
BPS are named as individual defendants in this action: Robert
Hepler (President), Douglas Kline (Vice President of Finance),
Michael Quinn (Senior Manager), Gregg L. Christensen (Dallas
Western Regional Manager) and Brian W. Pearsall (Charlotte Branch
In August 1999, Hepler and Kline learned via the internet that
BPS was to be sold. Together, they developed an Aerial Equipment
Specialists Plan (AES Plan) which included specific fleet mixes for
each of the proposed branches to coincide with the local rental
markets, including specific employee compensation rates which were
formulated by experience in each of the markets to maximize
utilization. Hepler and Kline were unsuccessful in their attempt
to sell the AES Plan. In November 1999, Hepler and Kline resigned
from BPS and in December 1999 began working for H&E's Hi-Lift
Division. Hepler was employed as President, while Kline was
employed as Executive Vice President and Chief Financial Officer.
Hepler and Kline, while performing in a similar capacity as they
had at BPS, began to implement their AES Plan for H&E in seven
southeastern cities including: Atlanta, Charlotte, Orlando,Dallas, Houston, Tampa/Fort Meyers, and Fort Lauderdale. A major
concern of H&E in implementing the AES plan was the availability of
the right personnel to grow the business. By June 2000, former
BPS branch managers in Atlanta, Charlotte, Tampa/Fort Meyers, and
Orlando had been recruited and hired by H&E to perform similar
duties within their respective geographical areas. H&E had no
previous market presence in Atlanta, Charlotte, Orlando, Dallas,
Houston, Tampa/Fort Meyers, or Fort Lauderdale. In each location,
after the conversion of former BPS branch managers, a significant
number of key BPS personnel
(See footnote 2)
, if not all, were employed by H&E.
On 14 July 2000 plaintiff filed this action asserting claims
for: breach of fiduciary duty; aiding and abetting breach of
fiduciary duty; tortious interference with prospective relations;
violation of the North Carolina Trade Secrets Protection Act;
violation of the North Carolina Unfair Trade Practices Act; and
civil conspiracy. The case was assigned to the North Carolina
Special Superior Court for Complex Business Cases
. In an Opinion and Order dated 10 July 2002, Judge Ben F.
Tennille granted partial summary judgment dismissing the breach of
fiduciary duty claims against all defendants. The claim of aiding
and abetting breach of fiduciary duty against H&E was also
dismissed. The remainder of the claims proceeded to trial before
Judge Tennille. At the close of plaintiff's evidence, the trial
court granted Patrick C. Muldoon and Michele U. Dougherty's Rule
41(b) motion to dismiss all claims against them. On 2 May 2003
Judge Tennille entered an Order and Opinion ruling the remaining
defendants were jointly and severally liable for each of the
remaining claims with the exception of tortious interference with
prospective relations. The trial court awarded damages of
$5,000,000, which it then trebled under N.C. Gen. Stat. § 75-16
(2003). By Order entered 31 July 2003, the trial court also
awarded plaintiff's attorney's fees of $1,200,000.00 under N.C.
Gen. Stat. § 75-16. On 13 August 2003 Judge Tennille entered a
final judgment for $16,200,000.00 together with pre-judgment and
post-judgment interest of eight percent. Defendants appeal
(See footnote 3)
Defendants raise four issues on appeal: whether the trial court
erred in (I) concluding plaintiff's compilation of business
information constitutes a trade secret under N.C. Gen. Stat. § 66-
152 (N.C. Trade Secrets Protection Act) and that defendants
misappropriated trade secrets; (II) finding defendants violated
N.C. Gen. Stat. § 75-1.1 (Unfair and Deceptive Trade Practices
Act); (III) finding a proximate cause connection between
plaintiff's lost profits and defendants' conduct in determining
plaintiff's damages (and the trebling of such damages); and (IV)
concluding plaintiff's claims of unlawful conduct were not barred
Standard of Review
Since this appeal involves a bench trial, findings of fact made
by the trial court have the force and effect of a jury verdict and
are conclusive on appeal if there is evidence to support them[.]
Henderson County v. Osteen
, 297 N.C. 113, 120, 254 S.E.2d 160, 165
(1979). Appellate review of the trial court's conclusions of law
is de novo
. McConnell v. McConnell
, 151 N.C. App. 622, 626, 566
S.E.2d 801, 804 (2002).
We will consider the applicable findings and conclusions
according to defendants' assignments of error. We note the
extensive number of assignments of error which defendants do notargue. Therefore, we grant plaintiff's 21 October 2004 motion to
exclude from consideration defendants' unargued assignments of
error based on N.C. R. App. P. 28 (b)(6) and deem those assignments
of error abandoned.
 Defendants first argue the trial court erred in concluding
plaintiff's compilation of business information constitutes a trade
secret under N.C. Gen. Stat. § 66-152 (N.C. Trade Secrets
A trade secret is business or technical information that
[d]erives independent actual or potential commercial value from
not being generally known or readily ascertainable through
independent development . . . and
] the subject of efforts that
are reasonable under the circumstances to maintain its secrecy.
N.C. Gen. Stat. § 66-152(3)(a)-(b) (2003). Factors to consider
when determining whether an item is a trade secret are:
(1) the extent to which information is known
outside the business; (2) the extent to which it is
known to employees and others involved in the
business; (3) the extent of measures taken to guard
secrecy of the information; (4) the value of
information to business and its competitors; (5)
the amount of effort or money expended in
developing the information; and (6) the ease or
difficulty with which the information could
properly be acquired or duplicated by others.
State ex rel. Utils. Comm'n v. MCI
, 132 N.C. App. 625, 634, 514S.E.2d 276, 282 (1999) (citation omitted). Applying these factors,
our courts have found the following to constitute a trade secret:
cost history information
(See footnote 4)
; price lists
(See footnote 5)
; and confidential customer
lists, pricing formulas and bidding formulas
(See footnote 6)
On the issue of whether plaintiff's compilation of business
information constitutes a trade secret, defendants assign as error
only the following four findings of fact:
(16) AWP managers and salespeople know, from
experience or simply by asking their customers,
what type of equipment is needed by the different
types of contractors for particular jobs. For
example, electrical contractors will often use
smaller scissor lifts or push-around lifts that can
fit through interior doorways, while glass
manufacturers working on the outside of buildings
need taller boom lifts which can range up to 120
feet in height. Knowledge of the company's customer
base contributes to higher utilization of equipment
and better selection of the fleet mix for a
particular market. Such information allows a
business to invest in certain machines that yield
better rates and profits. A new market entrant has
a significant advantage if it has access to that
information. With such information, a new entrant
can maximize its initial fleet investment with
little risk, perhaps saving millions of dollars,
and can accurately project an operating budget.
. . .
In terms of price, historical prices have
limited value. Prices are quoted and then
negotiated between the outside sales representative
and the customer or over the telephone with inside
sales coordinators. While salesmen would like for
prices to remain confidential, they understand
and expect that prices will become known in the
market. Customers do not consider quoted prices to
be confidential and often reveal price sheets and
quoted prices of competitors to obtain more
favorable terms. AWP rental companies occasionally
quote good customers a fixed price for a job or
period of time; these arrangements would constitute
confidential information. Sealed bids or other
formal bidding processes are rarely used. Recent
consolidation in the industry has made pricing
extremely competitive and has created several large
. . .
(42) During Hepler's tenure
as [BPS'] president, the senior management team met
regularly, at least once per month. At its
meetings, the senior management team discussed
customers, mechanic availability, sales personnel,
equipment utilization, safety, marketing, product
mix, average rental rates, planning and other
matters. Branches were regularly evaluated branch-
by-branch. Senior management regularly shared BPS
marketing, customer and internally developed
information. This information included head counts,
salary information, pricing, organizational
structure, financial projections and forecasts,
cost information, branch budgets and customer
information, including the identity, contacts and
requirements of its rental customers, pricing in
effect for those customers and fleet utilization
information by branch. Senior management knew that
this information was confidential.
Defendants Hepler and Kline managed the day-to-day
affairs of BPS, made strategic decisions, developedand implemented budgets and hired and fired
employees. Hepler was involved in all levels of the
business. He frequently visited branches, discussed
up and coming job sites and sales personnel and was
actively involved with customers. Kline was
involved in all aspects of the business as the
result of his financial responsibilities. In
particular, he was extensively involved with branch
managers in budgeting. Hepler and Kline were highly
compensated. Hepler was paid a salary of $260,000
in 1999, and Kline was paid a salary of $160,000 to
manage 24 branch operations throughout the
Southeast and South Central United States. They had
access to and knowledge of BPS' confidential
Defendants argue plaintiff's compilation of broad generalized
categories of ever-changing business information does not qualify
as a trade secret. We disagree. Plaintiff considered the
following to be confidential: its customer information, preferred
customer pricing, employees' salaries, equipment rates, fleet mix
information, budget information and structure of the business. The
trial court determined such information was (1) not generally known
outside BPS; (2) only discreetly disclosed within BPS; (3) guarded
as secret (e.g. information removed from view when outsiders
visited BPS' premises, pricing kept in special books, passwords
used to protect computer
access, file removal rules, and salary
information kept under lock and key); (4) competitively valuable;
(5) developed at significant cost to BPS; and (6) difficult to
duplicate or acquire. In reaching such determinations, the trial
court made numerous findings and conclusions as to defendants' lackof credibility, which defendants do not assign as error.
Specifically, the trial court found with respect to testimony
regarding the existence of defendants' plan to raid BPS' key
branches in an orchestrated manner and the use of the branch
managers to do so . . . . [that] the uncontroverted actions [spoke]
louder than words of denial[.] See e.g., Ryals v. Hall-Lane
Moving & Storage Co.
, 122 N.C. App. 242, 246, 468 S.E.2d 600, 603
(1996) (trial court determines witness credibility and weight to be
given their testimony). With respect to trade secrets, the trial
(1) BPS/Sunbelt's compilation of information,
including its special pricing information, customer
information (identity, contacts and requirements of
its rental customers), personnel and salary
information, organizational structure, financial
projections and forecasts, utilization rates, fleet
mix by market, capital and branch budget
information, and cost information, when taken
together constitute trade secrets and (2) that
the defendants misappropriated BPS/Sunbelt's trade
secret information unlawfully.
Further, the trial court concluded:
First, while there is some direct evidence of the
purloining of documents or other written
confidential information, the reality is that
Hi-Lift hired the people from BPS/Sunbelt who had
the expertise to run an AWP business effectively
and they hired the salesmen who knew the customers
and the market. Pricing information was of fleeting
long-term [sic] value as the market was intensely
competitive. Short-term pricing or special account
pricing was of more value. Most of the information
about fleet usage was in the heads of the keymanagement people hired away. They knew the
essential needs to get up and running, and, if they
did not, the salesmen who were hired knew the
We therefore hold the trial court did not err in concluding
plaintiff's compilation of business information constitutes a trade
 Defendants also challenge the trial court's finding that
defendants misappropriated trade secrets. N.C. Gen. Stat. § 66-152
(1) defines misappropriation of a trade secret as acquisition,
disclosure, or use of a trade secret of another without express or
implied authority or consent, unless such trade secret was arrived
at by independent development, reverse engineering, or was obtained
from another person with a right to disclose the trade secret.
N.C.G.S. § 66-152 (1) (2003).
With respect to misappropriaton of trade secrets, defendants
assign as error findings of fact which relate to the hiring of BPS
branch managers who used the confidential information of BPS to
obtain sales and convert former BPS customers to H&E. Defendants
specifically assign error to the trial court's finding regarding
their astounding profit:
(251) Hi-Lift rentals increased by $30.8 million,
or 130 percent, to $55.4 million in fiscal year
2001 over fiscal year 2000. Thus, in fiscal year
2001, Hi-Lift had almost eight times the revenue it
had as of December 31, 1999. As stated by an
industry expert, such results are astounding.Moreover, the [c]ourt finds that these results
confirm a number of points including:
(a) The mass departures severely injured
Sunbelt, a result that could only have been
intended by defendants or the product of callous
disregard for the consequences.
confidential business information was used by
defendants; otherwise, their personnel could not
have  assembled so much business so quickly and
. . .
(d) Defendants' activities were unfair,
unethical and anticompetitive.
We note for the record defendants do not assign error to finding of
fact number 251(e): [Defendants'] actions resulted in a dramatic
$3.7 million turnaround in performance in one year. In addition,
defendants assign as error conclusions of law made by the trial
court which focus on the circumstantial nature of the evidence
pointing to the misappropriation of BPS' trade secrets as follows:
(287) The evidence shows that the individual
defendants knew BPS/Sunbelt's trade secrets and had
access to them, and each had the opportunity to
acquire them for disclosure and use. Prior to
appropriating BPS employees, en masse, H&E had no
customers in North Carolina, Georgia, or Florida.
Despite this fact, the new H&E operations made a
significant profit in their first year of operation
- based on their taking of BPS/Sunbelt employees,
trade secrets and customers - and the BPS branches
experienced a concurrent, substantial decrease in
business. This occurrence alone is circumstantial
evidence of the defendants' use and disclosure of
BPS trade secret information. Here, testimony
supports that [d]efendant[s] misappropriated
confidential customer information of BPS -testimony that [defendants] never rebutted. In
addition, testimony of witnesses located in
Tampa[/] Fort Myers, Dallas and Atlanta supports
that confidential customer information was
misappropriated by BPS employees who left and went
to H&E. Indeed, in Tampa, identical confidential
pricing was used by [a former BPS employee] after
she went to H&E, and in Dallas, [another former BPS
employee] took sales notes with him, even though he
was purportedly instructed not to do so.
(Citations omitted)(emphasis in original). There was significant
evidence before the trial court that defendants used and disclosed
BPS' trade secrets. Under the NCTSPA, to show a prima facie case
for misappropriation of trade secrets, a plaintiff must meet the
burden of introducing substantial evidence that defendant (1)
[k]nows or should have known of the trade secret; and (2) [h]as had
a specific opportunity to acquire it for disclosure or use or has
acquired, disclosed, or used it without the express or implied
consent or authority of the owner. N.C. Gen. Stat. § 66-155
(2003). An example of plaintiff's prima facie showing of
misappropriated trade secrets follows: prior to hiring BPS'
employees, defendants had no customers in North Carolina, Georgia
or Florida; however, defendants' actions resulted in a $3.7 million
(See footnote 7)
during 2001, while BPS branches in those same locationsduring that time experienced a concurrent, substantial decrease in
business. In addition, there was no evidence defendants had a
unified pricing structure at the time defendants began calling
customers in North Carolina, Georgia or Florida. In fact, there is
no evidence that defendants had independent business development in
any of the new markets. Former BPS customers were rapidly
identified, converted to defendant-H&E's customer base and extended
credit based on knowledge obtained through BPS' former employees.
Defendants failed to rebut this evidence establishing a prima facie
case of misappropriation of trade secrets. For the reasons stated
herein, these assignments of error are overruled.
Defendants next argue the trial court erred by finding
defendants violated N.C. Gen. Stat. § 75-1.1 (UDTPA)
(See footnote 8)
Our Supreme Court has stated, under N.C.G.S. § 75-1.1, it isa question for the jury as to whether the defendants committed the
alleged acts, and then it is a question of law for the court as to
whether these proven facts constitute an unfair or deceptive trade
practice[.] United Labs., Inc. v. Kuykendall
, 335 N.C. 183, 187
n.2, 437 S.E.2d 374, 377 n.2 (1993) (citing United Labs., Inc. v.
, 322 N.C. 643, 664, 370 S.E.2d 375, 389 (1988)).
North Carolina's UDTPA a plaintiff must prove (1) defendant
committed an unfair or deceptive act or practice, (2) the action in
question was in or affecting commerce, and (3) the act proximately
caused injury to the plaintiff. Dalton v. Camp
, 353 N.C. 647,
656, 548 S.E.2d 704, 711 (2001); First Atl. Mgmt. Corp. v. Dunlea
, 131 N.C. App. 242, 507 S.E.2d 56 (1998); N.C. Gen.
Stat. § 75-1.1 (2003). A practice is unfair if it is unethical or
unscrupulous, and it is deceptive if it has a tendency to deceive.
Polo Fashions, Inc. v. Craftex, Inc.
, 816 F.2d 145 (4th Cir. 1987)
(citing Marshall v. Miller
, 302 N.C. 539, 548, 276 S.E.2d 397, 403
In the present case, the trial court found as fact, and the
parties do not dispute, that plaintiff and defendants were
competitors in the AWP rental business which affected commerce.
After examining whether the acts of which plaintiff complains were
unfair, unethical or unscrupulous, and effectively caused
plaintiff's injury, the trial court concluded [t]he surreptitiousand intentional use of BPS employees to solicit other key employees
while both the soliciting and solicited employees were still
employed by BPS is an unfair trade practice.
The trial court's
conclusion was based on a number of findings that are fully
supported by evidence in the record. For example,
customers BPS' name had changed to H&E. Defendants used BPS' lease
contracts and pricing information, inserting their company name on
the documents. Newly hired H&E employees deleted BPS job
information and forwarded BPS phones to H&E upon leaving BPS
Further evidence showed key BPS employees were solicited to
work for defendants en masse
. In Atlanta, while still employed by
BPS, an employee assisted defendants in securing a facility for Hi-
Lift's branch. A few days later, the employee resigned from BPS
and was told by another former BPS employee that his resignation
would help cause instability at BPS in order to recruit others from
BPS to join Hi-Lift. A few months later, every employee working in
the Atlanta branch had been hired from BPS. Defendant-H&E's common
pattern in opening new branches was to hire the BPS branch
managers, direct them to recruit the top BPS personnel with little
notice to BPS of the employees' departures. Based on past
relationships with Hepler, BPS managers and their staff used
knowledge previously acquired at BPS to perform work for defendant-H&E in the same geographical location and with the same customers.
In keeping with this pattern, key BPS employees were lured away
with sign-on bonuses and high compensation packages. By using
former BPS employees and confidential information, defendant-H&E
was able to tailor rental fleets
at its branches without spending
the time, money and effort necessary
to develop such information.
In fact, the actual profits generated by defendants' greenfields
(See footnote 9)
should have taken much longer than it actually did (e.g. months,
rather than days).
Not only did defendants profit, but BPS
branches were severely impacted, or crippled, to the point BPS'
opportunity and ability to compete for key employees on a level
playing field was completely eliminated. Defendants' acts were
unfair and unscrupulous and caused injury to plaintiff. The trial
The appellate court decisions dealing with unfair
competition and conversion of business and
employees demonstrate an awareness that competition
is healthy and not to be unduly discouraged. Those
decisions also evidence a desire to permit
employees the greatest freedom of movement in order
to maximize their job opportunities. . . . Nothing
in this opinion should be read to depart from the
trends evident in those decisions. Hepler and Kline
were free to compete fairly, and each employee of
BPS/Sunbelt was free to work for the employer he or
she selected. The surreptitious way in which the
BPS employees were solicited may have actually
deprived them of the opportunity to see whatSunbelt would offer them to stay. None of the
converted employees had the right to use
BPS/Sunbelt confidential business information, but
they could use the experience and contacts they had
gained from years in the AWP business. The manner
in which the branch managers were used was
deceptive. That deception prevented fair
competition for both employees and customers. The
deceptive, secretive nature of defendants' actions
differentiates this case from others where courts
have found the hiring of competitor's employees to
(Citations omitted). [T]he fair or unfair nature of particular
conduct is to be judged by viewing it against the background of
actual human experience and by determining its intended and actual
effects upon others. United Labs.
, 102 N.C. App. 484, 491, 403
S.E.2d 104, 109 (citations omitted), aff'd
, 335 N.C. 183, 437
S.E.2d 374 (1993). In this case, defendants'
devastated, rather than competed with, plaintiff's existing AWP
sales business in violation of the Unfair and Deceptive Trade
Practices Act. This assignment of error is overruled.
 Defendants next contend the trial court erred in awarding
damages to plaintiff. Defendants argue that there is no proximate
cause between plaintiff's lost profits and defendants' conduct.
Defendants also argue the trial court erroneously calculated the
damages even if plaintiff's trade secrets have been
misappropriated. Unfair and deceptive trade practices and unfair competition
claims are neither wholly tortious nor wholly contractual in nature
and the measure of damages is broader than common law actions.
Bernard v. Cent. Carolina Truck Sales, Inc., 68 N.C. App. 228, 230,
232, 314 S.E.2d 582, 584-85 (1984). Plaintiffs must prove damages
to a reasonable certainty. State Props., L.L.C. v. Ray, 155 N.C.
App. 65, 76, 574 S.E.2d 180, 188 (2002). In cases where a claim
for damages from a defendant's misconduct are shown to a reasonable
certainty, the plaintiff should not be required to show an exact
dollar amount with mathematical precision. See Story Parchment Co.
v. Paterson Parchment Paper Co., 282 U.S. 555, 75 L. Ed. 544
(1931); Bigelow v. RKO Radio Pictures, 327 U.S. 251, 90 L. Ed. 652
(1946); see also Whiteside Estates, Inc. v. Highlands Cove, L.L.C.,
146 N.C. App. 449, 462, 553 S.E.2d 431, 440 (2001) (noting that
while the claiming party must present relevant data providing a
basis for a reasonable estimate, proof to an absolute mathematical
certainty is not required).
Defendants argue damages were speculative in that defendant-H&E
did not make a profit in its first year. They assert the trial
court violated N.C. Gen. Stat. § 66-154 because it awarded
duplicate damages. Defendants incorrectly assert the trial court
awarded plaintiff duplicate damages.
The trial court awarded
damages under the UDTPA, not the NCTSPA. Under the UDTPA,plaintiff was awarded lost profits and the value of benefit
defendants received, two different types of damages permitted under
the UDTPA. N.C. Gen. Stat. § 75-16 (If any person shall be
injured or the business of any . . . corporation shall be broken up
. . .or injured by reason of any act or thing done by any other
person, firm or corporation in violation of the provisions of this
Chapter, . . . if damages are assessed in such case judgment shall
be rendered in favor of the plaintiff and against the defendant for
treble the amount fixed by the verdict.).
Plaintiff's damages expert, Charles Phillips (Phillips)
measured plaintiff's damages on the basis of (1) lost profit and
(2) lost market share resulting from defendants' accelerated market
entry in the amount of $31,647,391.00 over several years. Our
court has previously addressed similar damages as to a UDTPA claim:
Plaintiff was entitled to recover damages which
were the natural and probable result of the
tortfeasor's misconduct. Plaintiff showed 1. the
sales and gross profits made by the salesmen to its
customers during their last year of employment with
plaintiff; 2. the sales plaintiff made to these
same customers during the two-year period after the
salesmen were employed with defendant, which was
the period of the restrictive covenants; 3. the
sales the salesmen made to those same customers
during that two[-]year period on behalf of the
defendant. [Defendants'] sales were made in the
same geographic area and to the same customers as
plaintiff's sales would have been. This evidence
was both relevant and admissible. It was for the
jury to decide how much weight to give such
evidence. Plaintiff was entitled to show evidenceof its lost profits by comparing its past history
of profits with gross sales of plaintiff's former
salesmen while working for defendant.
Roane-Barker v. S. Hosp. Supply Corp., 99 N.C. App. 30, 40, 392
S.E.2d 663, 669-70 (1990)(citation omitted). Under the UDTPA,
proximate cause is a question of fact. See American Rockwool, Inc.
v. Owens-Corning Fiberglass Corp., 640 F. Supp. 1411, 1445
The trial court did not err in finding defendants' acts were
the proximate cause of plaintiff's damages based on the
misappropriation of trade secrets and unfair and deceptive trade
practices. This assignment of error is overruled.
 In their final argument, defendants contend plaintiffs are
barred from seeking relief by the doctrine of laches.
The doctrine of laches requires a showing (1) that
negligently failed to assert an enforceable right within a
reasonable period of time, and (2) that the propounder of the
doctrine was prejudiced by the delay in bringing the action.
Costin v. Shell
, 53 N.C. App. 117, 130, 280 S.E.2d 42, 44 (1981)
(citing Builders Supplies Co. v. Gainey
, 282 N.C. 261, 192 S.E.2d
449 (1972); Rape v. Lyerly
, 287 N.C. 601, 215 S.E.2d 737 (1975)).
The burden of proof is on the party who pleads the affirmative
defense of laches. Taylor v. Raleigh
, 290 N.C. 608, 622, 227S.E.2d 576, 584 (1976). The statute of limitations applicable to
the misappropriation of trade secrets is three years. N.C. Gen.
Stat. § 66-157 (2003).
Plaintiff commenced this action on 13 July 2000, less than six
weeks after Sunbelt's purchase of BPS was completed (on 1 June
2000). Plaintiffs filed their action well within the three year
statute of limitations period which began from the time plaintiff
had knowledge of defendants' improper conduct, as early as November
1999. As there was no delay in bringing the action, there can be
no prejudice therefrom. This assignment of error is overruled.
Judges TIMMONS-GOODSON and LEVINSON concur.
$5,000,000.00 in damages which were trebled to $15,000,000.00
and attorney's fees in the amount of $1,200,000.00.
In Atlanta, by opening day in March 2000, every one of the
fifteen employees of H&E's Atlanta branch had been hired from BPS;
in Charlotte, by 5 June 2000, nine BPS staff were employed by H&E;
in Orlando, by 22 May 2000, H&E employed BPS' entire outside sales
staff; in Houston, by March 2000 H&E solicited and hired eight BPS
employees; in Tampa/Fort Meyers, by 5 June 2000 H&E hired twenty-
five BPS employees and over ninety percent of H&E employees in
Tampa/Fort Meyers were former BPS employees; and in Dallas, by 20
March 2000 H&E hired nine BPS employees.
Plaintiff filed a Cross Notice of Appeal solely on the issue
of damages yet fails to argue this issue in its brief, therefore,
this assignment of error is deemed abandoned. N.C. R. App. P.
28(b)(6) (Assignments of error not set out in the appellant's
brief, or in support of which no reason or argument is stated or
authority cited, will be taken as abandoned.).
See Byrd's Lawn & Landscaping, Inc. v. Smith
, 142 N.C. App.
371, 542 S.E.2d 689 (2001)
See Wilmington Star-News v. New Hanover Reg'l Med. Ctr.
N.C. App. 174, 179, 480 S.E.2d 53, 56
See Drouillard v. Keister Williams Newspaper Servs.
, 108 N.C.
App. 169, 173, 423 S.E.2d 324, 327 (1992)
The trial court found [a]s of December 31, 1999, H&E's AWP
fleet had only generated rental revenue of $ 7.2 million, a gross
profit of only $ 2.5 million and a pre-tax loss of $ 289,000.00.
The results of H&E's employment of Hepler, Kline, Christensen and
Quinn and their conspiratorial activities, were that Hi-Lift
realized $ 23.4 million dollars in rentals by December 31, 2000, agross profit of $ 16.9 million and a pre-tax profit of $ 3.4
Subsumed in plaintiff's UDTPA claim, the trial court found
plaintiff proved its tortious interference with prospective
advantage claim. Roane-Barker v. S. Hosp. Supply Corp.
, 99 N.C.
App. 30, 392 S.E.2d 663 (1990) (by recruiting and hiring the
plaintiff's employees, soliciting plaintiff's customers, and
inducing salesmen to interfere with plaintiff's existing accounts,
defendants had tortiously interfered with contracts or prospective
contracts; such interference also violated N.C. Gen. Stat. § 75-
Owens v. Pepsi Cola Bottling Co.
, 330 N.C. 666, 680, 412
S.E.2d 636, 644-45 (1992); Walker v. Sloan
, 137 N.C. App. 387, 392-
93, 529 S.E.2d 236, 241 (2000).
A greenfield is a startup branch in a market where there has
been no prior presence.
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