R.J. Cronkhite obtains $160,924.84 arbitration award in construction dispute.

Issue: Mold Abatement | Reconstruction | Water Remediation

Court: Private Arbitration (Wayne County)

Industry: Construction

Judge: Private Arbitrator

I represented a business specializing in restoration work arising from catastrophic losses.  The company had provided extensive water mitigation, mold remediation, and reconstruction work to a beautiful home that suffered severe water damage.  The homeowner refused to pay for the services after his insurance company disputed whether the work arose from the water damage.

To win, I had to painstakingly demonstrate that the company’s work was necessary and appropriate given the nature, cause, and extent of the water damage.

After a two-day arbitration, the arbitrator awarded the client 160,924.84, including not only work performed but also attorney’s fees and arbitration costs.  The company happily received full payment shortly after the arbitrator entered the award.

Enforced non-solicitation agreement against home care worker preventing home care worker from soliciting home care company’s clients and from interfering with the company’s provision of services.

Issue: Non-solicitation | Employment Agreement

Court: Wayne County Circuit Court (Michigan)

Industry: Healthcare

Judge: Judge Muriel Hughes

My client provided home care services, specializing in helping those injured in motor vehicle and work-related accidents.
My client, through hard-earned experience, knew enough to have its home care aides sign an employment agreement with a non-solicitation clause; these provisions are regularly enforceable under Michigan law.
Given that its workers were subject to non-solicitation provisions, my client was shocked to find that one of its home care aides attempting to solicit patients so that the home care aid could divert the business for herself. Even after agreeing not to solicit patients, some employees test their employer’s resolve to enforce non-solicitation provisions.
The home care work was also defaming my client to the insurance company responsible for assigning and paying for the care of these patients. This is a common tactic in unfair competition and solicitation situations: the home care worker was going directly to the source who awarded the work, the insurance company, to help ensure she intercepted the work.
Worse yet, the home care worker was providing healthcare services that conflicted with my client’s recommendations, jeopardizing the safety of these vulnerable patients.
Upon my client’s revelation, my client asked me to take immediate action to enforce the non-solicitation provision and stop the harmful communications with the insurance company.
I acted quickly and thoroughly explained the situation to the court, and the risk to the patient. The Court ordered the home aide to stop doing any further business with the patient. The Court also ordered the home aide from soliciting any further home patients of the home care company. Just as importantly, the Court ordered the home aide from interfering with the home care company’s provision of service with the patients, including communicating with the insurance company responsible for assigning, and paying for, the care.
This case illustrates some of the tactics that devious individuals use to unfairly compete in order to divert money for themselves. Courts will not tolerate this kind of “competition.” But it is critical for the attorney to provide the factual details, supported by evidence, that enable the judge to make a reasoned ruling in your favor.

Enforced non-compete and non-solicit agreement and obtained order against former tech salesman, prohibiting salesman from working in tech industry for two-year period.

Issue: Non-Compete | Non-Solicitation | Preventive Strategies

Court: Oakland County

Industry: Technology Industry

Judge: Judge Alexander

I represented a technology company specializing in managed services and hardware.
One my client’s lead salesman was terminated for a variety of reasons. The upset salesman than proceeded to solicit a number of the technology company’s customers and leads–despite having an employment contract that prevented him from doing so. The salesman also joined a new technology company in violation of his employment agreement’s non-solicitation clause.
My client found a smoking gun–the salesman had signed his name on one of my client’s customer’s sign-in sheets, along with a representative from the new technology company.
My client retained me and I swiftly filed a complaint and a motion asking the court to stop this misconduct.
The Court ordered the former technology salesman from soliciting any of my client’s customer, prospect, or lead.
After further litigation, the technology salesman consented to a court order (injunction) that prohibited him from working within the tech industry for a two-year period. This is an important lesson: courts will often reset the non-compete or non-solicit clause in order to prevent the employee from having a “grace” period during which the employee solicits or competes in violation of his contract.
The tech salesman and his new employer also consented to an injunction that prohibited them from soliciting any of the tech company’s customers, prospects, or leads.
By suing both the tech salesman and his new employer, my client sent a strong message to both employees and competitors that my client would not permit unfair competition and the raiding of its customerbase.

Obtained money judgment against telecom salesman and manager for unlawful solicitation of clients and violation of non-compete.

Issue: Non-Solicitation | Employment Agreement | Non-Compete

Court: Oakland County Circuit Court (Michigan)

Industry: Telecom

Judge: Judge Martha Anderson

My client’s expertise involved constructing and servicing cellular towers throughout the nation.
My client had hired a young, novice telecom salesman and spent thousands of dollars and years training him in the industry. This included paying for his valuable telecom certifications. The telecom worker repaid this investment by resigning and secretly joining a competitor in violation of his non-compete clause. Even more troubling, the telecom worker began diverting major telecom accounts to my client’s competitor. In the meantime, the telecom worker lied to my client about his post-resignation employment plans. This kind of deceit is a common ploy used by former employees who plan on breaking their contracts and unfairly competing with their former employers.
The telecom salesman’s violations came to light when my client’s customer accidentally sent an email to the telecom salesman’s old email account–undoubtedly stored in the customer’s Outlook contacts. You would be surprised how commonly this occurs.
I was retained to file a lawsuit and to request immediate injunctive relief against both the telecom salesman and the competitor.
At the beginning of the case, the judge entered an order prohibiting the telecom salesman from doing any work on my client’s accounts now being serviced at the competitor.
As the case progressed, it became increasingly clear that the competitor obtained my client’s customer accounts due to the telecom salesman diverting them to the competitor.
The competitor fired the telecom salesman. The competing telecom company also paid my client in light of my client’s claims that the new telecom company had successfully obtained a substantial amount of business based on the telecom salesman’s diversion of business in violation of his employment agreement.
As for the telecom salesman, the court awarded a money judgment against him. Further, the telecom salesman was prohibited from working within the telecom industry for a two-year period.
These results illustrate that prompt legal action and thorough discovery into the wrongdoing can lead to significant benefits and protection of customer accounts in the telecom industry.

Enforced non-compete and non-solicit against automation engineer.

Issue: Non-Compete | Non-Solicitation | Preventive Strategies


Industry: Technology and Automotive Industries


I enforced my client’s non-compete and non-solicitation agreement against a former automation engineer. The engineer had resigned and joined a competitor. The competitor then sought to use the engineer’s relationships with my client’s automotive customers, as well as the engineer’s knowledge of those customer’s systems and preferences, to win a bidding war. This is classic unfair competition; the maneuver failed after I got involved.
My client provides automation design solutions to a number of industries, including within the automotive industry. My client hired an automation engineer to help provide those services. As part of the engineer’s work, he became familiar with my client’s operations and technologies. But, perhaps even more importantly, the engineer was introduced to my client’s key customers. As the engineer continued to work with my client’s customer, the engineer began to under each customers’ technology preferences and how to implement those preferences within the customer’s business systems.
Any employer who puts its employees in a similar situation faces certain competitive risks. If an employee with this knowledge and relationships—created through the employee’s employment—joins a competitor, there is a significant chance, if not a likelihood, that the business will go with that employee.
This risk plays out somewhat differently in different industries. For instances, in the automotive industry, technology work, such as automation services, are typically bid out to various technology outfits. The bidding process will often require the bidding company to identify who will work on the project. Thus, when a former employee leaves, the employer faces dual challenges: not only does the employee take his knowledge of the employer’s systems and relationships, but a competitor can use the former employee’s name on a bid submission to great effect.
This is precisely the sort of situation that screams for an agreement with non-compete and non-solicit provisions. These provisions protect the employer should the employee leave and decided to solicit (or even accept) business from the former employee.
Fortunately, my employer had entered an agreement with its automation engineer, and the agreement contained the appropriate provisions to prevent unfair competition, including the engineer leveraging his knowledge to solicit my client’s customers. I was able to use the agreement–and my understanding of this industry and how its interplay with competition law–to negotiate a favorable resolution that ensured my client’s business relationships and contracts were not disrupted.