Court permits Angie's List injunction against ex-employees who defected to rival

January 3, 2017
Angie's List Inc.'s legal battle with former employees accused of taking confidential information from the company got new life after the Indiana Court of Appeals on Thursday overturned parts of a lower court decision.

In early 2016, the Indianapolis-based home services company filed a civil suit against three ex-employees—including salespeople Rick Myers and Maggie Leonard—who defected to rival HomeAdvisor.

Angie's List sought an injunction that would have ordered the employees to return proprietary information they took from Angie’s List, to refrain from soliciting any other Angie’s List employees to leave their jobs, and to cease employment at HomeAdvisor until they could prove they no longer possessed confidential information.

A Hamilton County Court judge denied that request in April. But the appeals court said Thursday that the court should have granted the injunction as far as requiring the employees to return company information and refraining from talking to other Angie's List employees about leaving for HomeAdvisor. The employees had signed agreements with Angie's List not to remove or share confidential information and not to recruit its employees to rival companies.

However, the Appeals Court upheld the lower court's decision not to require the employees to stop working at Home Advisor.

"The trial court properly found that an injunction against working for HomeAdvisor would unduly burden the employees, and it properly ruled in the employees’ favor on that issue," Judge John G. Baker wrote in the decision. 

"But the evidence unambiguously shows that Leonard and Myers, at the very least, took and failed to return proprietary information. And the evidence unambiguously shows that Myers, at the very least, contacted and encouraged Angie’s List employees to leave their jobs to join HomeAdvisor," Baker wrote. "As the employees covenanted not to take company documents and not to solicit employees away from the company, the trial court should have granted Angie’s List’s request for a preliminary injunction on these matters."

The appeals court said the confidentiality agreements the employees signed required them to return Angie's List documents, saying they had "emailed themselves hundreds of pages of confidential information and did not return the information upon leaving the company." Baker wrote that the lower court's decision not to require the return of that information "was against the logic and effect of the facts before the trial court."

The trial court was ordered by the appeals court to enter a preliminary injunction against the defendants to honor their agreements.

An Angie's List spokeswoman declined to comment on the ruling, citing a company policy not to comment on pending litigation. A spokeswoman for HomeAdvisor declined to comment and said that Leonard and Myers also wished not to comment. Attorneys for Leonard and Myers did not respond to an IBJ request for comment on Tuesday.

Angie’s List and HomeAdvisor are fierce competitors in the business of connecting consumers with home services providers. The Colorado-based company jumped onto Angie’s List’s turf in March, opening a 7,000-square-foot office on the second floor of One Virginia Avenue building, home to Scotty's Brewhouse restaurant.

HomeAdvisor said in November that it planned to add a second office on Massachusetts Avenue.

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