J-A17005-17


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

WOLFINGTON BODY COMPANY, INC.            :   IN THE SUPERIOR COURT OF
                                         :        PENNSYLVANIA
                       Appellant         :
                                         :
               v.                        :
                                         :
BRIAN O'NEILL AND GRECH                  :
MOTORS, INC.                             :
                                         :
                       Appellees         :         No. 67 EDA 2017

               Appeal from the Order Entered December 22, 2016
                In the Court of Common Pleas of Chester County
                       Civil Division at No(s): 2016-10934

BEFORE:    GANTMAN, P.J., RANSOM, J., and PLATT, J.*

MEMORANDUM BY GANTMAN, P.J.:                        FILED APRIL 30, 2018

     Appellant, Wolfington Body Company, Inc. (“Wolfington”), appeals

from the order entered in the Chester County Court of Common Pleas, which

denied Appellant’s expedited petition for a preliminary injunction against

Appellees, Brian O’Neill and Grech Motors, Inc. (“Grech”). We affirm.

     The relevant facts and procedural history of this case are as follows.

Wolfington is a bus sales company that provides specialized transportation.

In October 2013, Wolfington hired Mr. O’Neill as a commercial vehicle

salesperson.        On October 9, 2013, Mr. O’Neill executed an employment

agreement (“Employment Agreement”), which contained several restrictive

covenants. The Employment Agreement provides, in pertinent part:

       8. Non-Compete and Non-Solicitation Covenants.     The
       Employee agrees that during the Term of this Agreement
       and for a period of two (2) years thereafter:
_____________________________

*Retired Senior Judge assigned to the Superior Court.
J-A17005-17



          a.     Non-Compete.      The Employee will not directly
       or indirectly, on his own behalf or in the service or on
       behalf of others, as owner, principal, stockholder, director,
       employee,     officer,  consultant,    agent,   independent
       contractor, partner, joint-venture or in any other manner,
       engage in any activity in competition with any of the
       activities carried on by the Company (or any affiliate
       thereof) in any state within the United States in which the
       Company (or any affiliate thereof) then conducts any
       business or has conducted any business (whether during
       the Term or any period preceding the Term);

          b.     Customer Solicitation. The Employee will not,
       without the prior written consent of the Company, directly
       or indirectly solicit any account or customer with whom the
       Company (or any affiliate thereof) has conducted any
       business or for whom the Company (or any affiliate
       thereof) has performed any services or sold any products
       (whether during the Term or any period preceding the
       Term); nor will the Employee directly or indirectly solicit
       any person or entity who was a potential account or
       customer of the Company (or any affiliate thereof) as a
       result of contacts (including without limitation the
       transmittal of proposals) having been made between the
       Company (or any affiliate thereof) and such person or
       entity within one (1) year prior to the termination of this
       Agreement. …

                                 *     *   *

       9. Confidential Information.

           a.    Non-Disclosure. The Employee covenants and
       agrees that he will treat as confidential and will not,
       without the prior written approval of the Company, use
       (other than in the performance of his duties hereunder) or
       disclose in any manner, either during the Term o[r] any
       time thereafter after the termination of this Agreement,
       any “Confidential Information” (as hereinafter defined) of
       the Company or any affiliate thereof. The Employee also
       agrees that during the Term and thereafter, he will
       diligently protect any Confidential Information against loss
       by inadvertent or unauthorized disclosure and will comply

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J-A17005-17


        with all policies established by the Company for the
        purpose of protecting such information. All Confidential
        Information prepared by the Employee or which otherwise
        shall be disclosed to or come into the possession of the
        Employee, shall be and remain the sole and exclusive
        property of the Company. The Employee agrees that upon
        termination of this Agreement, or at any other prior time
        upon request, he will promptly deliver to the Company the
        originals and all copies of any Confidential Information that
        are then in his possession, custody or control.

           b.     Definition. For purposes of this Agreement,
        “Confidential Information” means any and all data and all
        information relating to the Company or any affiliate thereof
        or its affairs, including but not limited to information
        relating to the financial affairs, plans, processes, services,
        actual or prospective providers, suppliers or customers,
        customer      lists,  pricing    information,    technological
        information, manuals (including service manuals), patents,
        processes, provider contracts, trade secrets, the
        Employee’s or another person’s compensation, research or
        accounting of the Company or any affiliate thereof, which
        data and information is disclosed to the Employee or
        known to the Employee as a consequence of the
        Employee’s       employment     hereunder.       “Confidential
        Information” shall also include any such data or
        information provided to the Company by a third party and
        required to be kept in confidence by the Company.

(Employment Agreement, dated October 9, 2013, at 2-4; R.R. at 24a-26a).

     On October 24, 2016, Mr. O’Neill submitted a letter of resignation to

Wolfington. During an exit interview, Wolfington reminded Mr. O’Neill of the

restrictive covenants contained in the Employment Agreement.             In early

November 2016, Mr. O’Neill began employment with Grech, a bus

manufacturer for the high-end luxury market, as a Senior Sales Executive.

     On November 17, 2016, Wolfington filed a complaint against Mr.

O’Neill and Grech, claiming Mr. O’Neill was in violation of the restrictive

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covenants contained in his Employment Agreement because Grech was a

competitor of Wolfington. Specifically, Wolfington alleged, inter alia, that it

hired Mr. O’Neill in October 2013, as a commercial vehicle salesperson for

the Mid-Atlantic region—New York south through Maryland and east to and

through New Jersey and Delaware. Wolfington averred it had provided Mr.

O’Neill access to its confidential, proprietary, and/or trade secret information

during the course of Mr. O’Neill’s employment; the restrictive covenants in

the Employment Agreement are reasonable in scope and do not impose

greater restrictions than necessary to protect Wolfington’s legitimate

business interests; Mr. O’Neill resigned on October 24, 2016, and began

working for Grech in early November 2016; and Grech is one of Wolfington’s

competitors, specifically in Pennsylvania, New Jersey, Delaware, and

Maryland. Wolfington sought, inter alia, an injunction prohibiting Mr. O’Neill:

(1) from working for Grech or any other competitor for two years from the

date of Mr. O’Neill’s resignation from Wolfington; (2) from attempting to

solicit or interfere with any of Wolfington’s past, present, or prospective

customers; and (3) prohibiting Mr. O’Neill from disclosing any of Wolfington’s

confidential, proprietary, or trade secret information. Wolfington also sought

an injunction against Grech prohibiting Grech from attempting to solicit or

interfere with any of Wolfington’s past, present, or prospective customers,

and restraining Grech from disclosing or using any of Wolfington’s

confidential, proprietary, or trade secret information.


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      On November 18, 2016, Wolfington filed an expedited petition for

preliminary injunction and supporting memorandum of law.           Wolfington

claimed it would suffer immediate, substantial, and irreparable harm if Mr.

O’Neill and Grech continue to violate the terms of Mr. O’Neill’s Employment

Agreement.    Wolfington sought an order granting preliminary injunctive

relief and requiring Mr. O’Neill to oblige the restrictive covenants contained

in the Employment Agreement.       On December 7, 2016, Mr. O’Neill and

Grech filed answers to Wolfington’s complaint, and the expedited petition for

preliminary injunction, with new matter challenging, among other things, the

restrictive covenant as unreasonable, both temporally and geographically,

and unenforceable as against public policy.

      The parties proceeded to a hearing on the petition for preliminary

injunction on December 14-15, 2016. Richard Wolfington, Jr., the President

of Wolfington, testified, inter alia, Wolfington is a bus sales company that

provides specialized transportation throughout the Mid-Atlantic region and

the whole country. Mr. Wolfington explained the company has sold buses in

numerous states including, but not limited to, Pennsylvania, New Jersey,

New York, Delaware, Maryland, Virginia, Georgia, Florida, Wisconsin, and

Hawaii.   Mr. Wolfington said the company required Mr. O’Neill to sign the

Employment     Agreement    contemporaneously     with   the   start   of   his

employment, because Mr. O’Neill would be privy to pricing information,

customer lists, and other important information in his role, and the


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restrictive covenants were intended to protect Wolfington from unwarranted

disclosure of that information to a competitor. Mr. Wolfington explained the

company keeps its information on secured, password-protected servers. Mr.

Wolfington   described   Mr.   O’Neill’s    general   territory    as   northeastern

Pennsylvania, New Jersey, New York, and Maryland.             (See N.T. Hearing,

12/14/16, at 29-80; R.R. at 112a-163a.)

      Mr. O’Neill testified, inter alia, he is currently the Senior Sales

Executive for Grech in livery (luxury bus) sales. Mr. O’Neill said his territory

at Wolfington was limited to Philadelphia and New Jersey.               Prior to his

employment with Wolfington, Mr. O’Neill worked for another bus company

called Don Brown Bus Sales as a regional sales manager.              Mr. O’Neill also

previously worked for MTG Incorporated, a national wholesale provider of

limousine parts and accessories in the coach industry.            Based on his total

employment history over many years, Mr. O’Neill explained, he has

established a large customer base.         Mr. O’Neill said he kept a list of his

customers’ birthdays, anniversaries, home addresses, kids’ names, etc. Mr.

O’Neill testified that his lengthy employment history gave him extensive

knowledge of the industry and access to numerous “build sheets,” which are

the price sheet cost matrices, which manufacturers use to assemble the

prices of products. Mr. O’Neill discussed his employment at Wolfington and

frustrations working for that company. Mr. O’Neill insisted he returned all

“confidential” information belonging to Wolfington upon his departure and


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J-A17005-17


did not retain any of Wolfington’s information. Mr. O’Neill denied that Grech

is a competitor of Wolfington. Mr. O’Neill also denied that he had provided

Grech with a list of Wolfington’s customers. Mr. O’Neill explained he would

suffer immense financial harm if the court enforced the provisions of the

Employment Agreement and prohibited him from working in the bus sales

industry for two years. (See id. at 82-139; R.R. at 165a-222a); (See also

N.T. Hearing, 12/15/16, at 55-95; R.R. at 279a-319a).

      Edward Grech, testified, inter alia, he is the President of Grech, which

manufacturers buses for the high-end luxury market. Mr. Grech explained

that when he learned of the restrictive covenants contained in Mr. O’Neill’s

Employment Agreement with Wolfington, Mr. Grech instructed Mr. O’Neill to

return all of Wolfington’s information including computers, customer lists,

cell phones, etc. Mr. Grech said Mr. O’Neill confirmed he had returned all of

Wolfington’s information.   (See id. at 5-23; 95-108; R.R. at 229a-247a;

319a-332a).

      Brian Engle, Wolfington’s Vice President of Sales, testified, inter alia,

he was Mr. O’Neill’s direct supervisor when Mr. O’Neill worked at Wolfington.

Mr. Engle said Wolfington hired Mr. O’Neill to cover New Jersey, Philadelphia,

and the northeastern Pennsylvania counties. Mr. Engle explained Mr. O’Neill

had access to all price books, products, and manufacturers represented by

Wolfington. Mr. Engle testified Mr. O’Neill had access to Wolfington’s price

margins, internal structures, and creative financing tools.    Mr. Engle also


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J-A17005-17


discussed Wolfington’s customer list, which contains Wolfington’s past,

current, and prospective customers.              Mr. Engle admitted some of the

information on the customer list is available publicly through association

memberships. Mr. Engle emphasized its pricing information is not available

publicly, and Wolfington considers its pricing information confidential.                Mr.

Engle maintained Grech is a competitor of Wolfington because its sells

similar products in the same market.             (See id. at 23-50; R.R. at 247a-

274a).    At the conclusion of the hearing, the court took the matter under

advisement.

        The   court   denied    Wolfington’s     petition   for   injunctive   relief   on

December 22, 2016.          Wolfington timely filed a notice of appeal the next

day.1    On January 3, 2017, the court ordered Wolfington to file a concise

statement of errors complained of on appeal pursuant to Pa.R.A.P. 1925(b).

Wolfington timely complied on January 19, 2017.

        Wolfington raises the following issues for our review:

           WHETHER THE TRIAL COURT ERRED BY NOT ENFORCING
           THE POST-EMPLOYMENT NON-COMPETITION COVENANT
           AND     NON-SOLICITATION    COVENANT     WHERE
           WOLFINGTON PROVED THE EXISTENCE OF LEGITIMATE
           BUSINESS INTERESTS THAT THE NON-COMPETITION
           AGREEMENT WAS INTENDED TO PROTECT.

           WHETHER THE TRIAL COURT ERRED BY REQUIRING
____________________________________________


1 See Pa.R.A.P. 311(a)(4) (explaining appeal may be taken as of right and
without reference to Rule 341(c) from order that grants or denies
injunction).



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           [WOLFINGTON] TO ESTABLISH THE EXISTENCE OF A
           TRADE SECRET AS A CONDITION PRECEDENT TO
           WOLFINGTON’S ABILITY TO ENFORCE THE POST-
           EMPLOYMENT NON-COMPETITION AGREEMENT, THE NON-
           SOLICITATION AGREEMENT, AND THE NON-USE OF
           CONFIDENTIAL   INFORMATION    CLAUSES  OF   THE
           EMPLOYMENT AGREEMENT WHERE [WOLFINGTON] DID
           NOT ASSERT A CAUSE OF ACTION UNDER THE
           PENNSYLVANIA UNIFORM TRADE SECRETS ACT [“PUTSA”]
           AND REPEATEDLY SO ADVISED THE COURT.

           WHETHER THE [TRIAL COURT] ERRED BY FINDING THAT
           THE GEOGRAPHIC SCOPE OF THE POST-EMPLOYMENT
           NON-COMPETITION AGREEMENT WAS NOT REASONABLE
           WHERE [MR.] O’NEILL…DID NOT MEET HIS BURDEN TO
           ESTABLISH THROUGH COMPETENT EVIDENCE THAT THE
           RESTRICTIVE COVENANT WAS UNENFORCEABLE AND
           UNREASONABLE AND PRESENTED NO EVIDENCE OF SUCH
           ALLEGED UNREASONABLENESS.

           WHETHER THE TRIAL COURT ERRED BY REFUSING TO
           INVOKE THE “BLUE PENCIL” PROVISION OF THE
           EMPLOYMENT AGREEMENT TO LIMIT THE GEOGRAPHIC
           SCOPE OF THE POST-EMPLOYMENT NON-COMPETITION
           COVENANT IF THE TRIAL COURT BELIEVED THAT
           GEOGRAPHIC SCOPE WAS OVER BROAD.

           WHETHER THE TRIAL COURT ERRED BY NOT ENFORCING
           THE NON-SOLICITATION AND NON-DISCLOSURE/NON-
           USE OF CONFIDENTIAL INFORMATION COVENANTS
           CONTAINED IN THE PARTIES’ EMPLOYMENT AGREEMENT,
           REGARDLESS OF THE ENFORCEABILITY OF THE NON-
           COMPETITION AGREEMENT.

(Wolfington’s Brief at 5-6).2

        Our review of the denial of a preliminary injunction implicates the

following principles:

____________________________________________


2   For purpose of disposition, we have reordered some of Wolfington’s issues.



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           Our scope of review is plenary. [O]ur [standard of]
           review of a trial court’s order granting or denying
           preliminary injunctive relief is “highly deferential.”
           This “highly deferential” standard of review states
           that in reviewing the grant or denial of a preliminary
           injunction, an appellate court is directed to examine
           the record to determine if there were any apparently
           reasonable grounds for the action of the court below.

        An abuse of discretion is not merely an error of judgment,
        but if in reaching a conclusion the law is overridden or
        misapplied, or the judgment exercised is manifestly
        unreasonable, or the result of partiality, prejudice, bias, or
        ill will, as shown by the evidence or the record, discretion
        is abused. [W]e do not inquire into the merits of the
        controversy[.] Only if it is plain that no grounds exist to
        support the decree or that the rule of law relied upon was
        palpably erroneous or misapplied will we interfere with the
        decision of the trial court.

        A trial court has “apparently reasonable grounds” for
        granting the extraordinary remedy of preliminary
        injunctive relief if it properly finds that all of the “essential
        prerequisites” are satisfied.

Synthes USA Sales, LLC v. Harrison, 83 A.3d 242, 248-49 (Pa.Super.

2013) (internal citations and some quotation marks omitted).

        There are six “essential prerequisites” that a party must
        establish prior to obtaining preliminary injunctive relief.
        The party must show: 1) that the injunction is necessary
        to prevent immediate and irreparable harm that cannot be
        adequately compensated by damages; 2) that greater
        injury would result from refusing an injunction than from
        granting it, and, concomitantly, that issuance of an
        injunction will not substantially harm other interested
        parties in the proceedings; 3) that a preliminary injunction
        will properly restore the parties to their status as it existed
        immediately prior to the alleged wrongful conduct; 4) that
        the activity it seeks to restrain is actionable, that its right
        to relief is clear, and that the wrong is manifest, or, in
        other words, must show that it is likely to prevail on the
        merits; 5) that the injunction it seeks is reasonably suited

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          to abate the offending activity; and, 6) that a preliminary
          injunction will not adversely affect the public interest. The
          burden is on the party who requested preliminary
          injunctive relief[.]

Warehime v. Warehime, 580 Pa. 201, 209-10, 860 A.2d 41, 46-47 (2004)

(internal citations omitted).

          A decision addressing a request for a preliminary
          injunction thus requires extensive fact-finding by the trial
          court because the moving party must establish it is likely
          to prevail on the merits. Simply the moving party must
          establish a prima facie right to relief. If the moving party’s
          right to relief is unclear, then a preliminary injunction
          should not issue.

Synthes, supra at 249-50 (internal citations and footnote omitted). “In the

preliminary injunction context, we have further observed that if the evidence

supports a trial court’s factual finding, we will conclude that there are

apparently reasonable grounds for that determination.”            Shepherd v.

Pittsburgh Glass Works, LLC, 25 A.3d 1233, 1245 (Pa.Super. 2011).

        We combine Wolfington’s issues. Wolfington argues it has a legitimate

business interest in protecting its “confidential” information, which includes

customer lists, pricing information, and marketing strategies.        Wolfington

asserts its customer lists, pricing information, and marketing strategies are

not publicly available, and it restricts access to this information to its sales

team.      Wolfington maintains it stores its confidential information on

password-protected secure company servers.          Wolfington admits some of

the information regarding its customer lists is publicly available, but

Wolfington stresses it compiled both public and non-public information,

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which gives Wolfington a competitive edge over other bus dealers and is

worthy of protection. Wolfington highlights that it required all employees to

execute an agreement acknowledging the confidential nature of Wolfington’s

pricing information.

       Wolfington also complains the trial court improperly required it to

prove a claim for relief under PUTSA, even though Wolfington did not assert

a cause of action under that statute. Wolfington insists the court required

Wolfington to show the existence of a “trade secret” as defined by PUTSA,

instead of applying common law principles regarding enforcement of a non-

disclosure covenant, which requires proof of only a protectable business

interest. Even if Wolfington failed to establish a legitimate business interest

in   its   customer   lists,    pricing   information,   and   marketing   strategies,

Wolfington claims it has a legitimate business interest in the goodwill Mr.

O’Neill developed with customers on behalf of Wolfington.                  Wolfington

highlights    Mr.   O’Neill’s   significant   and   direct   personal   contacts   with

Wolfington’s customers, which is the “number one selling factor” in the bus

industry.    Wolfington submits the court completely ignored Wolfington’s

customer goodwill as a legitimate business interest. Wolfington suggests Mr.

O’Neill has a common law duty to protect and not profit from the use of an

employer’s confidential information, even in the absence of an express non-

disclosure agreement.           Wolfington insists Mr. O’Neill violated the non-

disclosure covenant and his common law duties to Wolfington by providing


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J-A17005-17


Grech with a list of customers whom Mr. O’Neill sold buses to while

employed at Wolfington, in addition to soliciting one of Wolfington’s

customers while employed at Grech.

       Wolfington further argues Mr. O’Neill failed to present any evidence to

support his claim that the non-compete covenant was unreasonable.

Wolfington claims the court based its decision not to enforce the non-

compete provision on its erroneous belief that Wolfington has done business

in 35 states. Wolfington maintains the non-compete covenant prohibits Mr.

O’Neill from working for a competing business in only about 17 states.3

Wolfington insists a non-compete covenant restricting Mr. O’Neill from

competing in 17 states is reasonable, given the scope of Mr. O’Neill’s job

duties at Wolfington. Even if the non-compete covenant is unreasonable in

scope, Wolfington insists the trial court should have applied the “blue pencil”

rule to narrow the geographic scope of the non-compete covenant.          At a

minimum, Wolfington contends the court should have applied the non-

compete provision to Mr. O’Neill’s prior sales territories—Pennsylvania, New

Jersey, Maryland, Delaware, and New York. Wolfington concludes the trial

court erred when it denied injunctive relief, and this Court should reverse

and enforce all of the restrictive covenants in the Employment Agreement.

We disagree.
____________________________________________


3In its reply brief, Wolfington contends the non-compete covenant prohibits
Mr. O’Neill from working in 15 states.



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       “Pennsylvania courts have historically been reluctant to enforce

contracts that place restraints on trade or on the ability of an individual to

earn a living; however, post-employment non-competition covenants are not

per se unreasonable or unenforceable.” WellSpan Health v. Bayliss, 869

A.2d 990, 996 (Pa.Super. 2005). Importantly:

          At a minimum, for a non-competition or restrictive
          covenant to be enforceable, it must be reasonably related
          to the protection of a legitimate business interest. The
          type of interests that have been recognized in the context
          of a non-competition covenant include trade secrets or
          confidential information, unique or extraordinary skills,
          customer good will, and investments in an employee
          specialized training program.      In contrast, a post-
          employment covenant that merely seeks to eliminate
          competition per se to give the employer an economic
          advantage is generally not enforceable.

Id. at 996-97 (internal citations and quotation marks omitted).             The

presence of a legitimate, protectable business interest is a threshold

requirement for an enforceable restrictive covenant.     Hess v. Gebhard &

Co. Inc., 570 Pa. 148, 163, 808 A.2d 912, 920 (2002).

       In general, a “trade secret” is any “compilation of information which is

used in one’s business that gives one an opportunity to obtain an advantage

over competitors.” WellSpan, supra at 997. Factors a court may consider

in determining whether information qualifies as a trade secret include:4

____________________________________________


4 Historically, Pennsylvania adopted the definition of “trade secrets” set forth
in the Restatement (Second) of Torts § 757. Trade secret law is now
codified at 12 Pa.C.S.A. § 5301-5308, as part of PUTSA.



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         (1) the extent to which the information is known outside
         the owner’s business; (2) the extent to which it is known
         by employees and others involved in the owner’s business;
         (3) the extent of measures taken by the owner to guard
         the secrecy of the information; (4) the value of the
         information to the owner and to his competitors; (5) the
         amount of effort or money expended by the owner in
         developing the information; and (6) the ease or difficulty
         with which the information could be acquired or duplicated
         by others.

Omicron Systems, Inc. v. Weiner, 860 A.2d 554, 562 (Pa.Super. 2004)

(quoting Dibble v. Penn State Geisinger Clinic, Inc., 806 A.2d 866, 871

(Pa.Super. 2002), appeal denied, 573 Pa. 666, 820 A.2d 705 (2003)).

      “The crucial indicia for determining whether certain information

constitutes a trade secret are substantial secrecy and competitive value to

the owner.”     O.D. Anderson, Inc. v. Cricks, 815 A.2d 1063, 1070

(Pa.Super. 2003) (internal citation and quotation marks omitted).           The

question of whether information is a trade secret must be made on a case-

by-case basis. Id. at 1071. “A trade secret does not include an employee’s

aptitude, skill, dexterity, manual and mental ability, or other subjective

knowledge.    In addition, if a competitor could obtain the information by

legitimate means, it will not be given injunctive protection as a trade secret.”

WellSpan Health, supra at 997.

      “[U]nder certain circumstances, customer lists and customer data may

be entitled to protection as trade secrets.” Iron Age Corp. v. Dvorak, 880

A.2d 657, 663 (Pa.Super. 2005).      See, e.g., Wellspan Health, supra at

998-99 (holding healthcare system’s patient referral base, which required

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J-A17005-17


substantial investments to generate, constituted legitimate, protectable

business interest; without legal recognition as protected interest, referral

bases of institutions, which provide highly specialized medical care could

erode, causing serious harm not only to clinical care and to physician

training and research programs, all of which benefit public).        Compare

Hess, supra (holding insurance firm failed to show its prices and customer

lists were unique to its business and deserved protection as trade secrets or

confidential information; potential customers available to insurance firm

were available to any other insurance agency operating in same county and

identities of potential clients were widely known and easily available;

because information insurance firm sought to keep confidential can be

obtained by legitimate means by its competitors, enforcement of restrictive

covenant on that basis is inappropriate); Renee Beauty Salons, Inc. v.

Blose-Venable, 652 A.2d 1345, 1349-50 (Pa.Super. 1995), appeal denied,

541 Pa. 627, 661 A.2d 874 (1995) (holding hair stylists’ compilation of client

record cards containing customers’ names, telephone numbers, hair styling

preferences, etc., did not constitute trade secret warranting injunctive relief,

where such information was easily ascertainable through other sources).

      Goodwill is essentially “the positive reputation that a particular

business enjoys.”    Hess, supra at 165, 808 A.2d at 922.             “Goodwill

represents a preexisting relationship arising from a continuous course of

business which is expected to continue indefinitely.”    WellSpan, supra at


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997.

       Once the threshold requirement of a protectable business interest is

met:

           [T]he next step in analysis of a non-competition covenant
           is to apply the [requisite] balancing test…. First, the court
           balances the employer’s protectable business interest
           against the employee’s interest in earning a living. Then,
           the court balances the employer and employee interests
           with the interests of the public.

           In weighing the competing interests of employer and
           employee, the court must engage in an analysis of
           reasonableness. First, the covenant must be reasonably
           necessary for the protection of the employer. In addition,
           the temporal and geographical restrictions imposed on the
           ex-employee must be reasonably limited.                The
           determination of reasonableness is a factual one, requiring
           consideration of all the facts and circumstances, with the
           party claiming unreasonableness as a defense against
           enforcement of the covenant bearing the burden of proof.

WellSpan, supra at 999 (internal citations omitted).            “Generally, our

determination of reasonableness of time and territory has involved a

weighing     of   competing   interests—that   of   the   employer’s   need   for

protection—against the hardship of the restriction to be imposed upon the

employee.” Insulation Corp. of America v. Brobston, 667 A.2d 729, 734

(Pa.Super. 1995).

       Where a covenant not to compete is overly broad, courts have

discretion to grant enforcement limited to those portions of the restrictions

which are reasonably necessary to protect the employer.         Hess, supra at

162-63, 808 A.2d at 920. See also Reading Aviation Service, Inc., 454


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Pa. 488, 311 A.2d 628 (declining partial enforcement of non-compete

covenant due to policy concern that courts should refrain from rewriting

agreements, which could encourage employers to draft unreasonable

restrictions knowing court can later enforce agreement, at least in part, by

reforming restrictive covenant); WellSpan, supra (discussing court’s

authority to “blue pencil” or “blue-line” unreasonable restrictive covenant).

      Instantly, the trial court decided Wolfington had failed to establish a

protectable legitimate business interest, reasoning:

         Here, I found that the skills and information necessary to
         enable an experienced salesperson such as [Mr.] O’Neill
         are readily available in the public domain.          Such
         information includes names and addresses of customers or
         potential customers of commercial transportation vehicles
         and competitive pricing of these products. There was no
         information that amounts to an actual secret, was of
         peculiar importance to Wolfington, or constituted a
         competitive value; rather, the information was common
         knowledge throughout the industry.        There is simply
         nothing unusual or new about the pricing of luxury
         commercial vehicles, the profit margins of the largest
         commercial vehicle companies, or their customers or
         prospective customers. Having no experience in the luxury
         bus industry, if I were thrust into a sales position for
         Wolfington or Grech, I would expect to target retirement
         homes, casinos, hotels, and colleges as a starting point.
         This is based on common sense, not derived from
         specialized skills or training or confidential proprietary
         information. …

         Further, the definition of “Confidential Information” as set
         forth in the Employment Agreement was so broad as to
         include any information [Mr.] O’Neill may have learned
         during his employment with Wolfington. There was no
         plausible way to distinguish such knowledge and
         information one acquires with experience and that which
         amounts to true confidential information deserving of

                                    - 18 -
J-A17005-17


       protection.   As set forth in more detail below, the
       restrictive covenants were not reasonably tailored to
       protect Wolfington’s business interests. The Agreement’s
       definition of “Confidential Information” was excessively
       broad and effectively prohibited [Mr.] O’Neill from
       engaging in his chosen profession.       As a result, the
       customer lists, costs and pricing margins, and marketing
       strategies are neither protectable as trade secrets nor do
       they amount to actual confidential information.       This
       conclusion was neither based on palpably erroneous law
       nor the misapplication of the law.

                               *     *      *

       Here, Wolfington failed to establish [the] threshold
       requirement. Wolfington did not prove the existence of a
       legitimate business interest in the information it sought to
       protect. On page 11 of my December 22, 2016 Opinion [in
       support of denying injunctive relief], I inadvertently
       misused the term “legitimate business interest”, using it to
       mean that I understood why Wolfington would desire to
       keep this information out of the hands of its competitors to
       the extent possible.     However, the remainder of my
       Opinion explains why I determined that the information did
       not amount to a trade secret or confidential information as
       it was already common through the livery industry.

       Although the establishment of legitimate business interests
       is necessary to enforce a restrictive covenant, it is not the
       only requirement.      The restrictive covenant must be
       reasonably tailored to protect the employer’s interests.
       Based upon evidence at the hearing, I concluded that
       Wolfington failed to establish that the restrictive covenants
       of the Employment Agreement were reasonably tailored,
       even if Wolfington indeed had proved a legitimate business
       interest in protecting its costs and pricing margins,
       customer lists, and marketing strategies. …

       In my analysis, I balanced the employer’s [purported]
       protectable business interests against the interest of the
       employee in earning a living in his…chosen profession,
       trade or occupation, and thereafter balanced those
       competing interests against the interest of the public. In
       doing so, I concluded that Wolfington’s interests in

                                   - 19 -
J-A17005-17


       protecting its customer lists, costs, and pricing margins,
       and marketing strategies were not legitimate business
       interests. Further, these interests were not outweighed by
       [Mr.] O’Neill’s right to earn a living in his chosen field.
       This is because such information was already widely
       disseminated within the luxury bus industry. Further, it is
       within the interest of the public to have competitive pricing
       available for commercial vehicles.      Because Wolfington
       failed to establish a legitimate business interest and, even
       had Wolfington proven a legitimate business interest, the
       restrictive covenants were not reasonably tailored to
       protect such interests, said restrictive covenants were
       unenforceable.     This conclusion was neither based on
       palpably erroneous law nor the misapplication of the law.

                                *     *      *

       Wolfington argues that I should have enforced the non-
       solicitation and non-use of confidential information
       covenants despite my finding that the non-competition
       covenant was unenforceable. …

       Here, I determined that the information Wolfington sought
       to protect was common knowledge within the industry and,
       therefore, did not amount to a legitimate business interest,
       i.e., trade secret or confidential information.         If a
       competitor could obtain the information by legitimate
       means, it will not be given injunctive protection as a trade
       secret. I have belabored this point already herein. Not to
       diminish the hard work of individuals in sales, but the skills
       and information necessary to enable an experienced
       salesperson such as [Mr.] O’Neill are readily available in
       the public domain. Such information includes names and
       addresses of customers or potential customers of
       commercial transportation vehicles and competitive pricing
       of these products. Simply stated, the luxury bus industry
       is not the type of field which requires highly specialized
       skills or technical details requiring protection, unlike for
       example, the pyrotechnic industry.

       Moreover, testimony demonstrated that Wolfington and
       Grech previously targeted and continue to target the same
       customers on a consistent basis, dating back to before
       [Mr.] O’Neill joined Grech. According to Wolfington, [Mr.]

                                    - 20 -
J-A17005-17


          O’Neill had lost sales to Grech in the past and conversely
          has won sales away from Grech while employed with
          Wolfington.    Both companies attend the same trade
          association conventions, set up booths for marketing
          purposes and use the events to target the same or similar
          customers. Thus, the information Wolfington seeks to
          protect was already subject to discovery by legitimate
          means. Under the law, such information is not entitled to
          injunctive protection. This conclusion was neither based
          on palpably erroneous law nor the misapplication of the
          law.

(Trial Court Opinion, filed February 14, 2017, at 11-15) (internal citations

and quotation marks omitted).5           We see no reason to disrupt the court’s

decision to deny the injunction, where Wolfington failed to satisfy the

“threshold” requirement to establish a legitimate business interest worthy of

protection.6 See Hess, supra; WellSpan, supra; Renee Beauty Salons,

Inc. See also Synthes, supra.

       Regarding Wolfington’s complaint that the court improperly required it

to establish a “trade secret” as defined in PUTSA, the trial court explained:

“Although I looked to PUTSA for guidance on the definition of ‘trade secret,’ I

ultimately concluded that the information Wolfington sought to protect was

neither a trade secret (as defined by PUTSA) nor did it amount to

____________________________________________


5 The trial court’s Rule 1925(a) opinion does not appear in the reproduced
record.

6 The court did not expressly address Wolfington’s claim that it has a
legitimate business interest in its customer goodwill. Even if Wolfington
could succeed on this claim, the restrictive covenants still fail the requisite
balancing test.



                                          - 21 -
J-A17005-17


confidential information, deserving of injunctive protection.” (Trial Court

Opinion at 10) (emphasis added). Further, Wolfington repeatedly claimed it

was seeking an injunction to protect its “trade secrets” throughout its

complaint and petition for injunctive relief. (See Complaint, filed 11/17/16,

at ¶¶ 1, 8, 9, 11, 23, 33-34, 53(c), 58, 60(c), 65, 65(c); R.R. at 6a-8a, 11a,

13a, 17a-18a, 20a); (Memorandum of Law in Support of Wolfington’s Motion

for Preliminary Injunction, filed 11/18/16, at 2, 4, 6-7, 10, 12, 14-15; R.R.

at 61a, 63a, 65a-66a, 69a, 71a, 73a-74a).               Thus, notwithstanding

Wolfington’s assertion at the injunction hearing and now on appeal that it did

not assert a cause of action under PUTSA, it was certainly reasonable for the

trial court to consider whether any of the information Wolfington sought to

protect was worthy of trade secret protection, based on the allegations in

Wolfington’s pleadings.7

       Moreover, even if Wolfington had established a legitimate business

interest, the trial court decided Wolfington was still not entitled to injunctive

relief, explaining:

          The non-compete covenant restricts [Mr.] O’Neill from
          directly or indirectly, on his own behalf or in the service or
          on behalf of others engag[ing] in any activity in
          competition with any of the activities carried on by
____________________________________________


7 In fact, the introduction paragraph of Wolfington’s complaint alleges: “This
case involves a concerted effort by a direct competitor of [Wolfington],
Grech, to steal Wolfington’s customers and accounts, and to misappropriate
Wolfington’s confidential, proprietary, and trade secret information…”
(Complaint at ¶ 1; R.R. at 6a).



                                          - 22 -
J-A17005-17


       Wolfington (or any affiliate) in any state within the
       United States in which Wolfington (or any affiliate
       thereof) conducts any business or have conducted any
       business.    Evidence at the hearing showed that [Mr.]
       O’Neill was responsible for the territory of New York south
       through Maryland and New Jersey, west through Delaware
       and Eastern Pennsylvania. Thus, the restriction does not
       apply merely to [Mr.] O’Neill’s former sales territory (PA,
       DE, NJ, NY, MD), but to any state in which Wolfington
       has ever done business. The effect of this clause is
       significantly more broad and drastic than would initially
       appear.      At the hearing, testimony revealed that
       Wolfington, as one of the largest bus dealers in the
       country, has done business in 35 states. Because this
       geographic restraint far exceeds the scope of [Mr.]
       O’Neill’s sales territory at Wolfington, it is unreasonable
       under the law.

       My finding that the geographic restraint was unreasonable
       was based upon competent evidence at the hearing of the
       limited scope of [Mr.] O’Neill’s sales territory when
       compared to the restrictive covenant’s scope of 35 states
       across the county. Such a restriction effectively prohibits
       [Mr.] O’Neill from earning a living in his chosen field for a
       period of two years. …

                               *     *      *

       Wolfington argues that this court should have invoked the
       “blue pencil” provision of the Employment Agreement to
       limit the geographical scope of the non-competition
       covenant. …

                               *     *      *

       Here, as written, the restrictive covenant prevented [Mr.]
       O’Neill from engaging in his chosen profession in more
       than two-thirds of the country for two years. Simply
       stated, this broad restriction is not necessary for the
       protection of Wolfington’s business interests which, as
       explained herein, are not entitled to injunctive protection
       due to the nature of the subject information. I do not find
       equitable considerations compelling in this instance. To
       invoke the court’s power to modify the restrictive covenant

                                   - 23 -
J-A17005-17


           would effectively encourage a policy whereby employers
           could impose the most broad restraints on an employee as
           a condition of employment, without consideration for the
           reasonableness or enforceability of such provisions, resting
           comfortably on the court’s power to modify the agreement
           if or when the employer sought to enforce the restrictive
           covenants.      Because this Commonwealth disfavors
           restrictions on trade, it follows that the court should
           exercise its power to modify a restrictive covenant in only
           the most deserving of cases. This is not such a case.
           Thus, I deemed the geographic restraints in the restrictive
           covenants to be more broad than necessary to protect
           Wolfington’s information and I exercised my discretion in
           refusing to “blue pencil” the covenant to modify the scope
           of the geographic restraints. This was not an abuse of
           discretion.

(Trial Court Opinion at 6-9) (internal citations omitted) (emphasis in

original).   The record supports the court’s decision that the non-compete

provision, restricting Mr. O’Neill from working in any state within the United

States in which Wolfington conducts business in or has ever conducted

business in, is unreasonably broad. (See Employment Agreement at 2; R.R.

at 24a.)     See also WellSpan, supra; Insulation Corp. of America,

supra.

      With respect to Wolfington’s claim that no evidence supported the trial

court’s finding that Wolfington conducts or has conducted business in 35

states, it is not apparent from the record where the trial court based that

finding.     Nevertheless, the record makes clear Wolfington conducted

business from June 2012 until the time of the injunction hearing in at least

17 states plus the District of Columbia. (See Wolfington’s Hearing Exhibit P-

7; R.R. at 375a-404a); (N.T., 12/14/16, at 37; R.R. at 120a).             Even if

                                      - 24 -
J-A17005-17


Wolfington conducted business in only those 17 states plus the District of

Columbia, the non-compete provision is still unreasonably broad when

compared to the small territory Mr. O’Neill was assigned to while working at

Wolfington. See WellSpan, supra; Insulation Corp. of America, supra.

      Concerning Wolfington’s claim that the court should have invoked the

“blue pencil” provision, Wolfington failed to preserve this claim in its petition

for injunctive relief and supporting memorandum of law, and did not raise

this issue at the injunction hearing. Thus, this issue is waived. See Irwin

Union Nat. Bank and Trust Co. v. Famous, 4 A.3d 1099 (Pa.Super.

2010), appeal denied, 610 Pa. 610, 20 A.3d 1212 (2011) (explaining general

rule that issues cannot be raised for first time in Rule 1925(b) statement or

on appeal). Moreover, the record supports the court’s refusal to invoke the

“blue pencil” provision. See Reading Aviation Service, Inc., supra. See

also Synthes, supra.      Therefore, Wolfington’s issues on appeal merit no

relief. Accordingly, we affirm.

      Order affirmed.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary



Date: 4/30/18



                                     - 25 -
