Court Opinion

ID: 4283946
Source: CourtListenerOpinion
Date Created: 2018-06-13 15:04:51.409201+00
Date Added: 2024-06-11T14:26:05.949018
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT

             PREMIER COMPOUNDING PHARMACY, INC.,
                      a Florida corporation,
                            Appellant,

                                    v.

                             ERIC LARSON,
                               Appellee.

                             No. 4D17-1318

                             [June 13, 2018]

  Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach   County;     Joseph     Marx,     Judge;     L.T.    Case     No.
502015CA011740XXXXMBAN.

  Raymond M. Christian of Raymond M. Christian, P.A., Palm Beach
Gardens, and Bard D. Rockenbach of Burlington & Rockenbach, P.A.,
West Palm Beach, for appellant.

    Jill G. Weiss of Jill G. Weiss, P.A., Palm Beach Gardens, and Robin
Bresky and Jeremy Dicker of the Law Offices of Robin Bresky, Boca Raton,
for appellee.

WARNER, J.

    After succeeding in obtaining an injunction against the appellee for
violation of a non-compete agreement, appellant moved for attorney’s fees
under the terms of the agreement. The trial court denied the fees, refusing
to enforce the attorney’s fee provision of the agreement. At the hearing on
appellant’s motion, the court found the agreement invalidly permitted the
appellant to obtain a temporary injunction without posting a bond, noting
the attorney’s fees provision was contained within the same paragraph as
the impermissible “injunctive relief without the posting of a bond”
language. We reverse, because the attorney’s fees provision is enforceable.

   Appellee Eric Larson, a licensed pharmacist, entered into an
employment contract with the appellant, Premier Compounding
Pharmacy, Inc. The agreement contained sections prohibiting appellee
from releasing or divulging appellant’s confidential information (Paragraph
9), a non-compete agreement (Paragraph 10), and an agreement to secure
to the employer any developments or patents produced by the employee
during the term of his employment (Paragraph 11). Paragraph 12 of the
agreement, entitled “Injunction without Bond,” allowed the appellant to
obtain an injunction for a violation of paragraphs 9, 10, and 12 of the non-
compete agreement. It also contained a provision for attorney’s fees,
providing in part:

      [A] breach of the covenants contained in Paragraphs 9, 10 and
      12 of this Agreement will result in irreparable injury to
      Employer and the only appropriate remedy for such breach
      would be an injunction. Thus, in the event there is a breach
      or threatened breach by the Employee of the provisions of
      paragraphs 9, 10 and 12, the Employer shall be entitled to
      seek and obtain injunctive relief without the posting of a bond
      to restrain the Employee from disclosing in whole or in part
      any confidential matters or from rendering service to any
      person, firm, corporation, association or other entity, or from
      claiming ownership to any invention or development or failing
      to provide further assurances, and the Employer will be
      entitled to reimbursement for all costs and expenses,
      including reasonable attorney’s fees (both at the trial and
      appellate levels) in connection therewith . . . .

(emphasis added).    The agreement also contained a severability clause
which stated:

      If any provision of this Agreement, the deletion of which would
      not adversely affect the receipt of any material benefit by or in
      favor of any party or substantially increase the burden of any
      party to this Agreement, shall be held to be invalid or
      unenforceable to any extent, the same shall not affect in any
      respect whatsoever the validity or enforceability of the
      remainder of this Agreement.

   In 2015, appellant filed a complaint for injunctive relief, alleging that
the appellee was discharged and then solicited one of appellant’s referring
physicians. It claimed appellee was employed with a local competitor as a
pharmacist. Appellant sought to enforce its non-compete restrictions
through temporary and permanent injunctive relief, requesting attorney’s
fees and costs, as well as monetary damages.

  After a hearing, the court granted Premier temporary injunctive relief.
Appellee appealed the temporary injunction, but he voluntarily dismissed

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the appeal. Appellee then moved for entry of final judgment, requesting
the court to find that the non-compete provision was reasonable. The
court entered a final judgment of injunctive relief for appellant, reserving
its jurisdiction to determine entitlement to attorney’s fees and costs.

   Appellant moved for attorney’s fees and costs, arguing it was the
prevailing party and entitled to fees under the employment agreement,
particularly paragraph 12, and section 542.335, Florida Statutes (2016).
Appellee contended that because paragraph 12 invalidly allowed the
issuance of an injunction without bond, it was unenforceable under
section 542.335(1)(j), Florida Statutes (2016). He claimed that this would
invalidate the entire paragraph, which should be severed from the
employment agreement. After a hearing, the trial court accepted appellee’s
interpretation and denied the motion for attorney’s fees. Appellant now
appeals. We review de novo a party’s entitlement to fees based on the
interpretation of contractual provisions. Carlin v. Javorek, 42 So. 3d 820,
822 (Fla. 4th DCA 2010).

    “As a general rule, contractual provisions are severable, where the
illegal portion of the contract does not go to its essence, and, with the
illegal portion eliminated, there remain valid legal obligations.” Fonte v.
AT&T Wireless Servs., Inc., 903 So. 2d 1019, 1024 (Fla. 2005). While
paragraphs within a contract may differ from individual provisions or
phrases, we examine the contract as a whole to determine the parties’
intent. Lalow v. Codomo, 101 So. 2d 390, 393 (Fla. 1958).

    The essence of paragraph 12 is the employer’s entitlement to seek an
injunction to prevent the employee from breaching the non-compete clause
of the contract.1 Without the right to obtain an injunction to prevent the
employee from working for a competitor, the employment agreement would
never protect the employer from an employee who began working for a
competitor or taking the employer’s customers and secrets. The contract
itself states that breach of the various agreements would constitute
“irreparable injury” to the employer. Although the paragraph specifies that
the “Employer shall be entitled to seek and obtain injunctive relief without
the posting of a bond to restrain the Employee,” the words “without the
posting of a bond” can be eliminated, and valid legal obligations remain.
While section 542.335(1)(j) provides a temporary injunction requires a

1 While appellee also points to the caption of the paragraph of “Injunction without

Bond” as reason to strike the entire provision, section 17 of the agreement
provides that, “The captions used in this Agreement are solely for the convenience
of the parties and are not used in construing this Agreement.” Consistent with
that term, we do not use the caption to construe the essence of the agreement.

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bond, and a contractual provision waiving a bond will not be enforced, no
bond is required for a permanent injunction. Thus, the “no bond”
requirement is very limited.     The appellant obtained a permanent
injunction to secure its very important right to enforce the non-compete
clause of the contract.

   If paragraph 12 is invalid in its entirety because of the “no bond”
requirement for a temporary injunction, then appellant would not be
entitled to any injunction at all. Yet, even appellee recognized that
appellant could enjoin him from competition pursuant to the terms of the
agreement, as appellee himself moved for the entry of a permanent
injunction.

    Moreover, the severance clause permits the remainder of the contract
to stand if the “no bond” requirement is eliminated. It provides that, “If
any provision of this Agreement . . . shall be held to be invalid or
unenforceable to any extent, the same shall not affect in any respect
whatsoever the validity or enforceability of the remainder of this
Agreement.”     (emphasis added).      Thus, because the extent of the
unenforceability of the provision goes solely to the “no bond” requirement
of the injunction, the remainder of the provision and the agreement is still
enforceable, including the attorney’s fees provision.

    In very similar factual circumstances, the court in Smart Pharmacy, Inc.
v. Viccari, 213 So. 3d 986, 991-92 (Fla. 1st DCA 2016), reversed the denial
of a temporary injunction which Smart Pharmacy sought to enforce a non-
compete agreement, remanding for entry of the injunction after the
determination of an appropriate bond. In a footnote, the court addressed
the enforceability of the contractual provision which allowed the employer
to seek a temporary injunction without bond, concluding that it did not
invalidate the remaining provisions of the agreement:

      Although Viccari’s noncompete agreement provided that it
      could be enforced “without [Smart Pharmacy] having to post
      bond or other security,” this provision is unenforceable. See
      § 542.335(1)(j), Fla. Stat. (“[T]he court shall not enforce any
      contractual provision waiving the requirement of an
      injunction bond or limiting the amount of such bond.”). This
      provision does not, however, render the entire noncompete
      agreement unenforceable as Appellees contend. First, the
      statute does not preclude the court from enforcing the
      agreement in its entirety, but rather only prohibits
      enforcement of the “contractual provision waiving the
      requirement of an injunction bond” (emphasis added).

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      Second, the noncompete agreement contained a severability
      clause providing that the invalidity of a provision of the
      agreement would not affect the validity and enforceability of
      the remainder of the agreement.

Id. at 991 n.4 (italics original, bold emphasis added). The court did not
conclude that no injunction could issue, but simply required that a bond
be issued prior to the entry of a temporary injunction.

   In its written order denying the fees, the trial court cited only Vital
Pharmaceuticals, Inc. v. Professional Supplements, LLC, 210 So. 3d 766
(Fla. 4th DCA 2017). The trial court’s reliance on Vital Pharmaceuticals to
support the denial of fees is misplaced. There, this court found that the
defendants, former employees of the plaintiff employer were not entitled to
an award of damages following the dissolution of a temporary injunction
wrongfully entered against them. Id. at 767-68. The employer never
posted a bond for its temporary injunction, and section 60.07, Florida
Statutes, provided that “[i]n injunction actions, on dissolution, the court
may hear evidence and assess damages to which a defendant may be
entitled under any injunction bond, eliminating the necessity for an
action on the injunction bond if no party has requested a jury trial on
damages.” Id. We found the statute “presupposes the existence of a bond
because an injunction order requires a bond under rule 1.610(b) and is
subject to dissolution until a bond is posted.” Id. at 768. Thus, if a
temporary injunction is wrongfully issued without a bond, then the party
against whom the injunction is entered is not able to collect damages
under a bond upon dissolution of the injunction. Id.

    The present case is distinguishable from Vital Pharmaceuticals. There,
the employee who succeeded in defeating the temporary injunction sought
attorney’s fees pursuant to statute, not a contractual provision authorizing
fees. However, in this appeal, the party who successfully obtained a
permanent injunction is seeking attorney’s fees. Furthermore, appellant’s
argument is based on the employment contract and the specific provision
for attorney’s fees in the contract, not section 60.07, Florida Statutes.

   Finally, we distinguish Place at Vero Beach, Inc. v. Hanson, 953 So. 2d
773, 775 (Fla. 4th DCA 2007), which the appellee cites to argue that the
severance “clause allow[ed] provisions, not portions of a provisions, of the
Agreement to be severed.” (emphasis in original). In other words, he
contends the court correctly struck the entirety of paragraph 12. In
Hanson, we found the trial court did not err by refusing to sever only
portions of an arbitration clause and instead invalidating the entire
arbitration provision. Id. We noted severance of individual parts of the

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provision would be proper only if “there [was] no ‘interdependence between
the arbitration clause and the remaining clauses of the agreement which
would [require] the trial court to rewrite or ‘blue pencil’ the agreement.’”
Id. at 775-76 (quoting Healthcomp Evaluation Serv. Corp. v. O’Donnell, 817
So. 2d 1095, 1097 (Fla. 2d DCA 2002)). In contrast, here, the severance
clause permits severance of any provision only to the extent of its
invalidity, which in this case is the “no bond” requirement. There is no
interdependence between the offending clause and the remaining
provisions, either within paragraph 12 or other provisions in the
agreement. Thus, the trial court was not required to rewrite the agreement
in any respect other than to eliminate the “no bond” requirement.

   The trial court erred in denying the motion for attorney’s fees. The
provision of the agreement authorizing the award of fees for this
permanent injunction, stipulated to by appellee, is not invalid. We
therefore reverse and remand for a hearing to determine the amount of
fees.

   Reversed and remanded for further proceedings.

GROSS and TAYLOR, JJ., concur.

                           *         *         *

   Not final until disposition of timely filed motion for rehearing.

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