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Calvary Industries, Inc. v. Coral Chemical Co.

Court of Appeals of Ohio, Twelfth District, Butler

August 21, 2017

CALVARY INDUSTRIES, INC., Plaintiff-Appellant,
v.
CORAL CHEMICAL COMPANY, Defendant-Appellee.

         CIVIL APPEAL FROM BUTLER COUNTY COURT OF COMMON PLEAS Case No. CV2016-02-0395

          Burke Law Office, LLC, Travis E. Burke, for plaintiff-appellant

          Garvey Shearer Nordstrom, John J. Garvey III, for defendant-appellee

          OPINION

          PIPER, J.

         {¶ 1} Plaintiff-appellant, Calvary Industries, Inc., appeals a decision of the Butler County Court of Common Pleas, granting a motion to dismiss in favor of defendant-appellee, Coral Chemical Company.

         {¶ 2} Coral Chemical Company is a corporation with citizenship in Illinois. Coral employed Rashmi Patel, who is also a citizen of Illinois. After 24 years of employment, Coral hired Patel as an independent contractor. The independent contractor agreement included a fixed termination date. When Patel and Coral could not reach an agreement to continue Patel's independent contractor status, their relationship terminated.

         {¶ 3} Approximately a month later, Calvary, an Ohio Corporation, hired Patel as an independent contractor. Calvary instructed Patel that he was not to utilize, share, or communicate any confidential, proprietary, or trade secrets he learned while working with Coral.

         {¶ 4} Coral later filed a complaint against Patel in a Lake County, Illinois, court alleging breach of the employment agreement and independent contractor agreement between itself and Patel ("Lake County Case"). Coral alleged that Patel breached the restrictive covenants prohibiting him from working for Coral's direct competitors, including Calvary.

         {¶ 5} Within the Lake County Case complaint, Coral named Calvary as a respondent in discovery. This designation gave Coral the opportunity to conduct discovery to determine whether Calvary should be named a defendant in the case. After a year of disputed proceedings in which Calvary challenged the Illinois Court's personal jurisdiction over it, the Illinois Court dismissed Calvary from the Lake County Case for lack of personal jurisdiction.

         {¶ 6} Prior to Calvary being dismissed from the Lake County Case, Calvary had initiated the current action for declaratory judgment against Coral in the Butler County Court of Common Pleas, seeking a declaration that (1) Calvary was legally permitted to employ Patel as an independent contractor; (2) Calvary did not commit any tortious conduct arising from, or in connection with, the employment of Patel as an independent contractor; (3) Calvary's employment of Coral's former employees did not violate noncompete and confidentiality agreements Coral had with its employees; (4) Calvary's conduct associated with Patel's employment did not cause any violation of the employment and independent contractor agreements between Patel and Coral; and (5) Calvary had not received, benefited from, or utilized any of Coral's confidential, proprietary, or trade secret information.

         {¶ 7} Coral filed a motion to dismiss or stay the proceedings, and argued that the issues raised in Calvary's declaratory judgment action were already pending before the Illinois Court through the Lake County Case. Calvary had not been dismissed from the Lake County Case as of this time. The trial court scheduled a conference with the parties on October 20, 2016. However, on October 19, 2016, the trial court canceled the status conference and granted Coral's motion to dismiss. Unbeknownst to the trial court, on September 12, 2016, Calvary had been dismissed from the Lake County Case. The trial court cited forum non conveniens as the reason for its dismissal.

         {¶ 8} Calvary thereafter filed a motion to reinstate its declaratory judgment action wherein it explained that the Illinois court dismissed it from the Lake County Case for lack of personal jurisdiction. The trial court denied Calvary's motion to reinstate, stating that it found the motion "not in proper order."[1] Calvary now appeals the trial court's order, raising the following assignments of error.

         {¶ 9} Assignment of Error No. 1:

         {¶ 10} THE TRIAL COURT ERRED BY GRANTING APPELLEE'S ...


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