J. A25035/15


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37


SOFTMART COMMERCIAL SERVICES INC. :                IN THE SUPERIOR COURT OF
                                  :                     PENNSYLVANIA
              v.                  :
                                  :
JACQUELYN MARIANI AND             :
ARRAYA SOLUTIONS, INC.,           :
                                  :
                    Appellant     :                No. 461 EDA 2015

                     Appeal from the Order January 13, 2015
                 In the Court of Common Pleas of Chester County
                       Civil Division No(s).: 2014-07615-CT

BEFORE: DONOHUE, MUNDY, and FITZGERALD,* JJ.

MEMORANDUM BY FITZGERALD, J.:                      FILED NOVEMBER 04, 2015

        Appellant, Jacquelyn Mariani, appeals from the order entered in the

Chester County Court of Common Pleas that granted the petition of

Appellee, Softmart Commercial Services, Inc.,1 for a preliminary injunction.

Appellant contends the court misconstrued the restrictive covenant and the

record did not justify injunctive relief. We affirm.2


*
    Former Justice specially assigned to the Superior Court.
1
    Arraya Solutions, Inc. (“Arraya”), is not a party to this appeal.
2
    As this Court recently observed:

           Our affirmance is based on the preliminary nature of this
           record. It is not a holding on the ultimate merits of [the]
           claims, which can be developed more fully prior to trial. . .
           .

                 It is somewhat embarrassing to an appellate
                 court to discuss the reasons for or against a
J.A25035/15


     We adopt the facts as set forth by the trial court’s opinion. 3 See Trial

Ct. Op., 4/21/15, at 1-4. Appellant timely appealed and timely filed a court-

ordered Pa.R.A.P. 1925(b) statement.4

     Appellant raises the following six issues:

        1. Did the Trial Court err by concluding that the Restrictive
        Covenant Agreement (“RCA”) is enforceable when it was
        not ancillary to an employment contract; when it was not
        supported by adequate consideration; when it was not
        reasonably limited in time and geographic territory; and
        when it was not necessary to protect a legitimate business
        interest of Softmart Commercial Services, Inc. (“Appellee”)
        without imposing an undue hardship on Appellant?



              preliminary decree, because generally in such
              an issue we are not in full possession of the
              case either as to the law or testimony—hence
              our almost invariable rule is to simply
              affirm the decree, or if we reverse it to give
              only a brief outline of our reasons, reserving
              further discussion until appeal, should there be
              one, from final judgment or decree in law or
              equity.

WMI Grp., Inc. v. Fox, 109 A.3d 740, 743 n.2 (Pa. Super. 2015) (citation
omitted).
3
  Appellee did not raise a claim under the Pennsylvania Uniform Trade
Secrets Act (“PUTSA”), 12 Pa.C.S. §§ 5301-5308. See also 12 Pa.C.S. §
5308 cmt.
4
   Appellee also moved for counsel fees and costs, averring fourteen
timekeepers, over 1,300 billable hours, and a noteworthy almost half-million
dollars in fees were required to obtain preliminary injunctive relief. See
Appellant’s Answer to Appellee’s Pet. for Att’ys’ Fees and Costs, 1/30/15; cf.
American Intellectual Property Law Association, Report of the Economic
Survey 36 (2013) (listing median fees for trade secret misappropriation
suit).




                                    -2-
J.A25035/15


       2. Did the Trial Court err by concluding that Appellee
       would likely succeed on the merits of its claims against
       Appellant for breach of the RCA when there was no
       evidence of harm (e.g., lost customers, lost partners, lost
       revenues, or any other identifiable harm) to Appellee
       which is an essential element of any cause of action for
       breach of contract?

       3. Did the Trial Court err by giving the RCA as expansive a
       reading as possible instead of a more narrow reading
       against Appellee, especially when any competition between
       Appellant’s new employer, Arraya Solutions, Inc.
       (“Arraya”), and Appellee was limited at most because no
       witness could point to a single instance in which Arraya
       and Appellee competed for a client or a project and not
       one witness could point to a single customer that Appellee
       lost as a result of Appellant’s employment with Arraya?

       4. Did the Trial Court err by concluding that Appellant’s
       employment at Arraya was unlawful or wrongful conduct
       under the RCA when there was no evidence that she
       utilized or was in physical possession of any confidential or
       proprietary information of Appellee after she made all of
       her phones and computers available to Appellee’s forensic
       consultant, who found no wiping utilities used, no
       confidential information taken, no documents printed or
       downloaded, no spoliation of evidence, no theft of trade
       secrets, and no transfer of any information to any third
       parties?

       5. Did the Trial Court err by concluding that a preliminary
       injunction would restore the status quo existing prior to
       Appellant’s departure from Appellee when the preliminary
       injunction restricting her from working in eastern
       Pennsylvania did not restore the status quo but disrupted
       the status quo, which had her working for seven months in
       Delaware and Chester counties for Arraya without any
       harm to Appellee?

       6. Did the Trial Court err by concluding that the harm to
       Appellee outweighed the harm to Appellant if a preliminary
       injunction were not issued when Appellant was forced out
       of her local region into a smaller commission market with
       significantly reduced income and new obstacles for travel


                                   -3-
J.A25035/15


         and business development, especially where the evidence
         suggested an abuse by Appellee of its superior bargaining
         power and a callous disregard for Appellant’s interest in
         pursuing her chosen occupation, neither of which serves
         the public interest?

Appellant’s Brief at 7-9.

      We summarize Appellant’s arguments in support of her first four

issues. In support of her first issue, Appellant claims the RCA is not

enforceable for four reasons.       First, Appellant asserts that when she

accepted the job offer, no one mentioned a non-compete agreement.

Second, she contends she did not receive adequate consideration for the

RCA, as she signed it five years after starting her job.   Third, Appellant

argues that the geographic restriction was unclear.5 Lastly, she insists the

RCA was unnecessary to protect Appellee’s business interest given the

existence of a non-solicitation clause.

      Regarding her second issue, Appellant reasons Appellee failed to

establish harm and thus could not recover for its breach of contract claim.

For her third issue, Appellant maintains the court erred by holding Arraya

and Appellee are competitors. With respect to Appellant’s fourth issue, she

maintains that she never used or possessed any of Appellee’s trade secrets.

She insists that Appellee adduced no evidence that she possessed any


5
  Appellee, however, counters that Appellant is restricted from contacting
customers within her assigned regions of eastern Pennsylvania and Georgia.
See Appellee’s Brief at 29; N.T. Prelim. Inj. Hr’g, 1/9/15, at 121-22.




                                     -4-
J.A25035/15


confidential information on any of her phones and computers. For these four

issues, we hold Appellant is due no relief.

      Our scope and standard of review was recently set forth as follows:

            Our scope of review is plenary.

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

         We do not inquire into the merits of the controversy. Only
         if it is plain that no grounds exist to support the
         decree or that the rule of law relied upon was
         palpably erroneous or misapplied will we interfere
         with the decision of the trial court.

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

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


                                      -5-
J.A25035/15


              right to relief is clear, and that the wrong is
              manifest, or, in other words, must show that it
              is likely to prevail on the merits”; 5) “that the
              injunction it seeks is reasonably suited to abate
              the offending activity”; and, 6) “that a
              preliminary injunction will not adversely affect
              the public interest.” The burden is on the party
              who requested preliminary injunctive relief.

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

          To establish a clear right to relief on a claim for breach
       of restrictive covenants of an employment contract, a
       party must, inter alia, demonstrate the following:

              In Pennsylvania, restrictive covenants are
              enforceable if they are incident to an
              employment relationship between the parties;
              the restrictions imposed by the covenant are
              reasonably necessary for the protection of the
              employer; and the restrictions imposed are
              reasonably limited in duration and geographic
              extent. Our law permits equitable enforcement
              of employee covenants not to compete only so
              far as reasonably necessary for the protection of
              the employer. However, restrictive covenants
              are not favored in Pennsylvania and have been
              historically viewed as a trade restraint that
              prevents a former employee from earning a
              living.

       Pennsylvania cases have recognized that trade secrets of
       an employer, customer goodwill and specialized training
       and skills acquired from the employer are all legitimate
       interests protectable through a general restrictive
       covenant.      In essence, the court must examine and
       balance the employer’s legitimate business interest, the
       individual’s right to work, the public’s right to unrestrained



                                    -6-
J.A25035/15


        competition, and the right to contract in determining
        whether to enforce a restrictive covenant.

            In construing a restrictive covenant, courts do not
        assume that a contract’s language was chosen carelessly,
        nor do they assume that the parties were ignorant of the
        meaning of the language they employed. When a writing
        is clear and unequivocal, its meaning must be determined
        by its contents alone. It is not the function of this Court to
        re-write it, or to give it a construction in conflict with the
        accepted and plain meaning of the language used.

              Only where a contract’s language is ambiguous
              may extrinsic or parol evidence be considered to
              determine the intent of the parties. A contract
              contains an ambiguity if it is reasonably
              susceptible of different constructions and
              capable of being understood in more than one
              sense. This question, however, is not resolved
              in a vacuum. Instead, contractual terms are
              ambiguous if they are subject to more than one
              reasonable interpretation when applied to a
              particular set of facts. In the absence of an
              ambiguity, the plain meaning of the agreement
              will be enforced. The meaning of an
              unambiguous written instrument presents a
              question of law for resolution by the court. . . .

           Furthermore, with respect to restrictive covenants:

              Courts have consistently held that the taking of
              employment is sufficient consideration for a
              covenant not to compete.        An employee’s
              promotion to a new position within the
              company        also    constitutes     sufficient
              consideration.

Fox, 109 A.3d at 747-49 (citations omitted).




                                    -7-
J.A25035/15


     As noted above, a restrictive covenant protects an employer’s trade

secrets. For a non-PUTSA6 claim,

        [t]he very concept of a “trade secret” is itself “somewhat
        nebulous.” Therefore, the decision of whether a particular
        compilation of customer data deserves protection as a
        trade secret necessarily must be made on a case-by-case
        basis. Our law is well settled that, to be classified as a
        trade secret, information must be an employer’s actual
        secret and not comprise mere “general trade practices.”
        Furthermore, the information must be of peculiar
        importance to the employer’s business before the law will
        protect it as a trade secret.

Iron Age Corp. v. Dvorak, 880 A.2d 657, 664 (Pa. Super. 2005) (citations

omitted).

        [O]ur Supreme Court has held that, under certain
        circumstances, customer lists and customer data may be
        entitled to protection as trade secrets. Furthermore, a
        trade secret may include compiled information which gives
        one business an opportunity to obtain an advantage over

6
  Appellee elected not to raise a claim under PUTSA, which defines “trade
secret” as follows:

        “Trade secret.” Information, including a formula, drawing,
        pattern, compilation including a customer list, program,
        device, method, technique or process that:

            (1) Derives independent economic value, actual or
            potential, from not being generally known to, and not
            being readily ascertainable by proper means by, other
            persons who can obtain economic value from its
            disclosure or use.

            (2) Is the subject of efforts that are reasonable under
            the circumstances to maintain its secrecy.

12 Pa.C.S. § 5302.




                                   -8-
J.A25035/15


         competitors. Nevertheless, customer lists are at the very
         periphery of the law of unfair competition. There is no
         legal incentive to protect the compilation of such lists
         because they are developed in the normal course of
         business anyway.

Id. at 663 (citations and quotation marks omitted). Even if such a list is not

entitled to protection as a trade secret, “the law will also prevent an

employe[e] from using customer contacts as well as confidential customer

information to his own advantage by soliciting the customers of his former

employer.”    Morgan’s Home Equipment Corp. v. Martucci, 136 A.2d

838, 843 (Pa. 1957) (footnote omitted).

      After careful review of the parties’ briefs, the record, and the reasoned

decision of the Honorable Edward Griffith, we affirm Appellant’s first four

issues based on the trial court’s decision. See Trial Ct. Op. at 5-14 (holding

(1) RCA executed in connection with Appellant’s promotion within company;

(2) Appellant’s promotion resulted in increased compensation; (3) RCA

limited to eastern Pennsylvania and Georgia; (4) record substantiates

multiple solicitations such that enforcement of RCA reasonably necessary to

protect Appellee; and (5) grounds exist supporting determination of harm to

Appellee and that Appellee is competitor to Arraya).7 We need not resolve

whether the identity of Appellee’s customers is a trade secret, see Dvorak,


7
  As noted above, Appellee maintains Appellant’s regions are limited to
eastern Pennsylvania and Georgia. See Appellee’s Brief at 29; N.T. Prelim.
Inj. Hr’g, 1/9/15, at 121-22.




                                     -9-
J.A25035/15


880 A.2d at 663, as Appellant admitted to soliciting those customers, which

both the RCA and the law forbids.      See Martucci, 136 A.2d at 843; see

also In re Strahsmeier, 54 A.3d 359, 364 n.17 (Pa. Super. 2012) (“As an

appellate court, we may uphold a decision of the trial court if there is any

proper basis for the result reached; thus we are not constrained to affirm on

the grounds relied upon by the trial court.” (citation omitted)).

      For her fifth issue, we reproduce the entirety of Appellant’s argument

below:

            The preliminary injunction did not restore the status
         quo existing prior to Appellant’s departure from Appellee
         because Appellant had been working in Delaware and
         Chester counties for Arraya without any harm to Appellee
         for over seven months. To the contrary, the preliminary
         injunction restricting her from working in these counties
         could not restore the status quo but only disrupt it.

Appellant’s Brief at 36. Appellant is not due any relief.

      As a prefatory matter, Appellant’s one-paragraph argument is devoid

of any legal analysis. Id. Appellant has not explained how or why the trial

court erred.   “It is the appellant who has the burden of establishing his

entitlement to relief by showing that the ruling of the trial court is erroneous

under the evidence or the law. Where the appellant has failed to cite any

authority in support of a contention, the claim is waived.” Bunt v. Pension

Mortg. Assocs., Inc., 666 A.2d 1091, 1095 (Pa. Super. 1995) (citations

omitted); accord Korn v. Epstein, 727 A.2d 1130, 1135 (Pa. Super. 1999).




                                     - 10 -
J.A25035/15


Because Appellant has cited no legal authority, she has waived this claim on

appeal. See Bunt, 666 A.2d at 1095.

          Regardless, we would have discerned no trial court error.       As our

Supreme Court explained, the “status quo to be maintained by a preliminary

injunction is the last actual, peaceable and lawful noncontested status which

preceded the pending controversy.”         Valley Forge Historical Soc’y v.

Washington Mem’l Chapel, 426 A.2d 1123, 1129 (Pa. 1981) (citation

omitted). As the trial court observed, the status quo is prior to Appellant’s

unlawful actions. See id. Accordingly, we would not have granted Appellant

relief.

          Appellant lastly argues that the harm from the preliminary injunction

outweighed the harm to Appellee from not granting a preliminary injunction:

               Appellant was forced out of her local region of Chester
            and Delaware Counties into a smaller commission market
            with significantly reduced income and new obstacles for
            travel and business development. By contrast, Appellee’s
            claims of greater injury are merely speculative harms
            about its reputation and the potential loss of goodwill and
            future business. These harms pale in comparison to the
            harm Appellant faces. Thus, by granting the preliminary
            injunction, the Trial Court rewarded the abuse by Appellee
            of its superior bargaining power and its callous disregard
            for Appellant’s interest in pursuing her chosen occupation
            despite suffering no identifiable harm, neither of which
            served the public interest.

Appellant’s Brief at 36-37 (citations omitted). As with Appellant’s fifth issue,

her bald allegations are not supported by legal analysis and thus she has

waived them on appeal. See Bunt, 666 A.2d at 1095.



                                      - 11 -
J.A25035/15


      In any event, in Ogontz Controls Co. v. Pirkle, 499 A.2d 593 (Pa.

Super. 1985), this Court addressed whether “the lower court incorrectly

found that greater harm would be done by refusing the preliminary

injunction than by granting it.”    Id. at 597.   In resolving this issue, the

Pirkle Court referenced

         cases in which a former employer alleges that his former
         employee has violated an anti-competition provision of an
         employment contract. In those cases, the defendant can
         often claim great harm, because a preliminary injunction
         puts him out of business or out of a job. However,
         preliminary injunctions have been approved in those
         situations due to the very nature of the agreed upon
         restriction, to prevent the way in which the former
         employee goes about making his or her livelihood after
         leaving the former employer.

Id. (citations omitted).

      Instantly, Appellant noted she would be inconvenienced and earn less

income if she complied with the injunction—less impactful than having no

business or no job.    Cf. id.   While we do not minimize the gravity of the

harm to Appellant, we discern no basis—particularly given this preliminary

record, cf. Fox, 109 A.3d at 743 n.2—to conclude the trial court abused its

discretion by improperly weighing the harms attendant to a preliminary

injunction.   Accordingly, after careful consideration of the record, grounds




                                     - 12 -
J.A25035/15


exist for the trial court’s ruling and thus we discern no abuse of discretion.8

See id. at 748.

      Order affirmed.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary

Date: 11/4/2015




8
  It bears repeating that “our standard of review for preliminary injunctive
relief is highly deferential” and thus, Appellant has “an opportunity to
develop the record further at trial.” See Fox, 109 A.3d at 753 n.2.




                                    - 13 -
                                                                                 Circulated 10/08/2015 03:46 PM




 SOFTMART COMMERCIAL SERVICES,                      IN THE COURT OF COMMON PLEAS
 INC.
              Plaintiff                             CHESTER COUNTY, PENNSYLVANIA

               v.                                   NO. 2014-07615

 JACQUELYN MARIANI and ARRAYA                       CIVIL ACTION - LAW
 SOLUTIONS, INC.
                 Defendants

Attorneys for Plaintiff' James T. Smith, Esq., William R. Cruse, Esq., Lauren   M. Fitzgerald, Esq.,
  Thomas A. Riley, Jr., Esq., Jane Richardson, Esq.
Attorneys for Defendants: Garlh G. Hoyt, Esq., Dianne G. Moretzsohn, Esq.

                                           OPINION

       Defendant, Jacquelyn Mariani ("Mariani"), has appealed from the Order entered
January 13, 2015 granting Plaintiff, Softmart Commercial Services, Inc. ("Softmart"),
preliminary injunctive relief and enforcing the terms of a restrictive covenant entered
when she was employed by Softmart.
Procedural and Factual Background:
       Softmart commenced this action against its former employee on August 6, 2014
for breach of two agreements, the Employee Innovation and Non-Disclosure Agreement
and the Confidentiality, Non-Solicitation and Restrictive Covenant Agreement
("Restrictive Covenant Agreement"). At the same time, Softmart petitioned for
preliminary injunctive relief to enforce the terms of the Restrictive Covenant Agreement.
On October 31, 2014, Softmart filed an amended complaint and added Arraya
Solutions, Inc. ("Arraya"), Mariani's current employer, as a defendant. Following
discovery, a hearing was held over five days beginning January 6, 2015. On January
13, 2015, we entered an Order granting Softmart preliminary relief, which required
Mariani to comply with the terms of the Restrictive Covenant Agreement.
      Mariani was hired by Softmart in April, 2008 as a small business account
manager and was responsible for increasing sales to Softmart's small business
customers. On July 1, 2011, Mariani was promoted to the position of inside account
manager for the south region where she had responsibility for Softmart's accounts in
Georgia, working remotely from Pennsylvania. On March 1, 2013, Mariani was
promoted to the position of strategic account manager in the eastern region of
                                                                           Circulated 10/08/2015 03:46 PM




Pennsylvania.     In this position, she was the face of Softmart and responsible for
prospecting     new   business,   while maintaining   a presence with Softmart's        existing
account base. In connection with this promotion, Mariani entered into the disputed
Restrictive Covenant Agreement.
       Mariani was solicited by Arraya for employment          on May 12, 2014 and she
accepted a sales position on May 23, 2014. Later on May 23, 2014, Mariani resigned
from Softmart. Mariani started working for Arraya on May 29, 2014.
      The provisions of the Restrictive Covenant Agreement that Softmart seeks to
enforce are:
      NO COt\JTACT WITH OR SOLICITATION OF SUPPLIERS, CUSTOMER
      REFERRAL SOURCES, AND CUSTOMERS:

        I agree that, during my employment and for a period of fifteen (15) months
        after my employment with Softmart terminates for any reason, voluntary or
        involuntary, I will not solicit, contact, or provide services to (or attempt to
       do any of the foregoing,) directly or indirectly, for the purpose or effect of
       competing or interfering with any part of Softmart's Business: (1) any
       Customer of Softmart within my Region; (2) any Customer of Softmart that
       I contacted, solicited, or in any way dealt with at any time during the last
      two years of my employment; (3) any prospective Customer of Softmart
      that I contact, solicit or in any way supported or dealt with at any time
      during the last two years of my employment; or (4) any existing or
      prospective Customer of Softmart for whom I had any direct or indirect
      responsibility at any time during the last two years of my employment. For
      purposes of this Agreement, 'Customer' shall include, without limitation,
      any company, person or entity that Softmart provides services to,
      including its director, officers, executive, managers, and representatives.
      For purposes of this Agreement, my 'Region' shall mean any geographic
      area to which I have been assigned with the last two years of my
      employment with Softmart, or, if I was not assigned to a specific
      geographic area, my 'Region' shall mean the United States of America.

      NO COMPETITION IN SAME REGION:

     I agree that, during my employment and for a period of eighteen (18)
     months after my employment with Softmart terminates for any reason,
     voluntary or involuntary, I will not, directly or indirectly, compete with
     Softmart's Business in my Region, as defined above. With respect to the
     restricted Region, this means that I will not be involved in the Business on
     my own behalf or on behalf of any Competitor of Softmart in a managerial,
     marketing, sales, administrative, test lead or other test capacity, whether
     as an owner, principal, partner, employee, consultant, contractor, agent or

                                             2
                                                                           Circulated 10/08/2015 03:46 PM




       representative. 'Competition', as used in the Agreement, shall mean any
       persons or entities who now, or in the future, develop, provide, offer or
       intend to offer or provide services in the Business described above.

(Restrictive Covenant Agreement, pp. 4, 5)

       Softmart described its business as:

      ... reselling of computer software, hardware, peripherals, accessories,
      supplies and other products used in connection with the operation and
      maintenance of computers, and provides consultation, license management,
      and training services related to the products described above, and also the
      quantitative analysis services know[n] as Analytics and SAM engagement, as
      well as software licensing and management (SLMS).

(Restrictive Covenant Agreement, p. 1)

      CONFIDENTIALITY:

        I understand that Softmart's proprietary and confidential information includes
       (without limitation): (1) customer lists or data, customer contact information,
       customer referral lists or data, customer referral sources, and customer
       preferences or records; (2) pricing information and policies, billing information
       and policies, business methods and philosophies of delivering services,
       business plans and analyses, contractual arrangements, marketing and sales
       strategies; (3) physical security systems, access control systems, network and
       other equipment designs; (4) information about products, proposed products,
       services, developments, processes, procedures, technical information, know-
       how, expertise, drawings, designs, specifications, scripts; (5) employment and
       payroll records; (6) tax information, forecasts, budgets, projections and other
       non-public financial information; (7) expansion plans, management policies
       and other business strategies and policies; (8) office procedures and
       protocols; and (9) Analytics" spreadsheets and/or work product. In exchange
      for my being provided access to such information, I agree that, at all time
      during and after my employment with Softmart, I will not disclose or
      communicate any of this information to any competitor or other third party, or
      use or refer to any of this information for any purpose, including but not limited
      to in the course of future employment for myself or any entity other than
      Softmart, or remove materials concerning any of this information from
      Softmarl's premises, except as necessary for me to properly perform services
     for Softrnart during my employment. Upon termination of my employment, I
     will immediately return to Softmart all correspondence files, business card
     files, customer and supplier source lists and files, software, manuals,
     forecasts, budget notes, electronically stored information or data, and other
     materials that contain any of this information, and I will not retain any copies of
     the materials. I understand that these provisions apply even to information of
     this type that is developed or conceived by me, alone or with others, at

                                             3
                                                                              Circulated 10/08/2015 03:46 PM




        Softrnart's instruction or otherwise. I also understand that these provisions
        apply to all information I may receive that is confidential and/or propriety to
        any customer, supplier, or other person or entity who does business with
        Softrnart.

 (RestrictiveCovenantAgreement, pp. 2-3)

 Discussion:
       To obtain preliminary injunctive relief, Softmart must establish six prerequisites:
               1) that the injunction is necessary to prevent immediate and
              irreparable harm that cannot be adequately compensated by
              damages;
              2) that greater injury would result from refusing an injunction than
              from granting it, and, concomitantly, that issuance of an injunction
              will not substantially harm other interested parties in the
              proceedings;
              3) that a preliminary injunction will properly restore the parties to
             their status as it existed immediately prior to the alleged wrongful
              conduct;
             4) that the activity it seeks to restrain is actionable, that its right to
             relief is clear, and that the wrong is manifest, or, in other words,
             must show that it is likely to prevail on the merits;
             5) that the injunction it seeks is reasonably suited to abate the
             offending activity; and,
             6) that a preliminary injunction will not adversely affect the public
             interest.
Summit Towne Centre, Inc. v. Shoe Show of Rocky Mount, Inc., 828 A.2d 995, 1001
(Pa. 2003).

      We first consider whether Softmart has produced sufficient evidence to establish
a clear right to relief on a claim for breach of restrictive covenants of an employment
contract Synthes v. Harrison, 83 A.3d 242 (Pa.Super.2013). To do so, Softmart must
show that:
         1) the restrictive covenant is incident to an employment relationship
         between the parties;
         2) the restrictive covenant is supported by adequate consideration;
         3) the restrictive covenant is reasonably necessary to protect the
         legitimate interests of the employer; and,
         4) the restrictive covenant is reasonable in time and geographic
         scope.


                                                4
                                                                       Circulated 10/08/2015 03:46 PM




 Hess v. Gebhard & Co., 570 Pa. 148, 808 A.2d 912, 917 (2002); Kistler v. O'Brien, 464
 Pa. 475, 347 /-\.2d 311 (1975); Capital Bakers, Inc. v. Townsend, 426 Pa. 188, 231 A.2d
 292 (1967).
 Incident to the emplovment relationship
        A restrictive covenant entered into as part of a change in a position of
 employment is incident to the employment relationship. Jacobson & Co. v. International
 Environment Corp., 427 Pa. 439, 235 A.2d 612, 618-619 (1967). On February 19,
 2013, John Henkels, Mariani's supervisor at Softmart, delivered a letter to Mariani
 containing an "internal transfer promotional offer" to the position of "Strategic Account
 Manager-Easter[n] Pennsylvania, Northern Region" to commence March 1, 2013. At
 the same time, Henkels handed Mariani related documents, including the Restrictive
 Covenant Agreement. Mariani accepted the offer by signing the letter the same day.
 However, she took the Restrictive Covenant Agreement for further review. (N.T. Vol. 1,
 68:22-69:9, 81:19-82:11; Exh. P-60)
       Mariani reviewed the Restrictive Covenant Agreement with an attorney,
requested changes, which were refused, and signed the document on March 1, 2013,
the same day she commenced her new position. (N.T. Vol. 2, 206:5-214:14, Vol. 3,
134:9-135:12; Exh. P-60)
       The preamble of the Restrictive Covenant Agreement recites that Mariani
entered the same "in consideration of the commencement of my employment as a
"Strategic Account Manager-Eastern PA". (Exh. P-60) Although Mariani cannot clearly
recall when she received the Restrictive Covenant Agreement and she contends that it
was delivered to her by Susan O'Neill, Softmart's director of Human Relations, and not
by Henkels, Mariani nonetheless acknowledged that signing the Restrictive Covenant
Agreement was a condition of her acceptance of the Strategic Account Manager
position. (N.T. Vol. 2, 204:17-205:5, 205:6-206:4, 214:10-14, Vol. 3, 136:12-20)
      In Kistler v. O'Brien, supra, cited by Mariani, a restrictive covenant was not
enforced because, in part, the requirement of a restrictive covenant was not a term
agreed upon when employment was accepted. In fact, O'Brien commenced
employment before the requirement of a restrictive covenant was even raised. In our
case, there is no dispute that the execution of the Restrictive Covenant Agreement was

                                           5
                                                                           Circulated 10/08/2015 03:46 PM




     necessary   if Mariani   wished   to commence    employment    as a Strategic     Account
     Manager.1    We therefore concluded that the Restrictive Covenant Agreement was
     incident to the employment relationship between Softmart and Mariani.
     Supporled bv adequate consideration
           A beneficial change in employment status is adequate consideration for
    enforcement of a restrictive covenant. Davis & Warde, Inc. v. Tripodi, 420 Pa.Super.
    450, 616 A.2d 1384 (1992). Mariani contends that despite language in Softmart's offer
    letter, identifying her transfer to Strategic Account Manager as an "internal transfer
    promotional offer", the new position was simply a transfer, not a promotion.
           Mariani's promotion to Strategic Account Manager came with an increase in her
    guaranteed monthly draw from $4,583 to $6,667 for twelve months, set against a
    commission rate of 12% of her gross profit margin on sales. At the end of twelve
    months, Mariani would continue to receive 12% of her gross profit margin and a
    refundable draw for an additional year. (N.T. Vol. 1, 65:19-66:23, 76:3-18; Exh. P-60)
    Mariani also received the benefit of an expansion in the geographic region for which she
    could obtain a bonus, an established customer base and a change in job duties allowing
    her to be more self-directed. (N.T. Vol. 1, 70:9-71:12)
          Mariani contends that she did not receive a raise in pay with her new position.
    To support her claim, she averaged her monthly pay before the job change and
    determined that she was paid $6,022 per month based upon her commissions. (Exh. 0-
    104) Therefore, her guaranteed pay increase amounted to only an additional $645 per
    month. In her new position, Mariani first exceeded her guaranteed draw in October,
2013 and by March, 2014 she was consistently exceeding .her guaranteed draw each
month. (Exh. D-104) Over the sixteen months that Mariani was employed as a Strategic
Account Manager, she earned on average $7, 144. (Exh. 0-104) Comparing averages
instead of draws, Mariani's pay increased by $1, 122 per month.
          It is evident that despite Mariani's contention, she did receive an enhanced
compensation package when she accepted the Strategic Account Manager position.
Furthermore, because more of her pay was structured as a guaranteed draw, Softmart

1
  Contrary to Mariam's assertion, there is no evidence that her position as an inside
account manager was at risk if she refused to sign the Restrictive Covenant Agreement.
                                               6
                                                                          Circulated 10/08/2015 03:46 PM




 took the risk of her performance.    Mariani's transfer was a promotion to a position where
 she had greater income potential, more responsibility and greater autonomy. As such,
 she enjoyed a. beneficial change in her employment status which served as adequate
 consideration for the restrictive covenant.
 Reasonably necessary to protect Softmart's legitimate business interests

        An employer may use a restrictive covenant to protect its business interests,
 including its trade secrets (e.g.,   pricing), confidential information, customer goodwill,
 and business opportunities. Hess, 808 A.2d at 920. Employers have protectable
 interests in customer relationships that have been acquired through the efforts of its
 sales representatives.
         In almost all commercial enterprises ... contact with customers or
         clientele is a particularly sensitive aspect of the business.... In most
         businesses . . . as the size of the operation increases, selling and
         servicing activities must be at least in part decentralized and entrusted
         to employees whose financial interest in the business is limited to their
         compensation. The employer's sole or major contact with buyers is
        through these agents and the success or failure of the firm depends in
         part on their effectiveness. . . . (t)he possibility is present that the
        customer will regard, or come to regard, the attributes of the employee
        as more important in his business dealings than any special qualities of
        the product or service of the employer, especially if the product is not
        greatly differentiated from others which are available. Thus, some
        customers may be persuaded, or even be very willing, to abandon the
        employer should the employee move to a competing organization or
        leave to set up a business of his own... The employer's point of view is
       that the company's clientele is an asset of value which has been
       acquired by virtue of effort and expenditures over a period of time, and
       which should be protected as a form of property. Certainly, the argument
       goes, the employee should have no equity in the customer which the
       business had developed before he was employed. Similarly, under
       traditional agency concepts, any new business or improvement in
       customer relations attributable to him during his employment is for the
       sole benefit of the principal. This is what he is being paid to do. When he
       leaves the company he should no more be permitted to try to divert to
       his own benefit the product of his employment than to abscond with the
       company's cashbox.
John G. Bryant Co., Inc. v. Sling Testing & Repair. Inc., 471 Pa. 1, 369 A.2d 1164,
1167-1168 (1977)(citation omitted).      Restrictive covenants may not be used to limit
competition. Omicron Sys. Inc. v. Weiner, 860 A.2d 554, 560 (Pa.Super.2004).


                                               7
                                                                                  Circulated 10/08/2015 03:46 PM




            Mariani acknowledged,         when she signed the Restrictive Covenant Agreement,
    that Softmart is in "a highly competitive industry" and that she would be given access to
    and would be required "to maintain, supervise, develop and initiate client relationships,
    referral sources and goodwill that are valuable to Softmart and which it has a legitimate
    interest in protecting."    (N.T. Vol. 3, 45: 18-21, 46:7-9,   133:8-1 O; Restrictive Covenant
    Agreement, pp. 1 at (3), 2 at (7)) The Restrictive Covenant Agreement addresses the
    protection   of these      customer    relationships   by providing   for "no contact with or
    solicitation of suppliers, customer referral source and customers" and "no competition in
    the same region" for fifteen months and eighteen months,                 respectively,    after her
    employment with Softmart ended. (Restrictive Covenant Agreement, pp. 4, 5) Absent
    the agreement,    Mariani would be free to sell to Softmart's         customers, trading on the
    relationships she established while a Softmart employee,              immediately after leaving
    Softmart's employ. The Restrictive Covenant Agreement was reasonably necessary for
    the protection of these customer relationships.
           In addition,   Mariani was given access to Softmart's             customer    information,
    including customer names and contacts, customer purchases by product,                    date and
    price, customer preferences, profit information, contract terms, contract expiration dates
    and license renewal timing,       to perform her job.       Mariani acknowledged         that such
    information was    proprietary    and confidential     and promised, when she signed the
    Restrictive Covenant Agreement, that she would "not disclose or communicate any of
this information to any competitor or other third party, or use or refer to any of this
information for any purpose, including but not limited to in the course of future
employment for myself." (Agreement, p. 3) Although there are times when Softmart has
shared limited amounts of this information with its partners2 and customers, protecting
this information from competitors is a legitimate concern of Softmart. The Restrictive
Covenant Agreement was reasonably necessary for the protection of this proprietary
and confidential information.




2
  When shared with partners, the use of such confidential information was controlled by
the partnership agreement. (Exh. P-8)
                                                    8
                                                                            Circulated 10/08/2015 03:46 PM




     Reasonable in time and geographic location
           Mariani bears the burden proving that the temporal and geographic restrictions
    set forth in the Restrictive Covenant Agreement are unreasonable. Bryant, 369 A.2d at
     1169. Mariani argues that an eighteen month prohibition on competition is excessive,
    particularly when the broad geographic scope of the covenant is considered.
           An eighteen month prohibition is not per se unreasonable as Pennsylvania courts
    have routinely enforced restrictive covenants longer than eighteen months. Hayes v.
    Altman, 424 Pa. 23, 225 A.2d 670, 673 (1967)(3 years), Worldwide Auditing Services,
    Inc. v. Richter, 402 Pa.Super. 584, 587 A.2d 772, 776 (1991)(2 years), Boyce v. Smith-
    Edwards-Dunlap Co., 398 Pa.Super. 345, 580 A.2d 1382 (1990)(2 years). At Arraya,
    Mariani is restricted for eighteen months based on the employment agreement she
    signed there. (N.T. Vol. 2, 219:19-220:9; Exh. P-9)       Mariani only claimed that the
    duration was too long because eighteen months is a long time for her to be precluded
    from working for whomever and wherever she chooses. (N.T. Vol. 2, 218:10-20) When
    dealing with sales employees, time limitations on restrictive covenants are set to permit
    an employer sufficient time to train, deploy and establish a new sales representative to
    manage its customers. Hillard v. Medtronic, Inc., 910 F.Supp. 173, 179 (M.D.Pa.,1995);
    Bryant, 369 A.2d at 1170. Mariani failed to address this issue and argued instead that
the eighteen month prohibition is inconvenient for her.
          As to geographic scope, the Restrictive Covenant Agreement is limited to
    Mariani's region. Region is defined as "any geographic area to which I have been
assigned within the last two years of my employment with Softmart, or, if I was not
assigned to a specific geographic area, my 'Region' shall mean the United States of
America."       (Restrictive Covenant Agreement, p. 4)       Mariani was assigned to the
"Easter[n] Pennsylvania, Northern Reqion'" when she accepted her promotion to
Strategic Account Manager. (Vol. 3, 6:17-7:11; Exh. P-60) The Eastern Pennsylvania-
Northern Region is that section of Pennsylvania defined by drawing a line from the
western boundary of Chester County straight to the New York border, bordered to the


3
  The offer letter Mariani signed stated, " ... this letter will confirm your acceptance of the
position of Strategic Account Manager - Easter[n] Pennsylvania, Northern Region."
(Exh. P-60)
                                              9
                                                                           Circulated 10/08/2015 03:46 PM




     north by New York, to the east by New Jersey and to the south by Delaware. (N.T. Vol.
     1, 160:2-161: 1)   Prior to commencing work as Strategic Account Manager, Mariani was
    assigned Georgia as an Inside Account Manager. Therefore, by geography, Mariani
    was barred from Softmart accounts and prospects in the Eastern Pennsylvania -
    Northern Region and Georgia, a restriction that Mariani agreed was fair. (N.T. Vol. 3,
    7:15-8:5; Vol. 4, 122:17-21)
           The language in the Restrictive Covenant Agreement defining "region" is clear
    and unambiguous. The language in the offer letter assigning Mariani a region is clear
    and unambiguous. No one disputes the geographic boundaries of the "Eastern
    Pennsylvania, Northern Region." Mariani maintains that "region" is vaguely described
    or ambiguous because she is barred from contact with some customers outside of
    Georgia and Eastern Pennsylvania. However, this bar is separate and apart from her
    regional bar. To understand why Mariani is barred from customers outside of Georgia
    and Eastern Pennsylvania, the specific terms of the non-solicitation paragraph must be
    reviewed. Mariani agreed, when she signed the Restrictive Covenant Agreement, that
    she would not:
          solicit, contact, or provide services to ...
          (1) any Customer of Softmart within my Region;
          (2) any Customer of Softmart that I contacted, solicited, or in any way
          dealt with at any time during the last two years of my employment;
          (3) any prospective Customer of Softmart that I contacted, solicited, or in
          any way supported or dealt with at any time during the last two years of
          my employment; or
          (4) any existing or prospective Customer of Softmart for whom I had any
          direct or indirect responsibility at any time during the last two years of my
          employment.
(Restrictive Covenant Agreement, p. 4) Therefore, under paragraphs (2) - (4), Mariani
is barred from contact with her former customers and prospects in areas outside of her
region. However, contrary to Mariam's contention, her region is not expanded to include
all areas in which her former customers and prospects are located.4



4
  Mariani acknowledged that there were procedures in place at Softmart if she wanted
to work with customers outside of her assigned region, which further confirms that
Mariam's region was clearly defined and known to her. (N.T. Vol. 3, 8:6-12:5, 172:7-24)
                                              10
                                                                         Circulated 10/08/2015 03:46 PM




        The evidence supports a conclusion that the restrictions on time and geography
 in the Restrictive Covenant Agreement         are reasonable.   However, before we can
 conclude that Softmart has produced sufficient evidence to establish a clear right to
 relief, we must consider Mariani's conduct after leaving Softmart as well as defenses
 Mariani has raised.
 Mariani's conduct
        Mariani created a list of her current customers and prospects that she carried to
 her second interview with Arraya to discuss her employment. (Exh. P-25) The list
 identified twenty-five customers and five prospects by name and location (city and state
 only). Christian Gingras, Director of Sales at Arraya, had requested the list for an
 interview that he set up with Mariani and Daniel Lifshutz, Arraya's CEO and co-owner.
 (N.T. Vol. 3, 23:9-24:1) Although Mariani denies having used Softmart's resources to
create the list, we do not find her credible on this point. Nonetheless, even if she
created the list from memory, the information was protected under the Restrictive
Covenant Agreement as confidential information. (Restrictive Covenant Agreement, p.
2) While Mariani argues that she provided nothing more than data that is available in a
phone directory, such information in a phone directory is not identified as "customers"
and "prospects" of Softmart.
       After leaving Softmart, Mariani immediately began to work for Arraya in her
former region. (N.T. Vol. 4, 138: 10-17). With the belief that the only restriction limiting
her conduct was that she could do nothing that would hurt Softmart, Mariani began to
contact her former Softmart accounts to let them know that she had changed
employment. (N.T. Vol. 3, 28:20-29:5, 49:10-14, 77:20-79:9, Vol. 4, 138:18-24) Very
quickly, what Mariani contends were innocent, informational contacts, became
solicitations for work on behalf of Arraya.
       Chaning Bete was Mariani's customer at Softmart. On June 5, 2014, Mariani was
in contact with Roger Bailey at Chaning Bete on behalf of Arraya by email and stated, "If
you need any Cisco, EMC, VMware, Microsoft Services, managed services (remote
helpdesk, cloud back up or DR, Infrastructure management), you know where to find
me". (Exh. P-83) Mariani conceded that this was a solicitation. (N.T. Vol. 3, 82:19-20,
83: 18-22) As a result of this contact, another employee of Chaning Bete, Deepu

                                              11
                                                                           Circulated 10/08/2015 03:46 PM




 Javaramu began a dialogue with Mariani about business they could do together.
 Mariani agreed that this was the desired outcome of her contact.        (N.T.   Vol. 3, 82:23-
 83: 10)    Mariani professes to have encouraged Chaning Bete to continue to work with
 Softmart, but her all of her emails with Bailey promote Arraya and encourage Bailey to
 rely on her for help. (N.T. Vol. 3, 146:1-9;   Exhs. 0-78, D-79)
           HSC was Mariani's customer at Softmart.        On June 9, 2014, Mariani was in
 contact with Glen Sides at HSC to invite him to an Arraya hosted suite at a Phillies
 game.      Mariani conceded that the purpose of inviting him to the game was to build
 rapport and tell him about Arraya.      (N.T. Vol. 3, 90:1-5, 90:14-16; 92:2-20; Exh. P-67)
 To the extent that HSC was not interested in the VMware being demonstrated at the
 Phillies event, Mariani encouraged Sides to come out because other people from Arraya
would be on hand to provide "insight and education around what might work for HSC."
(N.T. Vol. 3, p. 93:14-15)     Mariani claims that out of respect for the close relationship
she had with Sides, she was compelled to let him know that she had left Softmart.
However, in the email that she communicates that she has left, Mariani promotes
Arraya and encourages Sides to rely on her for help. (N.T. Vol. 3, 150:21-151:7; Exh.
0-87)
         Chatham Financial was Mariani's customer at Softmart. (N.T. Vol.3, 95: 17-19)
On July 14, 2014, Mariani was in contact with Steve Olshevski and Patrick Miller at
Chatham Financial by email and introduced Arraya as "a technology planning, design,
and implementation partner that focuses on enterprise solutions from EMC, Cisco,
VMware and Microsoft services." (Exh. P-90) Mariani admitted that the content of this
email amounted to a solicitation. (N.T. Vol. 3, 98:20-22) Within the email, Mariani
continued a discussion about work that she had begun while still with Softmart. In other
words, Mariani was trading on confidential client information obtained from Softmart
           ,vi)   '7
while shesellmq Chatham Financial Arraya's services directly, whereas earlier she had
been trying to bring Arraya in as Softmart's partner. Softmart would have received a fee
if Arraya had been brought in as a partner.          (N.T. 98:24-99:17; Exh. P-90) Mariani
admitted that her conduct interfered with Softmart's partner business. (N.T. 101 :8-9)
        Untra was Mariani's customer at Softmart. (N.T. Vol. 3, 103:16-19) On June 10,
2014, David Grunwald at Untra was invited as Arraya's guest to a Phillies game at

                                                12
                                                                                 Circulated 10/08/2015 03:46 PM




  Mariani's request.       (Exh. P-112) VMware Horizon Suite 6 was to be demonstrated at the
 game. When Grunwald could not attend the game, Mariani followed up with an email
 offering a meeting, along with her VMware lead, to discuss the VMware product.
 Although Mariani would only concede that she was offering services that Softmart could
 not provide directly,        the fact remains that she would have been selling the same
 services a month earlier as a Softmart representative and Softmart would have been
 paid a fee for bringing in a partner to do the work. (N.T. Vol. 3, 106:14-107:13,           108:14-
 109:22; Exh. P-112)
          Entercom was Mariani's customer at Softmart.            On June 3, 2014, Mariani was in
 contact with John Graefe and Craig Canter at Entercom to invite them to a Phillies
 game as Arraya's guests.             As part of the event, VMware and EMC products would be
 demonstrated. (N.T. Vol. 3, 109:24-111 :2) Mariani conceded that she had invited a total
 of ten Softmart customers to events, such as a Phillies game, on behalf of Arraya. (N.T.
 Vol. 3, 105:1-10) The purpose of these events was to educate customers about Arraya
 and build rapport.
          Vertex was Mariani's          customer   at Softmart.    Vertex also had an ongoing
business relationship        with Arraya and Mariani was assigned the Vertex account by
Arraya.      In June, 2014 Mariani sent a fruit basket to Vertex to announce her new
position with Arraya.         (N.T.    Vol. 3, 167:15-168:23)     In August or September, 2014
Mariani processed a license renewal for Vertex that had historically been renewed with
Arraya.     (N.T. Vol. 3, 164:12-165:12)       In late September, 2014, a million dollar deal was
struck by Vertex and Arraya. Mariani had little to do with this deal, which was well along
when she was hired by Arraya. (N.T. Vol. 3, 113:21-114:7,            163:22-164: 11, Vol. 4, 15: 19-
21) Mariani was paid 7.5% commission on the deal as compensation for the license
renewal.      (J\J.T.    Vol. 3, 115:16-18,    165:9-12)    Mariani admitted that Softmart was
competitive in the marketplace for some of the products included in the deal. (N.T. Vol.
3, 111:9-115:18)
          Despite her professed intent to do no harm to Softmart, Mariani immediately
began to work her Softmart accounts to transfer customer loyalty to Arraya.                 Mariani
tries to explain        away her conduct.      However, it is evident that Mariani meddled in
Softmart's established        customer     relationships   to gain leverage for Arraya. Mariani


                                                   13
                                                                                Circulated 10/08/2015 03:46 PM




 sympathized      with her customers       about the difficulties they were encountering           as
 Softmart transitioned       a new sales representative into her old position.     She mined the
 relationships she had built looking for chinks that would allow her to bring in Arraya.
 She stayed present with her customers.         She encouraged her customers to rely on her
 for help.     Mariani   used every opportunity to put the products and competencies of
 Arraya in front of her Softmart customers. Not once did Mariani tell her Softmart
 customers that she was barred from contact due to the terms of her Restrictive
 Covenant Agreement.            In the single instance where she mentioned           the bar, she
 continued to promote Arraya in the same email. During our hearing, Mariani explained
 repeatedly that her conduct was friendly, innocent and meant to be helpful to Softmart
 or at least to do no harm. Unrestrained, Mariani would continue sell Arraya to her former
 clients and prospects and in her former regions making use of her knowledge of
 customer needs gained from her employment as a Softmart sales representative.
 Competing business
        Mariani claims that she cannot be in breach of the Restrictive Covenant
Agreement because Softmart and Arraya are not competing businesses.
        The Restrictive Covenant Agreement defines a "Competitor" of Softmart as "any
persons or entities who now, or in the future, develop, provide, offer or intend to offer or
provide services in the Business described above." (Restrictive Covenant Agreement,
p. 5)    Softmart defines its business in the Restrictive Covenant Agreement as the
"reselling of computer software, hardware, peripherals, accessories, supplies and other
products used in connection with the operation and maintenance of computers, and
provides     consultation,    license   management,   and training   services     related   to the
products     described   above, and also the quantitative analysis services know[n] as
Analytics and SAM engagement, as well as software licensing and management
(SLMS)".      (Restrictive Covenant Agreement, p. 1)(italics added)             In other words,
Softmart sells software, hardware and IT consulting services to its customers to solve
information technology issues. (Vol. 1, 42:14-17, 84:10-22)
        On her Linkedln account, Mariani described Softmart as "a global provider of all
things IT. From software to hardware to services, Softmart provides a complete solution
for organizations in both the private and public sector."       (N.T. Vol. 4, 133:20-134:15;

                                                14
                                                                                   Circulated 10/08/2015 03:46 PM




  Exh. P-132)     IVlariani   described her work with Softmart as:         "Responsible for helping
 customers understand          and manage their software licensing agreements          and hardware
 procurements.        VVe have an analytical approach to dissecting your agreements and
 presenting scenarios         for moving forward.          We reduce IT spend[ing] by helping you
 reduce overhead associated with purchasing managing produce.                    Sales professional
 certified by over 15 companies including Microsoft, Adobe, IBM, HP, Symantec and
 more."     (Exh. P-132)
          Mariani's employment agreement with Arraya states that Arraya is "engaged in
 the business of Information Technology,                  Computer Hardware Sales and Computer
 Software Sales." (Exh. P-1, p. 1) Mariani testified that she is engaged in selling products
 and solutions for Arraya.        (N.T. Vol. 4, 135:22-136:3) On her Linkedln profile, Mariani
 described her work on behalf of Arraya as "responsible for driving Arraya Solutions'
 technology portfolio, including products and solutions from top manufacturers including
 EMC, Cisco, VMware, Microsoft, and VCE Company, as well as Arraya's suite of 356+
 Managed Services." (N.T. Vol. 4, 135:10-19; Exh. P-132) Arraya's business is the sale
of software, hardware and consulting services. (N.T. Vol. 4, 142:14-143:10)
          The parties each presented Venn diagrams to illustrate the overlap of products
sold by Softrnart and Arraya. As illustrated by Mariani, Softmart and Arraya both sell
VMware,      sorne Cisco, Microsoft Open, Eaton, APC,                 some IBM and EMC.        These
products, some of which are hardware and some of which are software, are the source
of 80% of Arraya's annual revenue.           (N.T. Vol. 4, 142:14-143:10;     Exhs. P-127, D-63A)
In comparison,      Softmart revenues are 80% attributable to hardware, 15% to software
and 5% to service. Softmart's top five hardware producers are HP, Dell, Lenovo, Cisco
and Apple.     Softmart's top four software producers are Microsoft, Adobe, VMware and
Symantic.     (N.T. Vol. 3, 9:15-21,   40:14-41:9,        41:16-20)
          In addition to selling the same products and services, Softmart and Arraya
compete for the same customers. If a customer calls Softmart first, Softmart's objective
is to get as much of the business as it can handle, including bringing in a partner for
which Softmart will be paid a referral fee.           Similarly, if the customer calls Arraya first,
Arraya's objective is to get as much of the business as it can handle and to bring in a
partner for which      it will be paid a referral fee only if necessary.     (N.T. Vol. 4, 136:13-


                                                     15
                                                                              Circulated 10/08/2015 03:46 PM




 138:5) Mariani agreed that the key to who gets the business is who the customer calls
 first. (N.T. Vol. 4, 137:17-19)    Mariani conceded that when she was selling for Softmart
 in 2013, she was competing with Arraya.             (N.T. Vol. 2, 197:8-13) Similarly, in March,
 2014, when Mariani was exploring the potential for new business for Softmart in a
 discussion with her counterpart at Arraya, she learned that Arraya could not help her
 because Arraya was already selling a competing product to the targeted customer.
 (N.T. Vol. 4, 148:13-150:14;        Exh.    P-131) Finally,   in July, 2014, when she was
 communicating    with a Softmart       customer on behalf of Arraya,         Mariani compared
 Arraya's capacity to that of Softmart stating, "[l]ike I used to at Softmart, we do a lot of
 whiteboarding and helping customers start from square one of thought planning and
 design." (Exh. P-90)
        Both Softmart and Arraya are in the business of solving the same types of
technology issues for their customers; however, they differ in their approach. Softmart
generally sells its customers products first and then up sells services using the access
gained through product sales to establish a relationship of trust with its customer. ((N.T.
Vol. 1, 45:8-21) Softmart will bring in a partner to provide services that it cannot provide
in-house to insure that it is a one-stop shop. (N.T. Vol. 1, 58:5-59:22, Vol. 3, 14:23-5)
Arraya approaches its customers as a consultant and then moves to product sales
using the access gained through its consulting services. (N.T. Vol. 3, 177:16-178:4,
179:9-11) Both companies           are selling the same hardware,         software   and related
consulting services to business customers in Eastern Pennsylvania.
       In Omicron Systems, the court held that two companies were competitors where
one company sold a single computer program as_ a solution to the customer's needs
and another company analyzed the needs of a customer, including marketing/sales
needs, and provided the best solution possible, whether by creating a new program or
utilizing existing software. Omicron Systems, Inc. v. Weiner, 860 A.2d at 560. In other
words, even when two companies              appear on their face to be different, if the two
companies offer a solution to the same problem, they are competitors.            Here, Softmart
and Arraya are competitors         because both are engaged in the business of selling
computer hardware, software and related consulting services to business customers in




                                                16
                                                                          Circulated 10/08/2015 03:46 PM




 eastern Pennsylvania.       Their approaches may t 2 different, but both companies are
 engaged in the same business.
 Absence of Gingras and Lifshutz from trial
        Mariani complains that we erroneously drew an adverse inference from the
 absence of Gingras and Lifshutz from the preliminary hearing. Contrary to Mariani's
 assertion, no inference was drawn from their absence. During closing argument we
 questioned Mariani's attorney about their absence, which counsel reasonably explained.
 (N.T. Vol. 5, 47:3-49:11)    Counsel misunderstood our concern, which was focused on
whether Marini had the support of Arraya in these proceedings. Mariani noted several
times in testimony that she had received support from Arraya, including payment of the
cost of her defense, but she was uncertain as to how far Arraya's support would extend
if injunctive relief was granted.

       Having determined that Softmart has produced sufficient evidence to establish a
clear right to relief on the claim for breach of the Restrictive Covenant Agreement, we
consider the six prerequisites that must be fulfilled to obtain a preliminary injunction.
1. Availabilitv of damages as compensation
       Mariani maintains that any harm to Softmart is adequately compensable by
money damages because mere loss of business, no matter how great, does not
constitute irreparable harm. In fact, at our hearing, Softmart could show little in lost
sales. However, "[i]t is not the initial breach of the covenant that establishes the
existence of irreparable harm but rather the threat of unbridled continuation of the
violation and the resultant incalculable damage to the former employer's business that
constitutes the justification for equitable-intervention." Bryant, 369 A.2d-at 1167. - The-
purpose of the Restrictive Covenant Agreement was to prevent more than just the sales
that might result from Mariani's solicitation of Softmart's customers and prospects. The
Restrictive Covenant Agreement was meant to "prevent disturbance in the relationship
that has been established between [Softmart] and their accounts through prior dealings.
It is the possible consequences of this unwarranted interference with customer
relationships that is unascertainable and not capable of being fully compensated by
money damages." Bryant, 369 A.2d at 1167. Where the interest sought to be protected
is the relationship that had been established on behalf of the employer through the

                                            17
                                                                                     Circulated 10/08/2015 03:46 PM




  efforts of the former sales employee, this interest is incapable of adequate protection by
  monetary damages and the use of injunctive relief is proper to avoid the threatened
  harm. Irreparable harm is likely to result when a sales employee resigns to work for a
 competitor, carrying with her the employer's goodwill, customer                     relationships,   and
 confidential information. Nat'I Bus. Servs., Inc. v. Wright, 2 F. Supp. 2d 701, 709 (E.D.
 Pa.   1998);   Fisher   Bioservices,    Inc.   v.   Bilcare,    Inc.,   2006    WL       1517382,     20
 (E.D.Pa.,2006).   Softmart   entrusted     Mariani    with     its   confidential     and   proprietary
 information and gave her access to its business relationships. The relationships at issue
 represent significant   investment     by Softmart.     Mariani has been compensated                   by
 Softmart for her role in creating and developing those relationships.                These customer
 relationships are entitled to protection based upon the terms of the Restrictive Covenant
 Agreement.
 2. Greater iniury from refusing than granting iniunction; iniunction will not substantially
 harm other interested parlies
       "[T]he basic purpose behind the task of balancing the hardships to the respective
 parties is to ensure that the issuance of an injunction would not harm the infringer more
than a denial would harm the party seeking the injunction." Prudential Ins. Co. of
America v. Stella, 994 F. Supp. 308, 316-17 (E.D. Pa. 1998). The preliminary injunction
we entered was tailored to abate only activity prohibited by the Restrictive Covenant
Agreement.      During the injunction period, Mariani is free to work in any capacity,
including for Softmart's competitors, as long as she does not work in her former region,
sell to certain of her former customers and prospects or use Softmart's confidential
information.    Furthermore, during this period, Arraya is free use another sales
representative to sell within- Mariarii's region- as· well as to her--f6rmer customers and
prospects.
       Mariani expressed concern about her ability to perform in a field sales position
any distance from her Downingtown home, due to family demands on her time. (N.T.
Vol. 4, 127:1-14) Mariani is the parent of two children under the age of three and at the
time of the hearing was helping her husband with driving since his arm was in a cast.
(N.T. Vol.4, 118:11-120:2, 126:20-24) Arraya's objective is to develop business within a
2-hour radius of Philadelphia. (N.T. Vol. 4, 129:11-23)         While Gringas can redraw sales
territories and reassign sales representatives for Arraya, each territory currently has a
                                                18
                                                                                  Circulated 10/08/2015 03:46 PM




     sales representative assigned. (N.T. Vol. 4, 123:5-23,      125:23-126:19)    Furthermore, the
     region assigned Mariani is more lucrative than other regions.          (N.T. Vol. 4, 127: 15-
     128: 13,     151 :2-15)   Finally,   Mariani expressed some uncertainty about the level of
     support she would be given by Arraya if injunctive relief were to be granted.
               We considered the issues Mariani raised. We also considered that Mariani may
     have been operating          under the misguided      notion that the Restrictive     Covenant
     Agreement would be unenforceable.5            However, Mariani "does not have a right to the
     ideal job, but rather, to be able to earn a livelihood." Nat'I Bus. Servs., 2 F. Supp. 2d at
     709. Working further from home may inconvenience Mariani or she may have a lower
     income due to assignment to a less lucrative area and Arraya may be inconvenienced
     by having to redraw and/or reassign sales territories; however, neither is irreparably
     harmed. Softmart will have its customer relationships further eroded unless Mariani is
     precluded from using Softmart's confidential information and from soliciting business
     opportunities from Softmart's customers. The harm Softmart will suffer due to Mariani's
     continued violation of the Restrictive Covenant Agreement is                    insidious and
     immeasurable. If Mariani is permitted to circumvent her contractual obligations, then
  the sanctity of the covenants Softmart has with other employees will be diminished and
  Softmart's ability to enforce these covenants will be curtailed. Graphic Management
  Associates, Inc. v. Hatt, 1998 WL 159035, *18 (E.D.Pa.,1998).                   On balance, the
                           r
  hardships weigh in favof.granting Softmart relief.
  3. Restoration of status quo
               The status quo to be maintained by preliminary injunction is the last actual,
  peaceable and lawful uncontested status which preceded the pending controversy.
-----~--·---

 Valley Forge Historical Soc'y v. Washington Memorial Chapel, 493 Pa. 491, 426 A.2d



 5
  Mariani had consulted with an attorney before she signed the Restrictive Covenant
Agreement who, she stated, had advised her that she could sign the agreement
because it was unenforceable. (N.T. Vol. 2, 213:19-21) Although Mariani says she
believed the Restrictive Covenant Agreement was unenforceable, there is no evidence
that she expressed this view when she gave a copy to Gingras and Lifshutz.
Additionally, Mariani's position has been that when she began working for Arraya, she
understood she could take no action to harm Softmart under the Restrictive Covenant
Agreement, not that she was unrestrained by an unenforceable agreement.
                                                    19
                                                                           Circulated 10/08/2015 03:46 PM




  1123,     1129 (1981 ). The preliminary injunction entered restores the status quo as it
  existed prior to Mariani's wrongful conduct.
  4. Likely to prevail on the merits.
           As discussed at length above, Softmart has demonstrated that it is likely to
 prevail on the merits.
  5. lniunction is reasonablv suited to abate the offending activity
           The preliminary injunction we entered prohibits Mariani from acting contrary to
 the terms of her Restrictive Covenant Agreement. She must refrain from selling in her
 former regions and to certain other former customers and prospects. She is prohibited
 from using Softmart's confidential information. Mariani is free to otherwise engage is
 sales activities.     The injunction is limited and reasonably suited to abate just the
 offending activity.
 6. No adverse affect to the public's interest

          The enforcement of restrictive covenants serves a number of public purposes,
 including discouraging unfair competition, the misappropriation and wrongful use of
 confidential information and the disavowal of freely contracted obligations. Merrill Lynch,
 Pierce, Fenner, & Smith, Inc. v. Napolitano, 85 F. Supp. 2d 491,499 (E.D. Pa. 2000);
Minnesota Mining & Mfg. Co. v. Gessner, 78 F. Supp. 2d 390, 393 (E.D. Pa. 1999); Nat'!
Bus. Servs., Inc. v. Wright, 2 F. Supp. 2d 701, 709 (E.D. Pa. 1998); Graphic Mgmt.
Associates, Inc. v. Hatt, No. 97-CV-6961, 1998 WL 159035, at *19 (E.D. Pa. Mar. 18,
1998). Arraya is free to compete with Softmart, but may not do so with Mariani as its
representative in Eastern Pennsylvania, Georgia or with certain other former customers
or prospects of Mariani. Mariani is free to work in sales, even selling the very same
products she previously sold for Softmart, but may not do so for a limited period within
her former regions or to certain other former customers or prospects or using or
disclosing Softmart's confidential information. We can see no harm to the public by the
enforcement of Mariani's lawful employment agreement.
          Having determined that Softmart established all of the prerequisites entitling it to
preliminary injunctive relief, we entered our Order on January 13, 2015.

          Mariani raises an additional issue in her Statement of Matters Complained of on
Appeal. Mariani claims that we erred by awarding attorneys' fees when we granted

                                              20
                                                                            Circulated 10/08/2015 03:46 PM




 preliminary injunctive relief.      Softmart sought attorneys' fees under the terms of the
 Restrictive Covenant Agreement, which provides "I agree to indemnify Softmart for its
 attorneys' fees and costs incurred in enforcing the terms of this Agreement should I
 violate any of its terms."       (Restrictive Covenant Agreement, p. 7) Our Order required
 Mariani
        to indemnify Softmart for its reasonable attorneys' fees and costs incurred
        in enforcing the terms of the Restrictive Covenant Agreement, as provided
        by the 'Attorneys' Fees' provision of the Restrictive Covenant Agreement.
        Softmart shall submit a fee petition to the Court within ten days of the
        entry of this Order. Any response thereto shall be due ten days thereafter.

 (Order, pp. 3-4) Mariani argues that attorneys' fees are not properly awarded as part of
 preliminary injunctive relief.
        Softmart commenced           this action seeking relief for breach of contract and
injunctive relief and therefore had made a claim for legal and equitable relief. A court in
equity has jurisdiction to award damages, in addition to providing for equitable relief.
Puleo v. Thomas, 425 Pa.Super. 285, 290, 624 A.2d 1075, 1078 (Pa.Super., 1993).
Two cases cited by Mariani, Holiday Lounge, Inc. v. Shaler Enterprises Corp., 441 Pa.
201, 272 A.2d 175 (1971) and Martindale Lumber Co. v. Trusch, 452 Pa.Super. 250,
681 A.2d 802 (1996), were reversed when damages were awarded as part of equitable
relief because the reviewing courts found that money damages had not been pied.
However, we have been unable to find a case in which attorneys' fees were awarded as
part of preliminary injunctive relief. In our case, we made the award believing that doing
so would promote the efficient resolution of claims.             Nonetheless, when Mariani's
counsel raised this issue by correspondence after entry of our Order, we responded by
email on February 10, 2015 and notified all parties that we would proceed to a final
injunctive hearing and enter a final order before addressing counsel fees.          Therefore,
despite the provision in the Order, we had already advised counsel that we would not
proceed as stated prior to the date that Mariani filed her appeal.




DATE:
                                                    Edwcri.d-Griffith, J.

                                               21
