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KATHLEEN WHITE, Plaintiff, v. CROSS SALES & ENGINEERING COMPANY,
d/b/a CROSS AUTOMATION and CONTROL CORPORATION OF AMERICA,
Summary judgment for defendant was affirmed in an action for tortious interference with
contract where defendant's evidence was that plaintiff worked for defendant before going to
work for a competitor (CCA); plaintiff had signed a non-compete agreement with defendant;
defendant sought to enforce that agreement and to prevent the loss of trade secrets; a lawsuit was
filed; and CCA dismissed plaintiff. Defendant did not demand that plaintiff be fired (only that
violations of the agreement cease); defendant threatened to sue but provided CCA with no
incentive to fire plaintiff; defendant's intent was only to protect its own interests; and similar
cases had resulted in negotiation and settlement rather than termination. Plaintiff provided no
evidence to the contrary.
David Q. Burgess, for plaintiff-appellant.
Constangy, Brooks & Smith, LLC, by Kenneth P. Carlson, Jr., for defendant-appellee.
MARTIN, Chief Judge.
Plaintiff appeals from an order granting summary judgment in favor of defendant and dismissing her claim for tortious interference with contract. Plaintiff contends the trial court erred in deciding defendant, Cross Sales & Engineering Company (Cross), did not intentionally induce another company, Control Corporation of America (CCA), to fire her. Plaintiff also argues defendant acted without justification in inducing her termination. For the reasons which follow, we affirm. Materials presented to the trial court, as relevant to the dispositive issue on appeal, tend to show that plaintiff began work on 8 September 1997 as a customer service representative for Cross, a company which markets electronic and automation components for industrial machinery. Shortly after beginning her employment, on 16 September 1997, she signed a covenant not to compete. According to the non-competition agreement, plaintiff could not work as a competitor to Cross for a period of one year, within a radius of 50 miles from the office where she most recently worked. Plaintiff was also prohibited from using or disclosing any of Cross's trade secrets or other confidential information. Cross later changed plaintiff's job title to inside sales representative, and for her last three years with Cross her sales region covered the geographical area of Raleigh-Durham, North Carolina.
Plaintiff resigned her employment with Cross on 3 May 2002, and about a week later had an exit interview. In the interview, plaintiff declined to tell Cross where she subsequently would be working. When Cross specifically asked plaintiff whether she would be working for CCA, plaintiff refused to answer. Cross reminded plaintiff about the non-competition agreement she had signed, and indicated it would enforce the covenant if plaintiff went to work for CCA.
Through other conversations with plaintiff, Cross understood that she had let her future employer know of her non-competition agreement. On 6 May 2002, Cross sent plaintiff a letter reminding her about the agreement: Enclosed is a copy of your non-compete agreement. . . . We understand that your new employer is informed of the existence of your non-compete agreement. I recommend that you provide them with a copy, an extra is enclosed for this purpose. We appreciate your willingness to comply with your non-compete and hopefully this will be the only communication necessary regarding this matter.
Plaintiff did not respond to the letter.
On 14 May 2002, plaintiff started work with CCA, an industry competitor to Cross, as a manager of inside salespeople. Cross learned that plaintiff was working at CCA, and called her at work to confirm that fact. The president of Cross sent a letter to the president of CCA on 21 May 2002, copied to plaintiff, indicating Cross believed plaintiff was violating her non-competition agreement:
I write to inform you that we have verified that Kathleen White, a former Cross Automation employee, has joined Control Corporation of America in Charlotte. We believe her employment with you is in violation of her non-competition agreement with Cross Automation, a copy of which is attached for your convenience. We have been told that CCA's management was informed that she had a non-competition agreement with us and that they were also given a copy of the signed agreement.
I kindly request your assistance in resolving this matter expeditiously. Please respond within 10 days after receipt of this letter.
Neither plaintiff nor CCA responded to the letter.
Having received no response to its previous two letters, Cross's counsel sent a third letter to plaintiff and CCA on 26 June 2002. After describing the content of the non-competition agreement, the letter concluded:
. . . Cross has investigated and has gathered information indicating that, not only has Control Corporation hired Ms. White, but it has placed her in an inside sales position, soliciting the very customers withwhom she was associated during her employment with Cross. This was done despite notice to Control Corporation that Ms. White was obligated under her Agreement. In fact, Cross has information that Ms. White solicited at least one such customer without revealing that she had changed employers, thus leading the customer to believe that it was dealing with Cross when it was, in fact, dealing with Control Corporation.
The employment of Ms. White by Control Corporation is a clear violation of the Agreement. Further, Ms. White possesses information which she is prohibited from disclosing both pursuant to her Agreement and pursuant to the North Carolina Trade Secrets Protection Act. Yet, in her current position as a sales representative for Control Corporation, she will be unable to perform her duties without misappropriating this trade secret information. Further, the continuation of wrongful solicitation of Cross' customers and of Ms. White's employment in such a sales position in violation of her agreement, after the obligations under the agreement were brought to the attention of Control Corporation, and Control Corporation's efforts to interfere by wrongful means with Cross's contractual relations both with its suppliers and customers, violates North Carolina's Unfair and Deceptive Trade Practices Act.
This letter is a demand that Control Corporation and Ms. White immediately cease any and all activities in violation of their respective contractual statutory and common law duties, and provide to Cross adequate assurances that these activities will not be resumed. It is our hope and expectation that you will understand the seriousness of this matter and will respond promptly. This is a matter of urgent and immediate concern to Cross. If we do not receive a satisfactory response by July 8, 2002, we have been authorized to initiate litigation to resolve this matter. In such litigation, we will seek both treble damages and attorney's fees pursuant to North Carolina's Unfair and Deceptive Trade Practices statute, as well as other available remedies, including equitable remedies.
Again, neither CCA nor plaintiff responded.
When Cross had received no response by 8 July 2002, it filed suit the next day, alleging breach of the non-competition agreement and other claims. CCA terminated plaintiff's employment on 14 July 2002, and gave her a one-sentence letter memorializing hertermination on 15 July 2002: Because of the lawsuit and your non-compete agreement with Cross Automation, we are forced to terminate your employment effective today, July 15, 2002. Cross's suit against CCA and plaintiff is not at issue here.
Plaintiff filed suit against both Cross and CCA on 2 January 2004, with an amended complaint filed 9 February 2004. Plaintiff reached a settlement with CCA and voluntarily dismissed her claims against it.
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