Donna M. Perella v. United Site Services Northeast, Inc.

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).

COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

23-P-554

DONNA M. PERELLA

vs.

UNITED SITE SERVICES NORTHEAST, INC.

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

The employer, United Site Services Northeast, Inc., appeals

from an order of a Superior Court judge granting the former

employee, Donna M. Perella, a preliminary injunction, enjoining

the employer from enforcing a noncompete provision in an

employment agreement. Concluding that the former employee met

the requirements under the declaratory judgment act and that the

motion judge acted within her discretion in granting a

preliminary injunction, we affirm.

1. Actual controversy. A plaintiff seeking a declaratory

judgment pursuant to the declaratory judgment act, G. L.

c. 231A, § 1, must "demonstrate the existence of an actual

controversy, as well as 'the requisite legal standing to secure

its resolution.'" Kligler v. Attorney Gen., 491 Mass. 38, 44

(2022), quoting Entergy Nuclear Generation Co. v. Department of
Envtl. Protection, 459 Mass. 319, 326 (2011). A party

demonstrates the existence of an actual controversy by showing

that there is:

"a real dispute caused by the assertion by one party of a
legal relation, status or right in which [that party] has a
definite interest, and the denial of such assertion by
another party also having a definite interest in the
subject matter, where the circumstances attending the
dispute plainly indicate that unless the matter is adjusted
such antagonistic claims will almost immediately and
inevitably lead to litigation."

John Moriarty & Assocs., Inc. v. Zurich Am. Ins. Co., 102 Mass.

App. Ct. 474, 484-485 (2023), quoting Gay & Lesbian Advocates &

Defenders v. Attorney Gen., 436 Mass. 132, 134-135 (2002). "To

have standing in any capacity, a [plaintiff] must show that the

challenged action has caused the [plaintiff] injury." Sudbury

v. Massachusetts Bay Transp. Auth., 485 Mass. 774, 779 (2020),

quoting Slama v. Attorney Gen., 384 Mass. 620, 624 (1981).

"[B]oth requirements are liberally construed." Doe No. 1 v.

Secretary of Educ., 479 Mass. 375, 385 (2018).

Here, the former employee "desires to return to the

industry of servicing temporary site services." She "intend[s]

to form [her] own company that would engage in sales of portable

sanitary units such as what [she] sold at United Site Services."

Pursuant to the noncompete provision of her employment

agreement, she must obtain "prior written consent of the Company

and the Company's parent corporation" before competing with the

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company or "engag[ing] in the business of leasing, renting,

selling or servicing of portable restrooms and sanitation

facilities or storage facilities or any other business related

thereto, within any county in the States of Massachusetts,

Connecticut, Rhode Island, Vermont, New Hampshire, Maine or New

York, or in any other state in which the Company conducts

business from time to time, or within any other territory in

which Employee performs any duties hereunder." She attempted to

get written permission by sending the employer a letter,

requesting a reply within fourteen days of receipt, but she

received no response.

These facts establish an actual controversy and standing.

There is an actual controversy because the former employee

intends to start a business in clear violation of the noncompete

provision, and the employer refused to waive the contractual

provision. See John Moriarty & Assocs., Inc., 102 Mass. App.

Ct. at 485 (actual controversy exists where insured "must weigh

the vigorousness of its defense against the possibility that it

ultimately will have to reimburse [insurer] for the entire cost

of that defense"). She has standing to challenge the noncompete

provision because its existence is injuring her by preventing

her from starting a business. See Entergy Nuclear Generation

Co., 459 Mass. at 327 (standing where controversy "affects the

party's primary conduct"). The former employee was not required

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to breach the noncompete provision before litigating its

enforceability. See Oxford v. Oxford Water Co., 391 Mass. 581,

584 (1984) ("It is not necessary that the parties be irrevocably

bound to a course of action before a court can afford

declaratory relief"). Accord Kligler, 491 Mass. at 46, quoting

Babbitt v. United Farm Workers Nat'l Union, 442 U.S. 289, 298

(1979) ("'When contesting the constitutionality of a criminal

statute, "it is not necessary that [the plaintiff] first expose

himself to actual arrest or prosecution"' in order to present an

actual controversy"). Therefore, the case presented an actual

controversy properly before the Superior Court.

2. Preliminary injunction. a. Standard of review. "[A]

party seeking a preliminary injunction must show '(1) a

likelihood of success on the merits; (2) that irreparable harm

will result from denial of the injunction; and (3) that, in

light of the [moving party's] likelihood of success on the

merits, the risk of irreparable harm to the [moving party]

outweighs the potential harm to the [nonmoving party] in

granting the injunction.'" Boston Firefighters Union, Local

718, Int'l Ass'n of Fire Fighters, AFL-CIO v. Boston, 491 Mass.

556, 562 (2023), quoting Garcia v. Department of Hous. &

Community Dev., 480 Mass. 736, 747 (2018). "We review the grant

or denial of a preliminary injunction to determine whether the

judge abused [her] discretion, that is, whether the judge

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applied proper legal standards and whether there was reasonable

support for [her] evaluation of factual questions." Children's

Health Rights of Mass., Inc. v. Belmont Pub. Sch. Dist., 102

Mass. App. Ct. 747, 748 (2023), quoting Lieber v. President &

Fellows of Harvard College (No. 2), 488 Mass. 816, 821 (2022).

b. Likelihood of success on the merits. "A covenant not

to compete is enforceable only if it is necessary to protect a

legitimate business interest, reasonably limited in time and

space, and consonant with the public interest." Boulanger v.

Dunkin' Donuts, Inc., 442 Mass. 635, 639 (2004), cert. denied,

544 U.S. 922 (2005). Legitimate business interests "include the

protection of trade secrets, confidential information, and good

will." Oxford Global Resources, LLC v. Hernandez, 480 Mass.

462, 470 (2018). "A former employer is not entitled by contract

to restrain ordinary competition." All Stainless, Inc. v.

Colby, 364 Mass. 773, 779 (1974).

Here, the noncompete provision is not reasonable. It bars

the employee from "engag[ing] in the business of leasing,

renting, selling or servicing of portable restrooms and

sanitation facilities or storage facilities or any other

business related thereto" at all for three years in seven named

States, as well as "any other state in which the Company

conducts business from time to time, or within any other

territory in which Employee performs any duties hereunder."

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This scope extends far beyond protecting the employer's

legitimate business interests, temporally and geographically.

The employer advances no argument that the noncompete

provision is enforceable as written. Instead, the employer

argues that the motion judge was required to narrow the

noncompete provision to its maximal enforceable scope.1 The

employer did not raise this argument in its written opposition

to the motion judge. At the motion hearing, the employer

briefly suggested in response to the judge's inquiry that the

judge could limit the provision's duration to "two years, twelve

months, [or] eighteen months," or reduce its geographical scope.2

Although the motion judge had the authority to narrow the

noncompete provision, see Automile Holdings, LLC v. McGovern,

483 Mass. 797, 808-809 (2020), the employer could not delegate

to the judge its duty to present options for the judge's

consideration. To put it another way, the employer cannot argue

on appeal that the judge erred by not ruling in a way that the

employer did not suggest at the trial court. See ProQuip Ltd.

v. Northmark Bank, 103 Mass. App. Ct. 133, 137 n.3 (2023)

1 The employment agreement specifically allows courts to
narrow its provisions.

2 The employer suggested hypothetically that the judge allow
the former employee to do business in upstate New York. At the
hearing, the former employee's attorney represented that the
former employee wanted to start a business in Bristol County,
Massachusetts.

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("Where this argument was not raised below, it is waived"). The

temporal limitations suggested by the employer would be

insufficient to make the noncompete provision enforceable, as

would the employer's suggestion that the geographical scope be

limited to allow the former employee to work in upstate New

York. The motion judge was not required to invent her own

geographical limitations unsuggested by the parties. The motion

judge, therefore, acted within her discretion in finding that

the former employee had a likelihood of success on the merits.

c. Irreparable harm and balancing of the interests. The

former employee put forward specific facts that show she will be

irreparably harmed without the preliminary injunction. The

former employee "intend[s] to form [her] own company that would

engage in sales of portable sanitary units such as what [she]

sold at United Site Services." It is unlikely that she could

accurately prove damages caused by delaying starting a business

until the noncompete provision expires.

The employer, on the other hand, put forward no evidence

that it would be harmed if the noncompete provision is not

enforced. Instead, the employer argued that the former employee

could benefit from the employer's good will with clients and

that she has confidential information.3 The employer, however,

3 The employer also argued that it is harmed per se because
the employment agreement says so. The terms of the agreement do

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failed to put forward any evidentiary support for these claims,

and the employer cannot show harm based on unsupported

assertions. See Eaton v. Federal Nat'l Mtge. Ass'n, 462 Mass.

569, 590 (2012) ("an allegation that is supported on

'information and belief' does not supply an adequate factual

basis for the granting of a preliminary injunction"). In any

event, we discern no error in the judge's finding that the harm

to the employee from the unenforceable noncompete agreement

outweighs the potential harm to the employer.4

In light of the former employee's strong likelihood of

success on the merits and proven risk of irreparable harm, the

not control a dispute over whether that agreement is
enforceable.

4 In light of our decision, we need not consider whether the
recently announced -- and pending -- addition of 16 C.F.R.
§ 910.2 (2024) would bar enforcement of the noncompete
provision.

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motion judge acted within her discretion in granting the

preliminary injunction.5

Order granting preliminary
injunction affirmed.

By the Court (Rubin,
Ditkoff & Grant, JJ.6),

Assistant Clerk

Entered: May 9, 2024.

5 The employer's request for attorney's fees and costs is
denied.

6 The panelists are listed in order of seniority.

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