Box v. J.B. Hunt Transport, Inc.

          Rehearing Denied July 17, 2019

          APPEAL FROM THE BENTON COUNTY CIRCUIT COURT, [NO. 04CV-16-1752], HONORABLE BRAD KARREN, JUDGE

         Friday, Eldredge & Clark, LLP, Little Rock, by: Elizabeth R. Murray, H. Wayne Young, Jr., and Joshua C. Ashley, for appellant.

         Cullen & Co., PLLC, Little Rock, by: Tim J. Cullen, for appellee.

         OPINION

         KENNETH S. HIXSON, Judge

Page 720

          This is the second appeal in this litigation between appellant David Box and his former employer, appellee J.B. Hunt Transport, Inc. (hereinafter "J.B. Hunt"). The first appeal was an interlocutory appeal wherein Box challenged the trial court’s order granting J.B. Hunt’s motion for an injunction and temporary restraining order. The temporary order was based on three agreements containing confidentiality, noncompete, and restricted stock provisions executed between the parties during Box’s employment, and the order enjoined Box from disclosing confidential information and trade secrets to Hub Group, Inc. (hereinafter "Hub Group"), and from employment with Hub Group for a period of one year from Box’s separation from J.B. Hunt. In Box v. J.B. Hunt Transport, Inc., 2017 Ark.App. 605, 533 S.W.3d 603 (Box I ), we held that the trial court abused its discretion in granting J.B. Hunt’s motion for an injunction and a temporary restraining order because, inter alia, J.B. Hunt failed to demonstrate a likelihood of success on the merits, and we reversed and remanded.

         After we reversed and remanded, Box filed a motion for damages and attorney’s fees against J.B. Hunt. Box sought damages incurred as a result of the injunction and attorney’s fees for prevailing on the injunction issue. J.B. Hunt filed a motion to strike Box’s motion, arguing that the trial court lacked jurisdiction to act on Box’s motion because, while the appeal in Box I was pending, J.B. Hunt voluntarily dismissed its underlying complaint against Box. J.B. Hunt asserted that the case was closed and that because more than ninety days had elapsed since the trial court’s order of dismissal, the case had been fully and finally dismissed. The trial court agreed with J.B. Hunt and entered an order finding that it lacked subject-matter jurisdiction to rule on Box’s motion for damages and attorney’s fees pursuant to Rule 60(c) of the Arkansas Rules of Civil Procedure.

         Box now brings this second appeal in the matter, challenging the trial court’s order wherein the trial court found that it lacked jurisdiction to rule on Box’s motion for damages and attorney’s fees. On appeal, Box argues that the trial court erred as a matter of law in dismissing for lack of subject-matter jurisdiction and that the trial court disregarded our mandate in Box I, thus depriving Box of his statutory right to seek damages and attorney’s fees associated with the wrongful injunction. We agree that the trial court erred in finding that it lacked subject-matter jurisdiction to rule on Box’s motion. Therefore, we reverse and remand.

          The relevant facts and procedural history are as follows. Box was employed by J.B. Hunt from 2000 until he resigned on October 27, 2016. For the last five years of his employment there, Box worked as a director of transportation in J.B. Hunt’s integrated capacity solutions division in Memphis, Tennessee. After leaving his employment with J.B. Hunt, Box accepted a position with another transportation company, Hub Group, as a regional vice president of operations in the Memphis region.

          The litigation began on November 22, 2016, when J.B. Hunt filed a complaint for breach of contract against Box. J.B. Hunt alleged that by accepting employment with Hub Group, Box had violated various noncompete and confidentiality agreements executed during his employment with J.B.

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Hunt. Generally, J.B. Hunt claimed that Box’s employment with Hub Group was the same or substantially similar to his employment with J.B. Hunt and that performing his responsibilities at Hub Group may result in Box disclosing trade secrets or confidential information of J.B. Hunt that would afford Hub Group an unfair competitive advantage. J.B. Hunt requested an order permanently enjoining Box from disclosing any of J.B. Hunt’s confidential information and trade secrets, and temporarily enjoining him from employment with Hub Group.

         On November 23, 2016, which was one day after it filed its complaint, J.B. Hunt filed a motion for an injunction and temporary restraining order. On February 14, 2017, the trial court entered an order granting J.B. Hunt’s motion for an injunction and temporary restraining order, finding that irreparable harm would result in the absence of an injunction or restraining order, and that J.B. Hunt had demonstrated a likelihood of success on the merits of its breach-of-contract complaint. Based on these findings, the trial court enjoined Box from disclosing confidential information and trade secrets and from employment with Hub Group through October 27, 2017. The trial court also awarded J.B. Hunt attorney’s fees and costs. The court had not yet determined the amount of attorney’s fees or costs when Box appealed from the interlocutory order entered on February 14, 2017, as he was permitted to do under Arkansas Rule of Appellate Procedure-Civil 2(a)(6), resulting in the first appeal to this court.^[1]

         After the record for the interlocutory appeal was lodged by Box in this court and after briefs were filed, on September 26, 2017, J.B. Hunt filed a motion to voluntarily dismiss its complaint in the circuit court pursuant to Arkansas Rule of Civil Procedure 41(a). The trial court entered an order dismissing J.B. Hunt’s complaint without prejudice on the same day. Subsequently, J.B. Hunt filed a motion to dismiss the appeal before this court. J.B. Hunt argued that the appeal in Box I should be dismissed for two reasons. First, it asserted that it had recently exercised its right in the court below to a voluntary dismissal of its underlying complaint against Box under Arkansas Rule of Civil Procedure 41(a). J.B. Hunt contended that because its original claims were dismissed without prejudice, the provisional remedy based on those claims, i.e., the temporary restraining order and preliminary injunction, had been dissolved. J.B. Hunt also noted in its motion that Box had not filed a counterclaim. Second, J.B. Hunt argued that the appeal should be dismissed as moot because the temporary restraining order by its terms expired on October 27, 2017, which was just two days after the case was scheduled to be orally argued before our court, making a decision prior to expiration of the temporary order practically impossible.

         In Box I, before addressing the merits of the interlocutory appeal, we first addressed the motion to dismiss appeal filed by J.B. Hunt. We denied J.B. Hunt’s motion to dismiss the appeal. We stated that when the record was filed with our court, there had been no such order of dismissal entered, and that it was therefore not part of our record.^[2] Because we will not consider a document not in the record, we stated that J.B. Hunt’s argument that the appeal should be dismissed because it voluntarily dismissed its action below was not before

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us. We also concluded that the expiration of the temporary order did not moot our review of the order. We noted that in the order being appealed, the trial court awarded attorney’s fees and costs to J.B. Hunt, which was one of the issues Box raised on appeal. In addition, citing Arkansas Rule of Civil Procedure 65(c) and Ark. Code Ann. § 16-113-405(a)(1) (Repl. 2016), we noted that in the temporary restraining order, the trial court ordered J.B. Hunt to post security in an amount sufficient to pay the damages sustained by Box should he be found to have been wrongfully enjoined or restrained. For those reasons, we concluded that our decision in Box I would likely have practical legal effects. Finally, we stated that even were we to agree that a decision rendered on appeal would not affect the rights of the parties, the appeal fell under an exception to the mootness doctrine because it involved issues that were capable of repetition but evaded review. For those reasons, we reached the merits of the appeal in Box I .

         Upon deciding the merits in Box I, we examined each of the relevant agreements executed by the parties during Box’s employment with J.B. Hunt as applied to the facts presented below. We held that the trial court abused its discretion in granting J.B. Hunt’s motion for an injunction and restraining order because J.B. Hunt failed to demonstrate a likelihood of success on the merits, and that the trial court made insufficient findings and conclusions to support its order.^[3] Therefore, we reversed and remanded.

         After we delivered Box I on November 8, 2017, J.B. Hunt filed a petition for rehearing with this court and a petition for review with the supreme court, both of which were denied. Our mandate was issued on January 25, 2018. On the same day the mandate was issued, Box filed a motion to recall the mandate for recovery of additional costs. We granted Box’s motion and issued an amended mandate on February 21, 2018.

         On February 21, 2018, the same day our amended mandate issued in Box I, Box filed in the trial court a motion for damages and attorney’s fees. Box alleged that he incurred damages as a result of the dissolved preliminary injunction, including lost income, lost stock opportunities, lost 401(k) matching funds, higher medical-insurance costs, and emotional distress. Box claimed entitlement to these damages pursuant to Ark. Code Ann. § 16-113-405(a)(1) (Repl. 2016), which provides:

Upon the dissolution in whole or in part of any injunction or restraining order of any and every kind and nature whatsoever, the circuit court wherein the injunction or restraining order was pending may assess and render against principal and sureties on the injunction bond a valid judgment for any and all ...