J.A05035/14

2015 PA Super 25

WMI GROUP, INC., WM ROBOTS, LLC, : IN THE SUPERIOR COURT OF

AND WM MANAGEMENT GROUP, INC., : PENNSYLVANIA

:

Appellants :

:

v. :

:

:

CHARLES FOX AND IED DETECTION :

SYSTEMS, LLC, :

:

Appellees : No. 1550 EDA 2013

Appeal from the Order Entered May 24, 2013

In the Court of Common Pleas of Montgomery County

Civil Division No(s).: 2013-11288

BEFORE: ALLEN, JENKINS, and FITZGERALD,*JJ.

OPINION BY FITZGERALD, J.: FILED FEBRUARY 06, 2015

Appellants, WMI Group, Inc., WM Robots, LLC, and WM Management 

Group, Inc., appeal from the order entered in the Montgomery County Court 

of Common Pleas denying their petition for a temporary restraining order 

and preliminary injunction against Appellees, Charles Fox and IED Detection 

Systems, LLC.1 Appellants contend the trial court erred by not issuing a 

preliminary injunction enjoining Appellees from violating a restrictive 

covenant. We hold that Appellants have not established their burden that 

 

*

Former Justice specially assigned to the Superior Court.

1 This is an interlocutory appeal as of right. See Pa.R.A.P. 311(a)(4).
J. A05035/14

- 2 -

the restrictive covenant binds Fox and, regardless, have not demonstrated 

the existence of a trade secret. Given the preliminary nature of the record 

and that Appellants’ entitlement to injunctive relief is presently unclear, we 

affirm.2

We state the facts as set forth by the trial court:

[Appellants] are in the business of marketing and selling 

machine and robotic products, some of which they 

manufacture, and some of which are manufactured by 

other companies.

On August 6, 2004, [Fox] entered into an employment 

agreement with Wolstenholme Machine, Inc. (WMI).[3] 

Attached to the employment agreement was an 

employment letter on Wolstenholme Machine stationary 

which outlined Fox’s salary, commission, benefits and 

 

2 Our affirmance is based on the preliminary nature of this record. It is not 

a holding on the ultimate merits of Appellants’ claims, which can be 

developed more fully prior to trial. As our Supreme Court explained:

It is somewhat embarrassing to an appellate court to 

discuss the reasons for or against a preliminary decree, 

because generally in such an issue we are not in full 

possession of the case either as to the law or testimony—

hence our almost invariable rule is to simply affirm 

the decree, or if we reverse it to give only a brief outline 

of our reasons, reserving further discussion until appeal, 

should there be one, from final judgment or decree in law 

or equity.

Summit Towne Ctr., Inc. v. Shoe Show of Rocky Mount, Inc., 573 Pa. 

637, 646, 828 A.2d 995, 1000-01 (2003) (emphasis added and citation 

omitted).

3 Although WMI is not one of the named appellants, the parties agree that 

WMI is now known as WMI Group, Inc. Appellants’ Brief at 4; Appellees’ 

Brief at 3.
J. A05035/14

- 3 -

general employment duties. Both of these documents 

were signed by Agit Gene Samsi (hereinafter “Samsi”) 

[who was then the] Vice President General Manager and 

Fox. Section 5 of the 2004 Employment Agreement stated 

as follows:

NON-COMPETITION

5.01 During the term of this Agreement and for 

12 months following the termination of 

Employee’s employment, Employee will not, 

without WMI’s prior written consent: (i) accept 

employment with a competitor or in any other 

manner compete with those business activities 

to which the Employee was assigned during the 

24 month [sic] prior to his termination of 

employment with WMI, (ii) solicit any customer 

or potential customer of WMI that Employee or 

his subordinates solicited or serviced for WMI or 

(iii) solicit to leave WMI or hire any individual 

who was an WMI employee during Employee’s 

employment at WMI.

Trial Ct. Op. at 1-2. 

The 2004 Agreement explicitly provided that the non-compete clause 

was effective upon termination of the Agreement:

1.04 This Agreement and all obligations hereunder, 

except for the post-employment obligation, shall 

automatically terminate if and when Employee assumes a 

different position in the Company[4]and signs a new 

Agreement, or upon termination of employment. The 

post-employment obligations described in Section 4.0 and 

5.0 of the Agreement shall remain in full force and effect 

after this Agreement is terminated. 

 

4 The 2004 Agreement defined “Company” as Wolstenholme Machine, Inc., 

i.e., WMI. See Appellants’ Prelim. Inj. Hr’g Ex. 3-B.
J. A05035/14

- 4 -

Appellants’ Prelim. Inj. Hr’g Ex. 3-B.5 The 2004 Agreement was also binding 

upon any successors and assigns to WMI: “This Agreement . . . shall be 

binding upon and inure to the benefit of WMI and Employee and their 

respective successors and permitted assigns and the Company will require 

its successors to expressly assume its obligations under this Agreement . . . 

.” Id. 

We continue to quote the trial court’s recitation of the facts:

Fox’s initial employment duties were to acquire new 

customers and sell products manufactured by [Appellants] 

in their machine shop.

On January 10, 2007, Fox signed a document on WM 

Robots, LLC stationary titled “Promotion to new Position 

within Company.” The employer listed is A. Gene Samsi 

with WM Management Group, LLC.[6] This document 

described Fox’s new position as WM Robots’ Sales and 

Business Development Manager and set forth his salary 

and commissions. The document did not contain a noncompete provision and did not refer to the non-compete 

provision in the 2004 agreement [with WMI]. 

Trial Ct. Op. at 2 (citation omitted).

 

5 The certified record did not include the preliminary injunction hearing 

exhibits. Our Supreme Court held “that where the accuracy of a pertinent 

document is undisputed, the Court could consider that document if it was in 

the Reproduced Record, even though it was not in the record that had been 

transmitted to the Court.” Pa.R.A.P. 1921 note (citing Commonwealth v. 

Brown, 617 Pa. 107, 117 n.4, 52 A.3d 1139, 1145 n.4 (2012)). In this 

case, because the preliminary hearing exhibits are part of the reproduced 

record and neither party has disputed their accuracy, we will consider them. 

See id.

6 WM Management Group, LLC is not a named party. WM Management 

Group, Inc., however, is a party.
J. A05035/14

- 5 -

We reproduce the 2007 document, as follows:

Promotion to new Position within Company

Employee: [Fox]

Employer: A. Gene Samsi with WM Management Group, 

LLC

Date: 1/10/2007

Effective Date: 1/1/2007

This letter is to formalize and define the agreement to 

Promote . . . Fox to the position of WM Robots’ Sales and 

Business Development Manager. 

Responsibilities include, but not limited to, Sales, Sales 

Management, Customer Service & Business Development 

for WM Robots’ products.

The defined territory for these responsibilities is global with 

the exception of UVSS products with territories reserved 

by BDL Systems Limited (England).

Products included, but not limited to, Robots (Currently 

[sic] the KNIGHT) and accessories, Wolstenholme 

AeroMed’s HazProbe, BDL Systems’ UVSS, and any other 

WM Robots’ product defined as any product or system sold 

as a WM Management Group’s part number.

Salary is $70,000 per year with annual reviews in the 

month of December.

Commissions on all WM Robot products will be 1% of Gross 

Sales with the exception of the KNIGHT product line, which 

will be .5% of Gross Sales. All new sales (sales orders 

received after January 1st, 2007) are subject to this 

commission structure. In addition to commissions 

received for WM Robots’ products, certain projects 

currently running or pending in WMI and CST are subject 

to a commission of .25% through 2007. These projects 

are listed below . . . .
J. A05035/14

- 6 -

Appellants’ Prelim. Inj. Hr’g Ex. 4. As noted above, WM Robots, LLC, is a 

different entity than WMI/WMI Group, Inc., in the 2004 agreement.

Fox’s new position replaced two individuals who left the 

company, and included new responsibilities of working on 

WM Robots’ robotic under-vehicle surveillance and [robotic 

camera]-type equipment. Fox stopped selling WMI 

products and solely worked on WM Robots’ product lines in 

his new position. 

Later in 2007, WM Robots, LLC contracted with Vallon, a 

German manufacturer of metal detection systems, 

magnetometers and degaussing equipment to represent 

and sell their products in the United States. Fox was 

assigned by Samsi as the sole salesperson for Vallon 

products. In this new position, Fox established a 

relationship with Vallon and the U.S. Military, the largest 

customer of WM Robots’ Vallon products. Thereafter, 90 

percent of Fox’s sales were devoted to selling Vallon 

products. The annual sales from WM Robots to the U.S. 

Military was approximately $60 million in 2011 and $110 

million in 2012.

On April 6, 2011, Fox signed a document on WM Robots 

stationary titled “Promotion and Commission Agreement 

Update for Charles Fox.” This document identified Fox’s 

new title as Vice President of Business Development and 

described his commissions. This document was signed by 

Samsi and Fox, and did not contain a non-compete 

provision. Again, no reference was made to the noncompete provision in the 2004 agreement between Fox 

and WMI.

Trial Ct. Op. at 2-3.

We set forth the 2011 document:

PROMOTION & COMMISSION AGREEMENT UPDATE FOR 

CHARLES FOX

Effective immediately, Charles Fox has been promoted to 

the new position of Vice President of Business 
J. A05035/14

- 7 -

Development. The following commission rates apply and 

are valid indefinitely:

All Vallon products: 3% of Gross Sales

All existing WM Robots’ products: 1% of Gross Sales

New WM Robots’ products: To be negotiated on a case by 

case basis.

HazProbe: 1% of Gross Sales

Wolstenholme Machine Shop Sales related to WM Robots’ 

customers: 1% of Gross Sales

Commission is due upon payment from customer in [sic] 

payable in soonest pay cycle. 

Appellants’ Prelim. Inj. Hr’g Ex. 8. WM Robots, LLC—a different entity than 

WMI Group, Inc.—is the company listed in the signature blocks of the 

agreement. Id. 

In late October 2012, Samsi and Bob Wolstenholme, 

owner of the three companies, presented Fox with a new 

Employment Agreement[,] which included a non-compete 

provision. Fox believed he was not bound by a noncompete provision since there was no such provision in the 

April 6, 2011 Employment Agreement. Fox would not 

agree to Wolstenholme’s proposed non-compete 

restriction. After failed negotiations, Fox submitted a 

letter of resignation on March 29, 2013, wherein he stated

“it is my intention to begin a new venture which will 

involve my representation of Vallon GmbH and Cobham 

Technological Services.” Fox intended to actively compete 

with [Appellants] for Vallon’s business. On April 2, 2013, 

Samsi received an email from Dan Dukes, a program 

manager for WM Robots, which was anonymously 

forwarded to him by one of his government contacts who 

had received the email from Fox. The email states, in 

relevant part:
J. A05035/14

- 8 -

If I have assumed correctly, you should have 

received an email from Gene Samsi about my 

resignation from WM Robots. I am creating my 

own company and still will be representing 

VALLON. I will also be representing Cobham 

Technical Services, who manufactures the 

ground penetrating radar portion of the VALLON 

detectors.

I am not sure what role WM Robots will have 

with Vallon in the future, but I promise there 

will be no service interruptions. This departure 

from WM Robots was not a rushed decision. My 

company will allow you more flexibility in 

dealing with VALLON, including direct contracts 

if so desired. 

On May 10, 2013, Jürgen Braunstein, sales director for 

Vallon, emailed Samsi and Fox and stated:

We informed you in an earlier phase that we 

want to go ahead with Clay [i.e., Charles Fox], 

preferably within WM Robots.

This is still our preference. However, Clay 

has his own company now.

The legal situation remains to be cleared, 

also for the staff that WM Robots is hiring. As 

long as the legal situation is not clear, we do not 

want to lose any business opportunities. 

Therefore we encourage WM Robots and IED 

Detection Systems to win customers for our 

products. We do not want any confusion for the 

customers and that both parties behave fair. 

Do not do any competition in front of the 

customer. If one party has a new business 

opportunity then the other party should respect 

it and should not try to squeeze in. 

On May 13, 2013, [Appellants] filed a Complaint against 

Fox and his new company, IED Detection Systems, LLC, 
J. A05035/14

- 9 -

alleging breach of contract, misappropriation,[7]

conversion of trade secrets, tortious interference, unfair 

competition, conversion, and breach of duty of loyalty. 

[Appellants] concurrently filed a Petition for Temporary 

Restraining Order and for Preliminary Injunction. An 

evidentiary hearing before the undersigned was held on 

May 22, 2013, and an order denying the Petition for 

Temporary Restraining Order and for Preliminary 

Injunction was entered on May 24, 2013. A Notice of 

Appeal to the Superior Court was filed by [Appellants] on 

the same day.

Trial Ct. Op. at 3-4 (footnote omitted). Appellants timely filed a courtordered Pa.R.A.P. 1925(b) statement. Appellants also filed an application for 

an injunction pending appeal pursuant to Pa.R.A.P. 1732(b), which this 

Court denied on August 19, 2013.8

Appellants raise the following issues:

Whether [Appellees] should have been temporarily and 

preliminarily restrained from using [Appellants’] trade 

secrets and confidential information to unfairly compete 

with [Appellants] by stealing (and/or attempting to steal) 

[Appellants’] primary supplier and customers, in violation 

of the restrictive covenants in Fox’s 2004 employment 

agreement and in violation of [PUTSA]? 

Whether Fox’s employment agreement was valid and 

enforceable at the time of [his] resignation, where the 

employment agreement was never terminated or 

superseded by a subsequent agreement during the course 

of [his] employment?

 

7 This claim is based upon a violation of the Pennsylvania Uniform Trade 

Secrets Act (“PUTSA”), 12 Pa.C.S. §§ 5301-5308, which “displaces 

conflicting tort, restitutionary and other law of this Commonwealth providing 

civil remedies for misappropriation of a trade secret.” 12 Pa.C.S. § 5308.

8 Appellants did not file anything under seal with the trial court or this Court.
J. A05035/14

- 10 -

Whether [Appellants’] network of customer contacts, 

customer-related information, marketing relationships 

within the niche (bomb detection device) market, and 

pricing methodology constitute trade secrets under the 

PUTSA, where such information is integral to [Appellants’] 

competitive advantage, required the expenditure of 

significant resources to develop, and is not readily 

ascertainable by [Appellants’] competitors?

Whether Fox’s solicitation of [Appellants’] primary supplier 

and customers while possessing and using [Appellants’] 

confidential information and trade secrets, in violation of 

the restrictive covenants in Fox’s 2004 employment 

agreement, constitutes irreparable harm under 

Pennsylvania law?

Appellants’ Brief at 2-3 (reordered to facilitate disposition).

We summarize Appellants’ arguments for their first two issues.9 

Appellants generally allege the trial court was obligated to issue a 

preliminary injunction against Appellees. Appellants suggest that a prior 

2004 agreement with WMI, which included a non-compete clause, was not 

replaced by the 2007 and 2011 agreements with WM Robots, LLC, each of 

 

9 Despite raising four issues in their brief, Appellants divide their argument 

into only three parts, thus violating Pa.R.A.P. 2119(a), which mandates that 

“argument shall be divided into as many parts as there are questions to be 

argued.” See Pa.R.A.P. 2119(a). We decline to quash, however. See PHH 

Mortg. Corp. v. Powell, 100 A.3d 611, 615 (Pa. Super. 2014) (declining to 

quash appeal despite numerous violations of appellate briefing rules); see 

also Commonwealth v. Briggs, 608 Pa. 430, 516, 12 A.3d 291, 343 

(2011) (“The briefing requirements scrupulously delineated in our appellate 

rules are not mere trifling matters of stylistic preference; rather, they 

represent a studied determination by our Court and its rules committee of 

the most efficacious manner by which appellate review may be conducted so 

that a litigant’s right to judicial review as guaranteed by Article V, Section 9 

of our Commonwealth’s Constitution may be properly exercised.”).
J. A05035/14

- 11 -

which lacked a non-compete clause. Id. at 17. Appellants reason that Fox’s 

promotion within WM Robots, LLC, did not void the prior agreement with 

WMI. Id. Instead, Appellants opine that the trial court should have 

disregarded the plain language of the 2007 and 2011 agreements with WM 

Robots, LLC, and considered the parties’ intent. Id. That intent, Appellants 

insist, was to incorporate the original 2004 agreement with WMI by implicit 

reference. Id. To substantiate their unstated intent, Appellants rely upon 

parol evidence. Id. at 19-21. Appellants alternatively suggest that the 

2004 agreement with WMI coexists with the 2007 and 2011 agreements 

with WM Robots, LLC. Id. at 17-18 (citing, inter alia, Restatement (First) of 

Contracts § 408 (1932)).10 We hold Appellants are not entitled to relief.

In Synthes USA Sales, LLC v. Harrison, 83 A.3d 242 (Pa. Super. 

2013), our Court discussed the applicable standard of review and legal 

principles for resolving an appeal from a request for a preliminary injunction:

Our scope of review is plenary. 

Our review of a trial court’s order granting or 

denying preliminary injunctive relief is highly 

deferential. This highly deferential standard of 

review states that in reviewing the grant or 

 

10 Appellants cite only one Pennsylvania state case, Robert Grace 

Contracting Co. v. Norfolk & W. Ry. Co., 259 Pa. 241, 102 A. 956 

(1918), which predates Section 408. Appellants also cite several 

Pennsylvania federal cases, which are not binding on this Court. See 

Appellants’ Brief at 17-18. Generally, “federal court decisions do not control 

the determinations of the Superior Court.” NASDAQ OMX PHLX, Inc. v. 

PennMont Secs., 52 A.3d 296, 303 (Pa. Super. 2012) (citations omitted). 
J. A05035/14

- 12 -

denial of a preliminary injunction, an appellate 

court is directed to examine the record to 

determine if there were any apparently 

reasonable grounds for the action of the court 

below.

An abuse of discretion is not merely an error of judgment, 

but if in reaching a conclusion the law is overridden or 

misapplied, or the judgment exercised is manifestly 

unreasonable, or the result of partiality, prejudice, bias, or 

ill will, as shown by the evidence or the record, discretion 

is abused. We do not inquire into the merits of the 

controversy. Only if it is plain that no grounds exist 

to support the decree or that the rule of law relied 

upon was palpably erroneous or misapplied will we 

interfere with the decision of the trial court. 

A trial court has apparently reasonable grounds for 

granting the extraordinary remedy of preliminary 

injunctive relief if it properly finds that all of the essential 

prerequisites are satisfied. 

There are six essential prerequisites that a party 

must establish prior to obtaining preliminary 

injunctive relief. The party must show: 1) “that 

the injunction is necessary to prevent 

immediate and irreparable harm that cannot be 

adequately compensated by damages”; 2) “that 

greater injury would result from refusing an 

injunction than from granting it, and, 

concomitantly, that issuance of an injunction will 

not substantially harm other interested parties 

in the proceedings”; 3) “that a preliminary 

injunction will properly restore the parties to 

their status as it existed immediately prior to 

the alleged wrongful conduct”; 4) “that the 

activity it seeks to restrain is actionable, that its 

right to relief is clear, and that the wrong is 

manifest, or, in other words, must show that it 

is likely to prevail on the merits”; 5) “that the 

injunction it seeks is reasonably suited to abate 

the offending activity”; and, 6) “that a 

preliminary injunction will not adversely affect 
J. A05035/14

- 13 -

the public interest.” The burden is on the party 

who requested preliminary injunctive relief.

A decision addressing a request for a preliminary 

injunction thus requires extensive fact-finding by the trial 

court because the moving party must establish it is likely 

to prevail on the merits. If the moving party’s right to 

relief is unclear, then a preliminary injunction should not 

issue. 

Synthes, 83 A.3d at 248-50 (emphasis added and punctuation, footnote, 

and citations omitted). Upon fulfilling all the “essential prerequisites,” the 

movant may obtain injunctive relief narrowly tailored to protect the 

employer’s legitimate business interest. Three Cnty. Servs., Inc. v. Phila. 

Inquirer, 337 Pa. Super. 241, 246, 486 A.2d 997, 1000 (1985) (noting “the 

preliminary injunction, if issued, should be no broader than is necessary for 

the petitioner’s interim protection”).

To establish a clear right to relief on a claim for breach 

of restrictive covenants of an employment contract, a 

party must, inter alia, demonstrate the following:

In Pennsylvania, restrictive covenants are 

enforceable if they are incident to an 

employment relationship between the parties; 

the restrictions imposed by the covenant are 

reasonably necessary for the protection of the 

employer; and the restrictions imposed are 

reasonably limited in duration and geographic 

extent. Our law permits equitable enforcement 

of employee covenants not to compete only so 

far as reasonably necessary for the protection of 

the employer. However, restrictive covenants 

are not favored in Pennsylvania and have been 

historically viewed as a trade restraint that 

prevents a former employee from earning a 

living.
J. A05035/14

- 14 -

Pennsylvania cases have recognized that trade secrets of 

an employer, customer goodwill and specialized training 

and skills acquired from the employer are all legitimate 

interests protectable through a general restrictive 

covenant. In essence, the court must examine and 

balance the employer’s legitimate business interest, the 

individual’s right to work, the public’s right to unrestrained 

competition, and the right to contract in determining 

whether to enforce a restrictive covenant.

In construing a restrictive covenant, courts do not 

assume that a contract’s language was chosen carelessly, 

nor do they assume that the parties were ignorant of the 

meaning of the language they employed. When a writing 

is clear and unequivocal, its meaning must be determined 

by its contents alone. It is not the function of this Court to 

re-write it, or to give it a construction in conflict with the 

accepted and plain meaning of the language used. 

Only where a contract’s language is ambiguous 

may extrinsic or parol evidence be considered to 

determine the intent of the parties. A contract 

contains an ambiguity if it is reasonably 

susceptible of different constructions and 

capable of being understood in more than one 

sense. This question, however, is not resolved 

in a vacuum. Instead, contractual terms are 

ambiguous if they are subject to more than one 

reasonable interpretation when applied to a 

particular set of facts. In the absence of an 

ambiguity, the plain meaning of the agreement 

will be enforced. The meaning of an 

unambiguous written instrument presents a 

question of law for resolution by the court.

Synthes, 83 A.3d at 250-51 (punctuation and citations omitted).

Furthermore, with respect to restrictive covenants:

Courts have consistently held that the taking of 

employment is sufficient consideration for a covenant not 

to compete. Capital Bakers v. Townsend, 426 Pa. 188, 

190, 231 A.2d 292, 293 (1967). An employee’s promotion 

to a new position within the company also constitutes 
J. A05035/14

- 15 -

sufficient consideration. Jacobson & Co. v. 

International Environment Corp., 427 Pa. 439, 449, 

235 A.2d 612, 618 (1967). However, the covenant must 

be executed contemporaneously with the exchange of 

consideration. Capital Bakers[,] 426 Pa. at 190–91, 231 

A.2d at 293–94. In Capital Bakers, a salesman executed 

a restrictive covenant when he was hired. He later 

executed a supplementary covenant without any change in 

his employment status. Our Supreme Court refused to 

enforce the second covenant because it was not executed 

contemporaneously with the exchange of consideration. 

The Court allowed enforcement of the original covenant. 

Id.

Records Ctr., Inc. v. Comprehensive Mgmt., Inc., 363 Pa. Super. 79, 

84-85, 525 A.2d 433, 435-36 (1987) (emphasis added). 

Strong public policy considerations underlie the conclusion 

that restrictive covenants are not assignable. Given that 

restrictive covenants have been held to impose a restraint 

on an employee’s right to earn a livelihood, they should be 

construed narrowly; and, absent an explicit assignability 

provision, courts should be hesitant to read one into the 

contract. Moreover, the employer, as drafter of the 

employment contract, is already in the best position to 

include an assignment clause within the terms of the 

employment contract. Similarly, a successor employer is

free to negotiate new employment contracts with the 

employees . . . or secure the employee’s consent to have 

the prior employment contract remain in effect.

Hess v. Gebhard & Co., 570 Pa. 148, 164-65, 808 A.2d 912, 921 (2002) 

(punctuation and citation omitted).

Instantly, as set forth above, Appellants asked the trial court to 

disregard the 2007 and 2011 agreements with WM Robots, LLC, and hold 

that the 2004 agreement with WMI controlled. When Fox terminated 

employment with WMI and joined WM Robots, LLC, in 2007, Fox did not 
J. A05035/14

- 16 -

assume a different position within WMI. See Appellants’ Prelim. Inj. Hr’g Ex. 

3-B; cf. Records Ctr., 363 Pa. Super. at 84-85, 525 A.2d at 435-36. 

Accordingly, the non-compete clause provision—set forth within the 2004 

agreement with WMI—became effective for twelve months. See Appellants’ 

Prelim. Inj. Hr’g Ex. 3-B; Hess, 570 Pa. at 164-65, 808 A.2d at 921 

(mandating narrow, stringent construction of restrictive covenants). 

Similarly, absent an applicable, explicit assignment clause, we decline to 

impute the non-compete clause to WM Robots, LLC. See Hess, 570 Pa. at 

164-65, 808 A.2d at 921. 

Appellants have also asked this Court to rely upon parol evidence to 

establish the parties’ intent to incorporate by reference the 2004 

agreement’s non-compete clause. But Appellants have not referred this 

Court to any ambiguous language such that we may resort to extrinsic and 

parol evidence. See Synthes, 83 A.3d at 248-51. Appellants have not 

identified any contract language “reasonably susceptible of different 

constructions and capable of being understood in more than one sense.” 

See id. Our courts are barred from considering Appellants’ parol evidence 

absent the predicate condition of ambiguity. See id.

As noted above, Appellants alternatively relied on, inter alia, 

Restatement (First) of Contracts § 408 in support of their proposition that 

the 2004 agreement with WMI coexists with the 2007 and 2011 agreements 

with WM Robots, LLC. Section 408 states as follows:
J. A05035/14

- 17 -

§ 408 Discharge of Duty Under an Earlier Contract by a 

Subsequent Inconsistent Contract

A contract containing a term inconsistent with a term of an 

earlier contract between the same parties is interpreted 

as including an agreement to rescind the inconsistent 

term in the earlier contract. The parties may or may not 

at the same time agree to rescind all the other provisions 

of the earlier contract. Whether they do this is a question 

of interpretation, except as this rule is qualified by the rule 

stated in § 223.[11]

Restatement (First) of Contracts § 408 (emphases added). Section 408 selfevidently addresses rescission of an inconsistent term—i.e., a non-compete 

clause—in a prior contract between the same parties. Id.; Wathen v. 

Brown, 200 Pa. Super. 620, 624, 189 A.2d 900, 903 (1963) (holding, 

“Parties to a contract may rescind it by making a new contract inconsistent 

therewith.” (citing Restatement (First) of Contracts § 408)); see also In re 

Klugh’s Estate, 362 Pa. 166, 173, 66 A.2d 822, 825 (1949) (“The rule is 

well settled that the parties to a contract may rescind it by making a new 

contract inconsistent therewith.” (emphasis added and citations omitted)).

Instantly, Appellants’ argument presumes the parties are identical for 

both the earlier and subsequent contracts. WMI was a party to the 2004 

agreement; WM Robots, LLC was not a party. See Appellants’ Prelim. Inj. 

Hr’g Ex. 3-B. WM Robots, LLC—not WMI—was a party to the 2007 and 2011 

agreements. See Appellants’ Prelim. Inj. Hr’g Ex. 4, Ex. 8. Absent identical 

 

11 Restatement (First) of Contracts § 223 (1932) addresses the effect of the 

statute of frauds.
J. A05035/14

- 18 -

parties for the contracts at issue, § 408 is inapplicable and rescission cannot 

occur. See Wathen, 200 Pa. Super. at 624, 189 A.2d at 903; Restatement 

(First) of Contracts § 408; see also In re Klugh’s Estate, 362 Pa. at 173, 

66 A.2d at 825. For these reasons, Appellants are not entitled to relief.

For their third issue, Appellants contend their pricing method is a trade 

secret. Appellants opine they price their products based upon negotiating 

discounts with their customers, profit margins, and “currency hedging,” i.e., 

“hedging against the fluctuation in the exchange rate between the U.S. 

Dollar and the Euro.” Appellants’ Brief at 28.12 They claim this “compilation 

of information” is a trade secret because the “mixture of those ingredients” 

is “unknown outside” of Appellants. Id. at 29. The trial court erred, 

Appellants suggest, by focusing on the individual ingredients—i.e., the 

discounts, profit margins, and “currency hedging”—and not on the 

combination of those individual ingredients. Id. Appellants separately 

contend their network of customer contacts, information, and relationships 

are also trade secrets. We hold Appellants are due no relief. 

At the preliminary injunction hearing, Appellants testified about their 

currency hedging:

[Samsi13]: WM Robots buys these products from Vallon, 

and we pay for them in euros. The exchange rate 

 

12 Appellants did not define “currency hedging” in any of their pleadings. 

13 Samsi is the chief operating officer of WMI. 
J. A05035/14

- 19 -

fluctuation that is prevalent in the euro is absorbed by WM 

Robots. So in order to maintain a certain level of margin 

of profit, we do what is called currency hedging. And we 

determine an exchange rate for a—let’s say there is a 

quotation or an estimate being supplied by the 

Government. I determine what the exchange rate should 

be so that we cover the period that that particular 

contractor delivery order is going to be open. 

N.T. Prelim. Inj. Hr’g, 5/22/13, at 53 (emphasis added).

The trial court requested clarification from Samsi:

The court: . . . One of the things I think you mentioned 

about was that [Fox] has unique knowledge as to the 

currency exchange during a transaction.

[Samsi]: Yes.

The court: Why would that be so unique? Why wouldn’t 

any person who is sophisticated in international currency 

understand the same logistics that you’re saying he has?

[Samsi]: Your Honor, it is unique to the extent of how we 

use the exchange rate fluctuation and how we hedge 

against fluctuations and how we price our products; that is 

unique to WM Robots.

The court: How so? In other words, wouldn’t that be the 

same for anybody who buys and sells internationally?

[Samsi]: In some form, yes. They would be able to be 

[sic] do that, yes.

The court: With respect to the pricing schedule, from what 

I understood . . . , if someone were to make a Freedom of 

Information Request—would they actually see the actual 

contract?

[Samsi]: They can see the contract, yes, Your Honor.

Id. at 101 (emphases added and capitalization omitted).
J. A05035/14

- 20 -

During the cross-examination of Fox, the court elicited an example of 

currency hedging:

[Appellants’ counsel]. Part of the way [Appellants] made a 

profit was to figure out how to correctly hit the right 

number of the conversion rate from euros to dollars?

[Fox]. Yes.

Q. And you were aware of how . . . WMI, did that?

A. I was tracking the exchange rate myself. The present 

communication that [Samsi] would have with the 

accountants, dealing with the exchange rates was not . . . 

presented to me.

The court: Can you give me an example? Let’s use [100 

euros] as to how fluctuation in the exchange rate would 

affect the price, the setting of the price, let’s say a unit 

costs [100 euros].

[A.] We would get a 20% discount. So the WM Robots’ 

cost for that product would then be 80 euros. We would 

take the 100 euro price and look at the exchange rates. If 

the exchange rate—around now, it is about 1.3. So we 

would then take the 1.3 exchange rate and multiply that 

by the euro cost. And we would put out a price of $130. 

And if there were additional discounts, then that would be 

done separately. That would be based on whatever Samsi 

would allow.

The court: Let me follow this again. Let’s say the price 

from Vallon is 100 euros. There is a discount of 20 

percent, so now it is 80 [euros]. But you’re setting it at a 

1.3 exchange rate, at 130 euros. Does that mean the 

Government would pay 130 euros for the unit?

[A.] . . . They would pay $130. 

The court: Oh, $130. What about the discount? Is that 

just profit?

[A.] Yes.
J. A05035/14

- 21 -

[Appellants’ counsel]: So as you just explained, you were 

aware of how the pricing worked, right?

A. Yes. But I was not aware of the actual exchange rates 

that Mr. Samsi was getting.

The court: Would he get a different rate than anyone 

trading in international currency would get?

[A.] No.

The court: So I don’t understand your comment that you 

weren’t aware of the rates he was getting. Would [Samsi] 

get a unique rate?

[A.] Mr. Samsi was the only one that was dealing with the 

accountants to hedge the dollar to the euro. I was not—

that was not a part of my role or responsibility.

Id. at 146-48 (capitalization omitted); see also id. at 53. 

Fox confirmed that he did not hedge currency on redirect examination:

[Appellees’ counsel: Y]ou mentioned something called in 

the pricing . . . a “hedging of the rates.” I am a little 

unclear on what that means. In the circumstances of 

pricing, when you’re calculating the conversion rate from 

the euro to the dollar, what does it mean to hedge that 

rate?

[Fox]. The . . . existing currency conversion rate is only in 

real time. These [sales] contracts [for products] would 

take place or be delivered several months down the road. 

So to properly anticipate what the exchange rate would be 

at the time of delivery or payment from the Government in 

order to make the WM Robots’ payment to Vallon, you 

would enter into hedging contracts to limit your exposure 

to wildly fluctuating exchange rates. 

Q. Who made these hedging decisions?

A. [Samsi] did.
J. A05035/14

- 22 -

Q. Do you have any experience in international markets 

that make you qualified to make hedging decisions?

A. No.

Id. at 186-87. Thus, both Fox and Samsi testified that only Samsi engaged 

in currency hedging.14 Id.; accord id. at 53, 148. Samsi also testified that 

customer information, contracts, and prices are publicly available. Id. at 

91-94, 101 (agreeing prices publicly available via Freedom of Information 

Request).

To obtain injunctive relief, a party must establish that the information 

at issue is a “trade secret,” as that term is defined by PUTSA. 12 Pa.C.S. § 

5302; Iron Age Corp. v. Dvorak, 880 A.2d 657, 664 (Pa. Super. 2005) 

(affirming denial of preliminary injunction because movant failed to establish 

information at issue qualified as trade secret). The PUTSA defines “trade 

secret” as follows:

“Trade secret.” Information, including a formula, drawing, 

pattern, compilation including a customer list, program, 

device, method, technique or process that:

(1) Derives independent economic value, actual or 

potential, from not being generally known to, and not 

being readily ascertainable by proper means by, other 

persons who can obtain economic value from its 

disclosure or use.

 

14 We note the common occurrence of currency hedging contracts. See, 

e.g., Union Steel Mfg. Co. v. United States, 837 F. Supp. 2d. 1307, 1321 

(Ct. Int’l Trade 2012) (noting “currency hedging” involves currency swap 

contracts); In re Sadia, S.A. Secs. Litig., 643 F. Supp. 2d 521, 523 

(S.D.N.Y. 2009) (same).
J. A05035/14

- 23 -

(2) Is the subject of efforts that are reasonable under 

the circumstances to maintain its secrecy.

12 Pa.C.S. § 5302. “[I]f a competitor could obtain the information by 

legitimate means, it will not be given injunctive protection as a trade secret.” 

Shepherd v. Pittsburgh Glass Works, LLC, 25 A.3d 1233, 1245 (Pa. 

Super. 2011) (citation omitted).

Instantly, even assuming the existence of a valid non-compete 

agreement, Appellants never raised an argument before the trial court that it 

was the unique combination or compilation of information that formed 

the basis of the trade secret at issue. Given Appellants’ emphasis on the 

currency hedging alone, we do not fault the trial court for not anticipating 

Appellants’ unvoiced compilation-of-information argument. Accordingly, 

because they failed to raise the argument that the compilation or 

combination of the instant discounts, profit margins, and currency hedging is 

a trade secret, see 12 Pa.C.S. § 5302, Appellants have waived it on appeal. 

See Pa.R.A.P. 302 (“Issues not raised in the lower court are waived and 

cannot be raised for the first time on appeal.”). Regardless, currency 

hedging is common knowledge and Fox did not engage in such hedging. 

N.T. at 53 (Samsi testifying, “I determine” exchange rate), 146-48, 186-87. 

Samsi also testified Appellants’ customer information, contracts, and prices 

were publicly available. Id. at 91-94, 101. Thus, because such information 
J. A05035/14

- 24 -

can be obtained via legitimate means, injunctive relief is presently 

unavailable.15 See Shepherd, 25 A.3d at 1245. 

Appellants lastly claim the trial court failed to ascertain whether 

Appellees’ use of Appellants’ alleged trade secrets constitutes irreparable 

harm. Appellants’ last issue presumes the existence of trade secrets and 

thus derives from their third issue. Because we discern no abuse of 

discretion with the trial court’s resolution of Appellants’ third issue, we need 

not address it. Accordingly, we affirm. 

Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 2/6/2015

 

15 As noted above, our standard of review for preliminary injunctive relief is 

highly deferential. See Summit Towne Ctr., 573 Pa. at 646, 828 A.2d at 

1000-01 (stating default position of appellate court is to affirm trial court’s 

order resolving request for preliminary injunctive relief); Synthes, 83 A.3d 

at 248 (same). Appellants have an opportunity to develop the record further 

at trial.