Willis RE Inc. v. Herriott

Background

Willis Re Inc. and other plaintiffs sought emergency injunctive relief against Paul Herriott in litigation involving an employment agreement, Phantom Stock Unit Agreements, and Restricted Covenant Agreements (RCAs). The court’s opinion addressed which state’s law governed the plaintiffs’ claims and the plaintiffs’ request for a temporary restraining order (TRO), an emergency form of injunctive relief.

Choice of Law

The court concluded that New York law governs the claims. It reasoned that:

- The employment agreement’s choice-of-law provision was limited by its terms to that agreement and stated that the agreement would be governed by California law. - The Phantom Stock Unit Agreements and RCAs did not incorporate the employment agreement by reference, so there was no inconsistency from the agreements having separate choice-of-law provisions. - Because the lawsuit arose out of and related to the RCAs, the RCAs’ choice-of-law provisions applied in the first instance. - Under Ministers & Missionaries Benefit Board v. Snow, New York law applied without regard to whether California had a greater interest in the dispute or whether applying New York law would violate California public policy. - California Labor Code section 925 therefore did not apply.

Temporary Restraining Order

In light of its choice-of-law conclusion, the court granted the plaintiffs’ motion for a TRO, subject to modifications that were to be set out in a separate order. The court did not enjoin TigerRisk Partners, LLC from prosecuting related litigation in California because TigerRisk was not a party to the agreements at issue. Herriott was enjoined only with respect to his own claims.

The court also declined to grant the portion of the requested relief concerning alleged improper solicitation of Willis Re employees. The plaintiffs had provided no evidence of such conduct beyond a conclusory allegation made “[u]pon information and belief.” The court held that this did not satisfy the requirement to show that, without an injunction, the plaintiffs would suffer harm that was actual and imminent rather than remote or speculative and that could not be remedied after trial.

Preliminary-Injunction Proceedings

The court reserved judgment on whether to grant a preliminary injunction, an injunction that remains in place while the case proceeds, and whether any such injunction should be narrower than the TRO. It ordered Herriott to file a supplemental opposition memorandum of no more than fifteen pages by February 16, 2021, and the plaintiffs to file a reply of no more than ten pages by February 19, 2021.

The additional briefing was to address whether the RCAs are enforceable under New York law, including whether unreasonable provisions should not be enforced and whether the court should modify the agreements by removing improper provisions. The parties also had to address whether the plaintiffs had provided enough evidence of concrete and imminent harm that could not adequately be remedied with money damages.

Conference and Disposition

The court ordered the parties to confer before a February 12, 2021 telephone conference. The conference was to address possible consolidation of the preliminary-injunction motion with trial or a summary-judgment motion, extensions of the briefing deadlines and any corresponding extension of the TRO, the plaintiffs’ request for expedited discovery, the amount of any bond if a preliminary injunction were granted, and settlement. The court directed the Clerk of Court to terminate ECF No. 39. Judge Furman did not make a final decision on the preliminary-injunction request in this opinion.