Carson Combs v. Brick Acquisition Company

IN THE COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE

August 6, 2013 Session

CARSON COMBS v. BRICK ACQUISITION COMPANY

Appeal from the Chancery Court for Hamilton County

No. 12-0518 W. Frank Brown, III, Chancellor

No. E2012-02696-COA-R3-CV -Filed - October 30, 2013

This appeal calls into question the validity of a covenant not to compete. A former employee

of a seller and distributor of brick brought this action seeking a declaratory judgment that his

agreement not to compete for two years with his former employer in the employee’s sales

territory is unenforceable. Following a bench trial, the court held the covenant unenforceable

and void. We hold that, because the employee had access to confidential pricing and profit

margin information and was the sole commercial brick salesperson for the company in the

Chattanooga area, the employer had a legitimate protectable business interest. We further

hold that the terms of the non-compete agreement are reasonable under the facts of this case.

Accordingly, we reverse the judgment of the trial court.

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court

Reversed; Case Remanded

C HARLES D. S USANO, J R., P.J., delivered the opinion of the Court, in which D. M ICHAEL

S WINEY and T HOMAS R. F RIERSON, II, JJ., joined.

John R. Bode, Robert F. Parsley, and Scott E. Simmons, Chattanooga, Tennessee, for the

appellant, Brick Acquisition Company.

R. Jonathan Guthrie and McKinley S. Lundy, Jr., Chattanooga, Tennessee, for the appellee,

Carson Combs.

OPINION

I.

Plaintiff Carson Combs worked for Key-James Brick and Supply, Inc. (“the

company”)1 as a brick salesperson from August 2004 until July 2012. In 2004, the company

was owned by the Large family, a local family in Chattanooga. Brent Large was Combs’

supervisor. In 2006, the Large family sold the company to Alabama-based Jordan Brick

Acquisition Company, Inc. As a condition precedent to the sale, company employees,

including Combs, were required to sign a covenant not to compete, which provided that, in

the event of termination of employment for any reason, the former employee would “not,

directly or indirectly, engage in any business competitive with the Company anywhere within

a one hundred (100) mile radius of any Company plant, warehouse, distribution center, sales

office, or sales territory of the Company for a period of two (2) years after said termination.”

Combs testified that, after the sale to Jordan, his work environment remained mostly

unchanged. Brent Large remained his supervisor.

In 2009, the company asked Combs to sign another substantially similar non-compete

agreement. He signed the proffered document on October 23, 2009. Also in 2009, Jordan

Brick was reorganized and all of its assets were transferred to Jenkins Brick and Tile

Company. Shortly after Combs signed the second agreement, Brent Large left the company

and Combs was assigned another supervisor. In January of 2011, Brick Acquisition

Company (“Acme”), a large corporate entity of a national scope, bought the company. Acme

made Combs an offer of continued employment. The terms of the offer made it clear that the

existing non-compete agreement was being transferred to Acme and would be enforced in

the event that Combs’ employment was terminated.

On July 10, 2012, Combs resigned his employment. He was unhappy with the

changes in his work environment ushered in by the change of ownership to Acme. The same

day, Combs brought this action for declaratory judgment, asking the court to declare that his

non-compete was invalid. Following a bench trial, the court – in a judgment incorporating

a comprehensive 25-page memorandum opinion – did just that. The court found that the

company did not provide Combs with specialized training that would enable Combs to

unfairly compete with it, and that Combs did not have proprietary trade secrets or

confidential information that would give him an unfair competitive advantage. The court did

find that Combs, as the company’s only commercial brick salesperson in the Chattanooga

area, had developed significant relationships with customers and suppliers, and could be

1

Although the ownership of the company changed hands several times while Combs was working

there, the name of the company remained “Key-James” throughout the period of Combs’ employment.

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considered “the face of the company.” However, the court noted that “although this factor

weighs in favor of the enforceability of the non-compete agreement, the court does not weigh

it heavily in favor of enforceability,” reasoning that “soon after Mr. Combs left his position,

he likely could no longer be considered the face of the department, especially once an

experienced salesman . . . took over the position.” Further finding that the two-year period

of the non-compete agreement was unreasonable and “longer than necessary to achieve

ACME’s purpose,” the court declared the whole non-compete agreement void.

(Capitalization in original.) Acme timely filed a notice of appeal.

II.

The issue presented, as concisely stated in Acme’s brief, is this: “is the non-

competition agreement enforceable?”

III.

In this non-jury case, our review is de novo upon the record, with a presumption of

correctness as to the trial court’s factual determinations, unless the evidence preponderates

otherwise. Tenn. R. App. P. 13(d); Murfreesboro Med. Clinic, P.A. v. Udom, 166 S.W.3d

674, 678 (Tenn. 2005). The trial court’s conclusions of law, however, are accorded no such

presumption. Udom, 166 S.W.3d at 678; Campbell v. Florida Steel Corp., 919 S.W.2d 26,

35 (Tenn. 1996). Our de novo review is subject to the well-established principle that the trial

court is in the best position to assess the credibility of the witnesses; accordingly, such

determinations are entitled to great weight on appeal. Columbus Med. Servs., LLC v.

Thomas, 308 S.W.3d 368, 383 (Tenn. Ct. App. 2009); Vantage Tech., LLC v. Cross, 17

S.W.3d 637, 644 (Tenn. Ct. App. 1999).

IV.

In Udom, the Supreme Court’s most recent decision interpreting a non-compete

agreement, the High Court reiterated the following applicable principles:

In general, covenants not to compete are disfavored in

Tennessee. See Hasty v. Rent-A-Driver, Inc., 671 S.W.2d 471,

472 (Tenn. 1984). These covenants are viewed as a restraint of

trade, and as such, are construed strictly in favor of the

employee. Id. However, if there is a legitimate business interest

to be protected and the time and territorial limitations are

reasonable then non-compete agreements are enforceable. Id.

at 473. Factors relevant to whether a covenant is reasonable

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include: (1) the consideration supporting the covenant; (2) the

threatened danger to the employer in the absence of the

covenant; (3) the economic hardship imposed on the employee

by the covenant; and (4) whether the covenant is inimical to the

public interest. Id. at 472-73 (citing Allright Auto Parks, Inc.

v. Berry, 219 Tenn. 280, 409 S.W.2d 361, 363 (1966)). Also,

the time and territorial limits must be no greater than necessary

to protect the business interest of the employer. Allright Auto

Parks, 409 S.W.2d at 363.

Udom, 166 S.W.3d at 678. In determining whether “there is a legitimate business interest

to be protected,” id., we have provided the following analytical framework:

Several principles guide the determination of whether an

employer has a business interest properly protectable by a

non-competition covenant. Because an employer may not

restrain ordinary competition, it must show the existence of

special facts over and above ordinary competition. [Hasty, 671

S.W.2d at 473.] These facts must be such that without the

covenant, the employee would gain an unfair advantage in

future competition with the employer. Id. Considerations in

determining whether an employee would have such an unfair

advantage include (1) whether the employer provided the

employee with specialized training; (2) whether the employee is

given access to trade or business secrets or other confidential

information; and (3) whether the employer’s customers tend to

associate the employer’s business with the employee due to the

employee’s repeated contacts with the customers on behalf of

the employer. Id. These considerations may operate

individually or in tandem to give rise to a properly protectable

business interest. See, e.g., AmeriGas Propane, Inc. v. Crook,

844 F.Supp. 379 (M.D. Tenn. 1993); Flying Colors of

Nashville, Inc. v. Keyt, C/A No. 01A01-9103-CH-00088, 1991

WL 153198 (Tenn. App. M.S., filed August 14, 1991).

An employer does not have a protectable interest in the general

knowledge and skill of an employee. Hasty, 671 S.W.2d at 473.

This is not only true of knowledge and skill brought into the

employment relationship, but also true as to that acquired during

the employment relationship, even if the employee obtained

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such general knowledge and skill through expensive training.

See Hasty, 671 S.W.2d at 473 (“general knowledge and skill

appertain exclusively to the employee, even if acquired with

expensive training and thus does not constitute a protectible

[sic] interest of the employer”).

In contrast, an employer may have a protectable interest in the

unique knowledge and skill that an employee receives through

special training by his employer, at least when such training is

present along with other factors tending to show a protectable

interest. Id.; Selox, Inc. v. Ford, 675 S.W.2d 474, 476 (Tenn.

1984) (“A line must be drawn between the general skills and

knowledge of the trade and information that is peculiar to the

employer’s business.”) (quoting R ESTATEMENT (S ECOND) OF

C ONTRACTS § 188 cmt. g (1981)). See also Flying Colors of

Nashville, 1991 WL 153198 at *5 (holding that training in

specialized techniques and processes of paint-mixing, together

with a special relationship with the employer’s customers, gives

rise to a properly protectable interest).

Thus, whether an employer has a protectable interest in its

investment in training an employee depends on whether the skill

acquired as a result of that training is sufficiently special as to

make a competing use of it by the employee unfair.

An employer has a legitimate business interest in keeping its

former employees from using the former employer’s trade or

business secrets or other confidential information in competition

against the former employer. Hasty, 671 S.W.2d at 473. A

trade secret is defined as any secret “formula, process, pattern,

device or compilation of information that is used in one’s

business and which gives him an opportunity to obtain an

advantage over competitors who do not use it.” Hickory

Specialties, Inc. v. B & L Labs., Inc., 592 S.W.2d 583, 586

(Tenn. App. 1979) (quoting Allis-Chalmers Mfg. Co. v.

Continental Aviation & Eng’g Corp., 255 F.Supp. 645, 653

(E.D. Mich. 1966)). The subject matter of a trade secret must be

secret and not well known or easily ascertainable. Hickory

Specialties, 592 S.W.2d at 587.

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What constitutes “confidential information” is somewhat less

clear. In Heyer-Jordan & Assocs., Inc. v. Jordan, 801 S.W.2d

814 (Tenn. App. 1990), we held that the identities of the

employer’s customers did not amount to “confidential business

information” within the meaning of the employment agreement

because such information was generally available in the trade.

We reasoned that “confidential information” is analogous to

“trade secret” and that, because customer identities are not

secret, they cannot be considered confidential. See also Amarr

Co. v. Depew, C/A No. 03A01-9511-CH-00412, 1996 WL

600330, *4-*5 (Tenn. App. W.S., filed October 16, 1996)

(holding that customer lists, customer credit information, pricing

information, and profit and loss statements did not constitute

confidential information because such information is easily

available from sources other than the employer).

An employer may also have a legitimate protectable interest in

the relationships between its employees and its customers. See

Hasty, 671 S.W.2d at 473. It is often the case that the customer

associates the employer’s business with the employee due to the

employee’s repeated contacts with the customer. The employee

in essence becomes “the face” of the employer. This

relationship is based on the employer’s goodwill. The

employee’s role in this relationship is merely that of the

employer’s agent. In this role, the employee is made privy to

certain information that is personal, if not technically

confidential. Because this relationship arises out of the

employer’s goodwill, the employer has a legitimate interest in

keeping the employee from using this relationship, or the

information that flows through it, for his own benefit. This is

especially true if this special relationship exists along with the

elements of confidential information and/or specialized training.

Vantage Tech., 17 S.W.3d at 644-46 (emphasis in original; paragraph headings omitted).

In applying these principles, we remain mindful that “[t]he inquiry as to reasonableness under

the circumstances is a fact-specific one, and there is no inflexible formula for determining

reasonableness; ‘each case must stand or fall on its own facts.’ ” Money & Tax Help, Inc.

v. Moody, 180 S.W.3d 561, 565 (Tenn. Ct. App. 2005) (quoting Allright Auto Parks, 409

S.W.2d at 363)).

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The non-compete agreement at issue in this case – the second covenant that Combs

signed after the company was purchased by Jordan Brick – states, in pertinent part, as

follows:

Associate [Combs] agrees that due to his position with the

Company and the opportunity such position has provided to

Associate to develop relationships with Company customers

such that he has become “the face” of the Company to its

customers, due to the Company’s investment in him through

training and otherwise and due to the confidential information

provided to Associate as a result of his position, his engaging in

any business which is (directly or indirectly) competitive with

the Company would cause the Company great and irreparable

harm. . . .

In the event that Associate’s employment with the company is

terminated, whether said termination is voluntary or involuntary,

and regardless of the reason therefore, Associate agrees that

Associate will not, directly or indirectly, engage in any business

competitive with the Company anywhere within a one hundred

(100) mile radius of any Company plant, warehouse, distribution

center, sales office, or sales territory of the Company for a

period of two (2) years after said termination.

* * *

Associate agrees that Associate will not, directly or indirectly,

during Associate’s employment with the Company and for a

period of two (2) years thereafter:

(1) In any way interfere with the Company’s relationships with

any of its customers who have placed orders with the Company

during the last five (5) years of the Associate’s employment with

the Company;

(2) Solicit, contact, call upon, communicate with, attempt to

communicate with, or do business with any customer, former

customer or prospective customer of the Company for the

purpose of such customer, former customer, or prospective

customer engaging in business competitive with the Company

or some person or business other than the Company.

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Combs was candid in his testimony about his employment goals and the aspirations

for his future after leaving Acme – he wants to start his own company selling brick, in direct

competition with his former employer. Combs testified:

I really want to stay in the brick industry because that’s what I

love. . . . And I wanted to start my own company. I wanted to

do it my way. And I didn’t want to worry about a billion dollars

in sales that Acme is trying to achieve, I wanted to worry about

putting brick in the market in Chattanooga and working with

people that I knew.

Regarding the training that the company provided Combs during his eight years of

employment, the parties disagree about how extensive and specialized it was. Combs stated

that when he began work as a commercial brick salesperson, the extent of his training was

“sitting down with Brent [his supervisor] and learning how to read a Dodge report.” The

Dodge report, an important source of potential sales leads, is an industry report providing

information about pending construction jobs and contact people such as the architect, general

contractor, and sometimes the masonry contractor. Combs testified that the Dodge report and

the newspapers were two of his primary sources in identifying potential customers. The

Dodge report is a subscription-based service accessible to anyone who pays a subscription

fee. Combs argues that the identity of the customer base is easily and publicly available and

is therefore not a protectable trade secret. Acme presented the testimony of Ladue Fossett,

its regional manager for North Alabama and East Tennessee, who agreed that the identity of

the company’s customer base can generally be found by looking in public sources such as the

Yellow Pages. Generally, when an employer’s customer base is ascertainable from public

sources, this information does not support the enforceability of a non-compete agreement.

See Selox, 675 S.W.2d at 475 (affirming trial court’s decision that employer “did not need

the protection of the non-competitive agreement” because, among other things, “the identity

of those who were in the market for purchasing welding supplies and industrial gases could

be ascertained by anyone of reasonable intelligence by a mere reference to the Yellow Pages

of the phone directory”).

After the company was bought by Jordan Brick, it sent Combs to a seminar put on by

the Brick Industry of America, where, according to Combs, “pretty elementary material on

the history of brick” was presented. Combs testified that he didn’t learn anything new at the

seminar. The company also trained him on its specialized, proprietary data entry and

management system, which was entitled “GEMINI.” The data-entry system enabled

salespersons to input information about their sales orders and print their monthly sales

reports. Combs testified that he did not take any information from GEMINI when he left,

and that it could not be used anywhere other than the company. There was no showing that

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he kept the software or the hardware to run or duplicate such a system. In any event, the

GEMINI system appears from the evidence to be more of an employee management tool

rather than anything that would give Combs an unfair competitive edge in sales.

After Acme bought the company, Combs attended two training sessions taught by

Leon Hawk, its director of sales training and systems. Combs testified that these sessions

presented information on improving general sales techniques, particularly asking open-ended

questions of potential customers. Combs stated that no proprietary or specialized information

was presented at these training sessions. Acme presented no evidence to the contrary. This

Court analyzed the type of employee training that would endow an employer with a

protectable business interest in Girtman & Associates v. St. Amour, stating as follows:

The knowledge acquired by [employee] Mr. St. Amour through

the training [employer] Girtman paid for is not a “legitimate

business interest” protectable by a non-compete agreement. The

training Mr. St. Amour received in this case was paid for by his

employer, but enrollment in those courses was not limited to

Girtman employees. Professionals from other competing

businesses in the door and hardware industry attended and

received the same instruction Mr. St. Amour received. The

courses imparted general knowledge of the door and hardware

industry, but none of it was specific to Girtman’s way of

conducting business. Thus, the training did not give Mr. St.

Amour an unfair advantage in competition and did not endow

Girtman with a protectable business interest.

Girtman, No. M2005-00936-COA-R3-CV, 2007 WL 1241255 at *7 (Tenn. Ct. App. M.S.,

filed Apr. 27, 2007).

The trial court in the present case held as follows in its memorandum opinion:

Here, as a salesman for ACME, the evidence reflects that Mr.

Combs’ training was not much different than those employees

in Girtman and Selox. Although ACME relies on the training

he received relating to the accounting methods and procedures

for entering sales in its specialized GEMINI computer system,

this training did not contribute to improving his salesmanship,

but only served to improve data-entry. Likewise, sending Mr.

Combs to the training at the Brick Institute of America (“BIA”)

did not endow him with specialized knowledge of ACME’s

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business because the training was not limited to ACME

employees. Further, Mr. Combs testified that, aside from

information on the history of brick, the sales training at BIA was

largely information he already knew. Similarly, Mr. Combs

testified that the training sessions provided by ACME consisted

of tips on general sales techniques, rather than specialized

information on the sale of ACME bricks. . . . Moreover, the

court notes that much of the knowledge of sales Mr. Combs

acquired came from his previous career as a real estate agent and

cannot even be attributed to ACME or its predecessors in the

brick industry. Therefore, the training imparted on Mr. Combs

by ACME and its predecessors cannot be considered

specialized. Accordingly, the court finds that this factor weighs

against the enforceability of the non-compete agreement.

(Citations to record omitted; capitalization in original.) The evidence does not preponderate

against these findings, and we agree with the court’s conclusion regarding Combs’ training.

Regarding the second factor, confidential information or trade secrets, Acme argues

that Combs had access to sensitive and confidential pricing information and Acme’s target

profit margins. The evidence supports Acme’s argument. Regional manager Fossett

testified, and Combs agreed, that the formula for pricing a bid in selling brick for a particular

job is product cost + shipping cost + markup (or profit margin). Fossett testified that Acme’s

formula process is used in the computation leading to highly competitive bids submitted to

architects or contractors. According to Fossett, if a competitor knows any of the those three

parts of the equation, “it would put [Acme] at a huge disadvantage.” Combs testified as

follows on this point:

Q: If you knew the product costs that [your competitors] were

using to create a bid on a project in which you were creating a

bid, would that have been an advantage for you?

A: If that was the product that we were bidding, it would. If I

knew what my competitor was bidding the project at, yes, that

would help.

Q: Because that product cost was going to be something that

they were going to have to employ to create their final bid

number?

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A: Yes. It’s one of the factors.

* * *

Q: And so you would at least know how much profit you could

make or how much profit you shouldn’t try to make if you

understood the components of their bid. Is that fair to say?

A: Sure.

Q: And that would give you a competitive advantage?

A: If I knew what their price was going in on a bid?

Q: Yes.

A: Yes.

* * *

Q: The third component that relates to margin, what you’re

talking about there is how much profit you build into the bid that

you’re making?

A: Yes, sir.

Q: Okay. And that margin, you had a target number given to you

by your managers; correct?

A: Yeah. . . .

Q: If you knew [your competitors’] target numbers, would that

be of assistance to you in creating that final bid number?

A: Yes.

Q: Why?

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A: If I knew all those other factors, their freight and their cost at

the plant and their markup, I would know where they were at

when we would bid it, so that would be an advantage.

Q: And the advantage, for the record, is that you could then

adjust your final bid number in such a way as to slide right

below them. Is that fair?

A: I could, yes, sir.

The testimony reflects that the pricing of brick is a rather complicated matter. Combs

testified that brick prices are dependent upon size, type, and color, and that every factor

changes the price. Fossett testified that the price list from a supplier can be 100 to 150 pages

long. Combs had access to the price lists of brick manufacturers and suppliers while he

worked at Acme, and these lists are not generally available to the public. Significantly,

Combs also was provided with Acme’s target profit margins – information that certainly is

not public. Acme is understandably very anxious to keep such information private. Combs

argues that he did not keep any price list books, that he has not memorized them, and that

brick prices frequently fluctuate. These arguments are reasonable and not without some

merit. Because prices change, the more time that had passed since Combs had seen and used

the price list books provided by Acme, the less relevant and useful the information would be.

However, the fact cannot be ignored that Combs was closely and regularly involved in the

process of pricing bids for the company for many years. He has a very good general

knowledge of how Acme conducts business in making competitive bids based on pricing and

target profit margins. Combs testified that he would frequently discuss these matters with

his supervisors, particularly when a customer would request a price decrease that would

reduce Acme’s profit below certain levels. As far as profit margin is concerned, Fossett

testified that there is a line below which the company will not go, and that Acme salespersons

know that line. We conclude that the evidence in this case preponderates in favor of a

holding that Acme has a legitimate protectable business interest in the confidential

information regarding pricing that was provided to Combs while he was employed there.

Turning to the third factor, special customer relationships, we find a most significant

fact – it is undisputed that Combs was the company’s sole commercial brick salesperson 2 in

the Chattanooga area for roughly seven years. Thus, if the company made contact and

established personal relationships with commercial customers from 2005 until mid-2012, it

was exclusively through Combs. Fossett testified as follows about the company’s efforts in

that regard:

2

The company also had seven or eight residential brick salespeople while Combs worked there.

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Carson [Combs’] job was to go and create business through his

relationships with architects, general contractors and masonry

contractors. It was his job to get to know those people, get to

know their tendencies, what they like and make relationships

with them . . . all things being equal, people buy from friends.

* * *

Carson knew and understood that he needed to see these people

often to keep the relationship right so someone else couldn’t

break in there, break that bond he might have with those people,

whether it be the masonry contractor or the architect. He knew

how important that was to do that, and he did a good job with

that.

Q: Was there any financial support given by the company to Mr.

Combs with respect to that relationship cultivation?

A: Yes. . . [W]e would sponsor holes in golf tournaments and

put teams in golf tournaments. Carson would grab some

customers and go spend some time with them. There was

financial reimbursement on fuel, company car allowances so it

would be no out-of-pocket expense[.]

Q: Did that include reimbursements for lunches, dinners, drinks

and the like?

A: Yes, yes.

Combs similarly testified that it was important for him to maintain good relationships with

his suppliers and customers, that Acme reimbursed him for his expenses in building and

maintaining them, and that the fact that he knew and had relationships with the people in the

industry was very helpful.

At trial, two masonry contractors and an architect from the Chattanooga area testified.

Each one confirmed that in buying brick from the company, Combs was the person they had

dealt with. When asked whether Combs “was the face of Key-James Brick,” Mike Jenkins,

a masonry contractor, replied, “[t]he commercial side of it, I mean, that’s who most of my

majority of dealings was with.” Pat Neuhoff, a local architect, testified that “I considered

Mr. Combs to be the face of the company when he was there.” The evidence establishes that,

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in this case, Acme’s customers associated its business directly with Combs due to his

repeated contacts with them. The trial court recognized this and held that “Mr. Combs’

interaction with customers was such that he was indeed the face of the company, or at least

the commercial brick sales department.” The court discounted this factor, however,

reasoning that “soon after Mr. Combs left his position, he likely could no longer be

considered the face of the department, especially once an experienced salesman . . . took over

the position.” This reasoning, carried to its logical conclusion, would vitiate the third factor

completely, because the replacement for an employee who resigns will almost always

eventually become the “new face” of the company. The pertinent question is not whether the

old employee is no longer the face of the company, or whether the company has a new face,

but whether, while the old employee was the face of the company, he or she established

exclusive relationships with customers that could be later unfairly exploited at the company’s

expense. See Hanger Prosthetics & Orthotics East, Inc. v. Kitchens, 280 S.W.3d 192, 201-

02 (Tenn. Ct. App. 2008) (holding employer had protectable interest in relationships between

former employee and employer’s customers where former employee, “virtually the only

employee” trained as a prosthetist for employer, was the face of the company). We hold that

the third factor supports the conclusion that Acme has a legitimate business interest that is

protectable by a non-compete covenant.

Having determined that Acme has a protectable business interest, we next examine

whether the terms of the non-compete covenant signed by Combs are reasonable. Combs

argues that the covenant was not supported by consideration, but it is now well established

in this state that continuing employment of an at-will employee can be adequate

consideration for a covenant not to compete. Hamilton-Ryker Grp., LLC v. Keymon, No.

W2008-00936-COA-R3-CV, 2010 WL 323057 at *11, n.10 (Tenn. Ct. App. W.S., filed Jan.

28, 2010); Girtman, 2007 WL 1241255 at *8; Central Adjustment Bureau, Inc. v. Ingram,

678 S.W.2d 28, 33, 35 (Tenn. 1984). Regarding “the threatened danger to the employer in

the absence of the covenant,” Udom, 166 S.W.3d at 678, the potential danger to Acme posed

by Combs’ possession of confidential information and significant exclusive personal

relationships with suppliers and customers has been discussed extensively above. As regards

“the economic hardship imposed on the employee by the covenant,” id., while the hardship

imposed on Combs is not insignificant, it is tempered by the fact that he has well-developed

sales skills that are easily transferable to other employment not involving the sale of brick.

Combs also has a real estate license, and he testified that he had been working as an

independent contractor on a four-month temporary job for a total salary of $10,000. It is also

significant to this analysis that Combs voluntarily resigned from his employment with Acme.

Finally, in order for the non-compete agreement to be enforceable, its temporal and

geographic limitations must be reasonable. Regarding the geographic limitations, although

they are unreasonably overbroad as written, the parties stipulated at the outset of trial that

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Acme was only seeking to enforce the agreement for Combs’ former sales territory, the

Chattanooga and Knoxville areas. The trial court appropriately limited its analysis of the

non-compete agreement to the narrowed territory. Regarding the two-year time period, we

find that it is reasonable in light of the totality of the circumstances discussed above.

V.

The judgment of the trial court is reversed. Costs on appeal are assessed to the

appellee, Carson Combs. The case is remanded to the trial court, pursuant to applicable law,

for entry of a judgment in accordance with this opinion and for the collection of costs

assessed below.

___________________________________________

CHARLES D. SUSANO, JR., PRESIDING JUDGE

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