                                                             FILED
                                                        Nov 30 2016, 7:15 am

                                                             CLERK
                                                         Indiana Supreme Court
                                                            Court of Appeals
                                                              and Tax Court




ATTORNEYS FOR                                             ATTORNEYS FOR
APPELLANTS/APPELLEES 1                                    APPELLEE/APPELLANT
HANNUM WAGLE & CLINE                                      AMERICAN CONSULTING, INC.,
ENGINEERING, INC., D/B/A HWC                              D/B/A AMERICAN
ENGINEERING, INC., MARLIN A.                              STRUCTUREPOINT, INC.
KNOWLES, JR., JONATHAN A. DAY,                            Michael A. Wukmer
AND DAVID LANCET                                          David M. Mattingly
David L. Swider                                           Mark R. Alson
Andrew M. McNeil                                          Audrey K. Hagedorn
Philip R. Zimmerly                                        Robert A. Jorczak
Bose McKinney & Evans, LLP                                Ice Miller LLP
Indianapolis, Indiana                                     Indianapolis, Indiana



                                            IN THE
    COURT OF APPEALS OF INDIANA




1
 Each party is designated as both appellant and appellee because, after Appellant Hannum Wagle & Cline
Engineering, Inc., d/b/a HWC Engineering, Inc., Marlin A. Knowles, Jr., Jonathan A. Day, and David
Lancet filed their appeal, Case No. 49A05-1601-PL-33 (“Case No. 33”), Appellee American Consulting, Inc.,
d/b/a American Structurepoint, Inc. (“ASI”) filed a separate appeal against Hannum Wagle & Cline
Engineering, Inc., d/b/a HWC Engineering, Inc., Marlin A. Knowles, Jr., Jonathan A. Day, and David
Lancet. ASI’s appeal was assigned appellate case number 49A04-1606-PL-1198 (“Case No. 1198”).
However, because we found that the parties and subject matter of the two appeals were related, we
consolidated Case No. 1198 with earlier-filed Case No. 33.

Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                   Page 1 of 41
      Hannum Wagle & Cline                                         November 30, 2016
      Engineering, Inc., d/b/a HWC                                 Court of Appeals Case No.
      Engineering, Inc., Marlin A.                                 49A05-1601-PL-33
      Knowles, Jr., Jonathan A. Day,                               Appeal from the
      Tom Mobley,2 and David                                       Marion Superior Court
      Lancet,                                                      The Honorable
      Appellants/Appellees-Defendants,                             Heather A. Welch, Special Judge
                                                                   Trial Court Cause No.
               v.                                                  49D01-1503-PL-7463

      American Consulting, Inc.,
      d/b/a American Structurepoint,
      Inc.,
      Appellee/Appellant-Plaintiff.




      Kirsch, Judge.


[1]   Civil engineering firm American Consulting, Inc., d/b/a American

      Structurepoint, Inc. (“ASI”) filed a lawsuit for, among other things, breach of

      contract, against its competitor Hannum Wagle & Cline Engineering, Inc.,

      d/b/a HWC Engineering, Inc. (“HWC”) and four of ASI’s former employees,

      namely Marlin A. Knowles, Jr. (“Knowles”), Jonathan A. Day (“Day”), David

      Lancet (“Lancet”) (together, “the Defendants”), and Tom Mobley (“Mobley”),

      after Knowles, and later Day, Mobley, and Lancet, left ASI’s employment and

      began employment with HWC. The trial court issued amended findings of fact




      2
        Tom Mobley is not a party to this appeal, but we include him in the caption because all parties of record in
      the trial court are parties on appeal. Ind. Appellate Rule 17(A).

      Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                         Page 2 of 41
      and conclusions thereon that granted a preliminary injunction in favor of ASI

      against HWC, Knowles, Day, and Lancet3 pursuant to non-compete and non-

      solicitation agreements that Knowles, Day, and Lancet each had executed with

      ASI. Defendants appeal the injunction and raise the following restated and

      consolidated issues:


                 I. Whether the trial court abused its discretion when it entered a
                 preliminary injunction enforcing non-competition restrictions
                 contained within Knowles’s employment agreement with ASI;
                 and


                 II. Whether the trial court abused its discretion when it entered a
                 preliminary injunction enforcing non-solicitation restrictions
                 contained within the Knowles, Day, and Lancet employment
                 agreements.


[2]   Several months after issuing the injunction, the trial court granted Knowles’s

      motion to partially dissolve the preliminary injunction as to Knowles. ASI

      appeals that decision and raises two issues that we consolidate and restate as:

                 III. Whether the trial court abused its discretion when it granted
                 Knowles’s motion and dissolved the injunction as it pertained to
                 him.


[3]   We affirm.4




      3
          The trial court denied injunctive relief as to Mobley, and ASI does not appeal that decision.
      4
       We held oral argument on October 21, 2016 at Purdue University’s Krannert School of Executive
      Management. We thank counsel for their preparation and argument, and we commend them on their

      Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                          Page 3 of 41
                                  Facts and Procedural History5
                                                    The Parties

[4]   ASI and HWC are civil engineering, architecture, planning and design firms in

      Indiana. ASI’s and HWC’s clients include public bodies, such as municipal

      governments and entities in Indiana, including Indiana Department of

      Transportation (“INDOT”), Hamilton County, Hancock County, Boone

      County, Indianapolis, Carmel, and Franklin.6 Public bodies typically award

      their engineering and transportation projects through a qualification-based

      selection (“QBS”) system designed to allow them to select engineers and

      professional consultants for projects based on qualifications rather than price.

      After the public entity selects the engineering firm, the parties then negotiate the

      project’s fee, the project’s scope, and other contract terms.


[5]   Knowles is a former employee and former owner of ASI. Knowles began his

      employment with ASI in 1994 as an hourly construction inspector, working his

      way up the ranks in the company, and in 2004 or 2005, Knowles was promoted

      to Vice President of Sales Administration. Knowles held this position until he

      resigned from ASI in May 2014. Among other responsibilities, Knowles was




      outstanding advocacy. We also thank the students for their insightful questions and comments posed after,
      but not specifically related to, the oral argument.
      5
        With few exceptions not relevant to the determination of this appeal, Defendants do not appear to challenge
      the trial court’s findings of fact as being improper or unsupported by the evidence.
      6
       As public entities do not exclusively contract with any company for engineering services, ASI and HWC
      have as clients some of the same entities.

      Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                      Page 4 of 41
      responsible for overseeing ASI’s sales and was actively involved in the sales

      process, including “making the pitch” for clients to select ASI in the QBS

      process. HWC Appellants’ App. at 30.7 As part of his sales duties, Knowles was

      involved in building business relationships and goodwill on behalf of ASI.

      Knowles was the assigned “principal in charge” for many ASI clients, including

      Cicero, Delaware County, Fishers, Grant County, Greendale, Hamilton

      County, Hancock County, INDOT, LaGrange County, Lawrenceburg, Morgan

      County, Noblesville, Orange County, and Putnam County. Id. at 17, 71. To

      help obtain business for ASI and to build relationships with clients, Knowles

      attended business development activities, such as breakfasts, lunches, dinners,

      charitable functions, golf outings, trips, sporting events, industry conferences,

      networking events, receptions, and political functions. ASI paid for his

      attendance at these activities.


[6]   In 2008, Knowles was offered and accepted ownership in ASI. On December

      29, 2008, Knowles and ASI entered into an Employment, Non-Disclosure and

      Non-Competition Agreement (“the Knowles Agreement”), which contained

      non-competition and non-solicitation restrictive covenants, whereby Knowles

      agreed to not do the following, directly or indirectly:

                 (1) sell, provide, attempt to sell or provide, or assist any person or
                 entity in the sale or provision of, any Competing




      7
          We will refer to the appendix filed by Defendants in their appeal as HWC Appellants’ App.


      Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                      Page 5 of 41
               Products/Services to any of the Company’s Customers or Active
               Prospects;


               (2) solicit or communicate with any such customers for the
               purpose of selling, providing, attempting to sell or provide, or
               assisting any person or entity in the sale or provision of, any
               Competing Products/Services; and


               (3) solicit, recruit, hire, employ, attempt to hire or employ, or
               assist any person or entity in the recruitment or hiring of any
               person who is an employee of ASI, or otherwise urge, induce or
               seek to induce any person to terminate his/her employment with
               ASI.


      Id. at 135-37; Joint Ex. 235.


[7]   Like Knowles, Day and Lancet formerly worked at ASI. Each worked as a

      resident project representative. On Day’s first day of employment at ASI,

      January 3, 2005, he signed a “Terms and Conditions of Employment”

      agreement with ASI (“the Day Agreement”), which included terms restricting

      him from soliciting or recruiting his former coworkers. Joint Ex. 8; HWC

      Appellants’ App. at 23. Lancet began working for ASI in 1998; later, in January

      2007, Lancet signed a “Terms and Conditions of Employment” agreement with

      ASI (“the Lancet Agreement”), which contained a non-solicitation provision

      identical to the one in the Day Agreement. Joint Ex. 234; HWC Appellants’ App.

      at 24.


[8]   Eventually, Knowles became unhappy at ASI, and in the winter of 2013 and

      spring of 2014, he met with the President of HWC, Ed Jolliffe (“Jolliffe”), and

      Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 6 of 41
       its Vice President, Terry Baker (“Baker”). At that time, HWC desired to make

       improvements to its transportation department, and it was familiar with

       Knowles because of his experience and reputation in the industry. Knowles

       told Jolliffe and Baker that he had an employment agreement with ASI and that

       he intended to abide by his contract. Jolliffe and Baker advised Knowles that

       HWC would position Knowles in an operations role at HWC to comply with

       the restrictive covenants in the Knowles Agreement.


[9]    On May 5, 2014, Knowles submitted a resignation letter to ASI, and in it, he

       stated that he would comply with the Knowles Agreement. Joint Ex. 90; HWC

       Appellants’ App. at 26. The letter did not mention that Knowles was joining

       HWC as its Vice President of Operations. On May 7, ASI’s President Rick

       Conner circulated an announcement to ASI employees that Knowles had

       resigned. Knowles’s last day at ASI was May 14, 2014. On May 19, 2014,

       HWC issued a press release announcing Knowles had joined HWC, and it

       circulated the press release to, among others, people and entities Knowles had

       identified on a list of “Key Clients.” Joint Exs. 44, 48, 52; HWC Appellants’ App.

       at 84.


[10]   As HWC’s Vice President of Operations, Knowles headed up four divisions,

       including HWC’s transportation division. After starting at HWC, Knowles

       began performing what HWC describes as contract-based activity, which

       included reviewing fees and verbiage in contracts and tracking down signatures

       for contracts. Knowles also continued to interact with HWC contacts who

       were also clients or prospective clients of ASI. Such interactions included going

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 7 of 41
       on fishing trips, playing poker, golfing, attending political and not-for-profit

       fundraisers, and seeing these friends and colleagues at various events and

       sharing family updates with them. At that time, the head of HWC’s

       transportation division was Randy Hancock (“Hancock”), and Hancock

       reported directly to Knowles. Hancock was not provided a copy of the

       Knowles Agreement and was not told what Knowles’s restrictions were, such as

       what clients were off-limits to Knowles. Jolliffe never read the Knowles

       Agreement and never had a complete list of Knowles’s clients at ASI.


[11]   In the months that followed Knowles’s May 2014 departure from ASI, a

       number of other ASI employees also left ASI and went to work for HWC.

       Initially, two days after HWC’s May 19 press release about Knowles joining

       HWC, ASI project-manager Clint Sparks (“Sparks”) sent an email, from his

       home account, to Knowles, indicating that he was planning to submit a resume

       to HWC and that “my story will be I am retiring and building a home in

       southern Indiana[.]” Joint Ex. 92; HWC Appellants’ App. at 45. Sparks noted

       “This is sent from my home email so we ought to be OK” and “Cell and this

       email should be safe for both of us[.]” Joint Ex. 92. On June 12, 2014, Sparks

       submitted his resume to HWC. Jolliffe and Hancock discussed Sparks’s

       qualifications with Knowles, and on July 13, HWC made a written offer to

       Sparks, which he accepted on July 17, 2014. Sparks thereafter resigned from

       ASI and told ASI that he was retiring; Sparks began working at HWC on

       August 11, 2014.




       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 8 of 41
[12]   Also shortly after Knowles left, Day visited HWC’s website, saw job openings

       for construction inspectors and, on June 24, 2014, submitted a resume to HWC.

       That same day, Knowles met with Lancet at a restaurant. Thereafter, Joliffe

       contacted and interviewed Lancet, telling Lancet that, in the spring of 2015,

       HWC would have positions to fill for resident project representatives and

       construction inspectors. On August 11, 2014, Lancet submitted a resume to

       HWC.


[13]   In August 2014, Day resigned from ASI and joined HWC. ASI did not remind

       Day at his exit interview that he had signed the Day Agreement, and Day testified

       that when he left ASI and joined HWC, he did not remember that he had signed

       the Day Agreement and was unaware that he was subject to a non-solicitation

       agreement. HWC Appellants’ App. at 49; Tr. at 770, 781. Shortly after joining

       HWC, Day prepared a list of various employees at ASI that he thought may be

       interested in joining HWC, which he called “HWC Potential Employees.” Joint

       Ex. 9; HWC Appellants’ App. at 56, 58. Day sent the list to Knowles in September

       2014. The Potential Employees list identified ten potential employees, nine of

       whom were then-current ASI employees. Day called various employees at ASI

       to gauge their interest in joining HWC and forwarded their applications to

       HWC’s management. Day had some discussions with Knowles about ASI

       employees who might be interested in joining HWC.


[14]   In or around this same time, Sparks, who was then employed at HWC,

       contacted Lancet, who was still at ASI, about HWC’s design engineering needs

       and requested names of anybody at ASI who was unhappy or that would be a

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 9 of 41
       potential candidate for HWC. In August or September 2014, and in response to

       Sparks’s inquiry, Lancet provided Sparks with the names of several ASI

       employees, including Amber Tolle (“Tolle”). Sparks stated to Lancet in a

       September 10, 2014 text message, “Keep hitting delete because if the sharks

       smell blood - who knows!” Joint Ex. 112; HWC Appellants’ App. at 53.


[15]   In September, Tolle submitted a resume to HWC. On September 28, Sparks

       wrote an email to Knowles and Hancock about the fact that Tolle had

       submitted a resume to HWC, but Sparks inadvertently sent the email to

       Knowles’s old ASI email address, which ASI was monitoring in order to

       respond to clients. ASI thus learned of Sparks’s and Knowles’s involvement in

       Tolle’s application to HWC.


[16]   In late October 2014, Knowles created a document that he saved as “Recruiting

       List,” which listed eleven potential recruits for HWC’s transportation division,

       eight of whom were ASI employees. Joint Ex. 98; HWC Appellants’ App. at 59-

       60. Later, on November 13, 2014, Knowles, Day, and Hancock met and

       discussed HWC’s potential candidates and upcoming needs, using a

       handwritten list that Knowles had made. Joint Ex. 17. The handwritten list

       contained a list of fifteen “Candidates,” eleven of whom were then-ASI

       employees. Id. In November, Knowles emailed the handwritten list to

       Hancock and Day.


[17]   In late November and December, several other ASI employees, some of whom

       met with Day at Day’s home, submitted their respective resumes to HWC,


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 10 of 41
       including Mobley. After receiving a job offer from HWC, Mobley discussed

       HWC employment with ASI employee Tim Conarroe (“Conarroe”), telling

       him that he should submit a resume, but not to do so on an ASI computer.

       Conarroe was not interested, and he reported Mobley’s conversation to ASI

       management.


[18]   Having received reports and other evidence concerning recruitment of its

       employees by HWC, ASI began an internal investigation in early 2015

       consisting, at least in part, of conducting interviews with ASI employees and

       meetings with ASI attorneys. ASI discovered that HWC had made offers of

       employment to six of its construction inspectors, including Lancet, Mobley, and

       Tolle. In February 2015, Lancet and Mobley each received and accepted a

       verbal offer of employment from HWC, and on March 6, 2015, ASI terminated

       Lancet and Mobley. In March 2015, several other employees, including Tolle,

       accepted HWC’s offer of employment and resigned from ASI.


                                               Procedural History

[19]   On March 6, 2015, ASI filed a verified complaint for injunctive relief and

       damages, alleging claims against HWC, Knowles, Day, Lancet, and Mobley for

       breach of contract, breach of the fiduciary duty of loyalty, unfair competition,

       civil conspiracy, tortious interference with contract and business relationships,

       and unjust enrichment. HWC Appellants’ App. at 109-59. Following some

       extensions of time for the parties to conduct discovery, ASI moved on July 2,

       2015 for a preliminary injunction to enjoin Defendants from directly or

       indirectly communicating with or serving ASI’s former, current, or prospective
       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 11 of 41
       customers in violation of the Knowles Agreement, and to prohibit Defendants

       from directly or indirectly communicating with, soliciting, or recruiting ASI

       employees in violation of the Knowles, Day, and Lancet Agreements. Id. at

       176-78. A three-day evidentiary hearing was held on September 29, 30, and

       October 1, 2015, at which evidence was submitted and witnesses testified. 8 The

       parties thereafter submitted proposed Findings of Fact and Conclusions of Law.


[20]   On December 11, 2015, the trial court issued Findings of Facts, Conclusions of

       Law, and Order Granting in Part the Plaintiff’s Motion for Preliminary

       Injunction against HWC, Knowles, Day, and Lancet.9 Id. at 12-100. The trial

       court denied ASI’s request for an injunction against Mobley. 10


[21]   With regard to the non-compete provisions of the Knowles Agreement, the trial

       court found: (1) ASI has a legitimate and protectable interest in its customers,

       in the “good will” that Knowles was hired to generate between ASI and its

       customers, and in its “need to start again on building personal relationships”

       after Knowles left ASI; (2) these interests may be protected by the non-compete

       provisions of the Knowles Agreement, which was enforceable because it was

       narrowly tailored and reasonable with respect to time, activity, and geography;

       and (3) ASI established a reasonable likelihood of success of proving Knowles



       8
        ASI indicates that “[s]eventeen witnesses testified . . . and over 160 exhibits were admitted.” ASI Appellee’s
       Br. at 3. Admitted evidence included deposition designations, documents, affidavits, and live testimony.
       9
         The trial court’s extensive and thorough Findings and Conclusions, 89 pages in length, aided our appellate
       review.
       10
            Mobley did not have an employment agreement with ASI.


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                        Page 12 of 41
       breached the non-compete provisions of the Knowles Agreement. HWC

       Appellants’ App. at 67-99. The trial court also held that ASI established a

       reasonable likelihood of success of proving at trial that Knowles, Day, and

       Lancet breached the non-solicitation provisions contained in their respective

       Agreements. Id. With regard to HWC, the trial court determined that ASI had

       established a reasonable likelihood of success of proving at trial that “HWC

       worked with Knowles to violate his [noncompetition] agreement” and that

       “HWC[] and Knowles intentionally worked together to hire multiple ASI

       employees.”11 Id. at 90-91.


[22]   Defendants filed a motion to modify and clarify the injunction order, seeking

       clarification of the scope of the operations duties that Knowles could or could

       not perform at HWC, and the trial court, following a hearing, issued, on

       January 25, 2016, Amended Findings of Fact, Conclusions of Law, and Order

       (“Amended Order”). The Amended Order incorporated the trial court’s

       December 2015 Findings and Conclusions and clarified that Knowles could

       continue to serve in an operations role at HWC.12 However, Knowles was

       preliminarily enjoined from (1) directly or indirectly selling, providing,

       attempting to sell or provide, or assisting any person or entity in the sale or




       11
          HWC notes that the injunction prohibits Knowles, Day, and Lancet from “acting in concert or conspiracy
       with” any other person or entity, including but not limited to HWC “to commit the acts prohibited” by the
       injunction, and, therefore, HWC’s position “is really derivative of the limitations imposed on Knowles, Day,
       and Lancet.” HWC Appellants’ Br. at 3 n.1.
       12
         The Amended Order included a non-exhaustive list of operations functions to illustrate the types of tasks
       that Knowles could perform that would not violate the non-compete. HWC Appellants’ App. at 105-06.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                      Page 13 of 41
       provision of, any Competing Products/Services to any of the Company’s

       Customers or Company’s Active Prospects;13 (2) soliciting or communicating

       with any such customers for the purpose of selling, providing, attempting to sell

       or provide, or assisting any person or entity in the sale or provision of, any

       Competing Products/Services; and (3) soliciting, recruiting, hiring, employing,

       attempting to hire or employ, or assisting any person or entity in the

       recruitment or hiring of any person who is an employee of ASI, or otherwise

       urging, inducing or seeking to induce any person to terminate his/her

       employment with ASI. HWC Appellants’ App. at 101-08.


[23]   With regard to Day and Lancet, the Amended Order preliminarily enjoined

       them from soliciting or endeavoring to entice away, knowingly offering

       employment to, knowingly employing, or offering or concluding any contract

       for services with any person who was employed by ASI as of the date that

       Day’s and Lancet’s employment with ASI ceased. Id. The Amended Order

       also prohibited Knowles, Day, and Lancet from acting in concert or conspiracy

       with any other person, including but not limited to HWC, to commit any acts

       prohibited by the Amended Order. Id.


[24]   In April 2016, Knowles filed a motion asking the trial court to partially dissolve

       the preliminary injunction on May 14, 2016, arguing that the 24-month




       13
         The terms “Competing Products/Services,” “Company’s Customer” and “Active Prospects” are not in
       dispute and are defined in the Knowles Agreement and the trial court’s Amended Order. HWC App. at 103-
       04, 135-36.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                 Page 14 of 41
       restriction in the Knowles Agreement began to run on May 14, 2014 and would

       expire on May 14, 2016. ASI responded that the express terms of the Knowles

       Agreement provided for an extension and also asserted that the doctrine of

       equitable estoppel should apply to prevent Knowles’s attempt to dissolve the

       injunction because Knowles should not benefit from his violation of the

       restrictions. The trial court held a hearing on May 16, 2016, and on May 20,

       2016, it granted the motion and dissolved the injunction as to Knowles and his

       non-compete, finding that (1) Indiana law precluded the enforcement of

       agreements to extend the duration of non-compete provisions when a

       preliminary injunction had been entered, and (2) ASI failed to satisfy the

       elements of equitable estoppel.14 Thereafter, ASI filed its appeal, which this

       court consolidated with Defendants’ earlier-filed appeal.


                                          Discussion and Decision

                                              Standard of Review
[25]   In order to obtain a preliminary injunction, ASI had the burden of

       demonstrating by a preponderance of the evidence: (1) a reasonable likelihood

       of success on the merits at trial; (2) the remedies at law are inadequate and that




       14
          Defendants note that, although the injunction enjoining Knowles has been dissolved, as of May 2016,
       Knowles’s appeal is not moot because the merits of his claims -- that the trial court improperly interpreted the
       Knowles Agreement and relied on speculative harm to support an injunction -- are matters of public interest
       and capable of repetition, and further, to the extent that a trial is held in this matter, a correct interpretation
       of the Knowles Agreement is critical for the preparation of jury instructions. HWC Reply Br. at 6 n.1.
       Moreover, Defendants observe, ASI is appealing the order dissolving the injunction. Id. We agree and
       proceed to address the issues raised by both parties on their merits.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                           Page 15 of 41
       irreparable harm will occur during the pendency of the action; (3) the

       threatened injury to ASI outweighs the potential harm to HWC, Knowles, Day,

       and Lancet from the granting of an injunction; and (4) the public interest would

       not be disserved by granting the injunction. Cent. Ind. Podiatry, RC. v. Krueger,

       882 N.E.2d 723, 727 (Ind. 2008); Gleeson v. Preferred Sourcing, LLC, 883 N.E.2d

       164, 172 (Ind. Ct. App. 2008).


[26]   To establish a party has a reasonable likelihood of success on the merits, the

       party must establish a prima facie case. Apple Glen Crossing, LLC v. Trademark

       Retail, Inc., 784 N.E.2d 484, 487 (Ind. 2003); Pinnacle Healthcare, LLC v. Sheets,

       17 N.E.3d 947, 953 (Ind. Ct. App. 2014). “The party is not required to show

       that he is entitled to relief as a matter of law, nor is he required to prove and

       plead a case, which would entitle him to relief upon the merits.” Avemco Ins.

       Co. v. State ex rel. McCarty, 812 N.E.2d 108, 118 (Ind. Ct. App. 2004).


[27]   “The grant or denial of a preliminary injunction is within the sound discretion

       of the trial court, and the scope of appellate review is limited to deciding

       whether there has been a clear abuse of discretion.” Gleeson, 883 N.E.2d at 171-

       72. When considering whether a trial court’s grant of a party’s motion for a

       preliminary injunction constitutes an abuse of discretion, this court determines

       whether the evidence supports the trial court’s special findings of fact and

       whether the findings support the judgment. Clark’s Sales & Serv., Inc. v. Smith, 4

       N.E.3d 772, 780 (Ind. Ct. App. 2014), trans. denied. This court should not

       disturb the findings or judgment unless they are clearly erroneous, nor should

       the court reweigh the evidence or reassess witness credibility. Id. Rather, the

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 16 of 41
       court should consider only the evidence favorable to the judgment and all

       reasonable inferences to be drawn therefrom. Id. We will reverse the trial

       court’s judgment only when it is clearly erroneous, and a judgment is clearly

       erroneous when a review of the record leaves us with a firm conviction that a

       mistake has been made. Gleeson, 883 N.E.2d at 172.


                          I. Knowles’s Non-Compete Agreement
[28]   There is no dispute that Knowles validly executed the Knowles Agreement,

       Section 9(a) of which contained the following non-competition covenants:


               During the Restricted Time Period, Employee will not sell,
               provide, attempt to sell or provide, or assist any person or
               entity in the sale or provision of, any Competing
               Products/Services to any of the Company’s Customers15 with
               respect to whom at any time during the twenty-four (24) months
               immediately preceding the termination of Employee’s
               employment with the Company, Employee had any sales or



       15
          The Agreement defined “Company’s Customers” as “any person or entity to whom Company sold or
       provided any products and/or services at any time during the twenty-four (24) months immediately
       preceding the termination of Employee’s employment with the Company.” HWC Appellants’ App. at 136.
       Section 9(d) of the Knowles Agreement extended the prohibitions of Section 9(a) to encompass the
       “Company’s Active Prospects,” defined as:

               (i) any person or entity that Employee, on behalf of the Company, solicited, assisted in
               the solicitation of, or engaged in marketing or sales towards, at any time during the
               twelve (12) months immediately preceding the termination of Employee’s employment
               with the Company; and/or (ii) any person or entity to whom the Company submitted a
               proposal or quote for the sale or provision of the Company’s products/services at any
               time during the twelve (12) months immediately preceding the termination of Employee’s
               employment with the Company.


       Id.



       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                   Page 17 of 41
        service contact on behalf of the Company, Employee had any
        business contact on behalf of the Company, Employee had any
        sales or service responsibility (including without limitation any
        supervisory or managerial responsibility) on behalf of the
        Company, Employee had any project responsibility on behalf of
        the Company, or Employee had access to, or gained knowledge
        of, any Confidential Information concerning the Company’s
        business with such customer, or otherwise solicit or
        communicate with any such customers for the purpose of
        selling, providing, attempting to sell or provide, or assisting
        any person or entity in the sale or provision of, any Competing
        Products/Services. . . .


        “Restricted Time Period” means the period of Employee’s
        employment with the Company and for twenty-four (24) months
        immediately after the termination of Employee’s employment
        with the Company regardless the reason for such termination.


Joint Ex. 235 (emphasis and paragraph separation added); HWC Appellants’ App.

at 135-36. Section 9(h) prohibited Knowles from violating the covenants

directly or indirectly:


        Employee acknowledges and agrees that the covenants contained
        in this Section 9 prohibit Employee from engaging in certain
        activities directly or indirectly whether on Employee’s own
        behalf or on the behalf of any other person or entity, and
        regardless [of] the capacity in which Employee is acting,
        including without limitation as an employee, independent
        contractor or owner.


Id. (emphasis added). In the Knowles Agreement, Knowles agreed that the

restrictions imposed were reasonable and necessary for the protection of ASI’s



Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 18 of 41
       legitimate interests, including business relationships and goodwill, and would

       not post any substantial hardship on him.16 Id. at § 12.


[29]   In its Findings and Conclusions issuing the injunction on Knowles’s non-

       compete, the trial court addressed the four-part test for a preliminary injunction

       and determined: (1) ASI established a reasonable likelihood of success on the

       merits of its breach of contract count against Knowles, Day, and Lancet; (2)

       ASI’s remedies at law are inadequate and that ASI established irreparable

       harm, noting that “the irreparable harm requirement ‘does not mandate that the

       party demonstrate specific losses in its business’” and that the evidence showed

       that, as a result of Knowles’s violation, there could be harm in the future to

       ASI, including loss of goodwill and a need to rebuild relationships and trust; (3)

       the threatened injury to ASI outweighed the potential harm to HWC, stating,

       “The threatened injury to ASI is great,” such as an erosion of ASI’s “pipeline of

       business,” while the potential harm to Defendants is “not large,” noting

       Defendants did not present evidence to show any harm “if the court enforces

       the agreements prior to trial[;]” and (4) it would not disserve the public interest

       to enforce the non-competition (and non-solicitation) provisions, observing that

       ASI’s requested injunctive relief would not prevent HWC from competing with




       16
          Knowles also agreed that a breach or threatened breach of Section 9 would give rise to irreparable injury to
       ASI, that money damages would not be adequate relief for such injury, and that ASI shall be entitled to
       obtain equitable relief and injunctive relief, including a preliminary injunction. HWC Appellants’ App. at 138
       (§ 11(a)). Although the Knowles Agreement contained a liquidated damages provision, id. at 138-39, the
       parties advised at oral argument that the trial court had determined that the liquidated damages provision
       constituted a penalty and was unenforceable.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                       Page 19 of 41
       ASI, “just as it had prior to Knowles joining it.” HWC Appellants’ App. at 67-97

       (Conclusion Nos. 4, 100, 102, 105, 109, 111, 113, 115, 117).


                                             A. Irreparable Harm

[30]   In challenging the trial court’s entry of the injunction, Defendants initially assert

       that ASI did not make a showing of irreparable harm and did not show that its

       remedies at law were inadequate. They argue, “There is no evidence of actual

       harm from Knowles[’s] actions while employed at HWC with respect to ASI

       clients. . . . No witness could identify any lost business or any specific projects

       that ASI was at risk of losing.” HWC Appellants’ Br. at 6. Defendants maintain

       that, at best, ASI was able to point only to possible lost work in the future due to

       Knowles’s interactions with friends and business contacts, which is too

       speculative and not sufficient to meet the standard for showing a threat of

       imminent harm required for a preliminary injunction, and, accordingly, entry of

       a preliminary injunction was an abuse of discretion.


[31]   However, to obtain a preliminary injunction, our courts have recognized that

       “irreparable harm is that harm which cannot be compensated for through

       damages upon resolution of the underlying action.” Coates v. Heat Wagons, Inc.,

       942 N.E.2d 905, 912 (Ind. 2011). The irreparable harm requirement “does not

       mandate that the party demonstrate specific losses in its business.” AGS Capital

       Corp., Inc. v. Prod. Action Int’l, LLC, 884 N.E.2d 294, 312 (Ind. Ct. App. 2008),

       trans. denied. In this case, ASI presented evidence that Knowles, while at HWC,

       was engaged in substantive work with individuals and entities that were ASI

       clients – work that HWC characterized as operations and contract-type work, not
       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 20 of 41
       sales – and he participated in client development activities with individuals and

       entities that were ASI clients. HWC Appellants’ App. at 33-35, 39-42. ASI

       President Conner described Knowles’s activities at HWC as “diverting” the

       “pipeline” of business opportunities. Id. at 35-36; Tr. at 31. The trial court

       determined that harm, whether current or future, to ASI’s business, goodwill,

       and the trust and personal relationships developed with accounts and entities was

       “necessarily intangible[,]” but “the fact that it cannot be quantified in a dollar

       amount is an argument in favor of equitable relief[.]” HWC Appellants’ App. at

       92. We cannot say that the trial court’s decision, finding that Knowles’s actions

       damaged ASI’s goodwill and posed a present and imminent threat to future

       business, was an abuse of discretion.


                                               B. Prohibited Conduct

[32]   Defendants next argue that the trial court failed to strictly interpret the Knowles

       Agreement, in particular the restricted activity.17 Defendants assert that “the

       restriction on selling competing services must be tied to specific projects or sales

       pursuits,” but instead the trial court “expansively” determined the non-compete

       language to preclude him from “communicat[ing] with ASI clients . . . for the



       17
          With regard to the restriction on “activity,” Defendants note that Knowles’s job, while at ASI, “was to
       administer the sales process,” and he did not perform engineering services for ASI, and because he did not do
       so, any restriction on his ability to provide such services to HWC’s clients cannot be enforceable under
       Indiana law. HWC Reply Br. at 7 n.2 (citing Cent. Ind. Podiatry, RC. v. Krueger, 882 N.E.2d 723, 730-31 (Ind.
       2008) and Clark’s Sales & Serv., Inc. v. Smith, 4 N.E.3d 772, 782 (Ind. Ct. App. 2014) (“a covenant that restricts
       the employee from competing with portions of the business with which he was never associated is invalid”),
       trans. denied.) ASI does not appear to be attempting to enforce any limitation on Knowles’s provision to
       HWC of engineering services or any other type of services that he did not do at ASI.



       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                          Page 21 of 41
       purpose of building a relationship and trust to obtain business for . . . HWC.”

       HWC Appellants’ Br. at 20-22. This reading, Defendants maintain, has the effect

       of “rendering Knowles a leper to any clients he dealt with at ASI and interfering

       with his constitutional rights of association” and constitutes an abuse of

       discretion. Id. at 22.


[33]   Indeed, Indiana courts have recognized that non-competition agreements or

       covenants not to compete are “in restraint of trade and not favored by the law”;

       however, they are enforceable if they are reasonable. Cent. Ind. Podiatry, 882

       N.E.2d at 729. To be reasonable, an agreement containing such a covenant (1)

       must protect legitimate interests of the employer; and (2) the restrictions

       established by the agreement must be reasonable in scope as to time, activity,

       and geographic area.18 Coates, 942 N.E.2d at 913. An appellate court reviews a

       trial court’s interpretation of restrictive covenants de novo. Cent. Ind. Podiatry,

       882 N.E.2d at 729.


[34]   Here, it is undisputed that, after joining HWC, Knowles continued to have

       interactions with ASI’s clients. Those fell into two basic categories: (1) those

       that ASI views as business development, including such things as fishing trips,

       poker games, golf outings, and not-for-profit fundraisers, and various social,

       industry, and political events with ASI clients; (2) those that were part of his job




       18
          Defendants focus the limitations on activity and do not challenge the geographic or time limitations
       imposed by the Knowles Agreement, other than the challenge to the extension provision, as addressed later
       in this decision.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                    Page 22 of 41
       in HWC’s operations division and were connected to the contract-type work that

       he did, which occurred after HWC had been selected as the engineering firm on

       a project, but before the contract was negotiated and signed.


[35]   With regard to the first category of interactions, involving attendance at such

       activities as industry, social, fundraising, and political functions, Knowles did not

       view his activities with these individuals to be in violation of the Knowles

       Agreement, testifying that because they were not connected to particular sales,

       and he did not seek to secure work from these contacts, they were not restricted

       activities. He explained that his attendance and involvement was not intended

       to secure work and was only to “build friendships.” HWC Appellants’ Br. at 4;

       HWC Appellants’ App. at 76; Tr. at 632. Defendants also submitted testimony

       from ASI clients, who stated that Knowles informed them of his contractual

       objections and that he was not soliciting business from them.


[36]   The trial court rejected Defendants’ suggestion that Knowles’s contacts with

       individuals at outside activities such as fishing, poker, social gatherings and not-

       for-profit activities were only in furtherance of friendships, relying in part on the

       testimony of Kenton Moore (“Moore”), ASI’s Vice President of Field Sales, who

       worked closely with Knowles at ASI. Moore described that it is necessary to

       develop trust and relationships with clients and potential clients, and to that end,

       ASI’s (and HWC’s) sales teams get to know and spend time with clients,

       prospective clients, and their families. HWC Appellants’ App. at 16; Tr. at 354,

       358-62.      Some examples include meeting for breakfasts, lunches, dinners,

       charitable functions, golf outings, trips, sporting events, conferences, networking

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 23 of 41
events, receptions, and political functions. All of these activities are paid for by

the employer (here, ASI or HWC) because the activities build trust and goodwill.

By building trust with clients and prospective clients, it is ASI’s and HWC’s goal

to obtain future projects. The trial court’s determination on the issue was based

to a large extent on its assessment of the credibility of the witnesses. The trial

court addressed this credibility aspect:


        With respect to ASI, Knowles testified that [] client development
        activities were designed to build relationships, trust, and goodwill
        for ASI.


        The purpose of Knowles’ activities on behalf of HWC is exactly
        the same: to build and maintain relationships and goodwill, with
        the goal of eventually obtaining work for HWC. The Knowles
        Agreement prohibits him from doing these activities with his
        former ASI clients.


        ....


        The court does not find it believable or reasonable that
        Knowles was not selling, trying to seek future projects, or was
        not trying to build a relationship of trust and confidence in him
        and his company, HWC.


HWC Appellants’ App. at 74, 77 (emphasis added). The trial court determined

that Knowles’s attendance at and participation in those types of activities,

which were generally paid for by HWC, were to preserve his relationships with

these clients and to maintain and develop goodwill and that, given the QBS

selection process of the engineering industry, the personal relationships and


Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 24 of 41
       trust developed through years of contact and goodwill “are often determinative

       factors as to which engineering firm is selected for a project.” Id. at 71, 74. The

       trial court was within its discretion in finding that engaging in such activities

       was for the purpose of selling, directly or indirectly, in violation of the Knowles

       Agreement.


[37]   With regard to the other category of contacts with ASI clients, which involve

       Knowles’s job responsibilities, Defendants note that Knowles’s job at HWC was

       in the operations department, and not in sales, where he was at ASI. HWC Reply

       Br. at 14. Defendants further seek to distinguish what Knowles did at ASI versus

       what he did at HWC:


               While he was at ASI, Knowles was actively involved in making
               the pitch for clients to select ASI pursuant to the QBS process. . .
               . In contrast, at HWC, Knowles[’s] role in new contracts is
               limited to reviewing fees, reviewing verbiage in contracts, and
               tracking down signatures for contracts—all of which comes after
               HWC has been selected by a client and which is internal within
               HWC.


       HWC Appellants’ Br. at 5; HWC Reply Br. at 7. Succinctly put, Defendants’

       position is that once the engineering firm has been selected, the “sale” has

       occurred (is complete), and, therefore, Knowles’s subsequent contacts with the

       client, during which the fees and project’s scope are discussed and determined,

       are not part of the sales process and do not violate his non-compete.


[38]   The trial court rejected this argument, again relying in part on the testimony of

       Moore, who explained that the sales cycle in the public engineering industry is

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 25 of 41
       lengthy and continuous; each of the many points of contact and connections with

       a client or prospective client before, during, and after the selection process are

       part of a company’s efforts to gain and retain business. Moore stated that the

       project is not “a win” until after negotiations and the contract is signed. ASI Ex.

       244; Tr. at 376.


[39]   Contrary to Defendants’ suggestion that the trial court’s reading of the restrictive

       covenants was overbroad and unenforceable because it effectively precludes him

       from working at HWC in any capacity, Knowles can work with HWC clients in

       the same or similar manner in which he was employed at ASI, provided the

       clients are not clients he recently worked with at ASI. Nor does the non-compete

       restrict him from working in internal operations, including, as ASI suggests

       “performance management, human resources, recruitment of non-ASI

       employees, and company growth initiatives.” HWC Appellants’ App. at 105-06.

       It was the negotiation of contracts with ASI clients, after HWC had been awarded

       the bid but before contract was signed, that the trial court interpreted as violative

       of the Knowles Agreement. Id. at 106.


[40]   On appeal, we are not to disturb a trial court’s findings or judgment unless they

       are clearly erroneous, nor should we reweigh the evidence or reassess witness

       credibility. Clark’s Sales & Serv., 4 N.E.3d at 780. Rather, we are to consider only

       the evidence favorable to the judgment and all reasonable inferences therefrom.

       Id.    Given this standard of review, we cannot say that the trial court’s

       interpretation of the terms of the non-compete was improper. Its findings and

       conclusions were not clearly erroneous.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 26 of 41
                                                    C. Laches

[41]   Defendants argued to the trial court that ASI waited an unreasonably long period

       of time before filing its lawsuit and seeking injunctive relief, and, based on this

       delay, Defendants asked the trial court to apply the doctrine of laches to preclude

       ASI from enforcing the Knowles Agreement. The equitable doctrine of laches

       contains three elements: (1) inexcusable delay in asserting a known right; (2) an

       implied waiver arising from knowing acquiescence in existing conditions; and (3)

       a change in circumstances causing prejudice to the adverse party. Gleeson, 883

       N.E.2d at 179-80. “Laches does not turn on time alone. . . . Unreasonable delay

       causing prejudice or injury is necessary.” Id. at 180. Prejudice may be created if

       a party, with knowledge of the relevant facts, permits the passing of time to work

       a change of circumstances by the other party. Id. The question of laches is one

       to be determined by the court in the exercise of its sound discretion. Ind. Real

       Estate Comm’n v. Ackman, 766 N.E.2d 1269, 1273 (Ind. Ct. App. 2002). For a

       decision to be reversed on appeal, an abuse of discretion must be clearly

       demonstrated. Id.


[42]   Defendants argue that ASI was aware of Knowles’s new position at HWC when

       he left ASI in May 2014 and was aware that, during the summer and fall of 2014,

       Knowles had some social interaction, such as golfing, fishing, and fundraiser

       events, with ASI clients, yet ASI did not take any action against Knowles until

       ten months later when it filed suit on March 6, 2015. The trial court rejected the

       laches argument, finding that the delay was reasonable, and we agree.



       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 27 of 41
[43]   The record reveals that, almost immediately after Knowles’s departure, ASI

       knew that Knowles took the position with HWC. ASI was aware of three or four

       instances in the summer and fall of 2014 where Knowles was observed interacting

       at social, political, or networking events with individuals who were at that time

       ASI clients. ASI did not deem that any action was necessary. However, later in

       2014 and into early 2015, after information “slowly trickled in,” ASI began to

       learn of the activities and communications occurring between HWC and ASI

       employees, and in early 2015, ASI launched an internal investigation, which

       further revealed to ASI that HWC, through the actions of Knowles, Day, and

       Lancet, among others, was “recruiting ASI’s employees.” ASI Appellee’s Br. at

       41, 45. In March 2015, ASI filed its lawsuit. While the better practice may have

       been for ASI to contact Knowles, Day, and Lancet, voice objection to those

       activities of which ASI was aware, and request that they cease from the activities,

       we cannot say that ASI’s decision to internally investigate and consult with

       counsel before filing suit constituted an unreasonable delay. Furthermore, even

       if the delay was considered unreasonable, Defendants have failed to show that

       they were prejudiced by any such delay, arguing only that ASI’s delay “worked

       a change in Knowles’[s] circumstances” because “Knowles settled into his new

       job and started to build a life at HWC.” HWC Appellants’ Br. at 29. This general

       statement does not identify prejudice. The trial court did not abuse its discretion

       when it rejected Defendants’ claim that a ten-month delay in filing suit and

       fourteen-month delay in seeking injunctive relief constituted laches.




       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 28 of 41
                  II. Enforcement of Non-Solicitation Agreements
[44]   Section 9(e) of the Knowles Agreement restricted him and his future employer

       as follows:

               During the Restricted Time Period, Employee will not solicit,
               recruit, hire, employ, attempt to hire or employ, or assist any
               person or entity in the recruitment or hiring of, any person who is
               an employee of the Company, or otherwise urge, induce or seek
               to induce any person to terminate his/her employment with the
               Company.


       Joint Ex. 235. Under Section 9(h) Knowles was prohibited from doing so

       directly or indirectly. Id. The Lancet Agreement19 provided that while Lancet

       was employed by ASI and for a period of two years after his employment with

       ASI concluded, Lancet would not

               solicit or endeavor to entice away, provide information to others
               purposely with the intent of helping them solicit or entice away,
               knowingly offer employment to, knowingly employ, or offer or
               conclude any contract for services with, any person who is
               employed by [ASI] at the date your employment with [ASI]
               ceases.


       Joint Ex. 234. The Day Agreement contained a non-solicitation provision

       identical to the Lancet Agreement. Joint Ex. 8.




       19
         Previous to signing the Lancet Agreement in January 2007, Lancet had signed in April 2004 an
       Employment Agreement, which included non-solicitation and non-competition provisions. Joint Ex. 144.
       The 2007 Lancet Agreement set forth the Terms and Conditions of his then-current employment, as well as a
       non-solicitation provision. Joint Ex. 234.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                  Page 29 of 41
[45]   Following the hearing, the trial court enjoined HWC, Knowles, Day, and

       Lancet as follows:


               Knowles, Day and Lancet shall not, directly or indirectly, have
               any communication with, solicit, recruit, hire, employ, attempt
               to hire or employ, or assist any person or entity (including but
               not limited to HWC) in the recruitment or hiring of any person
               who is an employee of ASI, or otherwise urge, induce or seek to
               induce any person to terminate his/her employment with ASI.


       HWC Appellants’ App. at 98-99.


[46]   In challenging the injunction, Defendants do not claim that the non-solicitation

       provision are unenforceable or that Defendants did not engage in the alleged

       solicitation or recruitment of ASI employees. Rather, they argue that there was

       no pending threat of recruiting activity, and thus no need for an injunction to

       enjoin it. That is, “any alleged recruiting activity was completed” by the time

       the lawsuit was filed in March 2015. HWC Appellants’ Br. at 17. Further,

       Defendants assert, there was no evidence that ASI “suffered any cognizable

       harm” from the loss of seven employees. Id. at 17.


[47]   The record reveals, however, that one of HWC’s primary objectives in hiring

       Knowles was to rebuild its transportation department, including recruiting and

       maintaining a better staff of employees. According to ASI, Knowles and HWC

       engaged “in a calculated scheme to raid ASI . . . of its employees and of its

       talent” and that Knowles and HWC, aware of the recruiting restrictions in the

       Knowles Agreement, “enlisted the help of Day and Lancet” to target at least

       eighteen ASI employees. ASI Appellee’s Br. at 21, 44. While Defendants urge
       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 30 of 41
       that any recruiting was complete by the time the complaint was filed, and

       would not happen anymore, there was no assurance of that. Indeed, when

       Knowles left ASI in May 2014, he expressed to ASI that he would abide by the

       Knowles Agreement, but near the end of 2014, ASI learned – through its

       employees and by receiving an email intended for Knowles at HWC – of the

       recruiting efforts. In issuing the injunction, the trial court expressly issued

       conclusions with regard to its credibility determinations. As to Lancet, the trial

       court stated:

               This Court finds that the following witnesses were not credible at
               all as they lied in previous testimony and or statements or/and
               they admitted they lied or they were deceptive to others
               purposefully: Lancet and Sparks. In addition, it was clear to the
               court after judging their (Lancet and Sparks) demeanor and
               content of their testimony that i[t] was not credible and should
               not be relied upon by this Court.


       HWC Appellants’ App. at 79. As to Day and Knowles, the trial court determined

       that their testimony “was not credible or believable in light of all the evidence.”

       Id. at 80. We do not reweigh evidence or assess witness credibility on appeal.

       Clark’s Sales & Serv., 4 N.E.3d at 780. Based on the record before us, the trial

       court was within its discretion to issue the injunction to prevent further

       recruitment, or the threat of it, by Knowles, Day, and Lancet.


[48]   Defendants also contend on appeal that the injunction was inappropriate, based

       on a lack of notice to Day and Lancet, since ASI did not give Day or Lancet a

       copy of their respective Agreements when either of them left ASI’s


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 31 of 41
       employment, nor did ASI remind either of them that they had signed such an

       Agreement, years prior and were bound by the non-solicitation provisions.20

       HWC Appellants’ Br. at 29-33. Their argument is grounded in equitable

       principles,21 i.e., “he who seeks equity, must do equity” and they argue that,

       here, “ASI’s affirmative choice not to provide notice should bar it from securing

       injunctive relief[.]” HWC Appellants’ Br. at 32; HWC Reply Br. at 26.


[49]   In this case, evidence was presented to support the trial court’s determinations

       that HWC through the efforts of Knowles, Day, and Lancet solicited or

       recruited, or assisted in the soliciting and recruiting of ASI employees. Lists of

       potential candidates were made and shared. Discussions were had, and

       interviews occurred, some at restaurants, homes, and through outside email

       servers. From this and other evidence, the trial court could make the

       reasonable inference that Knowles, Day, and Lancet knew that they were

       bound by non-solicitation restrictions. Furthermore, the trial court was




       20
         Defendants assert a lack-of-notice argument as to Day and Lancet only. See HWC Appellants’ Br. at 29-33.
       Thus, any argument that Knowles lacked notice of the non-solicitation aspect of the Knowles Agreement is
       waived. Ind. Appellate Rule 46(A)(8).
       21
          In their Appellants’ Brief, Defendants argued that “ASI had a duty to provide notice . . . of what those
       restraints were, and then prove that the restraints were reasonable. ASI did not.” HWC Appellants’ Br. at 31;
       see also id. at 29 (“This Court has not yet addressed whether an employer has an affirmative duty to provide a
       former employee with a copy of or a reminder notice of a restrictive covenant signed by the employee[,]” and
       “This case reveals why such a duty of notice should be required.”). In response, ASI argued that Indiana has
       not recognized a duty upon employers to either remind employees that they had signed a restrictive covenant
       or to provide them with a copy of it upon their departure. Defendants, in their Reply Brief, explain that they
       are not asking the court to recognize a new tort duty; rather, they are proposing that before an employer can
       secure injunctive relief through a trial court’s equitable powers, the employer must provide notice to the
       employee of the limitations of an existing restrictive covenant. HWC Reply Br. at 25 n.10. Thus, we do not
       make any duty analysis in our decision.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                      Page 32 of 41
       precluded from enforcing the provisions of the non-solicitation agreements

       through a preliminary injunction because Day and Lancet stated that they did

       not remember signing such documents. Indeed, the trial court expressly found

       that it did not deem them credible witnesses. The trial court did not abuse its

       discretion in issuing the injunction enjoining Defendants from violating the

       non-solicitation provisions of their respective Agreements.


                   III. Dissolution of the Injunction as to Knowles
[50]   In April 2016, Knowles filed a motion asking the trial court to dissolve the

       enforcement of the restrictive provisions of the Knowles Agreement, arguing

       that the 24-month restriction began when Knowles left ASI on May 14, 2014

       and it ended on May 14, 2016. The trial court agreed with Knowles and

       dissolved the injunction effective May 14, 2016. We review a trial court’s

       decision to dissolve or refuse to dissolve a preliminary injunction for an abuse

       of discretion. Gilmer v. Bd. of Comm’rs of Marshall Cnty., 428 N.E.2d 1318, 1319

       (Ind. Ct. App. 1981). “To the extent that the trial court was required to find

       facts with respect to what the proper length of the injunction should be,” we

       apply “the traditional deferential standard of review where facts have been

       found.” Oxford Fin. Grp. Ltd. v. Evans, 795 N.E.2d 1135, 1141-42 (Ind. Ct. App.

       2003). “To the extent the trial court’s decision turned on contract

       interpretation,” the standard of review is de novo. Id. at 1142.


[51]   Here, the Knowles Agreement contained a 24-month restriction, which began

       to run “from the time at which [Knowles] ceases to provide services to [ASI] in


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 33 of 41
       any manner whatsoever[.]” HWC Appellants’ App. at 135, 137. Section 9(i) of

       the Knowles Agreement contained the following extension clause in the case of

       a violation:

               In the event Employee violates any of the non-competition
               covenants contained in this Section 9, the duration of all non-
               competition covenants (and the Restricted Time Period) shall
               automatically be extended by the length of time during which
               Employee was in violation of such covenant, including, but not
               limited to, an extension equal to the time period from the date
               of Employee’s first violation until an injunction is entered
               enjoining such violation.


       Id. at 137 (emphasis added).


[52]   ASI opposed Knowles’s request for the trial court to dissolve the injunction on

       May 14, 2016, arguing that Section 9(j) of the Knowles Agreement, which

       Knowles voluntarily signed, contained a provision that tolled the time period by

       extending the non-compete by the amount of time from Knowles’s first

       violation until the entry of an injunction. Knowles, however, urged that

       Indiana case law, specifically Kuntz v. EVI, LLC, 999 N.E.2d 425 (Ind. Ct. App.

       2013), precludes a trial court from extending the duration of a non-compete

       through a preliminary injunction. Agreeing with Knowles and relying on

       Kuntz, the trial court in this case found that “the preliminary injunction cannot

       be extended because to do so would violate the purpose of a preliminary

       injunction as stated in Kuntz and so it must be dissolved [as to Knowles].” ASI’s

       Appellant’s App. Vol. II at 22. We agree.



       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 34 of 41
[53]   In Kuntz, Kuntz owned and operated a business, which he sold to JS Hare, and

       as part of the deal, he signed a covenant not to compete on December 12, 2011.

       It provided, in relevant part:

               For purposes of this Agreement, “Non-compete Period” shall
               mean the period that begins on the effective date of this
               Agreement and ends on October 7, 2014, except that the “Non-
               Compete Period” shall be extended by the duration of any
               violation by [Kuntz] of the terms of Paragraph 2 of this
               Agreement.


       999 N.E.2d at 428 (emphasis added). Eventually, JS Hare sold the business to

       EVI, LLC, which at some point suspected that Kuntz was violating the non-

       compete. EVI filed suit, and the trial court granted a preliminary injunction on

       December 17, 2012. The trial court granted EVI’s request to extend the

       preliminary injunction for an additional eight months, from October 7, 2014

       (the stated “end” date of the non-compete) until June 7, 2015, explaining that

       Kuntz’s violations of the non-compete commenced around the beginning of

       April 2012 and continued until December 2012, when the trial court enjoined

       Kuntz from violating the non-compete. Id. at 432.


[54]   On appeal, the Kuntz court reversed, concluding that a preliminary injunction

       was not an appropriate vehicle to extend the terms of a non-compete. It based

       its decision on the recognized purpose of a preliminary injunction, which is:

       “‘to preserve the status quo as it existed before a controversy, pending a full

       determination on the merits of the dispute.’” Id. (quoting Stoffel v. Daniels, 908

       N.E.2d 1260, 1272 (Ind. Ct. App. 2009)). And “[t]he status quo is the ‘last,

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 35 of 41
       actual, peaceful and non-contested status which preceded the pending

       controversy.’” Id. (quoting N. Ind. Pub. Serv. Co. v. Dozier, 674 N.E.2d 977, 987

       (Ind. Ct. App. 1996)). The Kuntz court explained that the last uncontested

       position of the parties was the non-compete agreement as it existed prior to

       litigation, which was enforceable until October 7, 2014, and the extension of the

       non-compete beyond the October 7, 2014 end date was “premature at this stage

       of the litigation and goes beyond the purpose of the preliminary injunction.”

       Id.


               Any court-ordered extension of the Non[-]compete Agreement
               would be appropriate only after a full examination of the case on
               the merits and a final determination that a violation occurred.
               Therefore, we conclude that the trial court abused its discretion
               by extending the duration of the Non[-]compete Agreement as
               part of the preliminary injunction.


       Id.


[55]   ASI seeks to distinguish Kuntz and argues that, unlike the Knowles Agreement,

       the agreement in Kuntz did not contain a provision that contemplated the

       extension of the non-compete upon the entry of a preliminary injunction: “The

       Kuntz [a]greement simply provided that the period ‘shall be extended by the

       duration of any violation’” and “was silent on whether the non-compete period

       could be extended as part of an injunction entered by the court.” ASI Appellant’s

       Br. at 25. However, we are not persuaded that this distinction makes a

       difference. The non-compete agreements both in the present case and the Kuntz

       case contemplated that they will be extended by the duration of any violation

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 36 of 41
       and by the length of time the employee was in violation. We find, as did the

       trial court, that Kuntz is directly applicable and precluded the trial court from

       applying the Section 9(i) extension provision of the Knowles Agreement at this

       stage of the litigation.22


[56]   Lastly, ASI asks us to reverse the trial court’s determination that Knowles was

       not equitably estopped from obtaining dissolution of the injunction. ASI had

       argued, and the trial court rejected, the position that Knowles, due to his

       deceptive conduct, should be equitably estopped from obtaining dissolution of

       the injunction. The party claiming equitable estoppel must show (1) its lack of

       knowledge and of the means of knowledge as to the facts in question, (2) its

       reliance upon the conduct of the party estopped, and (3) action based thereon of

       such a character as to change his position prejudicially. Money Store Inv. Corp. v.

       Summers, 849 N.E.2d 544, 547 (Ind. 2006). In this case, the trial court

       determined that “ASI either had knowledge that Knowles was in violation of

       his Non-Compete or that ASI had the means of obtaining such knowledge to

       determine whether Knowles was in violation of his Non-Compete Agreement




       22
         ASI observes that “at least one other Indiana reported case analyzed the extension of the duration of a
       non-compete clause without holding that extension clauses are per se unenforceable,” namely, Oxford Financial
       Group, Ltd. v. Evans, 795 N.E.2d 1135 (Ind. Ct. App. 2003). ASI Appellant’s Br. at 27. ASI argues that because
       the Oxford court did not simply state that extension clauses are per se unenforceable and, rather, engaged in an
       “extensive analysis” of the extension clause, we can infer that, in the right circumstances, an extension clause
       may be enforceable to extend a non-compete via a preliminary injunction. The trial court in the present case
       recognized Oxford in its findings and conclusions, finding that it was relevant, but determined that “Kuntz
       overruled it” ASI Appellant’s App. at 21-22. We too agree that Kuntz controls; it was more recently decided
       and spoke more directly to the issue at hand. To the extent that Oxford could be viewed as valid despite the
       Kuntz decision, we respectfully decline to follow it.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                        Page 37 of 41
       as early as May of 2014[,]” concluding that ASI did not meet the three

       requirements for application of equitable estoppel. ASI Appellant’s App. Vol. II

       at 24. We agree.


[57]   With regard to the “lack of knowledge” element of the inquiry, the record

       reveals that, although ASI may not have known of the extent of the violations

       of the Knowles Agreement, it was aware in May 2014 that Knowles went to

       work for competitor HWC and was aware of at least three or four instances

       during the summer of 2014 that Knowles had interaction with ASI clients at

       events or outings. In September 2014, when Sparks inadvertently sent an email

       to Knowles’s old ASI email address, ASI discovered that Knowles and ASI

       were involved in the recruitment of at least Tolle. We agree with the trial court

       that ASI failed to establish lack of knowledge sufficient to equitably estop

       Knowles from proceeding on his motion. Furthermore, with regard to the

       second and third prongs of the equitable estoppel inquiry, i.e., reliance upon the

       conduct of the party estopped, and action based thereon of such a character as

       to change his position prejudicially, ASI offers one sentence, stating that it

       relied on Knowles’s representation that he would honor his restrictive

       covenants “and did not take immediate legal action based on those

       representations.” ASI Appellant’s Br. at 41. This general statement does not

       explain in what way ASI was prejudiced, and we find it does not satisfy the

       second and third prongs of the equitable estoppel inquiry. The trial court did

       not abuse its discretion when it granted Knowles’s motion and dissolved the

       preliminary injunction on May 14, 2016.


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 38 of 41
[58]   Affirmed.


       Robb, J., concurs.


       Baker, J., concurs with separate opinion.




       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016   Page 39 of 41
                                                   IN THE
           COURT OF APPEALS OF INDIANA

       Hannum Wagle & Cline                                      Court of Appeals Case No.
       Engineering, Inc., d/b/a HWC                              49A05-1601-PL-33
       Engineering, Inc., et al.,
       Appellants/Appellees-Defendants,

               v.

       American Consulting, Inc.,
       d/b/a American Structurepoint,
       Inc.,
       Appellee/Appellant-Plaintiff.




       Baker, Judge, concurring.


[59]   I am compelled to concur fully with the majority opinion, but I write separately

       to voice my serious concerns about the extreme breadth of clause two of the

       relevant provision in the Knowles Agreement. Specifically, Knowles may not

       “solicit or communicate with any such customers for the purpose of selling,

       providing, attempting to sell or provide, or assisting any person or entity in the

       sale or provision of, any Competing Products/Services[.]” HWC Appellant’s


       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016            Page 40 of 41
       App. p. 135-37 (emphasis added). To tell a person who works in sales that he

       may not even communicate with past or potential clients is to take away his

       proverbial bread and butter. He may no longer schmooze. That is far too

       draconian to sit comfortably with me. And in this case, it goes a step farther,

       because the past and potential clients are all government employees, which

       takes it even farther into an overly restrictive realm.


[60]   We have largely moved as a society from an economy of goods to an economy

       of services. The disfavor with which this State views restrictive covenants

       should be heightened, in my view, where the purported irreparable harm cannot

       be quantified—which is almost always the case when it is the provision of

       services that is at the heart of a restrictive covenant. Under these

       circumstances, I believe only the narrowest of restrictive covenants should be

       enforceable, and I do not believe that clause two of the Knowles Agreement

       qualifies.23 With the current state of caselaw, however, I am compelled to

       concur fully with the majority opinion.




       23
         I have no reservations whatsoever about the drafting or enforcement of the provisions in these agreements
       prohibiting former ASI employees from poaching other ASI employees to work for HWC.

       Court of Appeals of Indiana | Opinion 49A05-1601-PL-33 | November 30, 2016                     Page 41 of 41
