Court Opinion

ID: 9744845
Source: CourtListenerOpinion
Date Created: 2023-08-26 22:18:52.898307+00
Date Added: 2024-06-11T07:24:52.418538
License: Public Domain

JUSTICE DUNN, dissenting: I respectfully dissent. I disagree with the conclusion of the majority that the salon has not carried its burden of raising a fair question as to the existence of a protectable interest. I believe the salon did adequately show it had a near-permanent relationship with its clientele. The majority correctly conclude that Illinois courts have developed a set of objective factors to consider in determining whether an employer has a near-permanent relationship with its customers. My disagreement with the majority, however, is their application of these factors to the facts of this case. These factors include (1) the length of time required to develop the clientele; (2) the amount of money invested to acquire clients; (3) the degree of difficulty in acquiring clients; (4) the extent of personal customer contact by the employee; (5) the extent of the employer’s knowledge of its clients; (6) the duration of the customers’ association with the employer; and (7) the continuity of employer-customer relationships. (Agrimerica, 199 Ill. App. 3d at 443-44; A.B. Dick, 159 Ill. App. 3d at 793; McRand, 138 Ill. App. 3d at 1051-54.) The employer is not required to show that the customer relationship is perpetual or indissoluble, or that a near-permanent relationship exists with each customer. Preferred Meal System v. Guse (1990), 199 Ill. App. 3d 710, 723-24. Applying the McRand factors here, I find sufficient evidence of a near-permanent relationship between the salon and its clients. The first three factors, taken together, do not cut clearly in favor of either party. The length of time that the salon takes to develop customers appears relatively brief. There is no indication that a hairstyling shop such as the salon must cultivate a potential client for a substantial period before that client will do business with the employer for the first time. (See, e.g., Agrimerica, 199 Ill. App. 3d at 444 (employer’s salespeople needed 6 to 12 months to develop sufficient confidence on the part of prospective customers and to persuade them to buy products); McRand, 138 Ill. App. 3d at 1051 (designer of management incentive and award programs for corporations normally required one to three years of contact with client before any business was booked for that client).) The salon does not appear to invest a great deal per client beyond the maintenance of the shop’s facilities. However, this cost is substantial, as the stylist supplies only her scissors and labor. The difficulty of acquiring clients is unclear from the record. However, the remaining McRand factors, particularly the extent of personal contact between employee and client, do strongly favor the salon. Here, there was testimony that the salon aided defendant (and other stylists) not only in developing specialized techniques, but in cementing durable relationships by learning and attending to the personal desires of each client. Our courts have repeatedly recognized that intensive contact between the employee and the client, helping to bind the client to the employer for as long as the employee works for the employer, is a weighty consideration in favor of finding a near-permanent employer-client relationship. McRand noted that in a highly competitive business, personal contact between employee and customer is important to maintaining long-term customer relationships. Businesses that settle for transitory clienteles do not bother to personalize the relationship between employee and client or to develop extensive knowledge of client needs, because the “[ejmployees’ extensive and specific knowledge of customers is unnecessary in a business where the customers are transitory” (McRand, 138 Ill. App. 3d at 1053). Applying this principle to the facts before it, the McRand court emphasized that the employees’ close working relationships with customers and knowledge of particular customers’ needs was strong evidence of near-permanent employer-customer relationships. Similarly, in Agrimerica, the court emphasized that the defendant-former employee developed close working relationships with customers, visiting them regularly and winning their personal trust. Agrimerica, 199 Ill. App. 3d at 445-46. In Tyler Enterprises of Elwood, Inc. v. Shafer (1991), 214 Ill. App. 3d 145, the court emphasized that the employer’s business was highly competitive and that, because the defendant-employee had extensive contact with customers, he “received invaluable information including the knowledge of the customer’s individualized needs. As a matter of policy, [the employer] put a premium on developing extremely close working relationships between its employees, like [the defendants], and its customers.” (Tyler, 214 Ill. App. 3d at 150.) In the case at bar, the testimony of both parties strongly supports a similar conclusion. See also Millard Maintenance, 207 Ill. App. 3d at 748 (employer and its sales staff, including defendant, “made an effort to develop *** close personal relationships” with customers); Guse, 199 Ill. App. 3d at 723 (employer, “doubtless through the efforts of the individual defendants themselves, had established a reputation for service, quality and reliability” with customers); A.B. Dick, 159 Ill. App. 3d at 793 (defendant-employee was “the central contact between plaintiff and its customers”). In the case at bar, the personalized nature of the employer’s services, including defendant’s attention to the individual needs of clients and her development of long-term relationships of trust with her clients — ways of doing business that the salon encouraged and provided guidance in — militates in favor of the trial court’s finding that plaintiff and its clients had a near-permanent relationship. Defendant argues that the evidence at the hearing demonstrated that a client’s loyalty is to the stylist rather than to the shop. Assuming this to be so, I conclude that this simply demonstrates that, as long as a stylist stays at the shop, the clients will be steady customers of that shop. This appears to be exactly the case at bar, not only as to defendant, but also as to other stylists (such as Michael Gilberto and Noreen Guy), who appear to have built up steady client bases over the years. The typical relationship between the salon and a client apparently is not transitory; clients are not anonymous faces who casually patronize the salon part of the time and a variety of other shops other times, depending on convenience or whim. Thus, the duration and continuity of customer associations — the sixth and seventh McRand, factors — cut strongly in plaintiffs’ favor. Defendant may not use the fact that customers followed her when she quit the salon as evidence that the salon lacked a long-term relationship with its clients. Insofar as defendant’s own covenant violations cut short the relationships between the salon and its clients, defendant would be asking us to make her covenant violations self-validating. (See Agrimerica, 199 Ill. App. 3d at 447.) As the cases I have cited tend to show, covenants not to compete become most important to employers precisely where there is a danger that employees who leave the business will take clients along with them. This fact does not establish that the covenants are invalid; to the contrary, the legitimate interest that employers have in such covenants is to prevent employees from taking over customers through the contacts with those customers that the employee has made while working for the employer. Tyler, 214 Ill. App. 3d at 150, relying on House of Vision, Inc. v. Hiyane (1967), 37 Ill. 2d 32. For the reasons just stated, I am of the opinion the salon carried its burden of raising a fair question as to the existence of a protectable interest. I find the issuance of the preliminary injunction was not against the manifest weight of the evidence. The judgment of the trial court should be affirmed.