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Fort Washington Investment Advisors, Inc. v. Adkins

United States District Court, S.D. Ohio, Western Division

September 5, 2019

CARL ADKINS, et al., Defendants.



         This case is before the Court on Plaintiff's motion for a temporary restraining order (Doc. 2) (the “TRO Motion”), as well as the parties' responsive memoranda (Docs. 13, 15, 16).[1] The Court heard oral arguments on September 4, 2019. (Min. Entry and Not. Order dated Sept. 4, 2019).

         I. BACKGROUND

         Plaintiff Fort Washington Investment Advisors, Inc. (“Fort Washington”) is an Ohio-based asset management firm, that offers investment solutions to its clients. (Doc. 1 at ¶¶ 2, 7). Defendants Carl Adkins and Katie Owens (collectively “Defendants”) are Ohio residents, who work in the financial services industry. (Id. at ¶¶ 3-4, 8, 14).

         On September 8, 2016, Fort Washington hired Mr. Adkins as a Vice President. (Id. at ¶ 8). On September 23, 2016, Fort Washington hired Ms. Owens as an Associate. (Id. at ¶ 14). At the outset of their employment, both of the Defendants signed a confidentiality agreement (the “Confidentiality Agreement”), reading as follows:

I understand that in the course of performing my job duties and responsibilities, I may be authorized to access and use proprietary, confidential, and/or trade secret information (“confidential information”). I acknowledge my responsibility to protect the privacy of confidential information. I agree that both during my employment and after my employment with Western & Southern Financial Group (WSFG) [parent company of Fort Washington] ends, I will not retain or use any confidential information. I further understand that WSFG has taken various steps to maintain the confidentiality and secrecy of this information, including use of password protected hardware and software, encryption, and other similar security tools. Additionally, this confidential information will be made available to me only on a need-to-know basis.
Confidential information means any non-public information, including, but not limited to, business plans, product information and plans, business methods and processes, customer/potential client information (including contact information), producer information (including contact information), marketing plans and strategies, competitive analyses, financial information, and personal identification information, such as an individual's name, address, social security number, telephone number, and any other information about an individual's finances, occupation, credit, character, habits or other personal characteristics.

(Id. at ¶¶ 9, 16, Exs. A, D (emphasis added)).

         Mr. Adkins also signed a non-solicitation agreement (the “Non-Solicitation Agreement”), reading as follows:

During the Employee's employment with Company [Fort Washington and affiliates] (the “Employment Period”), and for twenty-four (24) months thereafter, Employee agrees not to engage, directly or indirectly, in any of the following conduct: . . . (c) solicit or direct business of any current Client of the Company, who are or were Clients during the Employment Period, or Prospective Clients, either for himself or for any other individual or entity or advise any person or entity with respect thereto. As used herein, “Client” means any client of the Company at any time during the Employment Period, and a “Prospective Client” means any prospective client that has met with a representative of the Company at any time during the Employment Period.

(Id. at ¶ 12, Ex. C). Neither of the Defendants signed a non-compete agreement. (See generally id.; see also Doc. 13 at 2-3; Doc. 15 at 10).

         During the course of their employment at Fort Washington, both of the Defendants had access to Fort Washington's client information (e.g., their identities/profiles/etc.). (See Doc. 1 at ¶¶ 13, 17; Doc. 7 at ¶¶ 5; Doc. 8 at ¶¶ 5, 8).

         On August 2, 2019, both of the Defendants left their jobs at Fort Washington for jobs at Wells Fargo Clearing Services, LLC d/b/a Wells Fargo Advisors (“Wells Fargo”). (Doc. 1 at ¶¶ 1, 19-20). Thereafter, with the help of Wells Fargo's employees, both of the Defendants contacted certain of their former clients to let them know about their change in employment.[2] (Id. at ¶ 21; see also Doc. 7 at ¶ 5; Doc. 8 at ¶ 5; Doc. 9 at ¶¶ 2- 3). To date, at least three such clients have transferred their accounts from Fort Washington to Wells Fargo, and at least one such client has cited conversations with Defendants as the basis for its departure.[3] (Doc. 1 at ¶¶ 36-55; Doc. 15-1 at ¶ 40).

         On August 20, 2019, Fort Washington filed a verified complaint against Defendants (the “Complaint”).[4] (Doc. 1). In the Complaint, Fort Washington alleges that Defendants have used Fort Washington's confidential information to solicit Fort Washington's clients. (See Id. at ¶ 55). And Fort Washington claims that Defendants have committed, inter alia, breach of contract, misappropriation of trade secrets, and computer fraud. (Id. at ¶¶ 57-109).

         On August 22, 2019, Defendants filed three declarations in opposition to the Complaint (the “Declarations”). (Docs. 7-9). In the Declarations, Defendants (and Wells Fargo's Market Manager) assert that Defendants have not misappropriated Fort Washington's confidential information, solicited Fort Washington's clients, or improperly accessed, printed, and/or deleted any client files. (Docs. 7-9).

         After filing the Complaint, Fort Washington filed the instant TRO Motion. (Doc. 2). With the instant TRO Motion, Fort Washington included a proposed temporary restraining order, setting out the key relief sought, as follows:

4. Defendants, and anyone acting in concert with them, directly or indirectly, are hereby enjoined from violating the terms of the agreements and from violating Fort Washington's common law and statutory rights, including restraining and enjoining them from:
i. Further soliciting Plaintiff's clients as required by the Amended & Restated Non-Solicitation Agreement (“Non-Solicitation Agreement”);
ii. Using any of Plaintiff's confidential information as defined by the Agreement to Protect Confidential Information (“Confidentiality Agreement”) to solicit Fort Washington clients or for the benefit of any third party, including Defendants' current employer; and
iii. Having any contact with any of Fort Washington's clients until such time as the Court can be determined exactly what confidential, trade secret information Defendants have misappropriated to ensure that no such misappropriated information can continue to be used for Defendants' benefit.

(Doc. 2-2 at ¶ 4). Defendants do not object to paragraphs 4(i) or 4(ii). (See Doc. 13 at 11-12). Defendants do object to paragraph 4(iii). (See Id. at 12). Thus, the sole issue before the Court, at this time, is whether to award Fort Washington the relief sought in paragraph 4(iii).[5]

         II. ...

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