Opinion
NO. 23-CA-133
12-20-2023
PINNACLE SECURITY & INVESTIGATION INC. v. Timothy HOWARD, Jr. and Orleans Security, LLC d/b/a Force 1 Security Company
COUNSEL FOR PLAINTIFF/APPELLANT, PINNACLE SECURITY & INVESTIGATION, INC., Joseph F. Lavigne, New Orleans, P. J. Kee, Conner H. Fields, New Orleans COUNSEL FOR DEFENDANT/APPELLEE, TIMOTHY HOWARD, JR., Evan J. Bergeron, Samuel H. Winston, Jeigh L. Britton
ON APPEAL FROM THE TWENTY-FOURTH JUDICIAL DISTRICT COURT, PARISH OF JEFFERSON, STATE OF LOUISIANA, NO. 831-964, DIVISION "I", HONORABLE NANCY A. MILLER, JUDGE PRESIDING
COUNSEL FOR PLAINTIFF/APPELLANT, PINNACLE SECURITY & INVESTIGATION, INC., Joseph F. Lavigne, New Orleans, P. J. Kee, Conner H. Fields, New Orleans
COUNSEL FOR DEFENDANT/APPELLEE, TIMOTHY HOWARD, JR., Evan J. Bergeron, Samuel H. Winston, Jeigh L. Britton
Panel composed of Judges Stephen J. Windhorst, John J. Molaison, Jr., and Scott U. Schlegel
WINDHORST, J.
1Appellant, Pinnacle Security & Investigation, Inc. ("Pinnacle") appeals the trial court’s October 22, 2022 judgment denying its request for a preliminary injunction. For the following reasons, we affirm.
PROCEDURAL HISTORY
On August 24, 2022, Pinnacle, a security services provider, filed a Verified Petition for Damages and Injunctive Relief against appellee, Timothy Howard, Jr., and Orleans Security, LLC d/b/a Force 1 Security Company ("Force 1"). The petition alleged that Mr. Howard was hired by Pinnacle on July 31, 2019, he was promoted to command desk officer on August 12, 2020, and he was promoted again on January 6, 2021 to field supervisor. The petition also alleged that Mr. Howard resigned from his position as field supervisor on January 5, 2022, and he accepted employment with Force 1 on January 10, 2022. In the petition, Pinnacle sought to enjoin its former employee, Mr. Howard, from violating a Non-Competition and Confidentiality Agreement (the "non-competition agreement"). Pinnacle alleged that Mr. Howard violated the non-competition agreement by accepting employment and performing security services with its direct competitor, Force 1, approximately one week after resigning from Pinnacle (the "non-compete provision"). Pinnacle asserted that Mr. Howard also violated the non-competition agreement by soliciting Pinnacle customers, including the New Orleans Regional Transit Authority (the "RTA") and CrescentCare, a healthcare service provider in the New Orleans region (the "non-solicitation provision").
Pinnacle also filed a motion and incorporated memorandum in support of a temporary restraining order ("TRO") and preliminary injunction against Mr. Howard and Force 1, alleging that Mr. Howard breached the non-competition agreement. 2Pinnacle asserted that Mr. Howard was hired by Pinnacle to work as a supervisor on July 31, 2019 and he signed the non-competition agreement on August 22, 2019. While employed, Mr. Howard performed security services for CrescentCare and the RTA on behalf of Pinnacle. The motion asserted that Mr. Howard resigned from his position as supervisor on January 5, 2022, and Pinnacle learned that Mr. Howard accepted employment with Force 1 on January 10, 2022, less than one week later. Pinnacle alleged that since his resignation, Mr. Howard has been promoting Force 1’s security services to solicit Pinnacle’s customers, including CrescentCare and the RTA. On August 25, 2022, the trial court granted Pinnacle’s request for a TRO and set a hearing on Pinnacle’s request for a preliminary injunction.
The following exhibits were attached: (1) the petition for damages and injunctive relief; (2) the non-competition agreement; (3) Mr. Howard’s resignation letter; (4) RFP 2020-009 Individual Reviewer…… Scoring Form from the RTA; (5) Letter from the RTA to "All Proposers;" (6) the cease and desist letter to Mr. Howard; and (7) the cease and desist letter to Force 1.
Mr. Howard filed a memorandum in opposition contending that Pinnacle was actively seeking to prevent him from earning a living based on the alleged non-competition agreement. Mr. Howard denied sign- ing the non-competition agreement and contended that he had never seen the non-competition agreement until he was served with this lawsuit. He further asserted that even assuming the non-competition agreement is valid, which he denied, Pinnacle waived enforceability of the same because Pinnacle was aware of his concurrent employment with a competitor of Pinnacle. Mr. Howard further averred that he never solicited or procured business on behalf of Force 1. Mr. Howard prayed that the trial court dissolve the TRO and deny Pinnacle’s request for a preliminary injunction.
Pursuant to La. C.C.P. art. 1005, in ordinary proceedings the answer shall set forth any matter constituting an affirmative defense. Waiver is an affirmative defense which must be expressly pled in the answer. However, as this was a summary proceeding, Mr. Howard was not required to file an answer and he was not required to set forth the defense of waiver in a pleading. In his memorandum in opposition to Pinnacle’s request for a preliminary injunction, Mr. Howard clearly stated the defense of waiver.
On October 5, 2022, after an evidentiary hearing, the trial court denied and dismissed Pinnacle’s request for preliminary injunction. In its reasons for judgment, the trial court found the existence of a valid non-competition agreement to be 3"dubious." Finding his testimony to be extremely credible, the trial court found that Mr. Howard did not electronically sign the alleged non-competition agreement. The trial court also found that the signing of the non-competition agreement would have been contrary to Pinnacle’s business practice of allowing Mr. Howard to work a second security guard job within the covered territory of the non-competition agreement. Even assuming a valid non-competition agreement exists, the trial court found that Pinnacle was unlikely to prevail on the merits. The trial court found that Pinnacle did not complain that Mr. Howard continues to earn a living as a security guard, "which is consistent with Pinnacle having knowingly allowed [Mr.] Howard to violate that portion of the non-[competition] agreement previously." The trial court additionally found that Pinnacle submitted no evidence that Mr. Howard engaged in solicitation on behalf of Force 1, in violation of non-competition agreement. The trial court specifically found that the evidence showed that Pinnacle lost the CrescentCare and RTA contracts for reasons unrelated to Mr. Howard. Accordingly, the trial court denied and dismissed Pinnacle’s request for preliminary injunction.
FACTS and EVIDENCE
Because Pinnacle seeks review of the trial court’s denial of the preliminary injunction regarding only the non-compete provision of the non-competition agreement, the relevant facts elicited at the preliminary injunction hearing as to the issue on appeal are as follows.
Pinnacle is not seeking review of the trial court’s denial of its request for preliminary injunction regarding the non-solicitation provision of the non-competition agreement. Therefore, this opinion does not discuss the facts considered by the trial court concerning the solicitation provision.
Chad Perez, CEO and owner of Pinnacle, testified that he is familiar with the onboarding procedures for employees of Pinnacle in August of 2019. He stated that in June or July of 2019, Pinnacle transitioned from paper onboarding documents to 4an electronic applicant tracking system called "Trait Set." He testified that Trait Set "took applicant information in, they complete an application, track them throughout the interview process, after they were – the decision to hire was made, an email was sent to that applicant’s email address with a link to all the onboarding documents to complete electronically." He stated that for each onboarding document, the applicant electronically signs his name and then clicks a "submit" button, at which time the document is submitted. In August of 2019, Pinnacle required an applicant to sign eight onboarding documents. Mr. Perez testified that "[o]n the backend, once we get a notification that it is one hundred percent completed," someone from management personnel reviews the documents and electronically signs the documents that require approval. He testified that he is one of the individuals at Pinnacle with access to the onboarding documents once they are completed.
Although the transcript shows that the onboarding system is referred to as "Tradeset," one of the documents admitted into evidence, an email, shows that the system appears to be "Trait Set." For consistency purposes, this opinion will use the correct name of the system as shown on the exhibit.
In preparation for the hearing, Mr. Perez stated he retrieved the onboarding documents, including the non-competition agreement, electronically signed by Mr. Howard from Mr. Howard’s profile in the system. Mr. Perez testified that the onboarding documents show the various signatures by Mr. Howard, the date of August 22, 2019, and the time he signed electronically signed each document.
The six onboarding documents submitted into evidence were: (1) "Acknowledgment of Select Policies;" (2) "Employment Eligibility Verification;" (3) "Employee Withholding Exemption Certificate (L-4);" (4) the Agreement; (5) "Standard Operating Procedure;" and (6) "Employee’s Withholding Allowance Certificate" Form W-4 for 2019.
Mr. Perez testified that he also performed a search on Trait Set for Mr. Howard’s name. He produced three documents, asserting that they established that Mr. Howard signed the non-competition agreement.
The three documents were admitted as one exhibit.
5The first document provided the following:
378 So.3d 849.bmp
Mr. Perez testified that the above document shows Mr. Howards name, his application, the position he was applying for, dates, and a location where he was applying to work. Under the onboard column, the document shows that Mr. Howard was "one hundred percent approved and hired," which according to Mr. Perez, means Mr. Howard "completed all the documents, a management personnel went in, approved the documents that they need to, and he was determined to be hired."
6Mr. Perez also submitted into evidence a copy of an automated email from Trait Set showing Mr. Howard’s application was completed on August 20, 2019.
Mr. Perez testified that an applicant completes a one-page application by giving a work history and personal information.
378 So.3d 850_1.bmp
He testified that pursuant to Pinnacle’s onboarding procedures, Mr. Howard filled out an application on August 20, 2019, as shown in the above document, and the system then generated an email with a link to complete the eight required onboarding documents, which included the non-competition agreement. He testified that Mr. Howard signed the onboarding documents on August 22, 2019.
Mr. Perez testified that he retrieved the following document from the "backend of the system":
378 So.3d 850_2.bmp
Mr. Perez testified that the above document was retrieved from Mr. Howard’s profile in the system and it showed that eight onboarding documents were assigned to Mr. Howard, he completed all eight documents, and all eight documents were approved by management personnel. Mr. Perez stated that the non-competition agreement 7was one of the eight onboarding documents electronically signed by Mr. Howard on August 20, 2019, and he subsequently reviewed, approved, and electronically signed the non-competition agreement on August 26, 2019.
Mr. Perez acknowledged that he did not personally witness Mr. Howard electronically sign the non-competition agreement. When asked if he had any evidence that the non-competition agreement was actually included in the onboarding documents for Mr. Howard to complete, Mr. Perez testified he did. He stated that the system sent out eight documents, those documents are logged in under Mr. Howard’s profile within the system, and one of those documents is the non-competition agreement. He testified that he knows Mr. Howard signed all the onboarding documents, in- cluding the non-competition agreement because he reviewed and electronically signed the non-competition agreement after it was completed by Mr. Howard.
Later in his testimony, Mr. Perez testified that Mr. Howard was "initially hired in July of 2019" and at that time, Pinnacle "had not started the contract yet with the RTA." Mr. Perez stated that "[i]t was determined through an interview that he was going to be hired. So that’s when shortly thereafter he was sent the onboarding documents. And he began servicing RTA in August of 2019." Mr. Perez testified that Mr. Howard also handled the CrescentCare account when he was a supervisor.
Mr. Perez acknowledged that sometime after Mr. Howard was hired by Pinnacle, he learned that Mr. Howard was also providing security services as an assistant security director at the Riverwalk on behalf of Professional Security Consultants ("PSC"), another security provider. Mr. Perez testified that he researched the company and discovered that PSC was a security company from California. Mr. Perez testified that PSC’s only work locally was the Riverwalk and to his knowledge, Pinnacle has never been in competition with PSC. Based on this 8information, Mr. Perez testified that he determined Mr. Howard’s employment with PSC was not considered to be in competition with Pinnacle.
When questioned as to whether he permitted Mr. Howard to schedule his work at Pinnacle around his work at PSC, Mr. Perez replied "I did not." Mr. Perez was asked if he was aware that Mr. Howard, on at least one occasion, left his post with Pinnacle to respond to a security incident at the Riverwalk as part of his job with PSC, to which he responded "I believe there was an incident, now [that] you bring that up. I don’t recall [the] particulars around it."
Mr. Perez further testified that after Mr. Howard resigned from Pinnacle, he learned that Mr. Howard was competing with Pinnacle by accepting employment with Force 1 and performing security work on behalf of Force 1 with CrescentCare and the RTA, two former customers of Pinnacle. A cease and desist letter was subsequently sent to Mr. Howard and to Force 1.
Mr. Howard testified that he was formally employed by Pinnacle and he was initially hired, he believes in August 2019, as a security officer. When questioned as to whether he received an email with a link to electronically sign onboarding documents, Mr. Howard testified that he believed he signed onboarding documents in person, but the non-competition agreement was not one of the onboarding documents he signed. He stated that he did not recall and did not remember signing the onboarding documents via an email. The following dialogue occurred:
A. Not to my recollection. I don’t remember about signing anything on email.
Q. Did you sign anything at all via – electronically when you started at Pinnacle?
A. No, I don’t remember.
Q. You don’t remember. When you started out at Pinnacle, do you remember filling out forms related to your taxes?
A. Yes, I -- that’s what I’m saying. I don’t remember even doing any of that online. You’re asking about a question if it was online. No, I don’t remember that.
Q. Okay. Do you remember doing it in person?
9 A. I believe we did.
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Q. So here -- this is an acknowledgment of select policies that says that you elec- ironically signed on August 22nd, 2019 at 2:00 o’clock. Does this refresh your recollection about acknowledging these policies?
A. I see something that’s typed in. I can’t say this is actually my signature at all. So I can’t say that.
Q. Okay. So your testimony is you don’t recall doing that?
A. No, I don’t. I’m being honest. I don’t remember. That’s what I’m telling you.
Q. Okay. Turn the page, the next page in the exhibit. Employee Employment Eligibility Verification, Department of Homeland Security. Do you see that document?
A. Yes, sir.
Q. Do you recall seeing that document when you were hired on?
A. No, sir. Again, I told you, I don’t remember doing anything as far as this. This is now, you know, two years -two and a half years later. I don’t remember.
Q. Okay. But you’re not saying you didn’t do it, you’re just saying you don’t remember doing it?
A. No, sir, I don’t. I don’t remember doing this on the computer at all.
Q. Right. The last four -- and we redacted this for – I didn’t want to have your confidential information out there, but are the last four digits of your social security number XXXX?
A. Yes, sir.
Q. The next page there is the Employee Withholding Exemption Certificate. Do you recall signing that document electronically?
A. No, sir, I don’t remember.
Q. And again, according to this document, it’s showing that you signed it on the same date, 8/22 around 2:01; is that right? Do you see that down on the bottom right?
A. I see it, sir. Like I said earlier, I don’t remember signing this at all.
Q. Okay. And again, here is your social security number, last four is XXXX?
A. That is, correct,
Q. And then the next -- the next document within Exhibit 16, that’s the Pinnacle Security Investigation Non-competition and Confidentiality Agreement; is that right?
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A. Yes, sir, I see it.
Q. And were you aware that Pinnacle required its security officers to sign confidentiality and non-competition agreements?
A. No, sir, I was not aware.
Q. If you turn to the last page, it has there your signature, electronic signature, dated 8/22/2019 at 2:01 p.m.; is that right?
10 A . Yes, sir, I see the time.
Q. So just after the signatures on the other documents that we looked at within Exhibit number 16; is that correct?
A. Yes, sir. Like I said earlier, I still don’t remember.
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Q. So your testimony is you don’t remember receiving and signing this document electronically?
A. That’s correct, sir.
Q. But you’re not saying that it didn’t happen?
A. I said I don’t remember and I don’t remember seeing this at all.
Q. Okay.
A. Because
Q. Go ahead.
A. No, I’m just saying because I don’t remember. I stated it earlier, I don’t remember signing this at all and I don’t know about this agreement until just recently being served about it. Q. Okay. And you understand that this agreement prohibits you from competing with Pinnacle for a period of two years after you left your employment there in certain areas?
A. Again, I don’t remember seeing this and I don’t remember signing this.
Q. I understand that, I’m just -- so let’s just look at Provision 4 of the agreement that says Restricted Covenants. I understand your position is you don’t remember ever signing this. My question is a little bit different. Do you understand that this agreement would prohibit you, had you signed it, would prohibit you from competing with Pinnacle Security for a period of two years within the period you left employment at Pinnacle within the parishes that are listed in this agreement? Do you understand that?
A. Yes, I understand that. At the same time, I was already also working for another security company. So I would have really not have signed something like this.
Q. Okay.
A. Because of my experience.
Q. Okay. But you said you may have signed it, you just don’t recall signing it?
A. No, I said -- no, no, no, I said I don’t remember signing it, like I said earlier, and I don’t remember seeing this at all.
Q. Okay. All right. So let’s get through the last document here. And there’s a couple more. So the next document within Exhibit 16 is the Pinnacle Security Standard Operating Procedures. Do you recall receiving and reviewing that document when you when you started your employment at Pinnacle?
A. No, I don’t remember seeing this at all.
Q. Okay.
A. Or signing it.
Q. Okay.
11 A. Like I said earlier. I don’t remember seeing this and I don’t remember signing this at all.
Q. Okay. And if you look at the next page there, it shows that you electronically signed it on 8/22/2019 at 2:01 p.m., correct?
A. I see the time and I see -- I see my name on it, but like I said, I don’t remember seeing this or signing this. I really believe we did it in person.
Q. Okay. And then the next one is your W-4 form. Again, this one shows that it was electronically signed by you at 2:02 p.m. on August 22nd, 2019, all around the same time on the same date and around the same time that the all the other documents within Exhibit 16 show; is that correct?
A. Yes, sir. I see the same thing. Like I said earlier, I don’t remember seeing this or signing this. I believe we did it in person.
Q. Okay. And again there, the last four of your social security is XXXX?
A. Yes, sir.
Mr. Howard further testified that the non-competition agreement did not contain his signature; rather, it contained a typed name. He testified that he did not type his name nor did he authorize anyone else to type his name on the non-competition agreement. He did not agree verbally or in writing to the terms, conditions, restrictions, or obligations contained in the non-competition agreement. If he had been presented with the non-competition agreement, he would not have signed it because he has always worked at different security companies at the same time. He testified that for the past "twenty-five, twenty-six years," it was "a regular occurrence" for him to hold two different security jobs with competitors at the same time. He testified that he would not have been able to survive if he signed the non-competition agreement because he needed the second income.
He testified that he started working for PSC on October 2, 2019. He testified that he had a direct conversation with Mr. Perez about his concurrent employment with PSC. When Mr. Perez asked him about being a supervisor at Pinnacle, he informed Mr. Perez that he worked as the assistant security director at the Riverwalk on behalf of PSC. Pinnacle’s counsel asked him if PSC only serviced the Riverwalk, to which Mr. Howard responded: "At this particular time, I don’t believe they have 12anything else. But they have – they were in competition for other contracts in the city." Mr. Howard testified that PSC was a competitor of Pinnacle. Mr. Howard testified that he also informed other personnel at Pinnacle that he was providing security services at the Riverwalk on behalf of another security company. Mr. Howard verified two documents he electronically signed and filed with the Louisiana State Board of Private Security Exam showing that he worked for Pinnacle and PSC during the same time period. Mr. Howard further testified that while working for Pinnacle, he also worked for Algiers Charter School as a school resource officer and as part of his duties, he would patrol the school’s building to ensure safety. Mr. Howard testified that no one, including Mr. Perez, informed him that he was subject to a non-competition agreement or that he was not allowed to maintain his concurrent employment with PSC. He asserted that he did not see or become aware of the non-competition agreement until he was served with this lawsuit.
Mr. Howard testified that he also informed Tonic Grafield, Lee Guest, Penny Matthews, Emily Wahl, and John Welch.
These documents clearly show that Mr. Howard was aware that he was electronically signing the documents. Notably, there is no indication on the six onboarding documents admitted into evidence, including the non-competition agreement that the applicant, Mr. Howard in this case, agreed to sign the documents electronically.
Mr. Howard also testified that prior to working for Pinnacle, he was a security officer with Crescent Guardian, Incorporated ("CGI"). He stated that when CGI "got overtaken by Pinnacle, I was working for Pinnacle on that RTA contract." He asserted that when he started working at Pinnacle in August of 2019, he was a security officer and his duties changed in late November 2019, when he became a supervisor. Mr. Howard testified that he was assigned as security officer to the RTA after Pinnacle received the contract. He confirmed that while he was employed by Pinnacle, he also provided security services to CrescentCare. He asserted that his duties changed again around June of 2021, when John Welch started working for Pinnacle. Pursuant to Mr. Perez’s order, Mr. Welch informed him he would no 13longer be a supervisor. He was demoted to a dispatcher, received a reduction in pay, and his work schedule was changed. Because of this demotion, he was not able to maintain his "daily living." When he resigned from Pinnacle, his resignation letter shows he was a dispatcher, contrary to the Pinnacle’s assertion in its petition that he was field supervisor when he resigned. He testified that in January 2022, he stopped working at the Riverwalk and at Pinnacle.
While working with CGI, Mr. Howard testified that he was also working for Orleans Parish School Board.
Mr. Howard testified that after his resignation from Pinnacle, he was employed at Force 1 as an operations manager. However, he stepped down as the opera- tions manager in April or May of 2022, to complete his college diploma and he graduated in May of 2022. He testified that when he stepped down, he "had not made a decision if [he] was going to stay at all." He averred that he received the cease and desist letter from Pinnacle after he left Force 1 and he subsequently informed Force 1 about the letter. Mr. Howard testified that he was not aware of any representations made by Force 1 to Pinnacle concerning his employment with Force 1.
Mr. Howard testified that Pinnacle’s petition contained several inaccuracies: (1) the petition alleged that he managed the RTA account while at Pinnacle, which he testified was "false;" (2) the petition stated he was hired on July 31, 2019; however, he believes that Pinnacle "took over" in August 2019; (3) the petition inaccurately states he was promoted to command desk officer on August 12, 2020; (4) petition states he signed the non-competition agreement on August 22, 2019, which he denies.
LAW and ANALYSIS
In its sole assignment of error, Pinnacle contends that the trial court erred as a matter of law when it denied Pinnacle’s request for a preliminary injunction, which was based on a valid and enforceable non-competition agreement. Pinnacle contends that the non-competition agreement included non-compete and non-14solicitation provisions. Pinnacle asserts that it produced uncontroverted evidence showing that Mr. Howard breached his obligation not to do under the non-compete provision. Nevertheless, the trial court failed to issue a preliminary injunction based on a mistaken belief that Pinnacle did not contest Mr. Howard’s breach of the non-compete provision. Pinnacle avers that the reasons for judgment show that the trial court evaluated the evidence only as to Mr. Howard’s breach of the non-solicitation provision and the trial court did not mention or apply La. R.S. 23:921 in its reasons for judgment. Pinnacle contends the trial court’s failure to apply La. R.S. 23:921 H and its disregard of the evidence showing Mr. Howard’s breach of the non-compete provision requires this court to conduct a de novo review. Pinnacle asserts that because it provided clear, uncontroverted evidence showing that Mr. Howard breached the non-compete provision, its request for a preliminary injunction should be granted.
[1–4] A preliminary injunction is essentially an interlocutory procedural device designed to preserve the status quo between the parties pending a trial on the merits. Wechem, Inc. v. Evans, 18-743 (La. App. 5 Cir. 5/30/19), 274 So.3d 877, 884, writ denied, 19-1176 (La. 10/15/19), 280 So.3d 600. The primary purpose of injunctive relief is to prevent the occurrence of future acts that may result in irreparable injury, loss, or damage to the applicant. Id.; Pappas v. Hand Surgical Associates, Ltd., 22-407 (La. App. 5 Cir. 3/29/23), 364 So.3d 495, 501. A preliminary injunction is a summary proceeding and merely requires a prima facie showing of a good chance to prevail on the merits. Pappas, 364 So.3d at 501. To make a prima facie showing, a plaintiff is required to offer less proof than is necessary in an ordinary proceeding for a permanent injunction. Id.; Vartech Sys., Inc. v. Hayden, 05-2499 (La. App. 1 Cir. 12/20/06), 951 So.2d 247, 255, n.8.
[5, 6] The principal demand is determined after a trial on the merits under ordinary process, even though the hearing on the summary proceedings to obtain the 15preliminary injunction may touch upon or tentatively decide merit issues. Pappas, 364 So.3d at 501. Therefore, the fact that a preliminary injunction is granted in one party’s favor does not preclude a different result on the merits. Id.
[7, 8] Although the judgment on a preliminary injunction is interlocutory, a party aggrieved by a judgment either granting or denying a preliminary injunction is entitled to an appeal. La. C.C. art. 3612. Generally, a trial court is granted wide discretion in determining whether an injunction is warranted and its denial or granting of the injunction will not be disturbed on appeal absent manifest error or a clear abuse of discretion. Yorsch v. Morel, 16-662 (La. App. 5 Cir. 7/26/17), 223 So.3d 1274, 1281, writ denied, 17-1475 (La. 11/13/17), 230 So.3d 207. However, where the trial court’s decision is based on an erroneous interpretation or application of the law, such an incorrect decision is not entitled to deference by the reviewing court, and the appropriate standard of review is de novo. Advanced Medical Rehab, L.L.C. v. Manton, 21-315 (La. App. 5 Cir. 2/23/22), 362 So.3d 703, 710, writ denied, 22-606 (La. 06/01/22), 338 So.3d 494. Finding that the trial court’s decision was not based on an erroneous interpretation or application of the law, we find that a de novo review is not warranted.
Non-competition agreements are governed by La. R.S. 23:921, which provides, in pertinent part:
A.(1) Every contract or agreement, or provision thereof, by which anyone is restrained from exercising a lawful profession, trade, or business of any kind, except as provided in this Section, shall be null and void. However, every contract or agreement, or provision thereof, which meets the exceptions as provided in this Section, shall be enforceable.
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C. Any person, including a corporation and the individual shareholders of such corporation, who is employed as an agent, servant, or employee may agree with his employer to refrain from carrying on or engaging in a business similar to that of the employer and/or from soliciting customers of the employer within a specified parish or parishes, municipality or municipalities, or parts thereof, so long as the employer carries on a like business therein, not to exceed a period of two years from termination of employment….
[9] 16A non-competition agreement is a contract between the parties who enter it, and is to be construed according to the general rules of contract interpretation. Pappas, 364 So.3d at 501. The common intent of the parties is used to interpret a contract. Id.; La. C.C. art. 2045. When the words of a contract are clear and explicit and lead to no absurd consequences, no further interpretation may be made in search of the parties’ intent. Id.; La. C.C. art. 2046.
[10, 11] Historically, Louisiana has disfavored non-competition agreements. Wechem, Inc. v. Evans, 18-743 (La. App. 5 Cir. 5/30/19), 274 So.3d 877, 885, writ denied, 19-01176 (La. 10/15/19), 280 So.3d 600. Louisiana has a strong public policy restricting these types of agreements, which is premised on an underlying stated objective to prevent an individual from contractually depriving himself of the ability to support himself, and consequently becoming a public burden. Id. Non-competition and non-solicitation agreements are deemed to be against public policy and therefore declared null, except under the limited circumstances as set forth in La. R.S. 23:921 C, which requires: (1) a two-year maximum duration, (2) a list of the areas in which the former employee is restrained, and (3) competition between the former employee and employer. Advanced Medical Rehab, L.L.C., 362 So.3d at 710-711, citing Causin, L.L.C. v. Pace Safety Consultants, LLC, 18-0706 (La. App. 4 Cir. 1/30/19), 363 So.3d 421, 428-429, writ denied, 19-0466 (La. 5/20/19), 271 So.3d 203.
[12, 13] In order to determine whether the employer has carried its burden of proving its right to injunctive relief, the court must consider the validity and enforceability of the agreement sought to be enforced by the employer. Wechem, Inc., 274 So.3d at 885. Further, although La. R.S. 23:921 H mandates the issuance of injunctive relief without the necessity of proving irreparable harm when the obligor’s failure to perform is established, the employer still bears the burden of proving that it is entitled to relief. Id. at 886.
[14, 15] 17A non-competition agreement may limit competition only as to a business similar to that of the employer, in a specified geographic area, and for up to two years from termination of employment. Wechem, Inc., 274 So.3d at 885; citing Paradigm Health System, L.L.C. v. Faust, 16-1276 (La. App. 1 Cir. 4/12/17), 218 So.3d 1068, 1072. Where the actions an employer seeks to enjoin pursuant to a non-competition agreement do not fall within the exception found in La. R.S. 23:921 C, or where the agreement is found to be unenforceable for failure to conform to La. R.S. 23:921, an employer seeking enforcement is unable to carry its burden of establishing that it is entitled to the relief sought. Id.
[16–21] A judgment and reasons for judgment are two separate and distinct documents. La. C.C.P. art. 1918; McDuffie v. State Farm Mutual Automobile Company, 19-344 (La. App. 5 Cir. 12/30/19), 287 So.3d 899, 903. Appeals are taken from the trial court’s final judgment, not the written reasons for judgment. McDuffie, 287 So.3d at 903. While reasons for judgment may be informative, they are not determinative of the legal issues to be resolved on appeal and they are not binding. Id.; Jessie v. Wendy’s Company, 22-156 (La. App. 5 Cir. 12/7/22), 356 So.3d 467, 471. Where the trial court’s reasons are flawed, but the judgment is correct, the judgment controls. Id. Appellate courts examine the result of the judgment and not the reasons for judgment. Dileo v. Horn, 15-684 (La. App. 5 Cir. 3/16/16), 189 So.3d 1189, 1208. Consequently, judgments are often upheld on appeal for reasons different than those assigned by the trial court. Wooley v. Lucksinger, 09-571, 09-584, 09-585, 09-586 (La. 4/1/11), 61 So.3d 507, 572.
Validity of electronic signature on non-competition agreement
[22] The first issue before this court is whether the trial court was manifestly erroneous in finding that Pinnacle failed to make a prima facie showing that Mr. Howard electronically signed the non-competition agreement.
18The use and effect of electronic signatures is governed by the Louisiana Uniform Electronic Transactions Act ("ETA"), La. R.S. 9:2601, et seq. La. R.S. 9:2605 B(1) provides "This Chapter applies only to transactions between parties, each of which has agreed to conduct transactions by electronic means." [Emphasis added.] La. R.S. 9:2605 B(2) provides "The context and surrounding circumstances, including the conduct of the parties, shall determine whether the parties have agreed to conduct a transaction by electronic means." One purpose of the ETA is to facilitate electronic transactions consistent with other applicable law. La. R.S. 9:2606 (1). La. R.S. 9:2607 provides:
La. R.S. 9:2602 (16) provides:
(16) "Transaction" means an action or set of actions occurring between two or more persons relating to the conduct of business, commercial, or governmental affairs.
La. R.S. 9:2602 (5) provides:
(5) "Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
A. A record or signature may not be denied legal effect or enforceability solely because it is in electronic form.
La. R.S. 9:2602 (13) provides:
(13) "Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
B. A contract may not be denied legal effect or enforceability solely because an electronic record was used in its formation.
La. R.S. 9:2602 (4) provides:
(4) "Contract" means the total legal obligation resulting from the agreement of the parties as affected by this Chapter and other applicable law.
La. R.S. 9:2602 (7) provides:
(7) "Electronic record" means a record created, generated, sent, communicated, received, or stored by electronic means.
C. If a law requires a record to be in writing, an electronic record satisfies the law.
D. If a law requires a signature, an electronic signature satisfies the law. [Emphasis added.]
La. R.S. 9:2602 (8) provides:
8) "Electronic signature" means an electronic sound, symbol, or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.
La. R.S. 9:2609 provides:
A. (1) An electronic record or electronic signature is attributable to a person if it was the act of the person.
(2) The act of the person may be shown in any manner, including a showing of the efficacy of any security procedure applied to 19 determine the person to which the electronic record or electronic signature was attributable.
La. R.S. 9:2602 (14) provides:
(14) "Security procedure" means a procedure employed for the purpose of verifying that an electronic signature, record, or performance is that of a specific person or for detecting changes or errors in the information in an electronic record. The term includes a procedure that requires the use of algorithms or other codes, identifying words or numbers, encryption, or callback or other acknowledgment procedures.
B. The effect of an electronic record or electronic signature attributed to a person under Subsection A of this Section is determined from the context and surrounding circumstances at the time of its creation, execution, or adoption, including the agreement of the parties, if any, and otherwise as provided by law. [Emphasis added.]
La. R.S. 9:2602 (1) provides:
(1) "Agreement" means the bargain of the parties in fact, as found in their language or inferred from other circumstances and from rules, regulations, and procedures given the effect of agreements under laws otherwise applicable to a particular transaction.
Evidence of a record or signature in a proceeding may not be excluded solely because it is in electronic form. La. R.S. 9:2613. [Emphasis added.]
Pursuant to these legal precepts, an electronic signature is attributable to a person if it was the act of the person. La. R.S. 9:2609 A(1). Therefore, "whether any particular record is ‘signed’ is a question of fact. Proof of that fact must be made under other applicable law. This Chapter simply assures that the signature may be accomplished through electronic means." La. R.S. 9:2602, Official Comments – 2001, 7(c); See also, Rapalo-Alfaro v. Lee, 15-209 (La. App. 4 Cir. 8/12/15), 173 So.3d 1174, 1182.
[23, 24] The existence or non-existence of a contract is a question of fact, and the trial court’s determination of this issue will not be disturbed unless manifestly erroneous or clearly wrong. Causin, L.L.C., 363 So.3d at 427 fn. 5, citing Read v. Willwoods Community, 14-1475 (La. 3/17/15), 165 So.3d 883, 888. When findings of fact are based on determinations concerning the credibility of witnesses, great deference is given to the trier of fact’s findings. Rosell v. ESCO, 549 So.2d 840 (La. 1989). Only the trier of fact can be aware of the variations in demeanor and tone of voice that bear so heavily on the listener’s understanding and belief in what is said. Id. Where there is a conflict in the testimony, reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed upon appeal, even though the appellate court may feel that its own evaluations and inferences are as reasonable.
20In this case, Pinnacle produced a non-competition agreement signed electronically by Mr. Howard. Under the ETA, electronic signatures are clearly given the same legal effect as all other types of signatures. Accordingly, Pinnacle has no additional burden of proof as to Mr. Howard’s signature unless Mr. Howard specifically denies signing the non-competition agreement. See Rapalo-Alfaro, 173 So.3d at 1182.
The record shows that Mr. Howard denied seeing and/or electronically signing the non-competition agreement in his opposition memorandum to the request for preliminary injunction and in his sworn testimony at the preliminary injunction hearing. Similarly, Mr. Howard denied electronically signing any of the six onboarding documents produced by Pinnacle, alleging that he completed onboarding documents, but believes he signed them in person and not via an email. Moreover, Mr. Howard testified that the non-competition agreement was not included in the onboarding documents he completed in person. Thus, Mr. Howard denied that the electronic signature on the non-competition agreement is attributable to him. Because Mr. Howard clearly denied electronically signing the non-competition agreement, it was Pinnacle’s burden to show that Mr. Howard did in fact electronically sign the non-competition agreement. We find no error in the trial court’s conclusion that Pinnacle had not met its burden.
In the instant case, the trial court found the existence of the non-competition agreement to be "dubious" and it further found Mr. Howard’s testimony that he did not see, review, or electronically sign the non-competition agreement to be extremely credible, despite Mr. Perez’s testimony to the contrary. Upon review of the testimony and evidence admitted at the preliminary injunction hearing, we do not find that the trial court was manifestly erroneous in finding that Pinnacle failed to make a prima facie showing that Mr. Howard electronically signed the non-21competition agreement. Therefore, Pinnacle did not show that it was entitled to a preliminary injunction against Mr. Howard.
This court does not opine in any manner as to whether Pinnacle will be able to sustain its burden on its principal demand after a trial on the merits.
First, there appears to be a question of fact as to when Mr. Howard was initially hired, and if he electronically signed the non-competition agreement, which could have bearing on whether Pinnacle had fully switched to the Trait Set system of electronically signing onboarding documents, including the non-competition agreement. Mr. Perez testified that Mr. Howard was hired on August 20, 2019 as shown by the Trait Set document and an email showing an application for Mr. Howard was submitted on August 20, 2019. The Trait Set document shows that on August 20, 2019, Mr. Howard was hired as a security officer and would be working at the New Orleans RTA location. However, Mr. Perez also testified that Mr. Howard was initially hired on July 31, 2019, prior to receiving the RTA account. It is noted that Mr. Perez testified that Pinnacle switched from paper onboarding to electronic onboarding document in "in June or July of 2019." The record does not indicate if there was a transitioning period. Mr. Howard testified he believes he started in August of 2019, when Pinnacle "took over" the RTA account, but he testified he believes he signed onboarding documents in person. Mr. Howard further testified that the non-competition agreement was not included in the onboarding documents he signed in person.
Secondly, Pinnacle’s evidence did not show that it complied with its own onboarding procedures as testified to by Mr. Perez, which raises issues of fact. Pursuant to La. R.S. 9:2609, Pinnacle may show "in any manner" that Mr. Howard is the person who electronically signed the non-competition agreement. Here, Mr. Perez, testified that under the Trait Set system: (1) an applicant submits an application; (2) the system tracks the applicant through the interview process; 22(3) once the decision to hire is made, an email is sent to that applicant’s email address with a link to all eight onboarding documents to complete electronically; (4) once the onboarding documents are completed, the system sends a notification to Mr. Perez and/or management personnel; and (5) management personnel reviews the documents and electronically signs the documents that require approval.
The evidence submitted by Pinnacle did not sufficiently verify the security procedures it utilized to verify that the electronic signature on the non-competition agreement belongs to Mr. Howard. La. R.S. 9:2609; La. R.S. 9:2602. Thus, Pinnacle failed to provide sufficient evidence for the trial court to find that Mr. Howard is the individual who signed the non-competition agreement. Specifically, at the hearing, Mr. Perez testified that an email would have been sent after Mr. Howard’s application on August 20, 2019, pursuant to Pinnacle’s onboarding procedures. However, the record does not contain an autogenerated email containing a link for the eight required onboarding documents from Trait Set to Mr. Howard’s email address. Additionally, despite Mr. Perez’s testimony that Mr. Howard electronically signed the required eight onboarding documents, including the non-competition agreement, Pinnacle only submitted six onboarding documents into evidence. Mr. Perez also submitted a Trait Set document, supra, testifying that it showed Mr. Howard was assigned and submitted eight onboarding documents, and that all eight were ap- proved. However, the document does not clearly support Mr. Perez’s testimony. Mr. Howard’s name does not appear anywhere on this document and there are no identifying marks on this document to link it to Mr. Howard’s profile. It is only linked to Mr. Howard’s profile on Trait Set through Mr. 23Perez’s testimony. Furthermore, Mr. Perez testified that a notification was received that the documents were completed by Mr. Howard and that he reviewed and signed the same. Nevertheless, the record does not contain an autogenerated notification sent to Mr. Perez or management personnel stating that the onboarding documents were completed by Mr. Howard and that they were ready for review.
During Mr. Howard’s testimony, counsel for Pinnacle asked Mr. Howard about the personal information on a few of the onboarding documents and whether that information was correct. In argument to the trial court and in its brief to this court, counsel for Pinnacle appears to argue that only Mr. Howard could have placed his personal information on the documents in question, suggesting this shows Mr. Howard electronically signed the onboarding documents, including the non-competition agreement. However, Mr. Howard did not testify that he entered any personal information on the onboarding documents submitted with his alleged electronic signature. Argument of counsel is not considered evidence. Nevertheless, our review of the times that Mr. Howard allegedly signed each document does not appear to support this argument.
Based on the record in this case, the trial court was required to weigh conflicting testimony and evidence to determine whether Mr. Howard electronically signed the non-competition agreement. Where there is a conflict in the testimony, reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed on appeal, even though an appellate court may feel that its own evaluations and inferences are as reasonable. Rosell, supra. Accordingly, we cannot find that the trial court was manifestly erroneous in finding that Pinnacle failed to make a prima facie showing at the preliminary injunction hearing that Mr. Howard electronically signed the non-competition agreement.
DECREE
For the reasons stated herein, we affirm the trial court’s judgment denying Pinnacle’s request for preliminary injunction, and we remand the case for further proceedings, if any.
AFFIRMED AND REMANDED
SCHLEGEL J., CONCURS WITH REASONS
1I agree with the majority and only write separately to stress that trial courts should be careful not to place higher burdens on a party solely because a contract is signed electronically. "[T]he "purpose of the Louisiana Uniform Electronic Transactions Act [ETA] is to remove barriers to electronic commerce by validating and effectuating electronic records and signatures." Rapalo-Alfaro v. Lee, 15-209 (La. App. 4 Cir. 8/12/15), 173 So.3d 1174, 1182, citing to Henry Gabriel, Prefatory Note to ETA (emphasis added). Further, the legislature expressly stated that the use of electronic signatures and electronic transactions should continue to be expanded, not contracted. See La. R.S. 9:2606 (2). The ETA "is not a general contracting statute — the substantive rules governing agreements and other legal transactions remain unaffected by this Chapter." Rapalo-Alfaro, 173 So.3d at 1182, citing to Gabriel, Prefatory Note to ETA.