Law School Case Brief
Schultz v. Ingram - 38 N.C. App. 422, 248 S.E.2d 345 (1978)
In order to be entitled to a preliminary injunction, the moving party must show there is probable cause that the movant will be able to establish the right he asserts, and there is reasonable apprehension of irreparable loss unless interlocutory injunctive relief is granted or unless interlocutory injunctive relief appears reasonably necessary to protect the movant's rights during the litigation.
Defendant Joe William Ingram, Jr. signed a "Sub-Associate Agreement," which contained a non-compete covenant. Plaintiff Howard Schultz & Associates, Inc. was named as "Principal." The Associate was authorized to conduct accounts payable auditing services within North Carolina, South Carolina, Georgia, Florida, Tennessee, Alabama and Mississippi for Plaintiff. Defendant worked in the Charlotte area for approximately two-and-one-half years at which time he resigned from his position. Subsequent to his notice of termination, the defendant told Plaintiff's president that he was considering going into the accounts payable auditing business in the Charlotte area after his resignation. The president submitted an affidavit that tended to show that the defendant scheduled accounts payable audits with several of the plaintiff's clients for whom the defendant had previously done auditing work while employed by the plaintiff. In response to the defendant's activities, plaintiff filed a complaint alleging that Ingram was breaching the restrictive covenant agreement by competing with the plaintiff and that the plaintiff would suffer irreparable harm in that the defendant would use and reveal various trade secrets and other confidential information of the plaintiff. The trial court granted plaintiff's motion for a preliminary injunction enjoining Ingram from engaging in accounts payable auditing in competition with the plaintiff within the states of North Carolina, South Carolina, Georgia, Florida, Alabama and Tennessee, except for Memphis, for a period of two years. Defendant was not enjoined from engaging in general accounting activities.
Did the trial court err in granting a preliminary injunction in favor of the plaintiff auditing company?
The court affirmed the order granting a preliminary injunction because the evidence presented in the pleadings, affidavits, and exhibits was sufficient to support a finding of plaintiff's probable success at trial and irreparable loss if the preliminary injunction was not granted. The court held that the absence of a statement of the reasons for the injunction only rendered the order irregular, not void, and should have been corrected by the trial court, which it was, and not on appeal.
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