*

The Honorable William Stafford, United States District Judge for the

Northern District of Florida, sitting by designation.

1

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

ELECTRONIC CITATION: 2004 FED App. 0005P (6th Cir.)

File Name: 04a0005p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

_________________

UNITED RENTALS (NORTH

AMERICA), INC.,

Plaintiff-Appellant,

v.

JERRY KEIZER, GRANT RENTALL, INC. and MULDER’S

OUTDOOR POWER

EQUIPMENT, INC.,

Defendants-Appellees.

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No. 02-1580

Appeal from the United States District Court

for the Western District of Michigan at Grand Rapids.

No. 00-00831—Douglas W. Hillman, District Judge.

Argued: October 28, 2003

Decided and Filed: January 7, 2004 

Before: CLAY and COOK, Circuit Judges; STAFFORD,

District Judge.*

2 United Rentals v. Keizer, et al. No. 02-1580

_________________

COUNSEL

ARGUED: Robert H. Smeltzer, LOWIS & GELLEN,

Chicago, Illinois, for Appellant. Steven C. Berry, BIGLER,

BERRY, JOHNSTON, SZTYKIEL & HUNT, Zeeland,

Michigan, for Appellees. ON BRIEF: Robert H. Smeltzer,

Gerald Haberkorn, LOWIS & GELLEN, Chicago, Illinois,

Harold E. Nelson, BORRE, PETERSON, FOWLER &

REENS, Grand Rapids, Michigan, for Appellant. Steven C.

Berry, BIGLER, BERRY, JOHNSTON, SZTYKIEL &

HUNT, Zeeland, Michigan, Robert W. Smith, SILVERMAN,

SMITH, BINGEN & RICE, Kalamazoo, Michigan, for

Appellees.

CLAY, J., delivered the opinion of the court, in which

COOK, J., joined. STAFFORD, D. J. (pp. 27-28), delivered

a separate opinion concurring in part and dissenting in part.

_________________

OPINION

_________________

CLAY, Circuit Judge. Plaintiff United Rentals (North

America), Inc. appeals from the April 5, 2002, district court

order granting summary judgment to DefendantsJerryKeizer,

Grant Rent-All, Inc. and Mulder’sOutdoorPowerEquipment,

Inc. on Plaintiff’s claims for breach of contract; violation of

the Michigan Uniform Trade Secrets Act, Mich. Comp. Laws

Ann. § 445.1902; intentional interference with contract;

intentional interference with business relations; civil

conspiracy; and breach of a fiduciary duty of loyalty. The

Court AFFIRMS the district court’s order.
No. 02-1580 United Rentals v. Keizer, et al. 3

I.

STATEMENT OF FACTS

A. Procedural History

On November 7, 2000, United Rentals (North America),

Inc. (“United”) filed a complaint against Defendants Jerry

Keizer, Grant Rent-All, Inc. and Mulder’s Outdoor Power

Equipment, Inc. (“Mulder’s”). Since the parties are

completely diverse and the amount in controversy exceeds

$75,000, the district court had subject matter jurisdiction over

the matter. 

The complaint alleged that Keizer violated his covenantnot-to-compete set forth in ¶ 7.2 of his employment

agreement by selling construction equipment and soliciting

United’s customers in a proscribed geographic area, the socalled “Target Area.” The complaint further alleged that

Keizer, Grant Rent-All and Mulder’s continue to compete

with United in the Target Area and do so with United’s

proprietary information in violation of ¶ 7.3 of the agreement

and the Michigan Uniform Trade Secrets Act. The complaint

also alleged a claim for tortious interference with business

relations – i.e., Defendants allegedly interfered with the

business relationship between United and its customers; a

claim that Mulder’s tortiously interfered with Keizer’s

obligations under the employment agreement; and a civil

conspiracy by all Defendants to breach the restrictive

covenants of the employment agreement, interfere with

United’s business relations; misappropriate United’s

confidential information; and to improperly solicit and do

business with United’s customers.

United sought an injunction against Keizer and Grant RentAll (and Mulder’s, to the extent it is doing business with

Keizer or Grant Rent-All) from competing with United in the

Target Area for a specified period of time, disclosing United’s

confidential information and soliciting United’s customers in

the Target Area for a specified period of time. United also

4 United Rentals v. Keizer, et al. No. 02-1580

sought to affirmatively compel Defendants to locate and

return any and all of United’s confidential information. The

complaint also sought an accounting from Defendants for

Keizer’s alleged breach of the employment agreement and an

award of actual and punitive damages. On August 24, 2001,

United filed an amended complaint adding a claim against

Keizer for breach of a fiduciary duty of loyalty.

Defendants Keizer and Grant Rent-All answered the

complaint, and Keizer filed a counter-claim against United on

February 21, 2001, alleging that United breached the

employment agreement by terminating him without prior

notice and without cause on March 6, 2000; Keizer sought his

unpaid salary under the agreement from March 6, 2000

through May 31, 2003. Defendant Mulder’s answered the

complaint on August 13, 2001. United filed an answer to the

counterclaim on March 31, 2001. Keizer and Grant Rent-All

filed an answer and counterclaim to the amended complaint

on September 13, 2001.

On November 1, 2001, Keizer and Grant Rent-All moved

for summary judgment on United’s complaint. On

November 2, 2001, United moved for summary judgment on

Count I of its complaint for breach of the non-competition

and non-solicitation provision of the employment agreement

and on Keizer’s counterclaim. 

On April 5, 2002, the district court granted Keizer and

Grant Rent-All’s summary judgment motion, denied United’s

motion for summary judgment on Count I, and granted

United’s summary judgment motion on Keizer’s

counterclaim. The district court also entered judgment in

favor of Mulder’s on all counts in United’s complaint, even

though Mulder’s had not moved for summary judgment. 

For the district court, the crux of the dispute boiled down to

the interpretation of the prohibition in ¶ 7.2 of Keizer’s

employment agreement which, inter alia, prohibits Keizer

from “directly or indirectly ... engag[ing] in the operation of
No. 02-1580 United Rentals v. Keizer, et al. 5

any equipment sale, rental or leasing business” in the Target

Area, excluding Newaygo County. The district court held

that this language prohibited Keizer from operating such a

business only if it is physically located within the Target

Area. Accordingly, Keizer did not breach the agreement by

operating Grant Rent-All, which is physically located in

Newaygo County, but nevertheless does one-third of its

business with customers inside the Target Area. Assuming

arguendo that the above-quoted language from ¶ 7.2 is

ambiguous, the district court further held that there was no

parol evidence in the record to support United’s contrary

interpretation of the agreement. 

The district court dismissed United’s claim for breach of

the confidentiality clause (¶ 7.3 of the agreement) because

United had failed to submit any evidence showing that Keizer

had taken or used any confidential information, as defined by

the agreement. The district court also dismissed United’s

claim under the Michigan Uniform Trade Secrets Act. The

district court dismissed the tortious interference with business

relations, tortious interference with contract and civil

conspiracy claims because there was no evidence that

Defendants had wrongfully interfered with United’s business.

Last, the district court dismissed the breach of fiduciary duty

of loyalty claim because there is no evidence that Keizer did

not devote his full efforts to United’s business.

United filed its notice of appeal on May 3, 2002. Keizer

did not appeal the district court’s dismissal of his

counterclaim against United.

B. Substantive Facts

United is a Delaware corporation with its principal place of

business in Greenwich, Connecticut. United is in the business

of renting and selling construction and industrial equipment

throughout the United States. United purchased all of the

stock of Kubota of Grand Rapids, Inc. (“KGR”) on June 9,

1998. KGR was then merged into United. United is in the

6 United Rentals v. Keizer, et al. No. 02-1580

business of renting and selling construction and industrial

equipment in the Western Michigan area. 

Jerry Keizer is a Michigan resident, a former owner of

KGR and former general sales manager of United/KGR.

Grant Rent-All is a Michigan corporation, with its principal

place of business in Grant, Michigan, which is within

Newaygo County. Keizer has been the owner and president

of Grant Rent-All since December 1994. Keizer never

worked at Grant Rent-All until May 2000. Grant Rent-All is

managed by Keizer’s step-son and step-son-in-law. 

Mulder’s Outdoor Power Equipment, Inc. (“Mulder’s”) is

a Michigan corporation, with its principal place of business in

Byron Center, Michigan; it is in the business of renting and

selling construction and industrial equipment. Jerry Keizer’s

brother, Ron Keizer, is employed by Mulder’s.

Prior to June 1, 1998, Jerry Keizer owned one-third of

KGR’s stock. The other two-thirds were owned by Grand

Valley Investments, LLC (“GVI”), a limited liability

company consisting of the four Grasman brothers (Larry,

Jack, Russ and Rick.) GVI also fully owned and operated an

equipment business in Hudsonville known as Grand Valley

Equipment Company, Inc. (“GVEC”); Keizer had no interest

in GVEC. KGR is located in Grand Rapids, Michigan and is

in the business of selling construction, farm and landscaping

equipment such as tractors and commercial mowers. 

In April 1998, United approached GVI with a letter of

intent to purchase the stock of both KGR and GVEC for

$22,750,000. United’s letter did not acknowledge the fact

that Keizer owned a significant amount of KGR stock; among

other things, the letter proposed that at closing, United would

enter into employment agreements with the four Grasman

brothers and that the Grasman brothers would enter into a

five-year non-compete agreement, but there was no reference

to Keizer. 
No. 02-1580 United Rentals v. Keizer, et al. 7

GVI, by contrast, clearly was aware that it did not own all

of the KGR stock and that in order for the proposed sale with

United to proceed, GVI needed to control all KGR stock.

Accordingly, GVI forwarded a copy of United’s letter of

intent to Keizer, along with a proposed stock option

agreement through which GVI would buy Keizer’s stock in

KGR. The stock option agreement recited that Keizer owned

7,250 KGR shares compared to GVI’s 14,500. It further

acknowledged that United had approached GVI about

purchasing all of GVEC’s stock and that the KGR shares

would be included in the proposed transaction. 

For $5,000, Keizer granted GVI an option to purchase his

KGR shares for $1,475,000. Keizer agreed that if GVI

exercised the option, Keizer would “enter into an agreement

not to compete with KGR or GVEC for five years (other than

in Newaygo County) and otherwise in form and substance

acceptable to [United], for which KGR shall pay Keizer”

$25,000. Further, upon exercising the option, KGR would

enter into a five-year employment agreement with Keizer that

could be terminated only for just cause. 

At this time, GVI also was aware that Keizer owned or

partially owned Grant Rent-All, a competing equipment sale

and rental business in Newaygo County. GVI also was aware

that Grant Rent-All had sold equipment to customers in the

Grand Rapids area, outside of Newaygo County. It is

undisputed that over one-third of Grant Rent-All’s customers

were located outside Newaygo County both before and after

the sale of KGR stock to United. 

According to Keizer, the Stock Option Agreement

mentioned that Newaygo County would be excluded from the

non-competition agreement because Keizer had so requested

at a meeting with the Grasmans and their attorney, Stephen

Kretschman, on April 29, 1998. Keizer wanted an assurance

incorporated into the non-competition provision that if things

did not work out with United as his new employer that he

could “do business as usual in Newaygo” with Grant Rent8 United Rentals v. Keizer, et al. No. 02-1580

1

Keizer’s testimony was corroborated by Richard, Russell and Terry

Grasman. United cites to the affidavit of Larry Grasman, which states

that his understanding of the non-competition agreement “was to allow

Jerry Keizer to compete with United only in Newaygo County.” (J.A.

1815.)

All.1 Keizer signed the modified stock option agreement later

that day. 

On May 20, 1998, Kretschman, the Grasmans’ attorney,

wrote United’s attorney, John Arndts, about the anticipated

employment agreement with Keizer. Kretschman’s letter

stated that he anticipated that Keizer’s employment agreement

would be “along the lines required of the Grasmans, but, in

the case of the non-compete, excluding Newaygo County,

where his son operates a competing business.” (J.A. 173-74.)

On May 26, Arndts wrote back with a form employment

agreement for Jerry Keizer to sign. Arndts further stated,

“[W]ith respect to excluding Newaygo County from the noncompetition provisions of Jerry’s agreement with [KGR], we

needmore information concerning what competitive activities

are contemplated in Newaygo County by his son and Jerry.”

(J.A. 183.) 

Thereafter, United made little effort to get any additional

information regarding the competitive activities of Grant

Rent-All. United asserts that its inquiries were limited

because the Grasmans had informed it that Grant Rent-All

was a business in which Keizer and his son or son-in-law

were involved, but that it was a very small business with a

different product line from the Grasmans and that it did

business only in Newaygo County. United does not claim,

however, that Keizer misled it about Grant Rent-All prior to

purchasing KGR’s and GVEC’s stock. In fact, United never

made any inquiries of Keizer about Grant Rent-All until

months after Keizer had signed his employment agreement.

The final version of Keizer’s employment agreement

contained the non-competition provision with the Newaygo
No. 02-1580 United Rentals v. Keizer, et al. 9

exclusion. The Grasmans’ attorney, Kretschman, had

incorporated the exclusion into the form employment

agreement that had been provided to him by United’s

attorney. Kretschman testified that he incorporated the

Newaygo County exclusion into Keizer’s employment

agreement with KGR to “reflect the fact that there was a

business in Newaygo County that would ... otherwise fall

within the scope of the non-compete that should be excluded

from it.” (J.A. 596). On June 1, 1998, Keizer sold his KGR

stock to GVI. On the same day, he signed the employment

agreement with KGR. 

Paragraph 7.2 of the employment agreement contains the

following non-competition and non-solicitation provisions:

7.2 Competition and Solicitation For a period

commencing on the Closing Date and terminating five

(5) years thereafter (the “Restricted Period”), neither

the Employee nor any of his Affiliates shall, anywhere

in the Target Area, (as herein defined), directly or

indirectly, acting individually or as the owner,

shareholder, partner, or employee of any entity,

(i) engage in the operation of any equipment sale,

rental or leasing business; (ii) enter the employ of, or

render any personal services to or for the benefit of, or

assist in or facilitate the solicitation of any business

engaged in such activities; or (iii) receive or purchase

a financial interest in, make limitation, as a sole

proprietor, partner, shareholder, officer, director,

principal, agent trustee or lender, provided, however,

that the Employee may own, directly or indirectly,

solely as an investment, securities of any business

traded on any national securities exchange or

NASDAQ, provided the Employee is not a controlling

person of, or a member of a group which controls such

business and further provided that the Employee and

his Affiliates do not, in the aggregate, directly or

indirectly, own two percent (2%) or more of any class

of securities of such business. Employee and the

10 United Rentals v. Keizer, et al. No. 02-1580

2

The agreement is governed by Michigan law (¶ 9) and also contains

an integration clause which reads:

This Agreement contains the entire agreement of the parties and

supersedes all prior or contemporaneous negotiations,

correspondence, understandings and agreements between the

Company agree that the sum of Twenty Five Thousand

Dollars ($25,000) Price shall be paid by the Company

to Employee in consideration of this covenant not to

compete upon execution of this Agreement. For

purposes hereof, the term “Target Area” shall mean the

area within the state of Michigan west of I-75 and U.S.

Route 23, but shall exclude Newaygo County.

(J.A. 29, ¶ 7.2.)

Paragraph 7.3 of the employment agreement contains the

following confidentiality provision:

7.3 Confidential Information During the Restricted

Period and thereafter, the Employee shall keep secret

and retain in strictest confidence, and shall not use for

the benefit of himself or others, all data and

information relating to the Business (“Confidential

Information”), including, without limitation, knowhow, trade secrets, customer lists, supplier lists, details

of contracts, pricing policies, operational methods,

marketing plans or strategies, bidding information,

practices, polices or procedures, product development

techniques or plans, and technical processes; provided,

however, that the term “Confidential Information”

shall not include information that (i) is or becomes

generally available to the public other than as a result

of disclosure by the Employee, or (ii) is general

knowledge in the equipment rental, sales or leasing

business and not specifically related to the Business.

(J.A. 29, ¶ 7.3.)2
No. 02-1580 United Rentals v. Keizer, et al. 11

parties, regarding the subject matter of this Agreement. This

Agreement may not be amended or modified except in writing

signed by both parties and supported by new consideration.

(J.A. 32, ¶ 12.)

3

The employment agreement continued in force. The employment

agreement provides that it cannot be terminated “by any voluntary or

involuntary dissolution, reorganization, merger, consolidation or transfer

of assets of the Company ..., if a surviving or resulting corporation or

other entity or person continues ... the business of the Company.” (J.A.

28, ¶ 6.6.) The agreement binds and “inure[s] to the benefit of the

corporation or other entity” and provides that Keizer would be a general

sales manager at that surviving entity. (J.A. 28, ¶ 6.6. )

On June 9, 1998, United purchased from GVI all of the

stock and assets of KGR and GVEC for $22,750,000. On

October 1, 1999, KGR and GVEC merged with United.3 In

March 2002, United replaced Keizer as the general sales

manager, although his salary and benefits continued per the

employment agreement. Keizer resigned effective April 27,

2002, believing that his demotion from general sales manager

was a constructive discharge. 

United’s complaint alleges that during the term of Keizer’s

employment, Keizer maintained an active interest in the

affairs of Grant Rent-All, a competitor of United, and

affirmatively misrepresented his interest in that business to

United. Specifically, the complaint alleges that Keizer

maintained his position as president of Grant Rent-All and

actively obtained financing for its equipment purchases.

When United asked Keizer about his interest in Grant RentAll, Keizer allegedly said that it was his son’s business, with

which he had nothing to do.

United alleges that, after resigning from United, Keizer

took a customer list and began surreptitiously competing with

United in the Target Area under the aegis of Grant Rent-All.

Specifically, United alleges that Keizer began selling

equipment to United’s customers within the Target Area;

12 United Rentals v. Keizer, et al. No. 02-1580

offering equipment for sale to the general public within the

Target Area both directly and through Mulder’s; selling

equipment at auctions within the Target Area; selling

equipment and parts directly to United’s competitors within

the Target Area; advertising equipment for sale and/or rental

within the Target Area; soliciting United’s customers within

the Target Area; marketing Grant Rent-All in a way that

suggested it was affiliated with other business within the

Target Area; and giving Mulder’s a copy of KGR’s customer

list. 

II.

ANALYSIS

A. Standard of Review

This Court reviews de novo a district court’s decision to

grant summary judgment. Cockrel v. Shelby County Sch.

Dist., 270 F.3d 1036, 1048 (6th Cir. 2001). Summary

judgment must be granted if the pleadings and evidence

“show that there is no genuine issue as to any material fact

and that the moving party is entitled to a judgment as a matter

of law.” Fed. R. Civ. P. 56(c). A dispute over a material fact

is only a “genuine issue” if a reasonable jury could find for

the nonmoving party on that issue. Cockrel, 270 F.3d at 1048

(citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248

(1986)). In reviewing the district court’s grant of summary

judgment, this Court must view all the facts and the

inferences drawn therefrom in the light most favorable to the

nonmoving party. Id. (citing Matsushita Elec. Indus. Co. v.

Zenith Radio Corp., 475 U.S. 574, 587 (1986)).

A special interpretive framework applies when a court

entertains a summary judgment motion in a breach of contract

case:

... [A] contract can be interpreted by the court on

summary judgment if (a) the contract’s terms are clear,

or (b) the evidence supports only one construction of
No. 02-1580 United Rentals v. Keizer, et al. 13

the controverted provision, notwithstanding some

ambiguity.... If the court finds no ambiguity, it should

proceed to interpret the contract – and it may do so at

the summary judgment stage. If, however, the court

discerns an ambiguity, the next step – involving an

examination of extrinsic evidence – becomes

essential.... Summary judgment may be appropriate

even if ambiguity lurks as long as the extrinsic

evidence presented to the court supports only one of

the conflicting interpretations.

Gencorp, Inc. v. Am. Int’l Underwriters, 178 F.3d 804, 818

(6th Cir. 1999) (quoting Torres Vargas v. Santiago

Cummings, 149 F.3d 29, 33 (1st Cir. 1998) (internal citations

and quotations omitted by Gencorp)).

B. The Plain Language of Defendant Keizer’s NonCompetition Agreement

As noted above, Keizer entered into an employment

agreement with United’s predecessor, KGR. Paragraph 7.2 of

the agreement contains a covenant not to compete; such

covenants are enforceable under Michigan law. See Mich.

Comp. Laws Ann. § 445.774a (a covenant that restricts an

employee from engaging in employment or a line of business

after termination of employment is enforceable “if the

agreement or covenant is reasonable as to its duration,

geographical area, and the type of employment or line of

business”). The covenant reads, in relevant part, as follows:

[N]either [Keizer] nor any of his Affiliates shall,

anywhere in the Target Area, (as herein defined), directly

or indirectly, acting individually or as the owner,

shareholder, partner, or employee of any entity ... engage

in the operation of any equipment sale, rental or leasing

business.

The central question is: What does it mean to engage in the

operation of a competing business in the Target Area? United

14 United Rentals v. Keizer, et al. No. 02-1580

argues that soliciting business from and selling to customers

within the Target Area is tantamount to operating a business

in the Target Area. Defendants argue that to operate a

business in the Target Area the business must be physically

located in the Target Area. In this Court’s view, Defendants

are correct.

As the district court noted, “When ordinary speakers refer

to where a business is operated, they refer to the location of

the business.... For example, a retail store in Grand Rapids

would not be said to operate in Newaygo County simply

because a customer drives from Newaygo to purchase an item

at the Grand Rapids store, even if the store actively advertised

in Newaygo.” (J.A. 70) (emphasis in original). Indeed, this

proposition becomes clearer with a more extreme example.

If Keizer were to relocate Grant Rent-All to the North Pole

(e.g., the warehouse, inventory and employees), send direct

mailings and make telephone calls to potential customers in

the Target Area and then personally deliver the goods, the

common sense understanding of this set-up would be that

Keizer operates his business in the North Pole, even though

he sells to customers in the Target Area. Cf. Bianchi v. Auto.

Club of Mich., 467 N.W.2d 17, 20 (Mich. 1991) (holding that

“common sense” is a proper basis for contract interpretation).

See also Lozada v. Dale Baker Oldsmobile, Inc., 197 F.R.D.

321, 339 (W.D. Mich. 2000) (“When the contract terms are

plain and unambiguous, a court will construe the contract as

it is written and presume the parties’ intent is consistent with

the ordinary meaning of the terms in the contract.”) (citing

Pierson Sand & Gravel, Inc. v. Pierson Township, 851 F.

Supp. 850 (W.D. Mich.1994)); Britton v. John Hancock Mut.

Life Ins. Co., 186 N.W.2d 781, 782 (Mich. Ct. App. 1971)

(“Contracts which are unambiguous are not open to

construction and must be enforced as written.”) (citations

omitted).

United cites to a dictionary that defines “operation” as “a

process or series of acts aimed at producing a desired result or

effect; a method or process of productive activity.”
No. 02-1580 United Rentals v. Keizer, et al. 15

Appellant’s Reply Br. at 5 (quoting Webster’s II, New College

Dictionary (1995)). United argues that the phrase “engage in

the operation of” in ¶ 7.2 is equivalent to “engage in a series

of acts,” such that Keizer’s acts of selling to customers in the

Target Area amounted to his engagement in a series of

prohibited acts in the Target Area. This Court has discovered,

however, that, with specific regard to a business, dictionaries

define operation to mean “a business activity or enterprise.”

Oxford English Dictionary Online Edition (from the second

print ed. 1989). The word “operate” is defined as “[t]o direct

the working of; to manage, conduct, work (a railway,

business, etc.)” Id. See also Webster’s Third New Int’l

Dictionary 1581 (1993) (“to manage and put or keep in

operation whether with personal effort or not <operated a

grocery store>”). Taken together, these definitions strongly

indicate that in the business context an operation requires a

discrete physical location, such as a railway or a grocery

store. But even assuming that an operation can transcend a

particular physical location, the definition of “operate”

indicates that management or oversight is an essential element

of a business operation. Here, there is no evidence that

Keizer has managed a competing enterprise in the Target

Area. Although Keizer allegedly carried out some sales and

deliveries in the Target Area, these transactions did not

involve management or oversight of Grant Rent-All’s

business.

United cites several cases that purportedly support its plain

meaning interpretation of the covenant-not-to-compete. On

the surface, the strongest case United cites isCollen v. Source

EDP, Texas, Inc., 576 S.W.2d 435 (Tex. Civ. App. 1978). In

that case, William Collen had agreed to a restrictive covenant

which stated that he would not “directly or indirectly, enter

into or be engaged as a sole proprietor, partner, stockholder,

or employee in any personnel placement business in the City

of Dallas, and within a 100-mile radius thereof.” Id. at 435-

36. Collen argued that the covenant restrained him only from

physically establishing a business in the proscribed area, and

therefore, he was not prohibited from working for a company

16 United Rentals v. Keizer, et al. No. 02-1580

whose office is located outside of that area, but soliciting

personnel placement business in Dallas. Id. at 436. In

affirming the lower court’s enforcement of the covenant

against Collen, the Texas court engaged in little analysis,

instead merely summarizing the facts and holdings of two

cases – Foxworth-Galbraith Lumber Co. v. Turner, 46

S.W.2d 663 (Tex. Comm’n App. 1932) and Hartung v. Hilda

Miller, Inc., 133 F.2d 401 (D.C. Cir. 1943). See Id. at 436.

This Court does not find Collen to be persuasive authority

for two reasons. First, the Texas court appeared to flout the

plain language of the restrictive covenant, which, on its face,

limited Collen only from working for a personnel placement

business “in” (i.e., physically located within) a defined area.

Collen abided by the plain terms of the covenant, and it is

inexplicable why the court read the covenant expansively to

include working for such a business located outside of the

defined area. Second, Collen was decided under Texas law,

not Michigan law, which commands the courts to narrowly

construe restrictive covenants. See Kelsey-Hayes Co. v.

Maleki, 765 F. Supp. 402, 406 (noting that the Michigan

Uniform Trade Secrets Act “does not remove such covenants

from disfavored status, and narrowly limits them to

‘reasonableness’ in protecting only a competitive interest,

duration, geographic area, and type of employment”), vacated

after settlement, 889 F. Supp. 1583 (E.D. Mich. 1991).

The two decisions relied upon by the Collen court in no

way advance United’s argument herein. In FoxworthGalbraith, the covenant restricted sales (“the business of

selling”) in Littlefield, Texas or within ten miles thereof. 

Foxworth-Galbraith, 46 S.W.2d at 663. Keizer’s covenant,

in contrast, restricts the “operation of any ... business” in the

Target Area. Had the drafters of Keizer’s covenant intended

to restrict sales or deliveries in the Target Area and not just

the presence of a business in that area, they easily could have

specified a sales limitation in the covenant. They did not. In

fact, it was because the covenant in Foxworth-Galbraith

additionally restricted shipments into the defined areas that
No. 02-1580 United Rentals v. Keizer, et al. 17

the Texas court enforced the covenant against the defendants.

The court suggested that without this specific restriction, the

defendants’ conduct would have fallen outside of the more

general prohibition against engaging in the business of

selling in those areas. See id. at 666 (holding that the specific

restriction on deliveries into Littlefield “was designed to

prohibit sales which might not come strictly within the terms

of the former provisions, and to prevent an evasion of such

provisions”).

United’s reliance on the Alabama court’s decision in Dixon

v. Royal Cup, Inc., 386 So. 2d 481 (Ala. Civ. App. 1980), is

misplaced for the same reasons. In Dixon, a salesman agreed

not to “engage in the business of selling” particular items

within a defined geographic area. Id. at 481-82. He

specifically agreed not to “solicit or take orders for or sell or

deliver any such merchandise” in that area. Id. at 482. Again,

Keizer agreed to no such specific geographic restrictions on

selling construction equipment. Unlike the drafters of the

agreement in Dixon, the drafters of Keizer’s employment

agreement could have specified a prohibition on soliciting

orders from or delivering merchandise to customers in the

Target Area, but did not.

If anything, the Dixon case undermines United’s argument.

The Alabama court noted that “engaging in business, as used

in a restrictive covenant in an employment contract, involves

not only the servicing or soliciting of customers, but also

means the setting up of an office or place of business for

soliciting or servicing customers.” Id. at 483 (emphasis

added) (citing R.E. Harrington, Inc. v. Frick, 428 S.W.2d 945

(Mo. Ct. App. 1968)). Assuming arguendo that the phrase

“engage in business” is linguistically equivalent to “engage in

the operation of ... any business,” on the facts of this case, it

is undisputed that Keizer did not set up an office in the Target

Area. Accordingly, under Dixon, Keizer did not run afoul of

the restrictive covenant because he did not engage in business

in the Target Area.

18 United Rentals v. Keizer, et al. No. 02-1580

4

One other case United cites is inapposite because the covenant

language was far broader than the language in Keizer’s contract. In

Sobers v. Shannon Optical Co., 473 A.2d 1035, 1038 (Pa. Super. Ct.

1984), the defendants had agreed to “not compete” with the plaintiff.

The second decision cited by the Texas Court of Appeals in

Collen also does not support United’s plain language

argument. In Hartung, the sellers gave the buyers the

exclusive right to use the name Hilda Miller, Inc. The sellers

further agreed not to “engage in the furniture business under

[that name] nor any other name within the District of

Columbia.” Hartung, 133 F.2d at 401. The sellers opened up

a competing furniture business under the Hilda Miller name

in a nearby Maryland suburb, advertised the business in

District of Columbia newspapers and sold to District of

Columbia residents. Id. at 401-02. Although the court

enforced the covenant as to the sellers’ use of the Hilda Miller

name, the court refused, on vagueness grounds, to enforce the

more general prohibition against engaging in the furniture

business in the District of Columbia. Id. at 402. Since there

is no allegation in this case that Keizer co-opted the United

name, it is difficult to see how Hartung is relevant.

Regardless, the language of the Hartung covenant focused on

engaging in the furniture business (i.e., sales) within the

District of Columbia, unlike Keizer’s covenant which focuses

on the situs of the operation from which sales emanate.4

Even assuming that United’s broad interpretation of

operating a business is plausible, any ambiguity in the

language, which was crafted by United’s predecessor in

interest, must be construed against United and in favor of

Keizer. See Higgins v. Lawrence, 309 N.W.2d 194, 196

(Mich. Ct. App. 1981) (“It is well settled in the law of

contracts that language will be construed against the party

drafting the instrument.”) (citations omitted); see also De

Bruyn Produce Co. v. Romero, 508 N.W.2d 150, 156 n.4

(Mich. Ct. App. 1993) (“an ambiguous document must be

construed against the drafter of the document”). It is
No. 02-1580 United Rentals v. Keizer, et al. 19

undisputed that United drafted the form employment

agreement; ¶ 7.2 was then modified by its predecessor-ininterest to the contract (GVI). Under ¶ 6.6 of the employment

agreement, United succeeded to GVI’s rights and obligations

under the agreement. Accordingly, United stands in the same

position as GVI relative to Keizer with regard to how the

agreement must be interpreted. Just as ¶ 7.2 would have to be

construed against GVI, as the drafter, so too must it now be

construed against United, as GVI’s successor. For this reason

as well, the district court was correct in holding that Keizer

did not breach ¶ 7.2 of the employment agreement by

operating a business located outside of the Target Area, but

that conducts business inside the Target Area.

C. The Extrinsic Evidence

Assuming arguendo that the operative language from ¶ 7.2

is ambiguous, the Court can look to parol evidence to

construe it as long as that evidence is not inconsistent with the

written words. See Ditzik v. Schaffer Lumber Co., 360

N.W.2d 876, 880 (Mich. Ct. App. 1984) (“The ‘parol

evidence rule’ operates to exclude evidence of prior

contemporaneous agreements, whether oral or written, which

contradict, vary or modify an unambiguous writing intended

as a final and complete expression of the agreement.”);

Detroit Bank & Trust Co. v. Coopes, 287 N.W.2d 266, 269

(Mich. Ct. App. 1979) (noting that the test for the

admissibility of parol evidence “is whether the proffered parol

evidence is inconsistent with the written language”) (internal

quotation marks and citations omitted). When interpreting an

ambiguous contract with extrinsic evidence, summary

judgment is proper so long as the “extrinsic evidence

presented to the court supports only one of the conflicting

interpretations.” Gencorp, 178 F.3d at 818. As discussed

below, the extrinsic evidence supports only one interpretation

of the agreement, that of Keizer’s.

It is undisputed that United (via GVI) was aware of

Keizer’s ownership interest and personal involvement in

20 United Rentals v. Keizer, et al. No. 02-1580

Grant Rent-All before entering into the employment

agreement. During negotiations, United’s attorney was

explicitly advised that ¶ 7.2 would have to exclude Newaygo

Countyfrom the non-compete because Keizer’s “son operates

a competing business” in that county. (J.A. 74.) United had

the opportunity to conduct due diligence on the extent to

which Grant Rent-All competes with United, but chose to rely

on the verbal assurance of a GVI representative that Grant

Rent-All was not a competitor. United never corroborated

this assurance by requesting written substantiation or by

speaking with Keizer. Had United requested documentation,

it would have discovered that one-third of Grant Rent-All’s

customers were located in the Target Area and that Grant

Rent-All sells similar products. Thus, on this factual record,

there is no evidence that the parties meant to curtail Grant

Rent All’s business in any fashion. Indeed, the negotiation

history shows that the Newaygo County exclusion was meant

to protect Keizer’s interest in that business. Thus, the

extrinsic evidence shows that the parties intended to restrict

Keizer’s ability to compete by limiting the location of the

business which he might operate.

United counters that the most important piece of extrinsic

evidence is Keizer’s stock option agreement with GVI.

There, Keizer agreed that he would “enter into an agreement

not to compete with KGR or GVEC for five years (other than

in Newaygo County) and otherwise in form and substance

acceptable to [United], for which KGR shall pay Keizer”

$25,000. (J.A. 171.) (emphasis added). United argues that the

stock option agreement shows that the parties intended to

precludeKeizerfrom competing with United anywhere except

within Newaygo County. Appellant’s Br. at 34. 

United’s argument is not persuasive. This language merely

labels the type of agreement to which Keizer would later

agree – an agreement not to compete; it does not even begin

to define the scope of that agreement. As the instant dispute

shows, a non-competition provision can be narrow or broad,
No. 02-1580 United Rentals v. Keizer, et al. 21

5

United also cites as parol evidence the affidavit of Larry Grasman,

a principal of GVI, who stated that his understanding of the noncompetition agreement “was to allow Jerry Keizer to compete with United

only in Newaygo County.” (J.A. 1815.) In contrast, the other three

principals of GVI, Richard, Russell and Terry Grasman, corroborated

Keizer’s interpretation of ¶ 7.2 – namely, that the provision was intended

to permit Grant Rent-All to operate as it always had been. Larry

Grasman’s testimony does not create a genuine issue of material fact on

the meaning of ¶ 7.2, in light of the overwhelming parol evidence which

supports Keizer’s interpretation. Specifically, both GVI and United were

aware of Keizer’s involvement with Grant-All, and United was on notice

that Grant-All was a competitor. Despite this knowledge, United and GVI

did not draft ¶ 7.2 with language that explicitly precludes Keizer from

selling in the Target Area.

depending on the specific language of the agreement.5 Thus,

the stock option agreement does not create a disputed issue of

fact about the meaning of ¶ 7.2. Moreover, even assuming

that the stock option agreement somehow obligated Keizer

not to compete with United in the Target Area, as discussed

above, the other evidence shows that ¶ 7.2 of the employment

agreement creates no such obligation. Accordingly, the

employment agreement dictates Keizer’s non-competition

obligations, not the earlier-signed stock option agreement.

See CMI Int’l, Inc. v. Intermet Int’l Corp., 649 N.W.2d 808,

812 (Mich. Ct. App. 2002) (“When two agreements cover the

same subject matter and include inconsistent terms, the later

agreement supersedes the earlier agreement.”) (citation

omitted).

D. Defendant Keizer’s and Grant-All’s Alleged Breach

of Keizer’s Employment Agreement 

United argues that Keizer has violated the non-competition

provision, even accepting the district court’s interpretation of

¶ 7.2. United cites to evidence that Keizer has been doing

business with Mulder’s and Grand Equipment Company,

competitors located in the Target Area. Appellant’s Br. at 13.

In the Target Area, Keizer has sold equipment at auctions,

placed two or three pieces of used equipment on a vacant lot

22 United Rentals v. Keizer, et al. No. 02-1580

with a “for sale” sign, attended a trade show, advertised his

business, solicited customers through mass mailings and

placed a few pieces of equipment for sale or rental at

Mulder’s. Id. at 13-14. This evidence, however, shows only

that Keizer has done some business (i.e., selling or renting

equipment) in the Target Area, not that he has operated a

business located in the Target Area.

In addition, United has not articulated a basis for holding

Grant Rent-All liable for breaching a contract to which it was

not a signatory, namely, Keizer’s employment agreement.

Since Grant Rent-All was not a party to the agreement,

summary judgment on the breach of contract claim was

proper for Grant Rent-All on this independent ground.

E. Defendant Mulder’s Alleged Violation of the

Michigan Uniform Trade Secrets Act. 

United has not pressed its contract- and statutorily-based

breach of confidentiality claims against Keizer and Grant-All.

Accordingly, United has waived any challenge to the district

court’s dismissal of Count II (Michigan Uniform Trade

Secrets Act) with respect to Keizer and Grant Rent-All and

the portion of Count I which claims Keizer and Grant RentAll breached the confidentiality provisions of the employment

agreement. Instead, United takes issue with the district

court’s sua sponte entry of summary judgment in favor of

Mulder’s on United’s claim under the Michigan Uniform

Trade Secrets Act. (“MUTSA”). Although we agree with our

dissenting colleague that the district court should have

afforded United ten days’ advance notice and an opportunity

to respond, Yashon v. Gregory, 737 F.2d 547, 552 (6th Cir.

1984), we believe that the court’s violation of Rule 56 was

non-prejudicial. Kistner v. Califano, 579 F.2d 1004, 1006

(6th Cir. 1978) (holding that noncompliance with Rule 56's

ten-day notice requirement does not deprive the court of the

authority to grant summary judgment when “there has been

no prejudice to the opposing party by the court’s failure to

comply with this provision of the rule”). On appeal, United
No. 02-1580 United Rentals v. Keizer, et al. 23

has proffered whatever evidence and related argument it can

muster in opposition to summary judgment on the MUTSA

claim against Mulder’s. United has not argued that it was

denied critical discovery, thereby hampering its ability to

oppose summary judgment. Thus, the propriety of summary

judgment for Mulder’s is now ripe for a full and fair review.

Since we apply the same de novo standard of review that a

district court applies in the summary judgment context, it is

a better use of judicial resources for this Court to settle the

issue now rather than remanding and having to entertain

another appeal in the future.

In support of its MUTSA claim against Mulder’s, United

cites to the testimony of former employee Chad Alverson,

who went to work for Mulder’s. Appellant’s Br. at 15.

According to Alverson’s testimony, he brought a copy of a

customer list to Mulder’s, and Mulder’s owner, Art Mulder,

saw the list but told Alverson that Mulder’s “didn’t need it.”

(J.A. 447-48.) Alverson stated that he brought the list back

home and “it probably got thrown out.” (J.A. 448.) Mulder

testified that for “[a]bout three minutes” he perused a list that

he “assum[ed]” had been dropped at his store by Keizer. (J.A.

524-25.) He then “set it back down” and “then it was gone.”

(J.A. 526-28.) Mulder testified that it would have been

wrong to use the list and that the list is not in the possession

of anyone from Mulder’s. 

The MUTSA gives a court the power to enjoin an actual or

threatened misappropriation of a trade secret, such as an

unauthorized disclosure or use of a trade secret. Mich. Comp.

Laws Ann. §§ 445.1902, 445.1903. A “misappropriation”

means either:

(i) Acquisition of a trade secret of another by a person

who knows or has reason to know that the trade secret

was acquired by improper means.

24 United Rentals v. Keizer, et al. No. 02-1580

(ii) Disclosure or use of a trade secret of another without

express or implied consent by a person who did 1 or

more of the following:

(A) Used improper means to acquire knowledge of the

trade secret.

(B) At the time of the disclosure or use, knew or had

reason to know that his or her knowledge of the trade

secret was derived from or through a person who had

utilized improper means to acquire it, acquired under

circumstances giving rise to a duty to maintain its

secrecy or limit its use, or derived from or through a

person who owed a duty to the person to maintain its

secrecy or limit it use.

(C) Before a material change of his or her position,

knew or had reason to know that it was a trade secret

and that knowledge of it had been acquired by accident

or mistake.

Id. § 445.1902(b).

There is no evidence that Mulder’s has misappropriated or

is likely to misappropriate United’s customer list. First,

Alverson’s acquisition of the list and delivery to Mulder’s

cannot be imputed to Mulder’s. There is no evidence that

Mulder’s solicited this conduct or condoned it once the list

appeared at the store. Alverson brought the list to Mulder’s

completely on his own accord without the knowledge of

anyone else at Mulder’s. The record shows that Alverson was

merely a salesman at Mulder’s, not an officer, director or

high-level manager whose conduct potentially could bind the

company. Cf. CMI Int’l, 649 N.W.2d at 813 (“to make a

claim of threatened misappropriation, ... the party must

establish more than the existence of generalized trade secrets

and a competitor’s employment of the party’s former

employee who has knowledge of trade secrets”) (citation

omitted). Thus, Mulder’s never “acqui[red]” the list because

no one with any meaningful authority at Mulder’s either knew

or should have known that the list had been acquired through
No. 02-1580 United Rentals v. Keizer, et al. 25

6

Even if Mulder was aware that the list had come from Alverson or

Keizer, he would have had no reason to think that they had acquired the

list through improper means. To the contrary, Alverson and Keizer

acquired the list through proper means presumably because United gave

them the list when they were employed at United. The fact that Alverson

and/or Keizer perhaps should have returned the list after they left United

does not alter the fact that their acquisition of the list was proper.

improper means. In fact, Arthur Mulder testified that he was

not sure how the list ended up at his store.6

Second, there is no genuine issue of material fact that

Mulder’s disclosed or used the customer list. Mulder testified

that he glanced at the list for three minutes, determined that

it would be wrong to use the list, set it down and never saw

the list again. As far as anyone knows, the list that appeared

at Mulder’s existed for a day and then disappeared. Because

there is no evidence of a past disclosure or use of the list or

any likelihood of a future use or disclosure, summary

judgment for Mulder’s on the MUTSA claim was proper.

F. Claims for Intentional Interference with Business

Relations, Intentional Interference with Keizer’s

Employment Agreement and Civil Conspiracy 

An essential element of a claim for tortious interference

with contract, tortious interference with business relations and

civil conspiracy is that the alleged tortious conduct be

wrongful. See Trepel v. Pontiac Osteopathic Hosp., 354

N.W.2d 341, 347 (Mich. Ct. App. 1984) (tort of intentional

interference with contract or with business relations requires

a showing of “illegal, unethical or fraudulent conduct in

addition to intentional interference”); Feaheny v. Caldwell,

437 N.W.2d 358, 365 (Mich. Ct. App. 1989) (tort of civil

conspiracy requires concerted action “to accomplish a

criminal or unlawful purpose, or to accomplish a lawful

purpose by criminal or unlawful means”). As discussed

above, there is no genuine issue of material fact that Keizer

and Grant Rent-All breached the non-compete or

26 United Rentals v. Keizer, et al. No. 02-1580

confidentiality provisions of his employment agreement, nor

is there a genuine issue of material fact that Mulder’s violated

the Michigan Uniform Trade Secrets Act. Accordingly, there

is no underlying contractual violation or violation of

Michigan common law or statutory law on which to premise

these torts. Summary judgment was therefore proper.

G. Defendant Keizer’s Alleged Breach of a Fiduciary

Duty of Loyalty 

United argues that because the district court’s grant of

summary judgment on the breach of contract claim was

improper, it follows that dismissal of its claim for breach of

the fiduciary duty of loyalty also was improper. Appellant’s

Br. at 46-47. United has proffered no other argument on the

merits of this claim. As discussed above, the district court

properly granted summary judgment on the breach of contract

claim. Accordingly, the breach of fiduciary duty claim also

was properly dismissed.

III.

CONCLUSION

For all the foregoing reasons, the district court’s order

granting summary judgment to Defendants is AFFIRMED.
No. 02-1580 United Rentals v. Keizer, et al. 27

_____________________________________________

CONCURRING IN PART, DISSENTING IN PART

_____________________________________________

WILLIAM STAFFORD, District Judge, concurring in part

and dissenting in part. While I agree that summary judgment

was properly entered in favor of Keizer and Grant Rent-All,

I write separately to address the district court’s entry of

summary judgment in favor of Mulder’s. Mulder’s did not

file a motion for summary judgment, nor was notice ever

given to United that it should introduce evidence to support

its claims against Mulder’s. 

“The clearly established rule in this circuit is that a district

court must afford the party against whom sua sponte

summary judgment is to be entered ten days notice and an

adequate opportunity to respond.” Yashon v. Gregory, 737

F.2d 547, 552 (6th Cir. 1984). “We have underscored this

requirement of ‘unequivocal notice’ on numerous occasions.

Helwig v. Vencor, Inc., 251 F.3d 540, 552 (6th Cir.2001) (en

banc) (citing Salehpour v. Univ. of Tenn., 159 F.3d 199, 204

(6th Cir.1998); Briggs v. Ohio Elections Comm'n, 61 F.3d

487, 493 (6th Cir.1995); Yashon v. Gregory, 737 F.2d 547,

552 (6th Cir.1984)). “Noncompliance with the [ten days

notice] provision...deprives the court of authority to grant

summary judgment, unless the opposing party has waived this

requirement, or there has been no prejudice to the opposing

party by the court’s failure to comply with this provision of

the rule.” Kistner v. Califano, 579 F.2d 1004, 1006 (6th Cir.

1978) (citations omitted).

On appeal, United states: “[I]f this Court reverses the

District Court’s ruling on summary judgment as to Count I

[breach of contract against Keizer], it follows that this Court

should also reverse the District Court’s rulings as to Counts

IV [tortious interference with Keizer’s employment/noncompete covenant] and V [conspiracy to breach the restrictive

covenants contained in Keizer’s employment contract] as to

28 United Rentals v. Keizer, et al. No. 02-1580

Mulder’s.” Final Br. of Appellant at 47. United makes no

other argument with regard to Counts IV and V. Because

United appears to concede that Counts IV and Count V

against Mulder’s cannot survive the grant of summary

judgment to Keizer in Count I, I agree that we can affirm the

district court as to those two counts. Given our decision to

affirm the district court’s decision as to Count I, it would be

futile to remand Counts IV and V for further proceedings as

to Mulder’s. 

The same is not true of Count II, however. In Count II,

United alleges that the defendants, including Mulder’s,

violated the Michigan Trade Secrets Act by misappropriating

United’s trade secrets. United argues that the district court’s

sua sponte entry of summary judgment in favor of Mulder’s

on Count II should be vacated regardless of the decision as to

the other counts. I agree. Unlike Counts IV and V, this claim

against Mulder’s stands on its own and does not fail simply

because the claims against Keizer and/or Grant Rent-All fail.

The majority claims that “United has proffered whatever

evidence and related argument it can muster in opposition to

summary judgment on the MUTSA claim against Mulder’s.”

Infra p. 22. United, however, cannot offer evidence on appeal

that was not part of the record before the trial court; and while

I recognize that United has not argued that it was denied

critical discovery, I cannot assume that United would not

have introduced additional evidence before the trial court had

it been given appropriate notice. Because United should have

been given notice of, and an opportunity to respond to, the

district court’s sua sponte consideration of summary

judgment on the trade secrets claim against Mulder’s, and

because I cannot conclude from this record that the district

court’s failure to provide appropriate notice was nonprejudicial, I would vacate the district court’s entry of

summary judgment in favor of Mulder’s as to Count II and

would remand for further proceedings as to that claim.