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Giffords Oil Co. v. Wild - 106 A.D.2d 610, 483 N.Y.S.2d 104 (App. Div. 1984)

Rule:

Under certain facts, it is proper to treat plaintiffs' customer list as a trade secret and to prevent, by means of injunction, a former employee from using that list.

Facts:

Defendant Michael Wild was employed by plaintiff Giffords Oil Co. for several years in commercial sales. While there, Wild entered into an employment agreement which contained a covenant restricting him from directly or indirectly soliciting plaintiffs' customers for a period of three years after termination of his employment. He also agreed that Giffords' customer list was a valuable and unique asset of Giffords' business, that irreparable injury would result from a violation of the covenant and that a violation of the agreement would be a proper subject of injunctive relief. After defendant Wild was hired by its competitor, co-defendant Commander Oil Co., Plaintiffs commenced the instant action, alleging that certain customers had been solicited by defendant Wild and other former employees in violation of the employment agreement. The Supreme Court, Nassau County (New York) granted Giffords' motion for a preliminary injunction enjoining defendant former employees from interfering with Giffords' business in accordance with restrictive covenants in the employment agreements.  Defendants appealed from this order.

Issue:

Was there a danger of irreparable injury to plaintiff in defendants' use of the confidential customer list?

Answer:

Yes

Conclusion:

The court affirmed the order of the trial court. The court determined that Giffords' customers could not have been readily ascertained outside their business. The court held that it was proper for the trial court to treat the customer list as a trade secret and to prevent, by means of an injunction, the former employees from using such list. The court held that there was a likelihood of Giffords' ultimate success on the merits of the action and that there was a danger of irreparable injury to Plaintiffs. The court held that the trial court had not abused its discretion in granting Plaintiffs' preliminary injunction.

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