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Ikon Office Solutions, Inc. v. American Office Products, Inc.

Citation: 61 F. App'x 378Docket: Nos. 01-35498, 01-35782; D.C. No. CV-00-00064-JE

Court: Court of Appeals for the Ninth Circuit; April 3, 2003; Federal Appellate Court

Narrative Opinion Summary

This case involves an appeal by Ikon Office Solutions, Inc. against a summary judgment in favor of American Office Products, Inc. and its representatives, concerning the enforceability of noncompetition agreements. The district court found that Ikon could not enforce these agreements against employees Lesa Bergey and Larry Bradley. Bergey's agreement was invalid as it was signed post-employment commencement without prior oral agreement, while Bradley's enforcement rights were considered waived by Ikon due to lack of evidence and communications suggesting non-enforcement. The summary judgment for the Appellees was affirmed. Additionally, the court addressed a cross-appeal regarding attorney fees, determining that under Oregon law, such fees could only be awarded if a claim was pursued in bad faith, which was not demonstrated by Ikon. Consequently, the denial of attorney fees was upheld. Jurisdiction was confirmed under 28 U.S.C. § 1291, and the rulings were affirmed, with the outcome not suitable for publication or citation except under specified conditions.

Legal Issues Addressed

Attorney Fees Under Oregon Law

Application: Attorney fees were not awarded because there was no evidence of Ikon pursuing claims in bad faith, as required under Oregon law.

Reasoning: Attorney fees can only be awarded if a claim is made in bad faith, defined under Oregon law as having an 'improper purpose.' The record did not support a finding of an improper purpose by Ikon, leading to the conclusion that the Appellees were not entitled to attorney fees.

Enforcement of Noncompetition Agreements

Application: The court found that noncompetition agreements could not be enforced against employees if not properly executed or if waived by the employer.

Reasoning: The district court determined that Ikon could not enforce noncompetition agreements against Bergey or Bradley. Bergey's agreement was rendered invalid as she did not sign it until days after commencing employment, with no evidence of an oral agreement at the onset.

Waiver of Rights to Enforce Agreements

Application: Ikon waived its right to enforce Bradley's noncompetition agreement due to lack of documentation and communications that implied non-enforcement.

Reasoning: Regarding Bradley, while his agreement may have been valid, Ikon waived its right to enforce it. The absence of a noncompetition agreement in Bradley’s file, coupled with Ikon's communication indicating he could not disclose confidential information without mentioning the agreement, suggested abandonment of the right to enforce it.