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Corporate officer did not violate fiduciary duty when he started his own competing company after resignation

Brian Mann spent thirty years in a specialized concrete business.  The last ten of those years, he served as the Vice President of Quality Manufacturing, Inc.  When he became disenchanted with the President's failure to sell him a share of the business, Mann ultimately resigned, created a new competing business, and began recruiting customers.  Several of his previous co-workers joined him in the new business.  His former employer sued him, arguing that he had breached his fiduciary duty to the company by engaging in a competing business.

The Court of Appeals rejected the suit against Mann and reversed the trial court's judgment against him.  It noted that his former employer was essentially attempting to secure, by litigation, contractual protections and a non-compete clause that it never bargained for.  Since Mann didn't take anything to the new company that he had not brought TO the company ten years earlier, and since he never worked toward a competing personal goal on the company's time, he was not guilty of a fiduciary breach. The judgment against him was overturned, and a large judgment in Mann's favor was imposed.

Thompson O’Neil, P.C.
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Traverse City, Michigan 49684
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