       Third District Court of Appeal
                               State of Florida

                          Opinion filed August 1, 2018.
         Not final until disposition of timely filed motion for rehearing.

                               ________________

                               No. 3D17-2586
                         Lower Tribunal No. 17-15057
                             ________________

                    Data Payment Systems, Inc., etc.,
                                    Appellant,

                                        vs.

                       Christopher Caso, etc., et al.,
                                    Appellees.

     An Appeal from a non-final order from the Circuit Court for Miami-Dade
County, Eric William Hendon, Judge.

     Barakat Law, PA, and Brian Barakat, for appellant.

     Garcia-Menocal & Perez, P.L., and Anthony J. Perez and Alfredo Garcia
Menocal; The Carbonell Law Group, and Jorge Carbonell, for appellees.


Before ROTHENBERG, C.J., and SUAREZ and SCALES, JJ.

     SCALES, J.

     Appellant, plaintiff below, Data Payment Systems, Inc. d/b/a One Payment

(“Data Payment”), appeals a non-final order denying its motion seeking to
temporarily enjoin appellees, defendants below, from violating covenants of non-

compete agreements executed by two of the entity defendants. Because it appears

from the transcript of the hearing on Data Payment’s motion that the trial court (i)

failed to consider the statutory presumption of irreparable injury potentially

implicated in this case, and (ii) erroneously determined that Data Payment had an

adequate remedy at law that precluded injunctive relief, we reverse and remand for

the trial court to conduct a new hearing on Data Payment’s motion.

     I.      RELEVANT FACTS AND PROCEDURAL BACKGROUND

          Data Payment is in the business of providing credit card and payment

processing services to merchants in Florida and throughout the United States. Data

Payment provides its services to its customers directly, and also through

independent contractors referred to as “sub-offices.”

          In July 2016, Data Payment entered into a written sub-office agreement with

defendant Ignite Payments, Inc. (“Ignite”). This written sub-office agreement (the

“Ignite agreement”) contains restrictive covenants, including a non-compete clause1

1   The non-compete provisions provide:

          5.1 Covenant not to Compete: During the term of this Agreement and
          for eighteen (18) months after termination with cause by [Data
          Payment] or termination without cause by Sub Office, Sub Office and
          its principals shall not:

     (a) Engage directly or indirectly, in any business which is competitive
         with the business of [Data Payment] in providing payment processing
         services (a “Competitive Business”) or purchase any property or

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and a confidentiality clause.2     Defendant Juan Marcos Batista executed this

       assets relating to any Competitive Business within the state of Florida
       (the “Restrictive Territory”).

    (b) Directly or indirectly own an interest in, manage, operate, join,
       control, lend money, or render financial or other assistance to any
       person that engages in any Competitive Business with Restrictive
       Territory.

    (c) Solicit or attempt to solicit any present, past, or pending Merchants
        doing business with [Data Payment].

    (d) Either party shall not hire or attempt to hire any employee, agent, or
        independent contractor of [Data Payment] or Sub Office, including
        any person who has terminated employment or an independent
        contractor relationship for any reason within six (6) month [sic] prior
        to the execution of this Agreement and for a six (6) month period after
        that termination.

    (e) In the event this Agreement is terminated by [Data Payment] without
        cause, Sub Office shall not be subject to Section 5.1(a).

The Ignite agreement further provides that any violation of the non-compete
provision “may cause irreparable harm to either party” such that “either party shall
be entitled to seek an injunction in order to restrain any further violation . . . .”
2    The Ignite agreement incorporates a confidentiality agreement that was
separately executed by defendant Juan Marcos Batista on behalf of Ignite. The
Ignite confidentiality agreement is a separate document appended to the Ignite sub-
office agreement, and imposes a duty on Ignite to prevent disclosure of Data
Payment’s “Confidential Information,” which is described as including the
following:

       Technical and business information relating to [Data Payment’s]
       proprietary ideas, patentable ideas, copyrights and/or trade secrets,
       existing and/or contemplated products and services, software,
       schematics, research and development, production, costs, profit and
       margin information, finances and financial projections, customers,
       clients, marketing, and current or future business plans and models,

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agreement on behalf of Ignite.

      Thereafter, Batista, along with another defendant, Christopher Caso,

allegedly created defendant Onepay LLC (“Onepay”). In January 2017, Data

Payment entered into a sub-office agreement with Onepay (the “Onepay

agreement”). This agreement contains restrictive covenants3 nearly identical to

those contained in the Ignite agreement, including a “twelve-month” non-compete

clause. The Onepay agreement was also executed by Batista.

      Thereafter, according to Data Payment, defendants Caso and Batista

allegedly created a new business venture, Ireland Pay LLC (“Ireland Pay”) to

provide payment processing services in Florida in direct competition with Data

Payment. Data Payment then terminated the Ignite and Onepay agreements for

cause. Data Payment alleges that Caso and Batista, through their access to Data

Payment’s system by virtue of the Ignite and Onepay agreements, began to

misappropriate Data Payment’s trade secrets and to solicit Data Payment’s


      regardless of whether such information is designated as “Confidential
      Information” at the time of its disclosure.

The confidentiality agreement further provides that, if there is a breach or
threatened breach of the confidentiality agreement, Data Payment “shall be entitled
to injunctive relief.”
3 While the Onepay agreement contains the same confidentiality addendum as did
the Ignite agreement, the copy in the record is unexecuted. If Onepay ever
executed a confidentiality agreement, it was not made a part of the record.


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customers. Caso also allegedly confronted a Data Payment employee at the place

of business of a Data Payment customer and threatened the Data Payment

employee with violence.

      In June 2017, Data Payment initiated the instant action against Ignite,

Onepay, Ireland Pay, Batista and Caso.         Data Payment’s multi-count Second

Amended Complaint asserts claims for temporary and permanent injunctive relief,

misappropriation of trade secrets, breach of contract, tortious interference, and to

pierce the corporate veils of Ignite, Onepay and Ireland Pay. Relying on the non-

compete and confidentiality provisions of the Ignite and Onepay agreements, Data

Payment also sought emergency, temporary injunctive relief to enjoin: (i) each of

the defendants from threatening any further acts of violence toward Data Payment

and its employees; (ii) each of the defendants from retaining any of Data

Payment’s trade secrets or other confidential business information; (iii) Batista,

Ignite, and Onepay from violating the restrictive covenants set forth in the Ignite

and Onepay agreements; and (iv) Caso and Ireland Pay from aiding and abetting

the other defendants in violating the restrictive covenants set forth in the Ignite and

Onepay agreements.

      In October 2017, the trial court conducted an evidentiary hearing on Data

Payment’s temporary injunction motion, and, on October 27, 2017, entered the

appealed-from order denying Data Payment’s motion. The otherwise unelaborated



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order denies Data Payment’s motion “as to all parties for reasons stated on the

record.” The transcript from the hearing indicates that the trial court denied Data

Payment’s motion because (i) Data Payment presented no testimony “putting a

quantification” on any irreparable harm Data Payment allegedly would suffer if the

injunction were not entered, and (ii) the availability of other causes of action

asserted by Data Payment established the existence of an adequate remedy at law.

Indeed, after making those threshold determinations, the trial court concluded:

          THE COURT: . . . This Court need go no further because this Court
          has determined that there is specifically . . . a remedy at law that the
          parties can and are pursuing in this matter. An [sic] injunctive relief is
          not warranted. . . . [T]his Court will not even reach the other aspects
          with respect to whether or not there was an . . . existing contract or the
          parties were obligated under the agreement because . . . having [an]
          adequate remedy at law, that defeats the injunctive relief request in
          and of itself. Thank you all.

Data Payment timely appealed the trial court’s non-final order denying its motion

seeking temporary injunction relief.4

    II.      ANALYSIS5


4  We have jurisdiction pursuant to Florida Rule of Appellate Procedure
9.130(a)(3)(B).
5 “To the extent the trial court’s order is based on factual findings, we will not
reverse unless the trial court abused its discretion; however, any legal conclusions
are subject to de novo review.” Colucci v. Kar Kare Auto. Group, Inc., 918 So. 2d
431, 436 (Fla. 4th DCA 2006). As relevant here, the trial court’s determination of
the legal standard to apply when a party seeks a temporary injunction based on the
violation of a restrictive covenant is a question of law that we review de novo. See
Medco Data, LLC v. Bailey, 152 So. 3d 105, 107 (Fla. 2d DCA 2014).

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      Generally, a movant seeking a temporary injunction must establish the

following elements: (i) likelihood of irreparable harm and unavailability of an

adequate remedy at law; (ii) substantial likelihood of success on the merits; (iii)

injury to the movant that outweighs the harm to the opponent; and (iv) that an

injunction will not disserve the public interest. See Reliance Wholesale, Inc. v.

Godfrey, 51 So. 3d 561, 564 (Fla. 3d DCA 2010). In this case, having found that

Data Payment failed to satisfy the first prong, the trial court denied Data Payment’s

temporary injunction motion without conducting any further analysis as to the

remaining three prongs. For the following reasons, we conclude that the trial court

applied the incorrect law when conducting its inquiry as to the first prong, thus

requiring another hearing on the matter.

      First, Data Payment was not required to quantify the irreparable harm it

would suffer if a temporary injunction were not entered. As it relates to an alleged

breach of a non-compete agreement, irreparable injury “does not have reference to

the amount of damage caused, but rather to the difficulty of measuring the amount

of damages inflicted.” Air Ambulance Network, Inc. v. Floribus, 511 So. 2d 702,

702-03 (Fla. 3d DCA 1987) (quoting 42 Am. Jur. 2d Injunctions § 49). Therefore,

“an injury is irreparable where the damage is estimable only by conjecture, and not

by any accurate standard.” Id.




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      Moreover, in 1996, the Florida Legislature adopted section 542.335 of the

Florida Statutes to specifically validate, and codify the requirements for

enforcement of, written covenants restricting or prohibiting competition. See Ch.

96-257, § 1, Law of Fla; Corp. Express Office Prods., Inc. v. Phillips, 847 So. 2d

406, 409 n.2 (Fla. 2003) (“According to the Senate Staff Analysis, section 542.335

‘substantially expands and clarifies the noncompete statute governing validity and

enforcement of contracts in restraint of trade.’” (quoting Fla. S. Comm. on

Judiciary, SB 282 (1996) Staff Analysis 5 (Mar. 27, 1996))). Among other things,

the statute creates a presumption of irreparable injury to the person seeking to

enjoin a violation of a non-compete clause. See § 542.335(1)(j), Fla. Stat. (2016).

This provision reads, in its entirety, as follows:

      (1) Notwithstanding s. 542.18 and subsection (2), enforcement of
      contracts that restrict or prohibit competition during or after the term
      of restrictive covenants, so long as such contracts are reasonable in
      time, area, and line of business, is not prohibited. In any action
      concerning enforcement of a restrictive covenant:

             ....

      (j) A court shall enforce a restrictive covenant by any appropriate and
      effective remedy, including, but not limited to, temporary and
      permanent injunctions. The violation of an enforceable restrictive
      covenant creates a presumption of irreparable injury to the person
      seeking enforcement of a restrictive covenant. No temporary
      injunction shall be entered unless the person seeking enforcement of a
      restrictive covenant gives a proper bond, and the court shall not
      enforce any contractual provision waiving the requirement of an
      injunction bond or limiting the amount of such bond.



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Id. (emphasis added).

      Here, as the hearing transcript reveals, the trial court determined that, even if

a violation of the non-compete agreements had occurred, Data Payment would not

be entitled to injunctive relief because it had presented no evidence of irreparable

harm. Thus, it appears that the trial court erred by not employing the statutory

presumption of irreparable harm dictated by section 542.335(1)(j), which requires

consideration of whether the subject agreements are lawful and enforceable. See §

542.335(1)(g), (j) Fla. Stat. (2013); Medco Data, LLC v. Bailey, 152 So. 3d 105,

107 (Fla. 2d DCA 2014) (“Because the trial court made findings that would trigger

the presumption of irreparable injury under section 542.335(1)(j) but failed to

apply the presumption, we reverse the order on appeal and remand for

reconsideration in light of the presumption.”).

      Second, it also appears from the hearing transcript that the trial court

determined Data Payment is not entitled to injunctive relief because of the

existence of other causes of action – seeking money damages against the

defendants – pleaded by Data Payment. Whether Data Payment may prevail at

trial for damages on any of its underlying causes of action against the defendants,

however, does not ipso facto preclude entry of a temporary injunction in this case.

See Reliance Wholesale, Inc., 51 So. 3d at 566 (“[A]lthough a trial court may

award damages for a breach of an employee’s agreement not to compete, ‘the



                                          9
normal remedy is to grant an injunction. This is so because of the inherently

difficult, although not impossible, task of determining just what damage actually is

caused by the employee’s breach of the agreement.’” (quoting Capraro v. Lanier

Bus. Prods., Inc., 466 So. 2d 212, 213 (Fla. 1985))); see also Smart Pharmacy, Inc.

v. Viccari, 213 So. 3d 986, 990 (Fla. 1st DCA 2016) (“Smart Pharmacy does not

have an adequate remedy at law for the irreparable harm it has suffered, and may

continue to suffer, as a result of Appellees’ actions because ‘monetary damages are

difficult to prove with any certainty and . . . even if provable, would not adequately

compensate for all aspects of the violation of a covenant not to compete.’”

(footnote omitted) (quoting King v. Jessup, 698 So. 2d 339, 340 (Fla. 5th DCA

1997))). The trial court, therefore, erred when it determined, as a threshold matter,

that, because Data Payment had alleged other causes of action against these

defendants seeking monetary damages, Data Payment had an adequate remedy at

law that precluded Data Payment from obtaining injunctive relief for the alleged

breach of the covenants not to compete.

   III.   CONCLUSION

      In considering Data Payment’s temporary injunction motion, the trial court

neglected to consider section 542.335(1), the statutory provision applicable to

injunctions sought for alleged violations of non-compete agreements. The trial

court also erroneously determined that injunctive relief was unavailable to Data



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Payment because Data Payment had an adequate remedy at law by virtue of other

causes of action pled by Data Payment. We, therefore, reverse the order on appeal

and remand the case to the trial court for the court to conduct another hearing on

Data Payment’s temporary injunction motion.6

      Reversed and remanded, with instructions.




6 We express no opinion on the merits of Data Payment’s motion, whether Data
Payment is entitled to injunctive relief, or the other counts raised in Data
Payment’s Second Amended Complaint. Our reversal stems solely from what
appears to be a misapprehension by the trial court of the irreparable harm/adequate
remedy at law prong related to the alleged violations of the subject non-compete
agreements.

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