NetScout Systems, Inc. v. Hohenstein (Lawyers Weekly No. 12-015-17)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1784CV00373-BLS2 ____________________ NETSCOUT SYSTEMS, INC. v. CARL HOHENSTEIN ____________________ MEMORANDUM AND ORDER ON PLAINTIFF’S MOTION FOR RECONSIDERATION OF ITS REQUEST FOR A PRELIMINARY INJUNCTION A week ago the Court decided a motion by NetScout Systems, Inc., for a preliminary injunction that would enforce non-competition and other covenants (the “Agreement”) that Carl Hohenstein entered into when he was employed by Danaher Corporation’s subsidiaries. In support of its motion, NetScout argued and presented evidence that Danaher had assigned to NetScout all of Danaher’s rights under Hohenstein’s non-competition agreement. The Court concluded, based on NetScout’s own evidence, that Hohenstein’s obligations under the disputed provisions of his non-competition agreement expired on July 14, 2016, one year after Hohenstein’s employment with any Danaher subsidiary ended. The Court therefore denied NetScout’s motion to the extent that it sought to enforce the non-competition and non-solicitation covenants, but allowed the other relief sought without any opposition by Hohenstein.1 1. Reconsideration. NetScout seeks reconsideration with respect to enforcement of the non-competition and non-solicitation covenants based on a new legal theory as to why it is entitled to enforce the Agreement. When it first sought a preliminary injunction, NetScout filed an affidavit by its Director of Human Resources to explain why NetScout was entitled to enforce Danaher’s rights under the Agreement. She stated that Hohenstein had been employed by a Danaher subsidiary called Fluke Networks and that “[o]n July 14, 2015, NetScout acquired Danaher’s communications business, which included Fluke 1 At oral argument, Hohenstein said he did not contest the issuance of an injunction that would bar him from using or disclosing any NetScout proprietary information, helping to develop products or services that would compete with NetScout’s offerings, helping to hire away NetScout’s employees or contractors, or interfering in any relationship with NetScout’s vendors. – 2 – Networks.” The HR Director did not say that Fluke Networks, Inc., had been merged into NetScout or a subsidiary of NetScout. If that had happened, then of course Hohenstein would still be employed by the same company as before the NetScout/Danaher transaction, and NetScout would be entitled to enforce the Agreement as the legal successor to Fluke Networks. But that is not what NetScout contended. Instead, its HR Director swore that as part of the NetScout/Danaher transaction Hohenstein became a NetScout employee and “Danaher’s rights under the Agreement were assigned to NetScout.” This characterization of the transaction between Danaher and NetScout suggested that NetScout was acquiring selected assets and liabilities of Danaher. As NetScout now recognizes, if whatever Danaher subsidiary that employed Hohenstein had been merged into NetScout or one of its subsidiaries, there would have been no need for Danaher to assign to NetScout its […]