United States District Court, W.D. Kentucky, Paducah Division
MEMORANDUM OPINION AND ORDER
B. Russell, Senior United States District Judge.
matter is before the Court on Plaintiff First Financial
Bank's (“First Financial”) Motion for a
Temporary Restraining Order and Preliminary Injunction. [DN
4.] Defendant Timothy Williams (“Williams”)
responded, [DN 16], and First Financial replied, [DN 18.]
Fully briefed, this matter is now ripe for adjudication. For
the reasons stated herein, Plaintiff's motion for a
Temporary Restraining Order is GRANTED.
action arises out of Defendant Williams's former
employment with First Financial. Williams was Vice President
of Mortgage Services for Heritage Bank from October 2013
until July 22, 2019. [DN 4-2 at 3.] Heritage Bank maintained
its headquarters in Hopkinsville, Kentucky and operated in
locations throughout Southwest Kentucky and Northern
Tennessee. [DN 4-2 at 32.] Heritage Bank merged into First
Financial on July 27, 2019. [Id. at 9.]
January 2017, Williams entered into an Employment Agreement
(“Agreement”) with Heritage Bank. [Id.
at 3.] The Agreement restricts Williams from: (1) working for
or with a competitor for one year after termination that is
located in a city Heritage maintains a branch or within 50
miles; (2) soliciting employees or clients of Heritage for
one year; and (3) disclosing confidential information of
Heritage. [DN 4-2 at 3-4.] First Financial alleges Williams
planned secret meetings with employees of Heritage Bank and
encouraged them to remove confidential business information
in violation of the Agreement. [Id. at 7-8.]
Heritage Bank terminated Williams who began working for First
Advantage. [Id. at 9.] First Financial also asserts
Williams is in violation of the non-compete provision in the
Agreement by working for First Advantage. [DN 4-1 at 12.]
First Financial initiated this suit against Williams on
September 5, 2019 in Christian County Circuit Court.
[Id. at 41.] Williams then properly removed to this
Court. [DN 1.]
determine whether a preliminary injunction should issue under
Federal Rule of Civil Procedure 65(a), the Court weighs four
factors: “(1) whether the movant has a strong
likelihood of success on the merits, (2) whether the movant
would suffer irreparable injury absent a stay, (3) whether
granting the stay would cause substantial harm to others, and
(4) whether the public interest would be served by granting
the stay.” Ne. Ohio Coal. for Homeless & Serv.
Employees Int'l Union, Local 1199 v. Blackwell, 467
F.3d 999, 1009 (6th Cir. 2006). “These factors are not
prerequisites that must be met but are interrelated
considerations that must be balanced together.”
Mich. Coal. of Radioactive Material Users, Inc. v.
Griepentrog, 945 F.2d 150, 153 (6th Cir. 1991).
“For example, the probability of success that must be
demonstrated is inversely proportional to the amount of
irreparable injury the movants will suffer absent the
stay.” Blackwell, 467 F.3d at 1009. The party
seeking the preliminary injunction bears the burden of
justifying such relief. McNeilly v. Land, 684 F.3d
611, 615 (6th Cir. 2012) (citing Granny Goose Foods, Inc.
v. Bhd. of Teamsters & Auto Truck Drivers Local No.
70, 415 U.S. 423, 441 (1974)).
Enforceability of the Agreement
Financial and Williams both assert rights found in the
Agreement between Williams and First Financial. The Court
must first determine whether this agreement is enforceable.
First Financial states the Agreement is enforceable under
Kentucky law. Williams does not argue this point. Covenants
not to compete that involve professional services will be
enforced unless “very serious inequities would
result.” Lareau v. O'Nan, 355 S.W.2d 679,
681 (Ky. 1962). The Court agrees with First Financial that it
obtained the ability to enforce such covenants after the
merger of Heritage bank into First Financial. Again, Williams
does not dispute this point.
Court must also determine whether the provisions First
Financial seeks to enforce are reasonable. The Agreement
restricts Williams from competing with First Financial in any
county it maintains a branch and within 50 miles of such
counties, and from soliciting First Financial's employees
and customers. These restrictions were agreed to be in place
for one year after termination of employment.
Financial has cited Kentucky authority that has consistently
upheld similar restrictions. The Court agrees that the
restrictions found in this Agreement are in line with those
held to be reasonable. See Higdon Food Service v.
Walker, 641 S.W.2d 750 (Ky. 1982); Central
Adjustment Bureau, Inc. v. Ingram Associates, Inc., 622
S.W.2d 681, 686 (Ky. App. 1981). Considering Williams'
position within First Financial, and the restrictions agreed
to, the Court finds that the restrictions are not unduly
burdensome and reasonably protect First Financial's
interests. See Ceresia v. Mitchell, 242 S.W.2d 359,
364 (Ky. App. 1951).
Temporary Restraining Order
Whether the Movant Has a Strong Likelihood of Success on the
no single factor is controlling when determining whether a
preliminary injunction should issue, the likelihood of
success on the merits is often the predominant
consideration.” Pacheco v. Waldrop, 2013 U.S.
Dist. LEXIS 81593 *14 (W.D. Ky. June 10, 2013). The Court
will give great consideration to this factor. Williams argues
that there is no likelihood of success on the merits because
the Agreement is no longer enforceable. A finding that there
is no likelihood of success on the merits is usually fatal.
See Michigan State v. Miller, 103 F.3d 1240, 1249
(6th Cir. 1997).
specifically asserts that the Agreement is unenforceable
because he invoked Section 10 of the Agreement. Section 10 of
the Agreement gives Williams the right to “immediately
terminate this Agreement free of the obligations imposed by
paragraph 7 and 8 herein in the event of a “Change of
Control” of Heritage”. The Agreement also allowed
this option to be “exercised at any time by Employee
after the effective date of a Change of Control.”