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Case: 4:08-cv-01683-JCH Doc.

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IN THE UNITED STATES DISTRICT COURT


FOR THE EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
LASCO FOODS, INC.,
Plaintiff,
vs.
CASE NO.:
HALL AND SHAW SALES, MARKETING
& CONSULTING LLC, CHARLES R.
SHAW, AND RONALD N. HALL,
Defendants.
PLAINTIFFS MEMORANDUM OF LAW IN
SUPPORT OF ITS MOTION FOR TEMPORARY RESTRAINING ORDER
Comes Now Plaintiff, Lasco Foods, Inc. (Lasco), by and through its undersigned
counsel, and in support of its Motion for Temporary Restraining Order Pursuant to Fed. R. Civ.
P. 65(b), states to the Court as follows:
I.

INTRODUCTION

Lasco manufactures and sells high quality food products to restaurants and other food
service companies. Lasco utilizes its own sales force as well as contracted food brokers
throughout the United States to sell its products. Lasco has invested considerable time, resources
and money to develop and market its products and develop substantial relationships and goodwill
with its customers, suppliers, prospective customers, and brokers. Lasco considers certain
confidential customer, production and business information to be trade secrets (hereinafter
Trade Secret Information).

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Lasco hired Defendant Ron Hall in 1977 and Charles Shaw in 1989.1 Most recently, both
Hall and Shaw worked for Lasco as Regional Sales Managers and Shaw was also Lascos
National Sales Director. In their capacities as Sales Managers, Defendants Hall and Shaw had
direct, continuous, and extensive access to, and acquired considerable knowledge concerning,
Lascos Trade Secret Information. Further, in their capacities as Sales Managers, Defendants
Hall and Shaw became well acquainted with Lascos customers, clients needs, and future plans
as well as with all secret methods and processes used by Lasco in the conduct of its business.
Defendant Hall resigned his employment with Lasco on September 22, 2008. He last
worked for Lasco on September 19, 2008. Following his resignation, Lasco sent Defendant Hall
a letter reminding him of his obligations not to use or disclose Lascos Trade Secret Information
and further demanded Defendant Hall return to Lasco all electronic and hard copy information in
his possession belonging to Lasco.
Although Defendant Hall returned Lascos computer, to date Defendant Hall has failed to
comply with Lascos demand for the return of its other electronic or hard copy property. Further,
despite Lascos demands, Lasco recently learned Defendant Hall has contacted Lascos brokers
and end-user customers and offered products to these customers at a price lower than Lascos
price. As will be discussed in more detail below, Defendant Hall used Lascos Trade Secret
Information to attempt to obtain this business. In addition, both prior to and after his resignation
from Lasco, Hall attempted to obtain additional Trade Secret Information by deception from
Lascos broker in Oklahoma.
Defendant Shaw voluntarily resigned his employment with Lasco on August 11, 2008.
On August 19, 2008, Lasco demanded, in writing via hand-delivery, that Defendant Shaw honor
1

Lascos predecessor company, Halben Foods, actually hired both Hall and Shaw. In June 2004, Lasco
purchased Halben Foods and both Hall and Shaw became employees of Lasco.

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his post-employment legal obligations to Lasco. Lasco further demanded that Defendant protect
the sanctity of Lascos confidential and proprietary information. Despite its demands, prior to
returning Lascos computer, Defendant Shaw deleted confidential and Trade Secret
Information from Lascos computer. In addition, Defendant Shaw obtained from one of
Lascos former brokers a report of Lascos customers and products ordered by those customers.
As with Defendant Hall, it is clear Defendant Shaw has used Lascos Trade Secret Information to
obtain additional trade secret information from Lascos former broker in Oklahoma. Without this
Courts protection in the form of temporary, preliminary, and permanent injunctive relief,
Defendants will continue their unlawful course of conduct thereby irreparably injuring Lasco.
II.

The Facts Support Entry of a Preliminary Injunction.

Lasco manufactures and sells throughout the United States high quality food products,
including beverage mixes, cocktail mixes, desserts, gravy and sauce mixes, soup bases,
seasonings and salad dressings. These products are sold to restaurants and other food service
companies. Lasco has invested considerable time, resources and money to develop and market its
products, to develop substantial relationships and goodwill with its customers, suppliers,
prospective customers, and brokers, and to develop its goodwill and name. Lasco considers
certain confidential customer, production and business information to be trade secrets
(hereinafter Trade Secret Information). This Trade Secret Information includes, but is not
limited to certain reports that contain specific information regarding customers, customer lists,
prospect lists, pricing information, customer preferences, costs and processes, proprietary
vendors, profit margins, proprietary processes, and formulae. The Trade Secret Information is
neither generally known to the public nor readily ascertainable by proper means.

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The food service industry is highly competitive. Because of the diverse range of
customers in the industry, food service manufacturers and distributers produce a wide variety of
food and beverage products. In this highly competitive industry, Lasco distinguishes its food and
beverage products from their competitors products primarily based upon (1) unique formulae;
(2) price and cost control; (3) customer responsiveness; and (4) unique processes to create
products that meets customers specific needs.
In order to sell Lascos products and capabilities, sales representatives have access to
Lascos formulae and other Trade Secret Information. This knowledge is essential to sales
representatives as they work with customers to expand sales and determine whether Lasco is
capable of meeting the customers needs. In addition to knowledge of Lascos specific processes,
its sales representatives have intimate knowledge of Lascos customer lists, pricing lists,
suppliers and supplier prices, pricing strategies, marketing strategies, and Lascos strategic plans
for future sales, products and growth.
A.

As Lasco Employees, Hall and Shaw Learned Critical Trade Secret Information.
Most recently, both Hall and Shaw worked for Lasco as Regional Sales Managers and

Shaw was also Lascos National Sales Director. At the time of his resignation, in addition to his
National Sales Director responsibilities, Defendant Shaw had responsibility for sales in Missouri,
Illinois, Wisconsin, Nebraska, and Iowa. At the time of his resignation, Defendant Hall had
responsibility for sales in Texas, Louisiana, Mississippi, and Oklahoma.
In their capacities as Sales Managers, Defendants Hall and Shaw had direct, continuous,
and extensive access to, and acquired considerable knowledge concerning, Lascos Trade Secret
Information. Further, in their capacities as Sales Managers, Defendants Hall and Shaw became
well acquainted with Lascos customers, clients needs, and future plans as well as with all secret

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methods and processes used by Lasco in the conduct of its business. Moreover, Defendants Hall
and Shaw acquired personal knowledge of, and acquaintance and friendship with, Lascos
customers to such an extent as to place the goodwill of Lasco and the retention of its customers
in a large measure within the custody of Defendants Hall and Shaw. In furtherance of their sales
efforts, Lasco invested substantial sums of money to train Defendants Hall and Shaw in order to
facilitate Defendants becoming more effective in their job duties and responsibilities as Sales
Managers, which enhanced Defendants Hall and Shaws standing and goodwill with Lascos
customers and clients, which in turn benefited Lascos business.
Further, in their positions as Sales Mangers, Hall and Shaw responsibilities included
identifying new customers and increasing sales to existing customers. Hall and Shaw also
participated in corporate-wide sales strategy and management meetings. During their
employment with Lasco, Hall and Shaw developed and learned highly sensitive confidential
information concerning Lascos customers, pricing lists and strategies (including, but not limited
to, pricing letters, allowances, deviated pricing, etc.), and specific formulae and processes used
to manufacture and distribute food and beverage products specific to particular customers. In
fact, Hall and Shaw had virtually unlimited access to Lascos Trade Secret Information,
including but not limited to pricing strategy and methods, product development, marketing
strategies, processes, sources of labor, sources of materials, formulae, price lists and other
confidential information.
B.

Hall and Shaws Resignation and Subsequent Breach of Their Common Law and
Statutory Duties.
Defendant Hall voluntarily and abruptly resigned his employment with Lasco on

September 22, 2008. He last worked for Lasco on September 19, 2008. Following his
resignation, Lasco sent Defendant Hall a letter reminding him of his obligations not to use or

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disclose Lascos Trade Secret Information. In addition, Lasco demanded that Defendant Hall
return to Lasco all electronic and hard copy information in his possession belonging to Lasco.
Although Defendant Hall returned Lascos computer, to date Defendant Hall has failed to
comply with Lascos demand for the return of its other electronic or hard copy property.
Lasco recently learned Defendant Hall has contacted Lascos brokers and end-user
customers he came to know through his decades of employment with Lasco, and offered
products to these customers at a price lower than Lascos price.2 Specifically, on or about
October 28, 2008, Lascos retained sales broker in Houston, Texas informed Lasco that Hall
represented to Lascos customers that he could provide a product that was the same as Lascos
product and at $5.00 less per case.3 The formula of the product, the identity of the customer,
and the specific items purchased by the customer are not available to the general public or other
competitors of Lasco. Clearly, Defendant Hall used Lascos Trade Secret Information to attempt
to obtain this business.
In addition, both prior to and after his resignation from Lasco, Hall attempted to obtain
additional trade secret information by deception from Lascos broker in Oklahoma. Specifically,
in or around the first week of September 2008, while Defendant Hall was still employed by
Lasco, Defendant Hall requested a copy of certain confidential reports from the sales broker and
provided a false explanation as to why he needed such reports. In or around the last week of
August 2008, while Defendant Hall was still employed by Lasco, he and Defendant Shaw

Since Hall and Shaw Sales, Marketing & Consulting (HSSMC) was not formed until August 28, 2008,
these customers and brokers obviously had no association with HSSMC prior to Hall and Shaws endeavors on
behalf of HSSMC.
3
The information obtained by Lasco reflects that Hall represented to the customers that he could deliver the
same product at $5.00 less per case than Lascos deviated pricing. While either Hall or Shaw perhaps could
obtain Lascos suggested pricing, only by virtue of their employment with Lasco and their exposure to Lascos
Trade Secret Information would Hall and Shaw have known Lascos customers discounts, allowances, or product
formulae.

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formed HSSMC. In or around September 2008, after Defendant Hall resigned from Lasco and
began working for HSSMC, he again attempted, through deception, to obtain reports from one of
Lascos sales brokers. Specifically, Defendant Hall attempted twice to obtain copies of certain
reports from Lascos sales broker, again providing false explanations as to why he needed such
reports.
With respect to Defendant Shaw, he voluntarily resigned his employment with Lasco on
August 11, 2008. Defendant Shaws last day of employment with Lasco was on August 22,
2008. On August 19, 2008, Lasco demanded, in writing via hand-delivery, that Defendant Shaw
honor his post-employment legal obligations to Lasco. Lasco further demanded that Defendant
protect the sanctity of Lascos confidential and proprietary information. (See, Exhibit B, attached
to Complaint.) On August 20, 2008, Defendant Shaw sought clarification of his postemployment legal obligations. (See, Exhibit C, attached to Complaint.) On August 21, 2008,
Lasco provided Defendant Shaw with an additional hand-delivered letter, reiterating Defendant
Shaws post-employment legal obligations under Missouri Law owed by Defendant Shaw to
Lasco. (See, Exhibit E, attached to Complaint.) In addition, Lasco demanded that Defendant
Shaw return to Lasco all electronic and hard copy information in his possession belonging to
Lasco.
Despite its demand, prior to returning Lascos computer, Defendant Shaw deleted
confidential and Trade Secret Information from Lascos computer.4 In addition, Lascos
retained broker in Oklahoma contacted Lasco and provided information that Defendant Shaw
obtained from one of Lascos former brokerswith whom Lasco had a broker agreement
containing a confidentiality provisiona report of Lascos customers and products ordered by
4

Lasco has evidence that Defendant Shaw is still in possession of Lascos Trade Secret Information and,
upon entry by this Court of an appropriate protective order; it will produce such information in this litigation.

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those customers. As with Defendant Hall, it is clear Defendant Shaw has used Lascos Trade
Secret Information to obtain additional trade secret information from Lascos former broker in
Oklahoma.
III.

The Law Supports Entry of a Temporary Restraining Order.

To obtain a temporary restraining order, Lasco must show, as a threshold matter: (1) the
probability of success on the merits; (2) the threat of irreparable harm; (3) the balance between
the harm and the injury granting an injunction would inflect on the defendant; and (4) whether an
injunction is in the public interest. AHI Metnall, L.P. v. J.C. Nichols Co., 891 F. Supp. 1352,
1355 (W.D. Mo. 1995). The Eighth Circuit has summarized this test to mean that the court
should examine whether the balance of equities so favors the movant that justice requires the
court to intervene to preserve the status quo until the merits are determined. Dataphase Systems,
Inc. v. C L Systems, Inc., 640 F. 2d 109, 113 (8th Cir. 1981)(en banc). As discussed below, the
evidence establishes each of these elements and therefore the Court should grant a temporary
restraining order to protect Lascos Trade Secret Information.
A.

Lasco Is Likely To Succeed On The Merits.


The very nature of Trade Secret Information, including those relating to sensitive

business and financial information, renders them irretrievably and permanently damaged once
used or disclosed. Therefore, when an employee privy to Trade Secret Information leaves a
company to perform similar duties with a competitor, the employee may be enjoined from the
use of the former employers confidential information. As a general rule, Missouri courts will
grant equitable protection for an employers interest in trade secrets. Baxter International, Inc.
v. Morris, 976 F. 2d 1189, 1193 (8th Cir. 1992) (affirming grant of injunction against use or
disclosure of former employers trade secrets).

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While Lasco has actually suffered harm as a result of Hall and Shaws use and disclosure
of Trade Secret Information on behalf of HSSMC as evidenced by Halls bid to current Lasco
customers and Shaws obtaining additional Trade Secret Information as a result of Trade Secret
Information already known to him, Lasco need not wait until it has actually suffered harm to
seek injunctive relief. Missouri courts have ruled that a Plaintiff should not have to await
harms fruition before being entitled to seek an inadequate legal remedy of damages. A.B.
Chance Co. v. Schmidt, 79 S. W. 2d 854, 859-60 (Mo. App. 1986) (injunction proper despite
showing of actual disclosure of trade secrets); Osage Glass, Inc. v. Donovan, 693 S.W. 2d 71
(Mo. 1985). In circumstances such as this, Missouri courts further recognize that an injunction
must be sufficient to protect the [former] employer from unfair competition by a former
employee. Cape Mobile Home Mart, Inc. v. Mobley, 780 S.W. 2d 116, 118 (Mo. App. 1989)
(affirmed injunction against former sales employee against selling mobile homes for two years
within a thirty mile area).
Defendants Hall and Shaw left Lasco and are directly competing with Lasco in the very
same territory in which they performed work for Lasco. This case is very factually similar to
Cape Mobile Home, discussed above, in which the court of Appeals upheld a two year injunction
against a former employee who took a job with a direct geographic competitor, based largely on
the employees knowledge of sales and operations information, and his knowledge of the former
employers customer. The Court of Appeals stated that:
This information, in its entirely consists of the details of
employers operations and highlights the success or lack of success
of the business operations and performance of employees at the
[plaintiffs home] location and all the other employers locations . .
. [this information] would enable the competitor to structure and
operate its own facility to compete successfully against [plaintiff].

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The threat of irreparable harm discussed in Cape Mobile Homs, is the threat facing Lasco.
As discussed below, Lascos claim satisfies the essential elements of a cause of action under
Missouris Uniform Trade Secret Act (MUTSA)the existence of protectable Trade Secret
Information; the threat of misappropriation under the MUTSA; and the appropriateness of
injunctive relief. R.S.Mo. 417.450, et seq. Specifically: (1) Lascos confidential business and
financial information constitutes protectable trade secrets under the MUTSA; and (2) Hall and
Shaws performance of their responsibilities on behalf of HSSMC have resulted in their
revelation of certain trade secrets and threatens to result in the inevitable use and disclosure of
Lascos Trade Secret Information in violation of the MUTSA.5
1.

Lascos Confidential Information Constitutes Trade Secret Information.

As salespersons for Lasco, Hall and Shaw were privy to, worked with and helped develop
highly sensitive confidential information about Lascos manufacturing, sales, and distribution
business. This confidential information includes, but is not limited to, Lascos commission
structure; financial data; supplier information; pricing strategies and plans; plans to meet
competitive threats; advertising and promotional budgets and plans; billing systems; formulae
and product development and plans. This confidential business information falls within the broad
definition of trade secret contained in the MUTSA:
information, including but not limited to, technical or nontechnical data, a
formula, pattern, compilation, program, device, method, technique or
process, that:
(a)

Derives independent economic value, actual or potential, from not


being generally known to, and form not readily ascertainable by
proper means by, other persons who can obtain economic value
from its disclosure or use.

Lascos claim also satisfies the essential elements of a cause of action for misappropriation of trade
secrets under Missouri common law, which are (1) existence of a trade secret; (2) communicated to a defendant; (3)
while he was in a position of trust and confidence; and (4) used by the defendant to the injury of the plaintiff. Neil
and Spencer Holding, Ltd. v. Kleen-Rite, Inc., 479 F. Supp. 164, 0169-70 (E.D. Mo. 1979).

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(b)

Is the subject of efforts that are reasonable under the circumstances


to maintain its secrecy.

R.S.Mo. 417.453. As noted in the MUTSAs Comments, the list should be treated as
examples and not as a comprehensive listing of items eligible for trade secret status. Comments,
1985 Act 236.
Moreover, the Restatement of the law specifically provides that confidential business
information may constitute trade secrets. The current Restatement of the Law: Unfair
Competition (Third) 39(b) and (d), explains that [a] trade secret can also relate to others
aspects of business operations such as pricing and marketing techniques . . . . This is consistent
with the case law. For example, in RE/MAX of American, Inc. v. Viehweg, 619 F. Supp. 621
(E.D. Mo. 1985) lists of names of potential franchisees, reports showing sales produced and
commissions paid, and rosters of subfranchisors, were held to be protectable trade secrets. 615 F.
Supp. At 626. See also Cape Mobile Homes, 780 S.W. 2d at 117 (confidential information held
to include company wide operations and procedures manual, customer list, sales and profit
statistics). In Hall and Shaws positions, they obtained access to precisely this type of
information.
As further discussed below: (a) Lascos confidential business information derives its
value from its secrecy from its competitors, and (b) Lasco takes reasonable precautions to
preserve the secrecy of such information.

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a.

Lascos Trade Secret Information Derives Its Value From Its Secrecy
From Competitors.

The value of Lascos Trade Secret Information is its secrecy from Lascos competitors.
After all, the main purpose of business information such as the processes, sources of labor,
sources of materials, price lists, methods, and other confidential information is to out-maneuver
other companies selling similar products. As recognized by the Seventh Circuit in PepsiCo. Inc.
v. Redmond, 54 F. 3d 1262 (7th Cir. 1995), a strategic plan containing strategies for production
and manufacturing derives much of its value from the fact that it is secret and competitors
cannot anticipate [the companys] next move. 54 F. 3d at 1265. Similarly, information
regarding a pricing approach and specific price points for given areas is highly confidential and
would be extremely valuable to a competitor since knowing Lascos pricing plans would allow
a competitor to anticipate [Lascos] pricing moves and underbid [Lasco] wherever the competitor
so desired. Id.
The Trade Secret Information is used in Lascos business and gives Lasco a competitive
advantage over competitors who do not know it. Restatement (First) of Torts, 757 comment b.
If Lascos processes, sources of labor, sources or materials, price lists and other Trade Secret
Information were used as part of the decision-making process for HSSMCs own sales, the value
of Lascos business Trade Secret Information would not just be lostit would cripple Lascos
ability to compete effectively.
b.

Lasco Takes Reasonable Efforts To Maintain The Secrecy Of Its


Trade Secret Information.

Lasco takes considerable precautions to maintain the secrecy of its Trade Secret
Information. Lascos protection efforts include: requiring employees to sign its confidentiality

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agreements; monitoring compliance with confidentiality obligations; restricting access to certain


documents and information on a need-to-know basis; securing its facility; and maintaining other
secrecy and security measuresincluding restricted access to the building; and company
security. Thus, there is no doubt that Lasco has satisfied its burden of establishing that it has
undertaken reasonable efforts to maintain the secrecy of its Trade Secret Information.
2.

Hall & Shaws Status As Members Of HSSMC Threatens The Actual And
Inevitable Disclosure And Use Of Lasco Trade Secret Information.

The Missouri Uniform Trade Secret Act provides that [a]ctual or threatened
misappropriation may be enjoined. Misappropriation includes disclosure or use of a trade
secret of a person without express or implied consent where the person:
(c)

At the time of disclosure or use, knew or had reason to


know that knowledge of the trade secret was:
i.

Derived from or through a person who had utilized


improper means to acquire it;

ii.

Acquired under circumstances giving rise to a duty


to maintain its secrecy or limit its use; or

iii.

Deriving it from or through a person who owed a


duty to the person seeking relief to maintain its
secrecy or limit its use.

R.S.Mo. 417.453(2)(b). Hall and Shaw fall into subparts ii and iii because they: (a) knew that
Lasco expected them to keep its information confidential; and (b) they owed a specific common
law and statutory duty to Lasco to maintain the secrecy of its information.
As described above, it is appropriate to enjoin an employee from performing certain job
functions with a competitor when there is a sufficient threat that the trade secrets will be
inevitably used or disclosed. See, e.g., PepsiCo, 54 F. 3d 1262; FMC Corp. v. Varco Intl, Inc.,
677 F. 2d 500, 504 (5th Cir. 1982) (in enjoining a competitor from placing plaintiffs former

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employee in a position that posed an inherent threat of disclosure or use of the plaintiffs trade
secrets, the Fifth circuit noted that: Even assuming the best of faith, [the former employee] will
have difficulty preventing his knowledge of [plaintiffs trade secrets] from infiltrating his
work.).
Hall and Shaw acquired Lascos Trade Secret Information in confidence during the
course of their lengthy employment and, therefore, they owe a duty (both under the common law
and statute) to Lasco to maintain the secrecy of that confidential information. Each of the Trade
Secret Information at issue in this case was disclosed to Hall and Shaw as part of their duties
with Lasco. This Trade Secret Information were developed through the efforts and collaboration
of Lascos directors and executives, with the goal of giving Lasco a competitive edge over its
competitors, including HSSMC.
Any contention by Hall or Shaw that they do not intend to use Lascos Trade Secret
Information is the same argument that was rejected in PepsiCo as fall[ing] somewhat short of
the mark. 54 F. 3d at 1270. In PepsiCo, defendant Redmond was general manager of plaintiff
PepsiCos California business unit with access to PepsiCos confidential pricing, marketing and
business information. Redmond, like Hall and Shaw, left to compete against his former
employerleaving the plaintiff [i]n the position of a coach, one of whose players has left,
playbook in hand, to join the opposing team before the big game. PepsiCo, 54 F. 3d at 1270. In
this case, it is Hall and Shaws actual and inevitable use or disclosure of Lascos Trade Secret
Information that must be guarded against.
B.

Lasco Will Be Irreparably Harmed If the Requested Injunctive Relief Is Not


Granted.
The common law and the MUTSA both prohibit Hall and Shaw from using Lascos

Trade Secret Information. Lasco will suffer irreparable harm if Hall or Shaw uses or discloses

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Lascos Trade Secret Information during the course of their service to HSSMC because Lasco
will be at a critical business disadvantage at the hands of a competitor. This injury will be
difficult to assess and impossible to undo. In fact, due to Hall and Shaws unlawful use of
Lascos Trade Secret Information, at least one customer of Lasco has threatened to cease doing
business with Lasco. Disclosure of this Trade Secret Information by Hall and Shaw has and will
continue to put Lasco at a competitive disadvantage, allowing Hall, Shaw and HSSMC to reap
the fruits of Lascos substantial investments. Thus, the irreparable harm that Lasco will suffer if
Hall and Shaw are not enjoined is similar to the harm recognized in PepsiCo, and would render
ineffective any judgment that occurred after any use or disclosure of Lascos Trade Secret
Information.
C.

The Requested Injunction Will Not Harm Defendants.


The requested relief does not restrict Hall or Shaws ability to work in their chosen trade.

Lasco does not seek to prevent Hall or Shaw from using their general skills and knowledge.
Rather, Lasco wishes to maintain the confidentiality of particular formulae, customers, plans and
strategies developed by Lasco and disclosed to Hall and Shaw while the employer-employee
relationship existed, which are unknown to HSSMC and others in the industry, and which give
the Lasco an advantage over its competitors. PepsiCo, 54 F. 3d at 1269. The requested injunction
will not prevent Hall and Shaw from using their experience, but will only prevent him from
disclosing Lascos confidential and proprietary business information for a specified duration of
time. Requiring Hall and Shaw to honor their obligations to maintain the secrecy of Lascos
Trade Secret Information merely requires Hall and Shaw to obey the law.

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D.

The Public Interest Favors Granting The Requested Relief.


Every state in the U.S. grants protection to trade secrets because there is a strong public

interest in encouraging the progress of science and promoting commercial morality. The broadly
stated policies behind trade secret law are the Maintenance of standards of commercial ethics
and the encouragement of invention are the broadly stated policies behind trade secret law.
Kenawee Oil Co. v. Bicron Corp., 94 S.Ct. 1897 (1974). Missouri courts have long recognized
the public interest in protecting trade secrets. As one court recognized,
They say that if a secret is learned in confidence, or in a
confidential relationship, it will be protected as against those who,
through breach of trust or violated confidence, attempt to apply the
secret to their own use or to impart it to others, Germo Mfg. Co. v.
Combs, 209 Mo.App. 651, 240 S.W. 872, 881, or, otherwise stated,
it will nevertheless be protected from use or disclosure to whom it
has been revealed in confidence. Sandlin v. Johnson, 141 F.2d
660, 661 (8th Cir.). This is a rule of public policy, and is founded
in a profound knowledge of the human intellect and of the motives
that inspire the actions of men and the law peremptorily forbids
everyone who, in a fiduciary relation, has acquired information
concerning, or interest in the business or property of his correlate
from using that knowledge or interest in the business or property of
his correlate from using that knowledge or interest to prevent the
latter from accomplishing the purpose of the relation. Trice v.
Comstock, 121 F. 620, 622-623 (8th Cir).
Jerrold-Stephens Co. v, Gustaveson, Inc., 138 F.Supp. 11, 15 (W.D. Mo. 1956). There is no
doubt that the public interest compels protection of Lascos Trade Secret Information from
disclosure by Hall and Shaw. Lasco spent significant time and resources developing unique
products for its customers, development of which required innovation and invention which the
Supreme Court recognizes as a fundamental policy behind trade secret law. Moreover, Hall and
Shaw took this information, which they learned through their employment with Lasco, and used
it to underbid Lasco; unfortunately, they are likely to do so again in the future. Hall and Shaws

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conduct in utilizing Trade Secret Information of Lasco for their own personal gain and the gain
of HSSMC undercuts attempts to maintain a code of ethics in the industry, the second
fundamental policy behind trade secret law. Protecting innovative companies like Lasco is in the
public interest, not only to encourage innovation, but also to ensure a fair playing field for all
current and future competitors in the marketplace. For these reasons, the public interest mandates
that an injunction issue against Defendants to ensure they maintain the confidentiality of the
Trade Secret Information they acquired during their employment with Lasco.
IV.

CONCLUSION

WHEREFORE, for the foregoing reasons, Plaintiff Lasco Foods, Inc. requests that this
Court enter its Temporary Restraining Order and thereafter its Preliminary and Permanent
Injunction, enjoining and restraining Defendant and all others acting in concert with Defendant
who may gain actual knowledge of this Order, from doing any of the following:
(A)

Using, relying upon, or disclosing to HSSMC or any affiliate or any other person

or legal entity any Trade Secret Information or confidential information of Lasco acquired by
Hall or Shaw in the course of or arising out of their employment by Lasco, including, without
limitation, information relating to any of the following: (a) the training and instructions given by
the Company, (b) the knowledge of the identity and location of customers, (c) the sources of
supply, (d) the costs and the selling prices of the Company, (e)formulae, and (f) other Trade
Secret Information obtained by Hall or Shaw during their employment with Lasco.
(B)

For an accounting of all monies and profits realized by Defendants as a result of

the conduct alleged herein and for other damages that may be determined and fixed by this
Court.

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Case: 4:08-cv-01683-JCH Doc. #: 4 Filed: 10/31/08 Page: 18 of 19 PageID #: 61

(C)

For an Order restraining Defendants from deleting, destroying, or otherwise

duplicating or copying any of Lascos Trade Secret Information;


(D)

For an Order requiring Defendants to maintain and preserve all computerized or

other electronically stored information on their business and home computers;


(E)

For an Order requiring Defendants to immediately return all Lasco information

currently in their possession, whether in electronic or hard copy form;


(F)

For such other and further relief as the Court may deem just and proper including

Plaintiffs reasonable attorneys fees and costs herein incurred and expended.
Respectfully submitted,
OGLETREE, DEAKINS, NASH,
SMOAK & STEWART, P.C.

By: /s/ Burton D. Garland, Jr.


Burton D. Garland, Jr.
MBE # 82115
Rodney A. Harrison
MBE # 83160
7700 Bonhomme Ave, Suite 650
St. Louis, Missouri 63105
(314) 802-3953 telephone
(314) 802-3936 facsimile
Attorneys for Plaintiff

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Case: 4:08-cv-01683-JCH Doc. #: 4 Filed: 10/31/08 Page: 19 of 19 PageID #: 62

CERTIFICATE OF SERVICE
I hereby certify that I have on Friday, October 31, 2008, served a true and correct copy of
the foregoing via process server, at the following addresses:
Ronald N. Hall
120 La Colinda N
Weatherford, TX 76086-8802
Charles R. Shaw
57 Silas Court
St. Charles, Missouri 63304
Hall and Shaw Sales, Marketing & Consulting LLC
c/o Charles R. ShawRegistered Agent
57 Silas Court
St. Charles, Missouri 63304

/s/ Burton D. Garland, Jr.

6774629.1 (OGLETREE)

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