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Hughes v. Merchant E-Solutions

United States District Court, D. Minnesota

June 4, 2015

Glenn Hughes, Plaintiff.
v.
Merchant e-Solutions, Defendant.

Christopher S. Naveja, Amstein & Lehr, LLP, Chicago, Illinois; William M. Hart & Bradley J. Lindeman, Meagher & Geer, PLLP, Minneapolis, Minnesota, counsel for Plaintiff.

Andrew J. Voss & Joseph D. Weiner, Littler Mendelson, PC, Minneapolis, Minnesota, counsel for Defendant.

MEMORANDUM OPINION AND ORDER

SUSAN RICHARD NELSON, District Judge.

Before the Court is the Motion for a Preliminary Injunction [Doc. No. 10] filed by Defendant Merchant e-Solutions ("MeS"). After hearing oral argument on April 9, 2015, and in consideration of the submissions of the parties, the Court denies Defendant's motion for the reasons stated herein.

I. BACKGROUND

Plaintiff Glen Hughes filed this action in February 2015 for breach of contract and contract reformation. Hughes alleges that in January 2000, he entered into an independent contractor agreement with MeS's predecessor, Transcom, whereby Hughes was hired to solicit offers for credit card or bankcard processing services (the "Agreement"). (Compl. 7 [Doc. No. 1].) The Agreement described Hughes' powers and duties, Transcom's services, and Hughes' compensation. (Agreement §§ 2-4, Ex. 1 to Compl. [Doc. No. 1-1].) Up-front commissions and residual compensation were included in Hughes' compensation. (Id. § 4.) Section 6 of the Agreement included the following covenants made by Hughes to Transcom:

(6)(b) During the term of this Agreement, you agree not to:
(1) Represent any of Transcom's competitors in connection with any products and/or services while at the same time soliciting orders for us; and/or
(2) Sell, rent or lease any other equipment while at the same time soliciting orders for us;
(6)(c) During the term of this Agreement and for a period of twelve (12) months thereafter, you agree not to:
(1) Call upon or solicit, either directly or indirectly, or engage any person or entity to call upon or solicit, any of our existing customers with regard to any service or product covered by this Agreement; and/or
(2) Hire any person who prior to that time was an employee or IC of ours.
(6)(d) In the event of a breach by you of any of the above covenants, you agree that monetary damages will be inadequate, that we may seek and obtain a temporary and/or permanent injunction, and to pay our costs and attorney's fees.
(6)(e) You agree that if any loss to TPS is caused by your negligent or wrongful act, then we have full recourse to you and you shall be liable for one ...

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