Preview
FILED
DALLAS COUNTY
8/31/2017 6:20 PM
FELICIA PITRE
DISTRICT CLERK
DC-17-11360 Angie Avina
CAUSE NO. _______________
SCRAPSOURCE, LLC, § IN THE DISTRICT COURT
§
Plaintiff, §
§
v. § DALLAS COUNTY, TEXAS
§
JASON WOLFF, MITCHELL WOLFF AND §
FORTIS METAL MANAGEMENT, LLC, §
§
Defendants. § ___ JUDICIAL DISTRICT
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION
Plaintiff ScrapSource, LLC (“ScrapSource”) files its Original Petition and Application
for Temporary and Permanent Injunction (“Petition”) complaining of Defendants Jason Wolff,
Mitchell Wolff, and Fortis Metal Management, LLC (collectively, “Defendants”) and states:
DISCOVERY CONTROL PLAN
1. ScrapSource intends to conduct discovery under Level 2 pursuant to Texas Rule
of Civil Procedure 190.3.
DISCLOSURE OF RELATED CASE
2. Pursuant to Dallas County Local Rule 1.08, ScrapSource states that this case is
so related to a previously filed case to be subject to transfer under Local Rule 1.06. The
previously filed case was styled ScrapSource, LLC v. Jason Wolff, et al., Cause No. DC-15-
00717, in the 192nd Judicial District Court of Dallas County, Texas.
RULE 47 STATEMENT
3. ScrapSource states that it seeks damages of $100,000 or less and non-monetary
relief.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 1
PARTIES
4. ScrapSource is a Texas limited liability company with its principal place of
business in Dallas, Texas.
5. Jason Wolff (“Jason”) is an individual citizen of Texas who may be served with
process at his residence located at 3767 Jubilee Trail, Dallas, Texas 75229, or wherever he
may from time to time be found.
6. Mitchell Wolff (“Mitchell”) is an individual citizen of Texas who may be served
with process at 2515 McKinney Avenue, Suite 1300, Dallas, Texas 75201, or wherever he may
from time to time be found.
7. Fortis Metal Management, LLC (“Fortis”) is a Texas limited liability company
that may be served with process by service on its registered agent, Jason Wolff, at 3767 Jubilee
Trail, Dallas, Texas 75229.
JURISDICTION AND VENUE
8. Jurisdiction is proper over Defendants because they reside and/or have their
principal place of business in the State of Texas and all or a substantial part of the events or
omissions that give rise to ScrapSource’s claims occurred in Texas.
9. Venue is proper in Dallas County, Texas, pursuant to Sections 15.002(a)(1)-(3)
Texas Civil Practice & Remedies Code because Jason and Mitchell reside in Dallas County,
Fortis has its principal office in this state in Dallas County, and all or a substantial part of the
events or omissions giving rise to ScrapSource’s claims occurred in Dallas County, Texas.
FACTS
10. ScrapSource is a boutique scrap metal management and consulting firm that
assists companies in managing, selling, and/or disposing of various types of scrap metal.
ScrapSource has developed and implemented a variety of unique, proprietary, and cost-savings
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 2
structures to help its clients manage and sell their scrap metal that are more beneficial to its
customers than the methods traditionally used by purchasers and sellers of scrap metal.
11. ScrapSource hired Jason in September 2011 to act as an account representative,
pursuant to an Employment, Proprietary Information, Nondisclosure, and Non-Competition
Agreement (the “Employment Agreement”). Pursuant to the Employment Agreement,
ScrapSource gave Jason access to its trade secrets and confidential information during the
course of his employment. Among other terms, in the Employment Agreement, Jason agreed
not to solicit ScrapSource’s clients or employees, use its confidential, trade secret, or
proprietary information, or compete with ScrapSource for eighteen months following his
termination.
12. In December 2014, while still employed with ScrapSource, Jason and Mitchell
formed Fortis to compete directly with ScrapSource. Jason had earlier created a “Dropbox”
account into which he copied numerous ScrapSource proprietary files in violation of the
Employment Agreement. In January 2015, Jason resigned from ScrapSource and announced
his intent to compete directly with it. Both before and after Jason’s resignation, Defendants
used ScrapSource’s customer contacts, contractual agreements, and confidential, trade secret,
and proprietary information, and competed directly with ScrapSource. This conduct constituted
a breach of the Employment Agreement by Jason, and misappropriation of trade secrets and
tortious interference with ScrapSource’s contractual relations by all Defendants.
13. On or about January 22, 2015, ScrapSource filed suit against Defendants1 in a
suit styled ScrapSource, LLC v. Jason Wolff, et al., Cause No. DC-15-00717, in the 192nd
Judicial District Court of Dallas County, Texas (the “Original Lawsuit”). In the Original
Lawsuit, ScrapSource alleged causes of action against Jason for breach of the Employment
1
Fortis Commercial Construction, Inc., was also a party to the Original Lawsuit. It has since declared bankruptcy.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 3
Agreement and for declaratory judgment regarding Jason’s obligations under the Employment
Agreement, against Mitchell and Fortis for tortious interference with ScrapSource’s rights
under the Employment Agreement, and against all Defendants for violation of the Texas
Uniform Trade Secrets Act (“TUTSA”). ScrapSource sought a temporary restraining order and
temporary and permanent injunctive relief as well as money damages.
14. The Court entered its Agreed Temporary Restraining Order on January 23,
2015, prohibiting Defendants from soliciting or contacting customers of ScrapSource and from
disclosing ScrapSource’s “Confidential Information,” as defined in the TRO, and ordering
Defendants to turn over certain documents and computer devices to counsel for ScrapSource.
15. The Parties thereafter agreed to resolve the disputes between them and entered
into a Confidential Compromise Settlement Agreement and Mutual Release (the “Settlement
Agreement”) effective on February 6, 2015. One of the terms of the Settlement Agreement
called upon the Parties to request entry of an Agreed Permanent Injunction Order and Final
Judgment (the “Injunction Order”). The Court signed the Injunction Order and entered final
judgment in the Original Lawsuit on May 4, 2015. In the Injunction Order, the Court
permanently enjoined Defendants from:
a. Using or sharing any customer lists, customer information, pricing data,
contract forms, report forms, or other documents or data obtained from
ScrapSource;
b. Soliciting any employee of ScrapSource for a period of eighteen (18)
months through July 8, 2016;
c. Soliciting any client of ScrapSource listed on the ScrapSource list, Bates
labeled SS001 and attached hereto as part of Exhibit “A” (filed under
seal), for a period of eighteen (18) months through July 8, 2016;
d. Soliciting any customer of ScrapSource listed on the ScrapSource list,
Bates labeled SS002-003 and attached hereto as part of Exhibit A (filed
under seal), or whom [Jason] came in contact with while employed by
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 4
ScrapSource during the twelve (12) months prior to his resignation from
ScrapSource on January 9, 2015, for a period of twelve (12) months
through January 8, 2016; and
e. Competing with ScrapSource by soliciting scrap metal business in Dallas
County, Texas for a period of nine (9) months through November 5,
2015.
The Court further ordered that in the event Defendants violated the Injunction Order, in
addition to any other remedy found available by the Court, “the duration of the provision
violated will be extended for a period of time equal to the duration of the violation.” The Court
retained jurisdiction “for the purpose of enabling enforcement” of the Injunction Order.2 The
terms of the Injunction Order are expressly incorporated into the Settlement Agreement and,
among other relevant provisions, one of Defendants’ obligations under the Settlement
Agreement is to “abide by the obligations and regulations of the” Injunction Order.
16. In or about January 2017, ScrapSource became aware that Jason, and possibly
the remaining Defendants, had committed acts that ScrapSource believed constituted breaches
of both the Settlement Agreement and the Injunction Order. Pursuant to Rule 621 of the Texas
Rules of Civil Procedure, providing for discovery in aid of enforcement of a judgment,
ScrapSource deposed Jason on March 2, 2017. Jason admitted soliciting or doing business on
at least two occasions with one of the entities on the ScrapSource list attached to the Injunction
Order, in violation of both the Injunction Order and the Settlement Agreement.3
17. After Jason gave deposition testimony admitting Defendants’ violations of the
Injunction Order and Settlement Agreement, ScrapSource and Defendants, through their
respective counsel, engaged in extensive and protracted settlement negotiations. As set forth in
the email exchange attached hereto as Exhibit “A” (Page 013-016) on July 25, 2017, counsel
2
The attachment to the Injunction was filed under seal; the Injunction Order itself is a public record.
3
The identity of that entity is known to Defendants.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 5
for ScrapSource emailed counsel for Defendants what counsel for all Parties intended to be the
final form of a proposed settlement agreement (the “Second Settlement Agreement”). The
Second Settlement Agreement contains both monetary and nonmonetary terms, as well as
confidentiality provisions. Accordingly, out of an abundance of caution, ScrapSource has not
attached the Second Settlement Agreement to this Petition, but rather will seek leave of Court
to file it under seal after Defendants have appeared.4
18. Counsel for Defendants responded to the July 25, 2017, email referenced above
and requested a revision to a list of ScrapSource customers Defendants would be prohibited
from engaging with under the proposed Second Settlement Agreement. Counsel for
ScrapSource agreed and made the change, and asked counsel for Defendants if the remainder
of the form was agreeable. “I believe so,” counsel for Defendants responded. After an
exchange of emails on July 25 and 27, 2017, counsel for Defendants accepted the terms of the
Second Settlement Agreement and indicated that the only thing he needed was a “clean,
conformed copy” for signature, which counsel for ScrapSource provided on July 27, 2017. On
July 31, 2017, counsel for ScrapSource inquired “what’s the status on getting this signed?”
19. Counsel for Defendants responded by attempting to retract Defendants’ prior
acceptance of the terms of the Second Settlement Agreement, indicating “my clients have
decided to reject your last offer, and all previous offers. Negotiations have not produced an
acceptable agreement. We have no counter-offer at this time, in light of your responses to our
previous offers.” See Exhibit “B” (Page 017-021). As of the date of this Petition, Defendants
have not performed any of their obligations under the Second Settlement Agreement and/or the
contract between the Parties incorporating the terms of the Second Settlement Agreement.
4
The email exchange does not itself reveal any of the terms of the Second Settlement Agreement.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 6
FIRST CAUSE OF ACTION: BREACH OF CONTRACT
(SECOND SETTLEMENT AGREEMENT)
20. Paragraphs 1 through 19, above, are incorporated herein by reference.
21. In the exchange of correspondence referenced above, the Parties through their
respective counsel formed an enforceable contract. That is, whether (1) the instrument defined
herein as the Second Settlement Agreement is itself is an enforceable contract, and/or (2) the
email exchange attached hereto as Exhibit “A” represents and comprises a series of writings
establishing an offer, acceptance in strict compliance with the terms of the offer, and a meeting
of the minds with regard to all essential terms of the contract, the Parties agreed to settle and
compromise the disputes between them regarding Defendants’ conduct in breach or alleged to
be in breach of the (First) Settlement Agreement and the Injunction Order on the terms set
forth in the Second Settlement Agreement and/or the contract between them incorporating the
terms of the Second Settlement Agreement.
22. To the extent the Second Settlement Agreement, and/or the contract between the
Parties incorporating the terms of the Second Settlement Agreement, imposes a duty on
ScrapSource to perform any duty or duties, ScrapSource has performed or tendered
performance under the Second Settlement Agreement and/or the contract between the Parties
incorporating the terms of the Second Settlement Agreement. Defendants have failed to
perform any of their obligations, monetary and non-monetary, under the Second Settlement
Agreement, and/or the contract between the Parties incorporating the terms of the Second
Settlement Agreement.
23. Defendants’ breach of their obligations under the Second Settlement Agreement,
and/or the contract between the Parties incorporating the terms of the Second Settlement
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 7
Agreement, has proximately caused ScrapSource to suffer damages, which are ongoing and
continue to accrue, in excess of the minimum jurisdictional limits of this Court.
24. In addition, as a direct and proximate result of Defendants’ breach their
obligations under the Second Settlement Agreement, and/or the contract between the Parties
incorporating the terms of the Second Settlement Agreement, ScrapSource has suffered
irreparable injury and loss and will continue to sustain such harm unless and until the Second
Settlement Agreement, and/or the contract between the Parties incorporating the terms of the
Second Settlement Agreement, is enforced.
25. The harm to ScrapSource, if specific performance and injunctive relief does not
issue, is greater than the harm to Defendants if it does, and the public interest will not be
affected by the grant of specific performance and injunctive relief.
26. Accordingly, this Court should enter an order for specific performance and
injunctive relief, directing Defendants to comply with their obligations under Second
Settlement Agreement, and/or the contract between the Parties incorporating the terms of the
Second Settlement Agreement.
27. As a remedy for Defendants’ breach of the Second Settlement Agreement and/or
the contract between Parties incorporating the terms of the Second Settlement Agreement,
ScrapSource seeks and is entitled to an order compelling specific performance by Defendants
of their obligations, monetary and non-monetary, under the Second Settlement Agreement
and/or the contract between the Parties incorporating the terms of the Second Settlement
Agreement.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 8
SECOND CAUSE OF ACTION: IN THE ALTERNATIVE,
BREACH OF CONTRACT (ORIGINAL AGREEMENT)
28. Paragraphs 1 through 19, above, are incorporated herein by reference
29. Pleading in the alternative to Paragraphs 20 through 27, above, The Settlement
Agreement is an enforceable contract between the Parties.
30. ScrapSource has performed its obligations under the Settlement Agreement.
31. Defendants have breached their obligations under the Settlement Agreement,
including but not limited to by soliciting or doing business with one of the entities on the
ScrapSource list attached to the Injunction Order, during the period such acts were prohibited
under the Settlement Agreement and the Injunction Order, as admitted by Jason during his
deposition.
32. Defendants’ breach of their obligations under the Settlement Agreement has
proximately caused ScrapSource to suffer damages, which are ongoing and continue to accrue,
in excess of the minimum jurisdictional limits of this Court.
33. In addition, as a direct and proximate result of Defendants’ breach their
obligations under the Settlement Agreement, ScrapSource has suffered irreparable injury and
loss and will continue to sustain such harm unless and until the Settlement Agreement is
enforced.
34. The harm to ScrapSource, if specific performance and injunctive relief does not
issue, is greater than the harm to Defendants if it does, and the public interest will not be
affected by the grant of specific performance and injunctive relief.
35. Accordingly, this Court should enter an order for specific performance and
injunctive relief, directing Defendants to comply with their obligations under the Settlement
Agreement, including (as also provided in the Injunction Order) extensions of the duration of
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 9
the provisions violated by Defendants for a period of time equal to the duration of the
violations.
ATTORNEYS’ FEES
36. Paragraphs 1 through 19, above, are incorporated herein by reference.
37. Based upon Defendants’ respective breaches of (1) the Second Settlement
Agreement and/or the contract between Parties incorporating the terms of the Second
Settlement Agreement, or in the alternative (2) the Settlement Agreement, as described above,
ScrapSource has been required to engage the undersigned attorneys and agreed to pay their
attorneys’ fees. ScrapSource therefore is entitled to recover its reasonable attorneys’ fees
pursuant to Paragraph 16 of the Settlement Agreement and/or Chapter 38 of the Texas Civil
Practice and Remedies Code.
INJUNCTIVE RELIEF
38. Paragraphs 1 through 19, above, are incorporated herein by reference.
39. Pleading in the alternative to Paragraphs 20 through 37, above, including the
injunctive relief sought therein, ScrapSource requests a temporary injunction and a permanent
injunction enjoining Defendants from breaching the Settlement Agreement and any related
common-law and statutory duties owed to ScrapSource. The temporary and permanent
injunction should restrain each of Defendants, either directly or indirectly, or in concert with
each other or with others, from: (a) using or sharing any customer lists, customer information,
pricing data, contract forms, report forms, or other documents or data obtained from
ScrapSource; (b) soliciting any employee of ScrapSource for a period of time equal to the
period of time Defendants were in violation of the corresponding provisions of the Settlement
Agreement and the Injunction Order, after entry thereof; (c) soliciting any client of
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 10
ScrapSource listed on the ScrapSource list for a period of time equal to the period of time
Defendants were in violation of the corresponding provisions of the Settlement Agreement and
the Injunction Order, after entry thereof; (d) soliciting any customer of ScrapSource listed on
the ScrapSource list, or whom Jason came in contact with while employed by ScrapSource
during the twelve months prior to his resignation from ScrapSource, for a period of time equal
to the period of time Defendants were in violation of the corresponding provisions of the
Settlement Agreement and the Injunction Order, after entry thereof; and (e) competing with
ScrapSource by soliciting scrap metal business in Dallas County, Texas, for a period of time
equal to the period of time Defendants were in violation of the corresponding provisions of the
Settlement Agreement and the Injunction Order, after entry thereof.
RELIEF REQUESTED
For the foregoing reasons, ScrapSource respectfully requests that Defendants be cited
to appear; that the Court grant a preliminary and permanent injunction against Defendants as
requested above; that the Court enter judgment in favor of ScrapSource, and against
Defendants, on each of ScrapSource’s claims, causes of action, and requests for relief; that
ScrapSource recover its actual damages, pre- and post-judgment interest, reasonable and
necessary attorneys’ fees, and costs of court; that the Court order specific performance of (1)
the Second Settlement Agreement and/or the contract between Parties incorporating the terms
of the Second Settlement Agreement, or in the alternative (2) the Settlement Agreement, in the
manner set forth above; and that ScrapSource have such other and further relief, general or
special, at law or in equity, to which it may be justly entitled.
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 11
Respectfully submitted,
By:/s/ Gary D. Eisenstat
Gary D. Eisenstat
Texas State Bar No. 06503200
gary.eisenstat@ogletree.com
John M. Barcus
Texas State Bar No. 24036815
john.barcus@ogletree.com
OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C.
500 Preston Commons West
8117 Preston Road
Dallas, Texas 75225
(214) 987-3800
(214) 987-3927 (Facsimile)
ATTORNEYS FOR PLAINTIFF
30799700.1
PLAINTIFF’S ORIGINAL PETITION AND APPLICATION
FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 12
From: Bill Pedersen
Sent: Thursday, July 27, 2017 9:51 AM
To: Eisenstat, Gary D.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
sure
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:47 AM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Ok and the only thing you need is the clean Ex. 1, right?
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
gary.eisenstat©ogletree.corn I www.ogletree.com I Bio
From: Bill Pedersen [mailto:bill©bpedlaw.corn]
Sent: Thursday, July 27, 2017 9:46 AM
To: Eisenstat, Gary D.
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548,000001]
I need a clean, conformed copy first.
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:38 AM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Ok. We can change it. What's your ETA on signatures?
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 I Telephone: 214-624-11451 Fax: 214-987-3927
oary.eisenstatogletree.comIwww.ogletree.com 1 Bio
From: Bill Pedersen [mailto:bill©bpedlaw.com]
Sent: Thursday, July 27, 2017 9:38 AM
To: Eisenstat, Gary D.
1
13
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
I just want everything to match to avoid any confusion.
Thanks,
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:33 AM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
I can see if we have it in Word. Any reason why we can't use the pdf you sent me? Otherwise, I can have my
secretary find the original word document, modify it, and resend as a new Ex. 1 in PDF. Up to you.
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927
oary.eisenstatogletree.com 1 www.ogletree.com 1 Bio
From: Bill Pedersen [mailto:bill@bpedlaw.com]
Sent: Thursday, July 27, 2017 9:00 AM
To: Eisenstat, Gary D.
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Do you all have Exhibit 1 in Word? If so, please send it to me for correction, consistent with the agreed list
(attached and dated 5-18-17) execution. If it's easier, you could just send a corrected pdf for execution, too.
Thanks,
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Tuesday, July 25, 2017 3:07 PM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Great. Thx. You can swap out my Ex. 1 for yours or I can have Barb do it. Let me know when you have it signed.
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927
oary.eisenstatogletree.com 1 www.ogletree.com 1 Bio
2
14
From: Bill Pedersen [mailto:bill(abpedlaw.com]
Sent: Tuesday, July 25, 2017 3:06 PM
To: Eisenstat, Gary D.
Subject: Re: ScrapSource Final [ODNSS-OGL.047548.000001]
I believe so.
Bill
Get Outlook for iOS
From: Eisenstat, Gary D.
Sent: Tuesday, July 25, 2017 2:40:43 PM
To: Bill Pedersen
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Bill,
You are correct on the Ex. 1. We will replace. Are we good otherwise?
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
gary.eisenstatogletree.com I www.ogletree.com I Bio
From: Bill Pedersen [mailto:bill@bpedlaw.com]
Sent: Tuesday, July 25, 2017 11:13 AM
To: Eisenstat, Gary D.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Gary,
Just first off, the Customer list isn't revised, as was agreed last May. I have attached the list we agreed to at that
time. Otherwise, still reviewing...
Thanks,
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Tuesday, July 25, 2017 11:00 AM
To: Bill Pedersen
Subject: ScrapSource Final [ODNSS-OGL.047548.000001]
Attached is the redlined and a clean copy of the amended settlement agreement, including the renamed
Exhibit 1. Please have your clients sign the clean version and return to me so I can have my client sign as well.
Let me know if you have questions.
3
15
Thanks.
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927
gary.eisenstatogletree.com I www.ogletree.com 1 Bio
This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper
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This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper
recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited.
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4
16
From: Bill Pedersen
Sent: Monday, July 31, 2017 11:37 AM
To: Eisenstat, Gary D.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Gary,
My clients have decided to reject your last offer, and all previous offers. Negotiations have not produced an
acceptable agreement.
We have no counter-offer at this time, in light of your responses to our previous offers.
Thanks,
Bill
Bill Pedersen, III
Law Office of Bill Pedersen, III, PLLC
bill@bpedlaw.com
3800 Maple Avenue
Suite 380 — LB 50
Dallas, Texas 75219
Tel: (214) 630-4554
Fax: (214) 630-9264
www.bpedlaw.corn
This email contains legally privileged and confidential information. If you are not the intended recipient, or
an employee or agent responsible for delivering this message to the intended recipient, do not distribute or
copy this communication. If you have received this communication in error, please delete all copies and
notes us immediately by replying to the sender. Thank you for your cooperation.
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Monday, July 31, 2017 10:37 AM
To: Bill Pedersen
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Bill,
What's the status on getting this signed?
Thx.
Gary
1
17
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
ciary.eisenstatociletree.com I www.ogletree.com I Bio
From: Eisenstat, Gary D.
Sent: Thursday, July 27, 2017 1:27 PM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
See attached. Do you need an Exhibit 1 page? I assume not.
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
a
gary.eisenstatn I www.ogletree.com I Bio
From: Bill Pedersen [mailtotill©bpedlaw.com]
Sent: Thursday, July 27, 2017 9:51 AM
To: Eisenstat, Gary D.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
sure
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:47 AM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Ok and the only thing you need is the clean Ex. 1, right?
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
ciary.eisenstat(aociletree.corn I www.ogletree.com Bio
From: Bill Pedersen [mailto:bill@bpedlaw.corn]
Sent: Thursday, July 27, 2017 9:46 AM
To: Eisenstat, Gary D.
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
I need a clean, conformed copy first.
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:38 AM
To: Bill Pedersen
18
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Ok. We can change it. What's your ETA on signatures?
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
ciary.eisenstatogletree.com I www.ociletree.com I Bio
From: Bill Pedersen [nnailto:bill(abpedlaw.corn]
Sent: Thursday, July 27, 2017 9:38 AM
To: Eisenstat, Gary D.
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
I just want everything to match to avoid any confusion.
Thanks,
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Thursday, July 27, 2017 9:33 AM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
I can see if we have it in Word. Any reason why we can't use the pdf you sent me? Otherwise, I can have my
secretary find the original word document, modify it, and resend as a new Ex. 1 in PDF. Up to you.
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927
ciary.eisenstatodletree.corn I www.odletree.conn I Bio
From: Bill Pedersen [mailto:bill@bpedlaw.com]
Sent: Thursday, July 27, 2017 9:00 AM
To: Eisenstat, Gary D.
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Do you all have Exhibit 1 in Word? If so, please send it to me for correction, consistent with the agreed list
(attached and dated 5-18-17) execution. If it's easier, you could just send a corrected pdf for execution, too.
Thanks,
Bill
3
19
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Tuesday, July 25, 2017 3:07 PM
To: Bill Pedersen
Cc: Denny, Barbara J.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Great, Thx. You can swap out my Ex. 1 for yours or I can have Barb do it. Let me know when you have it signed.
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927
dary.eisenstatogletree.com I www.ogletree.com 1 Bio
From: Bill Pedersen [mailto:billbpedlaw.corn]
Sent: Tuesday, July 25, 2017 3:06 PM
To: Eisenstat, Gary D.
Subject: Re: ScrapSource Final [ODNSS-OGL.047548.000001]
I believe so.
Bill
Get Outlook for iOS
From: Eisenstat, Gary D.
Sent: Tuesday, July 25, 2017 2:40:43 PM
To: Bill Pedersen
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Bill,
You are correct on the Ex. 1. We will replace. Are we good otherwise?
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 I Telephone: 214-624-1145 1 Fax: 214-987-3927
gary.eisenstataogletree.com 1 www.ogletree.com I Bio
From: Bill Pedersen [mailto:bill(abpedlaw.com]
Sent: Tuesday, July 25, 2017 11:13 AM
To: Eisenstat, Gary D.
Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001]
Gary,
Just first off, the Customer list isn't revised, as was agreed last May. I have attached the list we agreed to at that
time. Otherwise, still reviewing...
4
20
Thanks,
Bill
From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com]
Sent: Tuesday, July 25, 2017 11:00 AM
To: Bill Pedersen
Subject: ScrapSource Final [ODNSS-OGL.047548.000001]
Attached is the redlined and a clean copy of the amended settlement agreement, including the renamed
Exhibit 1. Please have your clients sign the clean version and return to me so I can have my client sign as well.
Let me know if you have questions.
Thanks.
Gary
Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
8117 Preston Road, Suite 500 1 Dallas, TX 75225 'Telephone: 214-624-1145 1 Fax: 214-987-3927
dary.eisenstatogletree.com 1 www.ogletree.com 1 Bio
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FILED DALLAS COUNTY 8/31/2017 6:20 PM FELICIA PITRE DISTRICT CLERK DC-17-11360 Angie Avina CAUSE NO. _______________ SCRAPSOURCE, LLC, § IN THE DISTRICT COURT § Plaintiff, § § v. § DALLAS COUNTY, TEXAS § JASON WOLFF, MITCHELL WOLFF AND § FORTIS METAL MANAGEMENT, LLC, § § Defendants. § ___ JUDICIAL DISTRICT PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION Plaintiff ScrapSource, LLC (“ScrapSource”) files its Original Petition and Application for Temporary and Permanent Injunction (“Petition”) complaining of Defendants Jason Wolff, Mitchell Wolff, and Fortis Metal Management, LLC (collectively, “Defendants”) and states: DISCOVERY CONTROL PLAN 1. ScrapSource intends to conduct discovery under Level 2 pursuant to Texas Rule of Civil Procedure 190.3. DISCLOSURE OF RELATED CASE 2. Pursuant to Dallas County Local Rule 1.08, ScrapSource states that this case is so related to a previously filed case to be subject to transfer under Local Rule 1.06. The previously filed case was styled ScrapSource, LLC v. Jason Wolff, et al., Cause No. DC-15- 00717, in the 192nd Judicial District Court of Dallas County, Texas. RULE 47 STATEMENT 3. ScrapSource states that it seeks damages of $100,000 or less and non-monetary relief. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 1 PARTIES 4. ScrapSource is a Texas limited liability company with its principal place of business in Dallas, Texas. 5. Jason Wolff (“Jason”) is an individual citizen of Texas who may be served with process at his residence located at 3767 Jubilee Trail, Dallas, Texas 75229, or wherever he may from time to time be found. 6. Mitchell Wolff (“Mitchell”) is an individual citizen of Texas who may be served with process at 2515 McKinney Avenue, Suite 1300, Dallas, Texas 75201, or wherever he may from time to time be found. 7. Fortis Metal Management, LLC (“Fortis”) is a Texas limited liability company that may be served with process by service on its registered agent, Jason Wolff, at 3767 Jubilee Trail, Dallas, Texas 75229. JURISDICTION AND VENUE 8. Jurisdiction is proper over Defendants because they reside and/or have their principal place of business in the State of Texas and all or a substantial part of the events or omissions that give rise to ScrapSource’s claims occurred in Texas. 9. Venue is proper in Dallas County, Texas, pursuant to Sections 15.002(a)(1)-(3) Texas Civil Practice & Remedies Code because Jason and Mitchell reside in Dallas County, Fortis has its principal office in this state in Dallas County, and all or a substantial part of the events or omissions giving rise to ScrapSource’s claims occurred in Dallas County, Texas. FACTS 10. ScrapSource is a boutique scrap metal management and consulting firm that assists companies in managing, selling, and/or disposing of various types of scrap metal. ScrapSource has developed and implemented a variety of unique, proprietary, and cost-savings PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 2 structures to help its clients manage and sell their scrap metal that are more beneficial to its customers than the methods traditionally used by purchasers and sellers of scrap metal. 11. ScrapSource hired Jason in September 2011 to act as an account representative, pursuant to an Employment, Proprietary Information, Nondisclosure, and Non-Competition Agreement (the “Employment Agreement”). Pursuant to the Employment Agreement, ScrapSource gave Jason access to its trade secrets and confidential information during the course of his employment. Among other terms, in the Employment Agreement, Jason agreed not to solicit ScrapSource’s clients or employees, use its confidential, trade secret, or proprietary information, or compete with ScrapSource for eighteen months following his termination. 12. In December 2014, while still employed with ScrapSource, Jason and Mitchell formed Fortis to compete directly with ScrapSource. Jason had earlier created a “Dropbox” account into which he copied numerous ScrapSource proprietary files in violation of the Employment Agreement. In January 2015, Jason resigned from ScrapSource and announced his intent to compete directly with it. Both before and after Jason’s resignation, Defendants used ScrapSource’s customer contacts, contractual agreements, and confidential, trade secret, and proprietary information, and competed directly with ScrapSource. This conduct constituted a breach of the Employment Agreement by Jason, and misappropriation of trade secrets and tortious interference with ScrapSource’s contractual relations by all Defendants. 13. On or about January 22, 2015, ScrapSource filed suit against Defendants1 in a suit styled ScrapSource, LLC v. Jason Wolff, et al., Cause No. DC-15-00717, in the 192nd Judicial District Court of Dallas County, Texas (the “Original Lawsuit”). In the Original Lawsuit, ScrapSource alleged causes of action against Jason for breach of the Employment 1 Fortis Commercial Construction, Inc., was also a party to the Original Lawsuit. It has since declared bankruptcy. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 3 Agreement and for declaratory judgment regarding Jason’s obligations under the Employment Agreement, against Mitchell and Fortis for tortious interference with ScrapSource’s rights under the Employment Agreement, and against all Defendants for violation of the Texas Uniform Trade Secrets Act (“TUTSA”). ScrapSource sought a temporary restraining order and temporary and permanent injunctive relief as well as money damages. 14. The Court entered its Agreed Temporary Restraining Order on January 23, 2015, prohibiting Defendants from soliciting or contacting customers of ScrapSource and from disclosing ScrapSource’s “Confidential Information,” as defined in the TRO, and ordering Defendants to turn over certain documents and computer devices to counsel for ScrapSource. 15. The Parties thereafter agreed to resolve the disputes between them and entered into a Confidential Compromise Settlement Agreement and Mutual Release (the “Settlement Agreement”) effective on February 6, 2015. One of the terms of the Settlement Agreement called upon the Parties to request entry of an Agreed Permanent Injunction Order and Final Judgment (the “Injunction Order”). The Court signed the Injunction Order and entered final judgment in the Original Lawsuit on May 4, 2015. In the Injunction Order, the Court permanently enjoined Defendants from: a. Using or sharing any customer lists, customer information, pricing data, contract forms, report forms, or other documents or data obtained from ScrapSource; b. Soliciting any employee of ScrapSource for a period of eighteen (18) months through July 8, 2016; c. Soliciting any client of ScrapSource listed on the ScrapSource list, Bates labeled SS001 and attached hereto as part of Exhibit “A” (filed under seal), for a period of eighteen (18) months through July 8, 2016; d. Soliciting any customer of ScrapSource listed on the ScrapSource list, Bates labeled SS002-003 and attached hereto as part of Exhibit A (filed under seal), or whom [Jason] came in contact with while employed by PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 4 ScrapSource during the twelve (12) months prior to his resignation from ScrapSource on January 9, 2015, for a period of twelve (12) months through January 8, 2016; and e. Competing with ScrapSource by soliciting scrap metal business in Dallas County, Texas for a period of nine (9) months through November 5, 2015. The Court further ordered that in the event Defendants violated the Injunction Order, in addition to any other remedy found available by the Court, “the duration of the provision violated will be extended for a period of time equal to the duration of the violation.” The Court retained jurisdiction “for the purpose of enabling enforcement” of the Injunction Order.2 The terms of the Injunction Order are expressly incorporated into the Settlement Agreement and, among other relevant provisions, one of Defendants’ obligations under the Settlement Agreement is to “abide by the obligations and regulations of the” Injunction Order. 16. In or about January 2017, ScrapSource became aware that Jason, and possibly the remaining Defendants, had committed acts that ScrapSource believed constituted breaches of both the Settlement Agreement and the Injunction Order. Pursuant to Rule 621 of the Texas Rules of Civil Procedure, providing for discovery in aid of enforcement of a judgment, ScrapSource deposed Jason on March 2, 2017. Jason admitted soliciting or doing business on at least two occasions with one of the entities on the ScrapSource list attached to the Injunction Order, in violation of both the Injunction Order and the Settlement Agreement.3 17. After Jason gave deposition testimony admitting Defendants’ violations of the Injunction Order and Settlement Agreement, ScrapSource and Defendants, through their respective counsel, engaged in extensive and protracted settlement negotiations. As set forth in the email exchange attached hereto as Exhibit “A” (Page 013-016) on July 25, 2017, counsel 2 The attachment to the Injunction was filed under seal; the Injunction Order itself is a public record. 3 The identity of that entity is known to Defendants. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 5 for ScrapSource emailed counsel for Defendants what counsel for all Parties intended to be the final form of a proposed settlement agreement (the “Second Settlement Agreement”). The Second Settlement Agreement contains both monetary and nonmonetary terms, as well as confidentiality provisions. Accordingly, out of an abundance of caution, ScrapSource has not attached the Second Settlement Agreement to this Petition, but rather will seek leave of Court to file it under seal after Defendants have appeared.4 18. Counsel for Defendants responded to the July 25, 2017, email referenced above and requested a revision to a list of ScrapSource customers Defendants would be prohibited from engaging with under the proposed Second Settlement Agreement. Counsel for ScrapSource agreed and made the change, and asked counsel for Defendants if the remainder of the form was agreeable. “I believe so,” counsel for Defendants responded. After an exchange of emails on July 25 and 27, 2017, counsel for Defendants accepted the terms of the Second Settlement Agreement and indicated that the only thing he needed was a “clean, conformed copy” for signature, which counsel for ScrapSource provided on July 27, 2017. On July 31, 2017, counsel for ScrapSource inquired “what’s the status on getting this signed?” 19. Counsel for Defendants responded by attempting to retract Defendants’ prior acceptance of the terms of the Second Settlement Agreement, indicating “my clients have decided to reject your last offer, and all previous offers. Negotiations have not produced an acceptable agreement. We have no counter-offer at this time, in light of your responses to our previous offers.” See Exhibit “B” (Page 017-021). As of the date of this Petition, Defendants have not performed any of their obligations under the Second Settlement Agreement and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement. 4 The email exchange does not itself reveal any of the terms of the Second Settlement Agreement. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 6 FIRST CAUSE OF ACTION: BREACH OF CONTRACT (SECOND SETTLEMENT AGREEMENT) 20. Paragraphs 1 through 19, above, are incorporated herein by reference. 21. In the exchange of correspondence referenced above, the Parties through their respective counsel formed an enforceable contract. That is, whether (1) the instrument defined herein as the Second Settlement Agreement is itself is an enforceable contract, and/or (2) the email exchange attached hereto as Exhibit “A” represents and comprises a series of writings establishing an offer, acceptance in strict compliance with the terms of the offer, and a meeting of the minds with regard to all essential terms of the contract, the Parties agreed to settle and compromise the disputes between them regarding Defendants’ conduct in breach or alleged to be in breach of the (First) Settlement Agreement and the Injunction Order on the terms set forth in the Second Settlement Agreement and/or the contract between them incorporating the terms of the Second Settlement Agreement. 22. To the extent the Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement, imposes a duty on ScrapSource to perform any duty or duties, ScrapSource has performed or tendered performance under the Second Settlement Agreement and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement. Defendants have failed to perform any of their obligations, monetary and non-monetary, under the Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement. 23. Defendants’ breach of their obligations under the Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 7 Agreement, has proximately caused ScrapSource to suffer damages, which are ongoing and continue to accrue, in excess of the minimum jurisdictional limits of this Court. 24. In addition, as a direct and proximate result of Defendants’ breach their obligations under the Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement, ScrapSource has suffered irreparable injury and loss and will continue to sustain such harm unless and until the Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement, is enforced. 25. The harm to ScrapSource, if specific performance and injunctive relief does not issue, is greater than the harm to Defendants if it does, and the public interest will not be affected by the grant of specific performance and injunctive relief. 26. Accordingly, this Court should enter an order for specific performance and injunctive relief, directing Defendants to comply with their obligations under Second Settlement Agreement, and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement. 27. As a remedy for Defendants’ breach of the Second Settlement Agreement and/or the contract between Parties incorporating the terms of the Second Settlement Agreement, ScrapSource seeks and is entitled to an order compelling specific performance by Defendants of their obligations, monetary and non-monetary, under the Second Settlement Agreement and/or the contract between the Parties incorporating the terms of the Second Settlement Agreement. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 8 SECOND CAUSE OF ACTION: IN THE ALTERNATIVE, BREACH OF CONTRACT (ORIGINAL AGREEMENT) 28. Paragraphs 1 through 19, above, are incorporated herein by reference 29. Pleading in the alternative to Paragraphs 20 through 27, above, The Settlement Agreement is an enforceable contract between the Parties. 30. ScrapSource has performed its obligations under the Settlement Agreement. 31. Defendants have breached their obligations under the Settlement Agreement, including but not limited to by soliciting or doing business with one of the entities on the ScrapSource list attached to the Injunction Order, during the period such acts were prohibited under the Settlement Agreement and the Injunction Order, as admitted by Jason during his deposition. 32. Defendants’ breach of their obligations under the Settlement Agreement has proximately caused ScrapSource to suffer damages, which are ongoing and continue to accrue, in excess of the minimum jurisdictional limits of this Court. 33. In addition, as a direct and proximate result of Defendants’ breach their obligations under the Settlement Agreement, ScrapSource has suffered irreparable injury and loss and will continue to sustain such harm unless and until the Settlement Agreement is enforced. 34. The harm to ScrapSource, if specific performance and injunctive relief does not issue, is greater than the harm to Defendants if it does, and the public interest will not be affected by the grant of specific performance and injunctive relief. 35. Accordingly, this Court should enter an order for specific performance and injunctive relief, directing Defendants to comply with their obligations under the Settlement Agreement, including (as also provided in the Injunction Order) extensions of the duration of PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 9 the provisions violated by Defendants for a period of time equal to the duration of the violations. ATTORNEYS’ FEES 36. Paragraphs 1 through 19, above, are incorporated herein by reference. 37. Based upon Defendants’ respective breaches of (1) the Second Settlement Agreement and/or the contract between Parties incorporating the terms of the Second Settlement Agreement, or in the alternative (2) the Settlement Agreement, as described above, ScrapSource has been required to engage the undersigned attorneys and agreed to pay their attorneys’ fees. ScrapSource therefore is entitled to recover its reasonable attorneys’ fees pursuant to Paragraph 16 of the Settlement Agreement and/or Chapter 38 of the Texas Civil Practice and Remedies Code. INJUNCTIVE RELIEF 38. Paragraphs 1 through 19, above, are incorporated herein by reference. 39. Pleading in the alternative to Paragraphs 20 through 37, above, including the injunctive relief sought therein, ScrapSource requests a temporary injunction and a permanent injunction enjoining Defendants from breaching the Settlement Agreement and any related common-law and statutory duties owed to ScrapSource. The temporary and permanent injunction should restrain each of Defendants, either directly or indirectly, or in concert with each other or with others, from: (a) using or sharing any customer lists, customer information, pricing data, contract forms, report forms, or other documents or data obtained from ScrapSource; (b) soliciting any employee of ScrapSource for a period of time equal to the period of time Defendants were in violation of the corresponding provisions of the Settlement Agreement and the Injunction Order, after entry thereof; (c) soliciting any client of PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 10 ScrapSource listed on the ScrapSource list for a period of time equal to the period of time Defendants were in violation of the corresponding provisions of the Settlement Agreement and the Injunction Order, after entry thereof; (d) soliciting any customer of ScrapSource listed on the ScrapSource list, or whom Jason came in contact with while employed by ScrapSource during the twelve months prior to his resignation from ScrapSource, for a period of time equal to the period of time Defendants were in violation of the corresponding provisions of the Settlement Agreement and the Injunction Order, after entry thereof; and (e) competing with ScrapSource by soliciting scrap metal business in Dallas County, Texas, for a period of time equal to the period of time Defendants were in violation of the corresponding provisions of the Settlement Agreement and the Injunction Order, after entry thereof. RELIEF REQUESTED For the foregoing reasons, ScrapSource respectfully requests that Defendants be cited to appear; that the Court grant a preliminary and permanent injunction against Defendants as requested above; that the Court enter judgment in favor of ScrapSource, and against Defendants, on each of ScrapSource’s claims, causes of action, and requests for relief; that ScrapSource recover its actual damages, pre- and post-judgment interest, reasonable and necessary attorneys’ fees, and costs of court; that the Court order specific performance of (1) the Second Settlement Agreement and/or the contract between Parties incorporating the terms of the Second Settlement Agreement, or in the alternative (2) the Settlement Agreement, in the manner set forth above; and that ScrapSource have such other and further relief, general or special, at law or in equity, to which it may be justly entitled. PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 11 Respectfully submitted, By:/s/ Gary D. Eisenstat Gary D. Eisenstat Texas State Bar No. 06503200 gary.eisenstat@ogletree.com John M. Barcus Texas State Bar No. 24036815 john.barcus@ogletree.com OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. 500 Preston Commons West 8117 Preston Road Dallas, Texas 75225 (214) 987-3800 (214) 987-3927 (Facsimile) ATTORNEYS FOR PLAINTIFF 30799700.1 PLAINTIFF’S ORIGINAL PETITION AND APPLICATION FOR TEMPORARY AND PERMANENT INJUNCTION PAGE 12 From: Bill Pedersen Sent: Thursday, July 27, 2017 9:51 AM To: Eisenstat, Gary D. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] sure From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:47 AM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Ok and the only thing you need is the clean Ex. 1, right? Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 gary.eisenstat©ogletree.corn I www.ogletree.com I Bio From: Bill Pedersen [mailto:bill©bpedlaw.corn] Sent: Thursday, July 27, 2017 9:46 AM To: Eisenstat, Gary D. Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548,000001] I need a clean, conformed copy first. Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:38 AM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Ok. We can change it. What's your ETA on signatures? Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 I Telephone: 214-624-11451 Fax: 214-987-3927 oary.eisenstatogletree.comIwww.ogletree.com 1 Bio From: Bill Pedersen [mailto:bill©bpedlaw.com] Sent: Thursday, July 27, 2017 9:38 AM To: Eisenstat, Gary D. 1 13 Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] I just want everything to match to avoid any confusion. Thanks, Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:33 AM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] I can see if we have it in Word. Any reason why we can't use the pdf you sent me? Otherwise, I can have my secretary find the original word document, modify it, and resend as a new Ex. 1 in PDF. Up to you. Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927 oary.eisenstatogletree.com 1 www.ogletree.com 1 Bio From: Bill Pedersen [mailto:bill@bpedlaw.com] Sent: Thursday, July 27, 2017 9:00 AM To: Eisenstat, Gary D. Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Do you all have Exhibit 1 in Word? If so, please send it to me for correction, consistent with the agreed list (attached and dated 5-18-17) execution. If it's easier, you could just send a corrected pdf for execution, too. Thanks, Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Tuesday, July 25, 2017 3:07 PM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Great. Thx. You can swap out my Ex. 1 for yours or I can have Barb do it. Let me know when you have it signed. Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927 oary.eisenstatogletree.com 1 www.ogletree.com 1 Bio 2 14 From: Bill Pedersen [mailto:bill(abpedlaw.com] Sent: Tuesday, July 25, 2017 3:06 PM To: Eisenstat, Gary D. Subject: Re: ScrapSource Final [ODNSS-OGL.047548.000001] I believe so. Bill Get Outlook for iOS From: Eisenstat, Gary D. Sent: Tuesday, July 25, 2017 2:40:43 PM To: Bill Pedersen Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Bill, You are correct on the Ex. 1. We will replace. Are we good otherwise? Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 gary.eisenstatogletree.com I www.ogletree.com I Bio From: Bill Pedersen [mailto:bill@bpedlaw.com] Sent: Tuesday, July 25, 2017 11:13 AM To: Eisenstat, Gary D. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Gary, Just first off, the Customer list isn't revised, as was agreed last May. I have attached the list we agreed to at that time. Otherwise, still reviewing... Thanks, Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Tuesday, July 25, 2017 11:00 AM To: Bill Pedersen Subject: ScrapSource Final [ODNSS-OGL.047548.000001] Attached is the redlined and a clean copy of the amended settlement agreement, including the renamed Exhibit 1. Please have your clients sign the clean version and return to me so I can have my client sign as well. Let me know if you have questions. 3 15 Thanks. Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927 gary.eisenstatogletree.com I www.ogletree.com 1 Bio This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. 4 16 From: Bill Pedersen Sent: Monday, July 31, 2017 11:37 AM To: Eisenstat, Gary D. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Gary, My clients have decided to reject your last offer, and all previous offers. Negotiations have not produced an acceptable agreement. We have no counter-offer at this time, in light of your responses to our previous offers. Thanks, Bill Bill Pedersen, III Law Office of Bill Pedersen, III, PLLC bill@bpedlaw.com 3800 Maple Avenue Suite 380 — LB 50 Dallas, Texas 75219 Tel: (214) 630-4554 Fax: (214) 630-9264 www.bpedlaw.corn This email contains legally privileged and confidential information. If you are not the intended recipient, or an employee or agent responsible for delivering this message to the intended recipient, do not distribute or copy this communication. If you have received this communication in error, please delete all copies and notes us immediately by replying to the sender. Thank you for your cooperation. From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Monday, July 31, 2017 10:37 AM To: Bill Pedersen Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Bill, What's the status on getting this signed? Thx. Gary 1 17 Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 ciary.eisenstatociletree.com I www.ogletree.com I Bio From: Eisenstat, Gary D. Sent: Thursday, July 27, 2017 1:27 PM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] See attached. Do you need an Exhibit 1 page? I assume not. Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 a gary.eisenstatn I www.ogletree.com I Bio From: Bill Pedersen [mailtotill©bpedlaw.com] Sent: Thursday, July 27, 2017 9:51 AM To: Eisenstat, Gary D. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] sure From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:47 AM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Ok and the only thing you need is the clean Ex. 1, right? Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 ciary.eisenstat(aociletree.corn I www.ogletree.com Bio From: Bill Pedersen [mailto:bill@bpedlaw.corn] Sent: Thursday, July 27, 2017 9:46 AM To: Eisenstat, Gary D. Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] I need a clean, conformed copy first. Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:38 AM To: Bill Pedersen 18 Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Ok. We can change it. What's your ETA on signatures? Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 ciary.eisenstatogletree.com I www.ociletree.com I Bio From: Bill Pedersen [nnailto:bill(abpedlaw.corn] Sent: Thursday, July 27, 2017 9:38 AM To: Eisenstat, Gary D. Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] I just want everything to match to avoid any confusion. Thanks, Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Thursday, July 27, 2017 9:33 AM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] I can see if we have it in Word. Any reason why we can't use the pdf you sent me? Otherwise, I can have my secretary find the original word document, modify it, and resend as a new Ex. 1 in PDF. Up to you. Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 I Dallas, TX 75225 I Telephone: 214-624-1145 I Fax: 214-987-3927 ciary.eisenstatodletree.corn I www.odletree.conn I Bio From: Bill Pedersen [mailto:bill@bpedlaw.com] Sent: Thursday, July 27, 2017 9:00 AM To: Eisenstat, Gary D. Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Do you all have Exhibit 1 in Word? If so, please send it to me for correction, consistent with the agreed list (attached and dated 5-18-17) execution. If it's easier, you could just send a corrected pdf for execution, too. Thanks, Bill 3 19 From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Tuesday, July 25, 2017 3:07 PM To: Bill Pedersen Cc: Denny, Barbara J. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Great, Thx. You can swap out my Ex. 1 for yours or I can have Barb do it. Let me know when you have it signed. Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 1 Telephone: 214-624-1145 1 Fax: 214-987-3927 dary.eisenstatogletree.com I www.ogletree.com 1 Bio From: Bill Pedersen [mailto:billbpedlaw.corn] Sent: Tuesday, July 25, 2017 3:06 PM To: Eisenstat, Gary D. Subject: Re: ScrapSource Final [ODNSS-OGL.047548.000001] I believe so. Bill Get Outlook for iOS From: Eisenstat, Gary D. Sent: Tuesday, July 25, 2017 2:40:43 PM To: Bill Pedersen Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Bill, You are correct on the Ex. 1. We will replace. Are we good otherwise? Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 I Telephone: 214-624-1145 1 Fax: 214-987-3927 gary.eisenstataogletree.com 1 www.ogletree.com I Bio From: Bill Pedersen [mailto:bill(abpedlaw.com] Sent: Tuesday, July 25, 2017 11:13 AM To: Eisenstat, Gary D. Subject: RE: ScrapSource Final [ODNSS-OGL.047548.000001] Gary, Just first off, the Customer list isn't revised, as was agreed last May. I have attached the list we agreed to at that time. Otherwise, still reviewing... 4 20 Thanks, Bill From: Eisenstat, Gary D. [mailto:gary.eisenstat@ogletree.com] Sent: Tuesday, July 25, 2017 11:00 AM To: Bill Pedersen Subject: ScrapSource Final [ODNSS-OGL.047548.000001] Attached is the redlined and a clean copy of the amended settlement agreement, including the renamed Exhibit 1. Please have your clients sign the clean version and return to me so I can have my client sign as well. Let me know if you have questions. Thanks. Gary Gary D. Eisenstat I Ogletree, Deakins, Nash, Smoak & Stewart, P.C. 8117 Preston Road, Suite 500 1 Dallas, TX 75225 'Telephone: 214-624-1145 1 Fax: 214-987-3927 dary.eisenstatogletree.com 1 www.ogletree.com 1 Bio This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. This transmission is intended only for the proper recipient(s). It is confidential and may contain attorney-client privileged information. If you are not the proper recipient, please notify the sender immediately and delete this message. Any unauthorized review, copying, or use of this message is prohibited. 5 21