Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Transportation company’s non-solicitation employment contract alleged to be unreasonable restraint of trade, (Nov 5, 2014)

By Linda O’Brien, J.D., LL.M.

A heavy equipment transportation company’s employment practice of forcing employees to enter into a non-disclosure/non-solicitation employment contract which restricts a former employee’s ability to seek employment with another cargo transportation company was an unlawful restraint of trade and attempt to monopolize the cargo transportation market, according to a complaint filed in the federal district court in Miami (Varona v. LTA Logistics, Inc., November 3, 2014).

LTA Logistics is a heavy equipment transportation company which, operating under a license from the U.S. Department of Transportation, sells and arranges cargo transportation services throughout the United States. Enrique Varona is a cargo transportation industry professional with 30 years’ experience.

The complaint states that, in June 2009, Varona was hired by LTA as a sales agent because he had a number of working accounts he had developed over the course of many years. In November 2009, Varona was informed by Lester Trimino, LTA’s President and owner, that he was required to execute a “non-disclosure/non-solicitation” or face termination for his refusal. Varona objected to the contract as an unreasonable restraint of trade and was terminated from his employment with LTA on March 12, 2010.

On March 16, 2010, Varona entered into a representation agreement with Landstar Logistics, the largest trucking company in the U.S., to operate a Landstar franchise as an exclusive agent in Dade County, Florida. In June 2010, LTA became aware that Varona was a Landstar agent through an advertisement on an industry website. From June through August 2010, LTA’s owner, Trimino, engaged in an unsolicited intimidation and harassment campaign directed at Varona and Landstar for failing to “honor” his contract. The intimidation and harassment campaign consisted of unsolicited email and telephone calls to Landstar and unsolicited letters threatening legal action against Landstar for not honoring their unlawful contract, the complaint alleged.

According to the complaint, at least 25 employees have been forced to enter into the unlawful contract in order to continue their employment with LTA. LTA’s employment practice of forcing employees to enter into an unlawful employment contract represents an unreasonable restraint of trade because: (1) the contract denies Varona the ability to pursue lawful business opportunities to his detriment; (2) the contract is vague and does not provide Varona with adequate notice as to what behavior is to be restrained; (3) the contract unreasonably precludes Varona from performing tasks directly associated with his occupation; and (4) the enforcement of the contract imposes a two year uncompensated employment ban and results in compulsory involuntary servitude.

LTA’s exclusionary practice has had the effect of excluding competitors and allowed LTA to illegally attempt to monopolize the truck brokering market. Additionally, LTA has raised hurdles to fair competition through unreasonably restrictive non-disclosure agreements, deprives rival brokers of a significant number of sales they might have otherwise secure, and deprives consumers of a choice of carriers with possibly superior features, the complaint stated.

The plaintiff asserts claims for negligence, and violations of Sections 1 and 2 of the Sherman Act. The action seeks declaratory and injunctive relief, compensatory and treble damages, pre-judgment interest, costs of suit, attorney fees, and any other just and proper relief.

The case is No. 1:14-cv-24094-MGC.

Attorneys: Enrique J. Varona, pro se.

Companies: LTA Logistics, Inc.

News: Antitrust FloridaNews