2009CA0654 - Louisiana Court of Appeal, First Circuit

NOT DESIGNATED FOR PUBLICATION
STATE OF LOUISIANA
COURT OF APPEAL
FIRST CIRCUIT
2009 CA 0654
CYCLE SPORT LLC D B A CYCLE SHOP
VERSUS
GARY JONES AND KAY JONES
dJ
Judgment Rendered October
On
Appeal
from the 22nd Judicial District Court
In and For the Parish of St
Tammany
Trial Court No 2004 14208 Division
Honorable
Regel
Larry
L Bisso
J Green
G
Judge Presiding
Counsel for Plaintiff Appellant
Metairie LA
Cycle Sport LLC d b
W
Counsel for Defendants
Christopher Beary
John L Fontenot
Davide A
23 2009
Gary
Jones and
Kay
a
Cycle Shop
Appellees
Jones
Rosiglioni
New Orleans LA
BE
1t1
q hWH IPPLE
HUGHES AND WELCH JJ
HUGHES J
This is
an
defendants in
court
suit based
a
and
statute
was
in favor of the
judgment granted
summary
upon the trial
competition agreement
on a non
finding that the agreement exceeded the maximum
s
vacate
a
from
appeal
For the
therefore null and void
allowed
term
that follow
reasons
by
we
the summary judgment and remand for further proceedings
FACTS AND PROCEDURAL HISTORY
J
motorcycle dealership from
Shack
into
a
J ones
Cycle
contract
and
I
Shack
in
in
Gary
Jones and
refund of
sent
consulting services
Jones and
or
having
two year
Kay
Kay
a
Jones
owe
the
was
Louisiana the
a
Cycle Shop
in
exchange for
Jones from
a
Cycle
entered
a
Gary
fee of
was
a
owning maintaining
any interest in any business similar to the
plaintiff damages
costs
the Joneses
purchasing Cycle
name
d b
Shack defendants
term
consulting agreement
to
purchased
consulting agreement
of the
of the business
On
of the
event
was
July
9
2004
plaintiff
Joneses had
Spanish Trail
by the
not sold as evidenced
following provision in the purchase agreement Seller is not selling and buyer
the name Cycle
Shack
More specifically Buyer agrees not to use the word
the word Cycle in the name ofthe business
2
by
attorney fees and
stating that the
Shack
consulting
of a default
Shack s business located at 888 Old
Cycle
consulting
would terminate and
expenses
percentage of the consulting fees
Although Cycle Shop
Inc
period following termination
written notice of default
in Slidell
Cycle
The agreement further provided that in the
the Joneses would
a
a
Cycle Shack
Tammany Parish during the
St
agreement and for
agreement
Jones
Also included in the
provision prohibiting Gary
operating engaging
Cycle Shop
Cycle Shop
In connection with that sale
for
Jones
200 000 00 to each
Cycle Shop
Gary
with the sole shareholders of
Kay
a
Miller M D and Robert G Miller Jr
with Robert G
along
LLC d
b
plaintiff Cycle Sport
In 2002
agrees not to
Shack
but may
use
use
selling motorcycles
in
engaged
Parish in contravention of the
On
September
Jones and
Gary
to the
percentage of the
2
5
and
a
On June 27 2005
who
opposition
the
August
court
and
Shop the
of
to
was
refund of
term
named
s
3
fees
interest
legal
as are
2005
the defendants
signed
amount
5 205 00
on
hearing
August
t
of 46 785 23
reasonable in the
The Joneses filed
Esq
ordering the
was
all attorneys
no
fees
no
appearance at
granted by the trial
defendants
along with litigation
interest and
costs
costs
hrough their attorney of
Summary judgment
18 2005
4
motion for summary judgment
a
the motion for summary judgment and made
11
the time
at
remaining
being
denying the alleged default
David C Vidrine
as
said percentage
of the agreement
an answer
on
Tammany
percentage of the fees
a
contract
consulting
Cycle Shop filed
which asked for service
record
a
consequential damages
The Joneses filed
premises
1
reasonable attorney
ll additional and
in St
Cycle Shop filed the instant lawsuit against
2004
Section II of the
of termination
2004
between the parties
contract
Kay Jones seeking
paid pursuant to
equal
I
about June 9
on or
to pay
expenses in the
costs
Cycle
amount
and expenses of
collection
On
that
at
April
2006 the Joneses filed
10
the time of service of
Diaz
Glenn E
was
they made
attorney of record Glenn E
the motion for
the trial
court
improper
new
trial
erred in
was
Diaz
not
opposition
no
did not appear at the
motion for
to
trial
to
judgment
had notice of the motion
a new
3
nor
their
Nevertheless
appealed contending
trial in this
service of the motion for summary
The
the motion for summary
hearing because neither they
grant
alleging
Vidrine
David C
denied and the defendants
failing
new
motion for summary
their counsel of record
Joneses contended that
judgment and
Cycle Shop s
a
case
judgment
in
On
light
of the
appeal this
court
d b
and vacated the summary
agreed
Cycle Shop
a
2006 2402
Jones
v
See
judgment
La
LLC
Cycle Sport
1
App
14
9
Cir
07
unpublished
Following remand
judgment asserting
summary
a
matter
of law
After
and void
on
appeals urging
erred in
RS
trial
authorized
the
permitted by
RS
compete agreement
the trial
maximum
23 921
1
2
business
LSA R S 23 921
compete
term
erred in applying LSA R S 23 921
motion for
court
as
granted
finding the agreement null
term
a non
the trial
court
court
3
now
erred
erred in
the trial
of the agreement extend
4
was
at
of
Cycle Shop
the trial
temporal provisions
non
s
a
a
rather than LSA R S 23 921 C
23 921 B
that the agreement
court
hearing
two year
by LSA
sale of
was a
finding that
further than that
finding
November 12 2008
non
following assignments of error
that there
applying LSA
court
the
of the
invalidity
the basis that it exceeded the
competition agreement
finding
a
the
the defendants filed
court
in favor of the defendants
judgment
summary
in
the trial
to
the trial
court
four years
erred in
and
5
the
all
LAW AND ANALYSIS
Motion for
Summary Judgment
The summary
speedy
and
disallowed
construed
judgment
judgment procedure is designed
inexpensive determination of
by LSA C C
to
accomplish
shall
depositions
P
art
these ends
be rendered
answers
to
969 the
mover
in favor of the
interrogatories
is entitled
to
procedure
LSA C C P
judgment
966 B
4
no
as a
secure
just
is favored and shall be
art 966 A
mover
on
genuine issue
matter
the
except those
action
and admissions
the affidavits if any show that there is
and that
every
to
of law
2
if the
file
as
Summary
pleadings
together with
to material
LSA C C P
fact
art
Appellate
courts
criteria that govern
judgment
is
a
appropriate
977 So 2d 880
district
Boudreaux
Vankerkhove
v
In
ruling
evaluate the
but instead
on a
2007 2555
weight
to
of the evidence
or
to
determine whether there is
p
5
A fact is material if it
litigant s ultimate
genuine issue is
potentially
La
one
as
to
moving party
the issue
at
trial and
only
one or more
defense then the
to
out
insures
one
or
non
moving party
establish that he will be able
trial
If the
outcome
appropriate
must
of the
judgment
5
Hines
v
legal dispute
not
an
no
if
disagree
need for trial
Id at 765 66
proof remains
with
bear the burden of proof
absence of factual support
produce
to
do
so
will be
or
factual support sufficient
satisfy his evidentiary
2
All
fact
the adverse party s claim action
opponent of the motion fails
of material fact and summary
966 C
to
to
matter
recovery affects
precludes
conclusion there is
that there is
elements essential
not to
876 So 2d 764 765
moving party will
points
favor
s
On motion for summary judgment the burden of
the movant However if the
role is
s
which reasonable persons could
that issue and summary judgment is
for
Cir
1
App
genuine issue of triable
determines the
or
success
reasonable persons could reach
on
842 So 2d 373
determine the truth of the
a
non
Garrett 2004 0806 p 1 La 6 25 04
on
4 9 03
motion for summary judgment the judge
doubts should be resolved in the
A
La
5
p
993 So 2d 725 729 30
8 1108
a
same
rei Ernest N Morial New Orleans
ex
2002 1072
Authority
under the
Rau 2007 1726 pp 3 4 La 2 26 08
v
State
v
novo
consideration of whether summary
court s
Samaha
882 Allen
Exhibition Hall
377
review summary judgments de
burden of proof at
there is
granted
no
genuine
LSA C C P
issue
art
When
provided
a
motion for summary
in LSA C C P
allegations
otherwise
denials of his
or
C C P
La
Inc
1 Cir 2 8 08
App
materiality
it
whether
light of the
the
is
a
1 Cir
App
particular
substantive law
886 So 2d 448
So 2d 592
Cressionnie
Intrepid
LSA
law
9
Intrepid
v
that
is material
the case
137
0107 p
879 So 2d 736 738
dispute
be
seen
only
Hall 2003
v
American National
v
p
determines
can
Richard
Dyess
2003 1971
Inc
or as
respond
so
him
against
4
writ denied 2004 1858
451
v
04
applicable to
Property and Casualty Company
not
Cressionnie
substantive
fact in
mere
specific facts
Authority 2007
79 80
14
5
874 So 2d 131
1488 p 5 La 4 23 04
6 25 04
Finance
applicable
the
as
Supervisors of Louisiana State
984 So 2d 72
2003 1714 p 3 La
Because
in
Agricultural
forth
If he does
shall be rendered
on
by affidavits
must set
issue for trial
appropriate
Louisiana
v
967
art
supported
not rest
but his response
See also Board of
967 B
University
adverse party may
pleading
genuine
a
if
judgment
art
an
in LSA C C P
provided
showing that there is
summary
art 967
is made and
judgment
La
La
2003 1714 at p
App
1
10 29 04
3
Cir
885
879 So 2d
at
738 39
Louisiana
s
Limitation
Louisiana
s
LSA R S 23 921
the parties in this
on
Non
limitation
which
case
at
Competition Agreements
on
non
competition agreements is found
the time of the 2002
provided
in
pertinent part
as
contracts
entered into
follows
prohibited restraint on forum
prohibited competing business contracts against engaging
in provisions for
921 Restraint of business
agreement or provision thereof
hv which anvone is restrained from exercisin1 a lawful
profession trade or business of any kind except as provided in
A
1
Everv
contract
or
this Section shall be null and void
6
in
by
Any person including
B
shareholders of such
corporation
a
corporation who sells
with the buyer that the
and the individual
the
1oodwill
of a
seller will refrain
business may agree
from carrying on or engaging in a business similar to the
business being sold or from soliciting customers of the business
being sold within
a
specified parish
or
parishes
or
municipality
parts thereof so long as the buyer or any
municipalities
person deriving title to the goodwill from him carries on a like
or
or
business therein not
to
exceed
period of
a
two vears
from the
date of sale
Any person including
C
shareholders of such
servant
who is
corporation
emplovee
or
corporation
a
mav a1ree
and the individual
emploved as
an a1ent
with his emplover to refrain
carrying on or engaging in a business similar to that of the
employer andor from soliciting customers of the employer
within a specified parish or parishes
municipality or
municipalities or parts thereof so long as the employer carries
from
like business therein
exceed
period of two vears
from termination of employment An independent contractor
whose work is performed pursuant to a written contract mav
enter into an a1reement to refrain from carrvin1 on or
on a
en1a1in1
in
basis
as
a
business similar to the business of the
a
with whom the
same
not to
independent
if the
contractor has
independent
contractor
for a period not to exceed
work performed under the written
two vears
contracted
were an
the date
from
person
on
the
employee
of the last
contract
G
Any agreement covered by Subsections B C D E or
F of this Section shall be considered an obligation not to do
and failure to perform may entitle the obligee to recover
damages for the loss sustained and the profit of which he has
been
deprived In addition upon proof of the obligor s failure to
perform and without the necessity of proving irreparable
injury a court of competent jurisdiction shall order injunctive
relief enforcing the terms of the agreement
Emphasis added
On
parties
did
therefore
Rather
appeal Cycle Shop
not
include the
Paragraph
Cycle Shop
by the parties that
the
B
contends that the sale agreement between the
of LSA R S
argues that the
may be
of the
goodwill
subject
23 921 is
motorcycle business and
not at
only portion of the
to the
provisions
consulting agreement which is subject
7
to
issue in this
contracts
entered into
of LSA R S
Paragraph
C
case
23 921 is
of the statute
Thus
LSA R S 23 921
The first
at
not state
888 Old
that the
not
sold
being
in the
Cycle
signed
on
of the
though
name
it
of its business
The
on
11
July
2002
buyer
buyers
as
an
as
was
being
sold
Cycle Shack
could
fixed
prices
parts
provision conveying
agreement between the parties
Robert G Miller M D
Liability
for various items of movable
the
not
goodwill
mention
a
being
sold
non
competition
the December 2002 amended
however
Gary
Jones
contractor
and
Kay
consultants
operation of the
new
is
to
assist
for
dealership
closing of the asset sale
provide that during that two
the
provide that J
will be hired as independent
hereby amended
Jones
The
in
a
the
to
management
period of two
employment
and
years from
contract
shall
period and for a two year
period after the employment terminates J Gary Jones and Kay
year
Jones and any business entity with which either or both are
affliated shall not compete with Cycle Sport LLC in St
Tammany Parish Louisiana The compensation paid to J Gary
Jones and Kay Jones is set at TWO HUNDRED THOUSAND
DOLLARS each
8
but
of the business
agreement stated in pertinent part
purchase agreement
was
amended agreement
and accessories
July 2002 purchase agreement did
The
In
the word
use
Louisiana Limited
a
Shack
Cycle
its manager member Robert G Miller Jr
including motorcycles
no
and
This agreement did
name
Thereafter
Cycle Sport LLC
purchase agreement
likewise contained
that the
that the
agreed
was
Company represented herein by
property
parties
Cycle Shack business
specifically provided
Miller Jr
The amended
the
Trail in Slidell Louisiana
December 2 2002 listed the
Robert G
We agree
case
of the business known
assets
Spanish
of
Buyer and Buyer is buying from Seller the
to
selling
goodwill
fact the agreement
B
applying Paragraph
Robert G Miller M D and Robert G Miller Jr
as
improvements and
located
erred in
court
the facts of this
to
Seller is
provided
the trial
purchase agreement signed by
named the buyers
land
asserts
Cycle Shop
A
consulting agreement was signed by the parties
on
December 3 2002 and
in pertinent part
provided
WHEREAS
J
Inc
Gary Jones Cycle Shack
has
operated a motorcycle dealership in Louisiana doing business
as the
Cycle Shack for approximately thirty five years and
WHEREAS the Cycle Shop is purchasing the assets of J
Gary Jones Cycle Shack
and
Inc
WHEREAS Consultants are the sole owners of all of the
outstanding shares of stock of J Gary Jones Cycle Shack Inc
and
WHEREAS
result of Consultants
a
desires
Cycle Shop
the
experience
as
Consultants with respect
years of
retain the services of
to
continuing
to
long
operation
the
of the
dealership
the
THEREFORE
NOW
parties hereto
agree
as
follows
DURATION
I
provided in this Agreement the term
of this Consultant Agreement shall expire on the second 2nd
anniversary of the date of execution hereof Consultants agree
Except
otherwise
as
and shall be
to
obligated
services and
provide consulting
perform hereunder for the full
term
of this
Agreement
FEES
II
In consideration of the services
Cycle
Cycle Shop shall pay to the Consultants a fee
AND
NOIlOO S
HUNDRED
THOUSAND
herein the
Shop
of
to the
provided
TWO
200 000 00
DOLLARS
each
which
Consultants
acknowledge receipt
IV
COVENANTS
A
Consultants
that
specifically
acknowledge
pursuant to this Agreement Consultants will receive valuable
and confidential information including without limitation
information regarding the operational sales promotional and
marketing methods and techniques of The Cycle Shop and the
System Consultants covenant that during the term of this
Agreement except as otherwise approved in writing by The
Cycle Shop Consultants shall not either directly or indirectly
or
on
behalf of
partnership
1
or
in
or
of the
Cycle Shop
prejudicial
or
indirectly
or
to
to
attempt
indirect inducements
directly
with any person
conjunction
persons
corporation
Divert
customer
or
or
to any
any
any
business
or
competitor by direct
otherwise
the business
associated with The
divert
other
or
to
act
operations
Cycle Shop
do
or
perform
injurious
andor
or
goodwill
employ any person who is at
that time employed by The Cycle Shop or otherwise
2
Employ
or
seek
to
9
directly
her
or
indirectly induce such
employment therewith
3
maintain
Own
person to leave his
or
or
operate
engage
in
or
have
an
interest in any business similar to the Cycle Shop within
the Parish of St Tammany State of Louisiana
B
Consultants
that
covenant
except
as
otherwise
approved in writing by the Cycle Shop Consultants shall not
regardless of the cause for termination either directly or
indirectly for Consultants
through
or
behalf of
on
with any person persons partnership
limited liability company or other entity
conjunction
1
to
corporation
2
competitor by direct or indirect inducements
otherwise or to do or perform directly or indirectly
Shop
or
in
years following termination divert or
divert any business or customer of the Cycle
For two
attempt
or
to any
injurious or prejudicial
operations andor goodwill associated
Shop or
any other act
2
For two
2 years
business
with The
Cycle
termination
employ or
seek to employ any person who is at the time employed
by The Cycle Shop or otherwise directly or indirectly
induce such person to leave his or her employment
therewith
or
For
3
maintain
similar
2
two
years
engage in
to
or
following termination
own
interest in any business
which is located within the
have
an
Cycle Shop
Tammany State of Louisiana
the
Parish of St
VII
following
to the
INDEPENDENT CONTRACTOR AND
INDEMNIFICATION
Agreement does not constitute either
Consultant to be an agent legal representative joint venturer
partner employee or servant of The Cycle Shop for any
It is understood and agreed that
purpose whatsoever
Consultants shall be independent contractors and are in no way
A
This
authorized
to
representation
agree
x
Agreement
does
not
create
a
fiduciary
between them
SEVERABILITY AND CONSTRUCTION
A
herein
this
that
relationship
make any contract agreement warranty or
on behalf of The Cycle Shop
The parties further
Except
each
as
expressly provided
paragraph part
term
andor
to
the
contrary
provision of this
Agreement shall be considered severable and if for any reason
any section part term and or provision herein is determined to
be invalid and contrary to or in conflict with any existing or
future law or regulation by a court or agency having valid
jurisdiction such shall not impair the operation or have any
other effect upon
such other
portions sections parts
10
terms
and
or
provisions
of this
Agreement
may remain otherwise
as
intelligible and the latter shall continue
and effect
to
bind the
parties
sections parts terms andor
be part of this Agreement
We agree with
evidence
an
intent
to convey
rather indicate that certain
who continued
were
hired
as
to
run
on
the
assets
full force
given
hereto and said invalid
provisions
portions
shall be deemed
not to
with
provisions along
motion for summary
judgment
do
not
goodwill of the Cycle Shack business but
of the company
the Cycle Shack business
independent
be
that the contractual
Cycle Shop
the other evidence submitted
to
contractors
to
at
were
sold and its
their
Mississippi
provide consulting
owners
location
services
to
Cycle Shop
2
In addition to other evidence discussed herein we note that the affidavit of Gary Jones is
contained in the record and states in pertinent part that he currently owns the Cycle Shack Inc
Cycle Shack in Picayune Mississippi on June 9 2004 a Cycle Shack employee Terrell
Terry
requested permission to take two unserviced motorcycles
Cafe in Slidell along with another Cycle Shack employee
the
the
William Bounds
reimbursed by him Jones or
Fox
Southside
to
Bike
Night
at
employees themselves bore the expense of the trip and were not
Cycle Shack the bikes taken were not for sale and no supplies required for a sale were provided
to these employees the motorcycles were not serviced and had no fuel or charged batteries he
Jones is not authorized by the manufacturers to sell unserviced motorcycles he Jones did not
have a license to sell motorcycles in St Tammany Parish following Bike Night the motorcycles
he Jones never attempted to divert business or customers away
were returned to Cycle Shack
from the Cycle Shop he Jones has never attempted to employ or induce away any employee of
Cycle Shop he Jones has never committed any acts injurious to the Cycle Shop business and
he Jones has not owned maintained operated engaged in or had an interest in any business
similar to the Cycle Shop in St Tammany Parish The affidavit of Terrell Terry Fox was also
filed into the record and stated that he was the sales manager at Cycle Shack in Picayune
Mississippi from March of 2004 through January of 2005 Bike Night is an event that allows
motorcycle enthusiasts to come together it was his idea to go to Bike Night he completed all the
he paid the rental fee for the
necessary paperwork regarding the space used during Bike Night
Jones
to
attend Bike Night he was never
space used during Bike Night he was not paid by Gary
reimbursed by Gary Jones for the expenses related to Bike Night he asked William Bounds to go
with him to Bike Night they used William s personal vehicle to transport two motorcycles from
the Cycle Shack showroom to display at Bike Night these two motorcycles were not serviced a
motorcycle has to be serviced before it can be sold he did not have a license to sell motorcycles
in Louisiana on Bike Night they did not bring any receipt forms sales forms order forms credit
applications or anything else needed to make a sale there were no discussions regarding
financing purchase price or negotiations held with anyone during Bike Night business cards that
he distributed had his name on them brochures on display were manufacturers brochures the
two motorcycles were returned to the Cycle Shack and he has never performed any injurious act
In
with respect to the Cycle Shop business nor sought to employ any Cycle Shop employees
the
Mr
Jones
and
Mr
Fox
the
introduced
contrast to the statements made by
Cycle Shop
depositions of William Bounds and Joseph Miciello Mr Bounds who was at the time of his
affidavit a Picayune Mississippi police office asserted that he was instructed by J Gary Jones
in Slidell Louisiana in connection with
and operate a sales tent at Southside Cafe
Mr Bounds further stated that two Cycle Shack
bike night on June 9 2004
motorcycles were set up in a tent in Southside s parking lot for purposes of the sales display and
to set up
Southside
that the
s
tent had a
sign
on
it with
Cycle
Shack
Picayune Mississippi address Mr
Cycle Shack employee passed out business
s name
and
Bounds stated that on June 9 2004 he and another
Mr Miciello s affidavit stated that he attended the June
cards and brochures and solicited sales
9 2004 bike night and assisted Cycle Shack employees place motorcycles on display in a tent
Mr Miciello observed the two Cycle Shack
which was equipped with a Cycle Shack sign
salesmen
and solicit sales
pass out business cards and brochures
11
during the
event
On the contrary the J oneses argue
agreement entered into by the parties
sale of the
goodwill
Paragraph
that Plaintiff
Shack
Cycle
3
the sale
purchased
prior
was
to
asserting
probability
the
that
wanted
Jones
taxes
and I wanted
a
result of the
frequented
after
set up
met
with
Gary
on
one
following
he could
so
save
he wouldn t
another
dealership
provided
to
replied
Not
occasion
He
Mr Miller
consulting agreement
there and
so
excerpt from the
an
Cycle Shop
a
as
whole lot
was
a
I
less than
4
helpful
Despite the
with the trial
Joneses assertions
court
render services
that
to
as
in connection
with its
Further
was
operation
in Robert G
of
to
a
Miller
following
the Joneses cite the case of Godwin
537 So 2d 1165 La 1989
point
I
Consulting Agreement
in Slidell Louisiana
Jrs affidavit he stated the
1988
Jones stated in his affidavit filed
Gary
p ursuant to the
Cycle Shop
motorcycle dealership
defined
establish
frequent Cycle Shop
noncompete agreement
When asked what type of services the Joneses
On this
to
consulting agreement
a
in and raid my employees and
operate out of Slidell
went up
the provisions of
circumstances
in which he stated the
come
or
to
that the patrons who
the sale would continue
of Robert G Miller Jr
Gary
on
consulting
that the
Original emphasis omitted
deposition
1 Cir
subject
support of this argument the Joneses submitted
In
3
court
essentially part and parcel of the
of the business and therefore
of LSA R S 23 921
B
this
to
writ denied
v
Godwin
which
they
533 So 2d 1009
1010
La
App
goodwill is
to patronize the
contend holds that
the probability that customers of an established business will continue
However we do not find the Godwin case authoritative with respect to the issue
business
before this court as the ownership of the goodwill at issue in Godwin case was not in dispute
each spouse litigant owned a part
Contrarily in the case before this court the argument turns
on
whether
inferred
So 2d 713
Agency
both
4
goodwill
Nor do
La
Inc
we
App
v
cases were
of a business
was
conveyed in a sale
by the Joneses
find jurisprudence cited
2 Cir
writ denied
338
Toledano 292 So 2d 266
decided
prior
to
significant
2d
So
268
consulting
in this
services
to
Cycle Shop dispositive
to LSA R S
purportedly
12
must be proven and not
Suckle
Inc
v
Suckle
335
1976 and Marshall Brown Insurance
La App 4 Cir 1974
to be authoritative as
of the
case
a fact
700
amendments
We do not find the fact that the Joneses
Such
Gold
nature
23 921
breached their agreement to provide
of the agreement between the parties
O
and before December 2 2002 the
n
from
at 888
a
locations
two
Spanish
Old
warehouse
in
one
Trail Slidell Louisiana and also maintained
the
at
the warehouse
and the other
Picayune Mississippi
Cycle Shack s
improvements
Cycle Shack operated
consisted of the land and
assets
and Louisiana locations and
Mississippi
plus the inventory
accessories
parts
and
furnishings at each location and the warehouse plus the
O n December
personal vehicles of Gary and Kay Jones
2 2002 the Cycle Shop purchased certain assets from the
T he assets
Slidell Louisiana location of the Cycle Shack
purchased from the Cycle Shack were considerably less than
the
one
of
the
half of the
sale
and
parts
location
improvements of Cycle
the warehouse
in
did
nor
fact
continuously
not
the
not
Shack
at
of
some
located
purchase
at
the time
inventory
the
the
at
Slidell
any of the land and
either of the business locations
inventory parts accessories and
any
furnishings at the Picayune
personal vehicles of Gary
and
of
accessories
Cycle Shop did
Cycle Shop
by the Cycle Shack
consisting only
furnishings
or
owned
assets
location
and
or
the warehouse
nor
any
and in
Kay
particular
of
the
goodwill
Cycle Shack
Jones
the
purchase
Cycle Shack has continued
under the
same name
operate
to
from before the sale
through
F ollowing the
the present under the name Cycle Shack
sale Cycle Shack used mass media advertising to inform its
customers of the sale and that all customers were requested to
do business with the
In order to
this
case
prevail
the Joneses
Cycle Shack
on a
are
motion for summary judgment the
required by
through pleadings depositions
to
together with
file
on
mover
Herein the Joneses have failed
conveyed
the
to
goodwill
is entitled
to
of
interrogatories and admissions
to
judgment
no
business
the
as
of law
matter
as a
triggering
issue
genuine
show that the sales agreement
a
in
966 to establish
art
the affidavits if any that there is
material fact and that
herein
answers
LSA C C P
movant
at
issue
application
of
LSA R S 23 921 B
support of its position that the
In
consulting agreement
the
case
as
issue herein is valid
of Newton and Associates Inc
10 18 00
559
at
non
v
compete prOVIsIOn of the
Cycle Shop cites
Boss 2000 889
772 So 2d 793 writ denied 2000 3162
holding
that
a
non
La
La
1 12 01
competition agreement covering
13
to
this
App
court
5 Cir
781 So 2d
a
term
of
employment is
termination
entered into contained
the business of his
covenant that the
a
applicable during
the
In
of
term
Reading the
intended
termination of
pertaining
to
agreements
in its
apply
to
the sale of
to
a
from the date of sale
applicable
to
independent
this
we
the time
not
contract
and for
competition
non
to
subject
find that the
limits
exceed
a
of the
B
non
period
LSA R S
statute
the
statute
two years
The second part of subsection C
limits non competition provisions for
case
period not to exceed two years
last work performed under the written
from the date of the
a
D
Subsection
addresses
non
competition
agreements in partnerships and provides that they are not to
exceed a period of two years from the date of dissolution
Subsection
non
E
relates
competition
to
exceed
franchise agreements and limits the
provisions in those agreements to a period
to
following severance of the franchise
And finally Subsection F relating to the
relationship
computer software industry limits non competition agreements
not to
period
a
two years
exceed
not to
two years
from the date of the
termination of employment
In all instances addressed
limit for the
by the
statute
the statutorv
competition allreement refers to a time
period that commences at the termination of the relationship
non
Similarly in this
case
concerning employment agreements
we
find that the time limit set out in the statute refers to a two year
period following termination of employment and does not
include time
intended
as
prior
to
the
termination
Boss argues to limit
non
If the
statute
were
total of
following the
competition
whether
to
a
during employment or
termination of the employment it would have simply stopped
with the phrase not to exceed a two year period
without
adding from termination of employment The addition of that
two
years
phrase
was
for
a
purpose
to
specify
commenced after termination of
that the
two year
period
employment
Thus in line with this interpretation we find no error in
the trial court ruling that the time period specified in the
agreement between these parties did not violate the law and was
valid and enforceable
14
two
clause
competition
of
post
compete with
period following
Subsection
corporations
contractors to
contract
entirety
not to
period
employment
not
a
the limitations
employment
that the
was
only
follows
as
relationship
a
of his
employment
statute
to
the
to
employee would
term
deciding
the Fifth Circuit reasoned
was
the
employer during
years after its termination
subject
In Newton
23 921
rather it is
23 921
that is
competition agreement
non
contained in LSA R S
23 921
LSA R S
governed by
not
Newton and Associates
We agree with this
added
The
non
conjunction
Joneses
of the
with
an
a
establish
employment
matter
or
post termination
provisions
are
a
non
at
795 96
as
case was
contract between
allow
not
that
for
of LSA R S
they
772 So 2d
emphasis
analysis
the agreement did
contract
Boss
v
compete agreement in the instant
LSA R S 23 921
year
Inc
out
the
hereinabove is
23 921 C
entitled
to
the
two year term
not
controlled
post termination period of two years
competition agreement
written in
Cycle Shop and
competition during
pointed
plainly
is in
This
two
with the
compliance
Therefore the Joneses have failed
summary
judgment invalidating
by
the
to
non
compete provision of their consulting agreement with the plaintiff herein
Having decided the appeal
unnecessary
to
address the
on
the basis stated herein
find it
we
remaining assignments of error
CONCLUSION
For the
court
reasons
assigned
in favor of Gary Jones and
is remanded for further
OpInIOn
All
costs
of this
the summary judgment rendered
by
the trial
Kay Jones is hereby vacated and the
proceedings
appeal
in accordance with the
are to
be borne
by Gary
matter
foregoing
Jones and
Jones
JUDGMENT VACATED REMANDED TO TRIAL COURT
15
Kay