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Tarkett USA, Inc. v. Harnix Corp.

United States District Court, N.D. Ohio, Eastern Division

June 6, 2017

TARKETT USA, INC. Plaintiff,
v.
HARNIX CORP., et al., Defendant.

          ORDER

          CHRISTOPHER A. BOYKO United States District Judge

         This matter is before the Court on Defendant Gilles de Beaumont's Motion to Dismiss for Lack of Personal Jurisdiction or, in the Alternative, Motion to Transfer Venue. (ECF # 7). For the following reasons, the Court grants, in part, Defendant's Motion.

         According to Plaintiff Tarkett USA, Inc.'s (“Tarkett”) Complaint, Gilles de Beaumont was a long time employee of Tarkett and Tarkett's predecessors. In 1996, Tarkett, through its predecessors Azrock Industries, Inc. and National Floor Products Company, Inc., entered into an Agreement with Harnix Corporation d/b/a Linron that involved the reselling of Tarkett products to Walmart. Under the Agreement, Linron would manage the installation process of the Tarkett products. The Agreement contained a non-compete clause wherein Defendants agreed not to sell competing products to Walmart.

         Linron also managed the removal of Tarkett products at Walmart stores wherein the old flooring was removed and returned to Tarkett for recycling and use in new Tarkett products. These include vinyl composite tile (“VCT”), which consists of approximately 30% recycled materials, thereby reducing Tarkett's costs and supporting Tarkett's sustainability initiatives.

         The relationship continued for nearly twenty years with an average of $14, 500, 000 of Tarkett products sold to Walmart through 2013. During this time the VCT product sold to Walmart was manufactured in Texas. In 2014, Tarkett moved its VCT production operation to Alabama.

         On August 7, 2015, Linron gave Tarkett notice it was terminating the 1996 Agreement. Tarkett acknowledged receipt of the notice and reminded Linron of the prohibited activities clause, including the non-compete provision, that would remain in effect for one year. In spite of the contractual non-compete clause, Defendants have competed with Tarkett in violation of their obligations under the 1996 Agreement.

         In 1996, the VCT produced by Tarkett was manufactured in Texas. De Beaumont was Tarkett's Texas-based executive responsible for the manufacturing and sales of the VCT. In his role as a Tarkett executive, Tarkett alleges de Beaumont had access to Tarkett's confidential and proprietary information including, but not limited to, product information, product development and design, the identity of customers and employees; manufacturing and plant operations, vendor information; marketing information and strategies; sales training techniques and programs; acquisition and divestiture opportunities and discussions; and data processing and management information systems, programs and practices.

         In 2014, Tarkett moved its VCT manufacturing operation from Texas to Alabama. As a result of the move, de Beaumont was reassigned by Tarkett to Montreal, Canada as a sales manager. De Beaumont terminated his employment with Tarkett shortly thereafter. De Beaumont signed a Separation Agreement with Tarkett wherein he agreed not to compete with Tarkett for one year after the conclusion of his employment with Tarkett. The Separation Agreement also contained a non-disclosure clause. According to Tarkett, de Beaumont went to work for Linron, a competitor of Tarkett and disclosed Tarkett confidential information to Linron, both in violation of the Agreement. Tarkett alleges Breach of Contract and Tortious Interference with Business Relationships claims against de Beaumont.

         De Beaumont moves to dismiss this action or transfer to Texas. According to de Beaumont, the Court lacks personal jurisdiction over him as his contacts with the State of Ohio are minimal. De Beaumont does not challenge the sufficiency of his contacts with the State of Ohio in order to satisfy Ohio's long-arm statute. Instead, he focuses his challenges on the Due Process requirements of personal jurisdiction. De Beaumont contends any contacts he has had with the State of Ohio have been random, fortuitous or attenuated. His Separation Agreement did not contemplate him having any action or continuing obligation in Ohio. Although he spent two days in Ohio negotiating the Separation Agreement, it was only because Plaintiff was located there. Although the Separation Agreement contains a choice of law clause, naming Ohio law as the applicable law to be applied to any disputes, there is no venue provision. Thus, according to de Beaumont, he never purposefully availed himself of the privilege of acting in the State of Ohio.

         Moreover, according to de Beaumont, Plaintiff cannot demonstrate that its claims against de Beaumont arose out of his contacts with Ohio. Any alleged breach of the Separation Agreement necessarily occurred outside Ohio as did his allegedly tortious interference with Plaintiff's business relationships.

         Lastly, de Beaumont contends it would be unreasonable to hale him into court in Ohio because the Separation Agreement clearly contemplates he was to fulfill his contractual obligations in Texas, not Ohio. Therefore, the Court lacks any personal jurisdiction over de Beaumont.

         De Beaumont requests alternatively that should the Court find it has personal jurisdiction over him, for the convenience of the parties the case be transferred to Texas where the private and public interest factors favor venue in that court.

         According to Plaintiff, de Beaumont was a corporate executive with Tarkett for ten years when its headquarters were located in northeast Ohio. As a Tarkett corporate executive, de Beaumont traveled to Ohio regularly, communicated with Ohio, received payments, supplies and reimbursement monies from Ohio and signed his Separation Agreement containing an Ohio choice of law clause. De Beaumont also caused injury in Ohio by disparaging Plaintiff to prospective and current customers of Plaintiff in order to divert business away from Plaintiff. All of this is sufficient to establish the Court's personal jurisdiction over de Beaumont.

         STANDARD ...


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