In many areas of business, the “playing field” is highly competitive. Businesses compete against rivals for clients or customers, and they also compete with one another when it comes to securing and retaining top employees. In a recent dispute pitting two Spanish-language TV networks against each other, the Third District Court of Appeal ruled that Telemundo was entitled to an injunction that would prevent one of its network executives from starting work at a rival network, TV Azteca.
The executive in this case was Joshua Mintz. Telemundo Media LLC and he signed a contract that began on January 1, 2015 and ran through December 27, 2017. The agreement also gave Telemundo an irrevocable option to extend Mintz’s deal by one more year. The agreement also included a non-competition clause. That provision stated that Mintz could not go to work for any “Spanish-language media competitor of Telemundo… within the United States” for a period of six months after the termination of his employment with Telemundo. The agreement also bound both parties to go through the network’s alternative dispute resolution process if a non-competition issue arose.
In late November 2015, Mintz decided to leave Telemundo and go to work for TV Azteca SA, which is one of Telemundo’s primary competitors. Unsurprisingly, one month later, Telemundo demanded that the two sides go through alternative dispute resolution. Instead, two weeks after this demand, on January 7, 2016, Mintz informed Telemundo that he would be starting at TV Azteca in six days. Two days prior to Mintz’s scheduled start at TV Azteca, Telemundo filed a lawsuit in Miami. The network sued both TV Azteca and Mintz, asking the court to issue an injunction that would prohibit Mintz from working for the rival until Telemundo and Mintz completed the alternative dispute resolution process.
The trial court rejected Telemundo’s request. Since Mintz’s new job was located in Mexico City, and the non-competition provision only listed a geographic coverage area limited to the United States, the provision was not applicable, and Mintz was free to start his job at TV Azteca.
Telemundo appealed and won. The case that Telemundo laid out met each of the criteria for the issuance of a temporary injunction. The appeals court concluded that the network had a high chance of success of proving at trial that a breach of contract had occurred. In the original employment contract, both Mintz and Telemundo agreed that Mintz’s services were something that had a “special, unique, unusual, extraordinary and intellectual character” and that this character gave them “a peculiar value” for which Telemundo could not be properly compensated through a simple monetary award. Mintz promised to deliver those “unique” services to Telemundo until December 27, 2017. Ceasing providing those services to Telemundo, and instead delivering those services to TV Azteca starting in January 2017, likely amounted to a breach.
The law also requires a party seeking an injunction to show that it cannot be adequately compensated through money damages and to prove that the failure to obtain an injunction would cause it an “irreparable injury.” In this case, Telemundo’s proof on these points was largely contained in the employment contract itself, since both the network and Mintz agreed that Mintz’s services were peculiar, special, and unique. Allowing such a peculiar, special, and unique talent to escape early from his contract and go to work right away for a chief rival would be exactly the type of injury that would be considered both irreparable and something for which a monetary damages award would not sufficiently compensate.
In business, you may need to use legal processes to protect your business from rivals in many ways, including guarding your rights regarding your trade secrets and intellectual property, as well as your rights regarding the services of your key employees. For skillful advice and representation regarding your issues, reach out to the Florida commercial litigation attorneys at Stok Folk + Kon. Our attorneys can help you take the actions necessary to protect your business’ rights and property.
Contact us online or by calling (305) 935-4440 to schedule your consultation.
More blog posts:
Both Direct, Indirect Economic Benefits Count In Determining if Miami Beach Debtor Received ‘Value’ for Payments Made, 11th Circuit Rules, Florida Business Lawyers Blog, April 4, 2016
Florida Business Owners Not Required to Arbitrate Due to Agreement’s Narrow Language, Florida Business Lawyers Blog, April 30, 2015