Court Opinion

ID: 6779337
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:54:12.329767+00
Date Added: 2024-06-11T16:02:50.589852
License: Public Domain

Cook, J.,
dissenting. I believe that the trial court correctly granted summary judgment in favor of Bauernschmidt in this case. To come to that conclusion, I resolve certain underlying issues differently from the majority. First, Siegel clients with whom Bauernschmidt worked were not just Siegel’s clients, but also Bauernschmidt’s clients. Second, the information developed by Siegel as a “client list” may be protectable as a trade secret, but the identities of Bauernschmidt’s clients cannot be trade secrets. Third, Bauernschmidt was therefore entitled, upon leaving Siegel, to contact those clients with whom she had worked while with the Siegel firm. Fourth, use of the “client list” by Bauernschmidt for purposes of preparing a mailing to the clients with whom she worked while with the Siegel firm would not amount to misappropriation of the trade secret properties of the Siegel client list.
Court of Appeals’ Judgment
The court of appeals held that the client names on Bauernschmidt’s Rolodex were properly retained by her because those were names of clients she had represented while with the Siegel firm. Siegel did not appeal that judgment. The law of the case, then, is that Bauernschmidt could properly use those Rolodex cards to compile her mailing to Siegel clients she represented while with the Siegel firm.
*184The court of appeals, however, held that the potential trade secret violation here was Bauernschmidt’s use of the client list to compile her mailing list of former clients. The court implicitly distinguished Bauernschmidt’s use of “Rolodex names” from her use of the Siegel “client list” based upon the fact that the Siegel “client list” included all of Siegel’s clients, not just those clients for whom Bauernschmidt worked. But if the reference to the Rolodex names is no violation (given that those clients were her clients as well as the firm’s clients, see discussion infra) and those Rolodex names appear in the compilation of all Siegel clients, as they necessarily would, then it is incongruous to hold that Bauernschmidt’s reference to the Siegel client list for the names of her former clients would violate trade secret law. In other words, it was inconsistent for the court of appeals to say that Bauernschmidt could look at her Rolodex to compile her mailing, but that she could not reference the client list for the same purpose: contacting her former clients.
The court of appeals erred in elevating names of Bauernschmidt’s former clients (otherwise permitted to be used) to protectable trade secret status simply because those names appeared on Siegel’s client list along with its other clients whom Bauernschmidt had not represented. .
Dual Status of Clients
Both Siegel and the majority opinion discuss whether the clients Bauernschmidt represented while with the Siegel firm are her clients or Siegel’s. They are both hers and the firm’s. The firm has a relationship with the client, but the servicing lawyer also has her own lawyer-client relationship. Siegel acknowledges this concept with joint references in the complaint. At paragraph one, the complaint identifies two plaintiffs: Fred Siegel Co., L.P.A., a licensed professional association of attorneys doing business in Ohio, and Fred Siegel, a principal member of that licensed professional association. The complaint then repeatedly refers to “plaintiffs’ clients,” thereby implying the clients’ dual status as firm clients and also Fred Siegel’s clients.
A Lawyer’s Clients Are Not Eligible for Trade Secret Protection
Clients may not be reserved to any lawyer or firm as a trade secret. Cases from Ohio and other jurisdictions have long held that a client’s right to choose an attorney must be free and unfettered. Disciplinary Rules prohibiting noncompete provisions between lawyers (DR 2-108), requirements that client files be returned (DR 2 — 110[A][2]), and other similar doctrines have evolved in recognition of the professional and intensely personal nature of the attorney-client relationship.
From Fred Siegel’s deposition testimony, it seemed that in filing this lawsuit he misunderstood the state of the law on departure-based communications. He *185testified that he believed it improper for any lawyer leaving a firm to contact any client of the former firm with the intent of seeking to take that client to the new firm. It is from this mistaken perspective that the case proceeded.
This court has recognized that a client has an absolute right to discharge an attorney or law firm at any time, with or without cause, subject only to the obligation to compensate the attorney or firm for services rendered prior to the discharge. See Reid, Johnson, Downes, Andrachik & Webster v. Lansberry (1994), 68 Ohio St.3d 570, 629 N.E.2d 431, paragraph one of the syllabus. “ ‘The attorney-client relationship is consensual, highly fiduciary on the part of counsel, and he may do nothing which restricts the right of the client to repose confidence in any counsel of his choice. * * * No concept of the practice of the law is more deeply rooted.’ ” Corti v. Fleisher (1981), 93 Ill.App.3d 517, 522-523, 49 Ill.Dec. 74, 417 N.E.2d 764, 769, quoting Dwyer v. Jung (1975), 133 N.J.Super. 343, 347, 336 A.2d 498, 500. “[E]ach person must have the untrammelled right to the counsel of his choice.” Corti at 523, 49 Ill.Dec. 74, 417 N.E.2d at 769.
A departing attorney may notify clients of his or her departure from a law firm, identify his or her new location of practice, and indicate a willingness to provide legal services at the new location. Such communication is permitted under DR 2-102(A)(l) and (2) and DR 2-103(A). Respect for a client’s choice demonstrates to the client and to the public that the lawyer and law firm are truly practicing a profession. Board of Commissioners on Grievances and Discipline (Apr. 3, 1998), Opinion No. 98-5.
Therefore, Bauernschmidt’s former clients cannot be Siegel’s trade secrets. Even when a lawyer or firm compiles a client list as Siegel did, the mere listing of clients’ names cannot confer trade secret protection.
Limits of Trade Secret Protection of Siegel’s Client List
Useful information formatted into an attorney’s or law firm’s client list, however, may be protectable as a trade secret. Former R.C. 1333.51(A)(3). The statutory language includes lists and compilations. The purpose of Ohio’s trade secret law is “to maintain standards of commercial ethics * * * as well as the protection of the substantial investment of employers in their proprietary information.” Valco Cincinnati, Inc. v. N & D Machining Serv., Inc. (1986), 24 Ohio St.3d 41, 48, 24 OBR 83, 89, 492 N.E.2d 814, 820, citing Kewanee Oil Co. v. Bicron Corp. (1974), 416 U.S. 470, 94 S.Ct. 1879, 40 L.Ed.2d 315; see, also, Levine v. Beckman (1988), 48 Ohio App.3d 24, 28, 548 N.E.2d 267, 271. Thus, trade secret law would protect Siegel’s investment in developing the compilation aspects of its client lists — the cross-referencing of a given client’s name with parcel numbers, the names of other property owned or managed by that same client, billing names and phone numbers, the identity of clients if different from the named tax plaintiff, the identity of owners of properties, and the contact *186people of leased property. If Bauernschmidt and/or Arter & Hadden took from Siegel the advantage it had earned through the time and effort invested in compiling such information, that usurpation could support a claim for misappropriation of a trade secret, provided that Siegel also could prove the secrecy requirements of the claim. But Siegel established no issue of fact that Bauernschmidt usurped the protectable aspects of its compilation. Siegel was only able to show that Bauernschmidt may have referred to the list during the process of generating a mailing list of her former clients. But the identities of her clients may not be trade secrets, and the use of Siegel’s list merely to obtain or double-check addresses, spelling, and the like, of only those clients Bauernschmidt worked with is not misappropriation.
Summary Judgment Properly Granted
Because trade secret law does not bar Bauernschmidt’s referring to the Siegel client list to contact her former clients, summary judgment in favor of Bauernschmidt is properly granted unless Siegel, in its response, put in dispute the truth of Bauernschmidt’s claimed limited use of the list.
In Bauernschmidt’s affidavit, she states in paragraph 6: “The only clients of the Siegel firm I contacted were those clients for whom I had done work during my tenure at that firm.” In its-response to defendants’ motion for summary judgment, Siegel alleged that “[sjolicitation letters * * * were sent to clients of [Siegel] with whom defendant Bauernschmidt had never met or worked.”
Fred Siegel testified in his deposition:
“Q. Do you know of any client that she worked for?
“A. Specifically? No, she worked with — there was no restriction on any client she worked for, actually, other than if the client directed otherwise which they did on occasion.
“Q. So she could have worked for any client in the office?
“A. That’s correct.
“Q. Do you have any information that Mrs. Bauernschmidt now has a client formally with your office other than the clients she worked for while at your office?
U * * *
“A. I know of certain ones that she didn’t work for. Well, I’m not sure. I can’t answer that question.
“Q. You don’t know exactly who [sic ] she contacted, do you?
“A. No, but I will find out. Almost everybody called me and sent me copies.”
*187In later responding to the Bauernschmidt and Arter & Hadden motion for summary judgment, Siegel merely reasserted the allegation that solicitation letters were sent to clients of the Siegel firm with whom Bauernschmidt did not work. In support, Siegel was unable to offer any evidence beyond the same deposition-testimony quoted above along with certain nonsupportive deposition testimony from Bauernschmidt.
Siegel’s summary judgment response sought to succeed on the inadequacy of Bauernschmidt’s affidavit. But because Siegel took the position that any reference to the client list by Bauernschmidt was a trade secret violation, its response failed to raise an issue of fact on the material issue: whether Bauernschmidt contacted Siegel clients other than those with whom she worked. The court of appeals’ reversal of summary judgment cannot be sustained based only upon Siegel’s suspicions that Bauernschmidt solicited Siegel clients for whom she did not work. The appellants sustained their initial burden by submitting, inter alia, Bauernschmidt’s affidavit testimony establishing that the only clients who followed her from the Siegel firm to Arter & Hadden were clients for whom she had worked. Siegel did not sustain its reciprocal burden under Civ.R. 56(E) to “set forth specific facts showing that there is a genuine issue for trial” that Bauernschmidt solicited Siegel clients for whom she had not worked.
The evidence cited by the court of appeals as establishing an issue of fact, the matching misspellings from the Siegel client list and Bauernschmidt’s client letters, only supports the inference that she looked to Siegel’s client list to prepare her letters. Her limited reference to the client list for the correct mailing information for her former clients does not implicate trade secret protections.
Because Siegel has no cause of action for a trade secret violation if there is no evidence that Bauernschmidt exceeded her right to contact former clients, summary judgment was properly granted. I would affirm the trial court’s grant of summary judgment in favor of Bauernschmidt on Siegel’s claim of misappropriation of trade secret.
Tortious Interference
My conclusions on the trade secret issues dictate affirming summary judgment for Bauernschmidt on Siegel’s tortious interference claim. The court of appeals held that Siegel’s “business interference [claim] is dependent on whether or not the information that Bauernschmidt retained was in fact a trade secret; if so, then the use of that information could be found to be tortious.” Likewise, the majority decides to affirm on the basis that the usurping of a trade secret could satisfy the “wrongful means” prong of the fair competition analysis found in Section 768 of the Restatement of Torts 2d. Given that Siegel could not refute Bauernschmidt’s limited, proper use of the client list, then Bauernschmidt is *188protected by the fair competition privilege discussed in the majority opinion. Though the majority also mentions that disclosure of fee information might support a finding of •wrongful means, the court of appeals’ decision in favor of Bauernschmidt on that issue precludes Siegel challenging that here, as Siegel did not appeal from the court of appeals’ judgment.
I would reverse the court of appeals’ judgment because the trial court properly granted summary judgment in favor of Bauernschmidt on Siegel’s claim of tortious interference with contract.
Modification of the Kenty Test
Even if I were to agree with the majority on the disposition of this case, I would take this opportunity to modify paragraph two of the syllabus of Kenty v. Transamerica Premium Ins. Co. (1995), 72 Ohio St.3d 415, 650 N.E.2d 863, so that it agrees with the Restatement of Torts 2d.
The Kenty court, while professing to adopt the elements of tortious interference with contract set forth in the Restatement, established that the fourth element in proving tortious interference is “lack of justification.” Id. at 419, 650 N.E.2d at 866. The Restatement, however, does not mention “justification” in the relevant sections themselves, but only in its introductory note and in its comment sections. See 4 Restatement of the Law 2d, Torts (1979), Sections 766, 767, and 768. And when the Restatement does discuss justification, it is to discuss the problems with its use as a defense. Id. The introductory note discusses alternative word choices for the test, including the word “justification,” and concludes by stating that “[t]he word adopted for use in this Chapter, neutral enough to acquire a specialized meaning of its own for the purposes of the Chapter, is ‘improper.’ ” Id. at Introductory Note at 6. The comments explain the confusion that can result by using the language “without justification” in the test because the question then becomes “who has the burden to prove what?” See, e.g., id. at 37-38, Comment k, Section 767.
The Kenty court added an element not contained in the recommended language of the Restatement and unfortunately distorted the proper test. Justification connotes a “lawful excuse or reason.” Black’s Law Dictionary (6 Ed.1990) 865. And according to Black’s, the “[t]erm is not widely used in torts[.]” Id. at 866. The Restatement does not require either party to a tortious-interference-witheontract action to prove justification or a lack thereof. Instead, it requires that the plaintiff prove improper interference. According to the Restatement, a party may interfere with a contract, and as long as the interference is not improper, no tort has been committed. “Justification” is simply not an accurate term for the element required.
*189Therefore, Kenty’s second syllabus paragraph should be modified to coincide with the Restatement so that in Ohio, “[i]n order to recover for a claim of intentional interference with a contract, one must prove (1) the existence of a contract, (2) the wrongdoer’s knowledge of the contract, (3) the wrongdoer’s intentional procurement of the contract’s breach, [ (4) by improper means], and (5) resulting damages.” Kenty, 72 Ohio St.3d 415, 650 N.E.2d 863, paragraph two of the syllabus. What constitutes “improper means” is explained in the Restatement. See Restatement of Torts 2d at 39, Section 768, and at 39-44, Comments a through i.