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Metito Ltd. v. General Electric Co.

February 18, 2009


The opinion of the court was delivered by: Gerard E. Lynch, District Judge


Plaintiff Metito (Overseas) Ltd. ("Metito") commenced this action alleging broad ranging acts of unfair competition by defendant General Electric Company ("GE")*fn1 stemming from the purported solicitation of Metito employees throughout the Middle East. Specifically, Metito claims that GE (1) tortiously interfered with Metito's contracts through the hiring of Metito employees; (2) tortiously interfered with Metito's prospective business relations; (3) misappropriated Metito trade secrets through former Metito employees; and (4) engaged in unfair competition through predatory recruiting of Metito employees. As a result, Metito seeks to permanently enjoin GE from contacting any "contractually-barred" Metito employees or attempting to acquire Metito's trade secrets. Metito additionally alleges that GE committed trade defamation and seeks $50 million in damages therein.

Metito moves for partial summary judgment on liability with respect to all claims except defamation. GE cross-moves for summary judgment on all counts. For the following reasons, Metito's motion is denied and summary judgment is granted to GE on all claims.


Upon completion of discovery, and in response to GE's motion for summary judgment, what began as a case involving allegations concerning a plethora of improper activity involving a score of improperly hired employees and the attendant misuse of their knowledge to unjustly gain a competitive advantage has, in almost every essential regard, been reduced to a case concerning the career of a single individual -- Preshant Sonmale.*fn2

Before describing Sonmale's career, however, it is necessary to briefly describe GE's corporate structure. Defendant General Electric Company is incorporated in New York and headquartered in Connecticut. (Hamid Decl. Ex. 4, Defendant's Response to Interrogatory No. 1a.) The General Electric Company conducts its water industry business through GE Infrastructure, an unincorporated subdivision of the General Electric Company, which in turn contains an unincorporated division called GE Infrastructure Water & Process Technologies ("GE Water"). (P 56.1 Stmt. ¶ 4; D 56.1 Stmt. ¶ 4.)

General Electric International, Inc. ("GEII") is a wholly-owned subsidiary of the General Electric Company. (D 56.1 Stmt. ¶ 151.) GEII is incorporated in Delaware and has its principal offices in Connecticut. (Id.) GEII provides various services, including employment services, to a number of subsidiaries of the General Electric Company, including GE Betz S.r.l ("GE Betz"). (Id.) GE Betz is a wholly-owned indirect subsidiary of the General Electric Company's GE Water division. (D 56.1 Stmt. ¶ 152.) GE Betz is an Italian corporation with its principal offices in Milan. (Id.)GE Europe is a subsidiary of the General Electric Company based in Brussels. (D 56.1 Stmt. ¶ 153.)

I. Preshant Sonmale

Sonmale began working for Metito in July 2001, pursuant to an employment contract dated April 23, 2001. (Pl. 56.1 Stmt. ¶ 8; D 56.1 Stmt. ¶¶ 1, 3.) Sonmale's contract with Metito contains both a confidentiality agreement and a non-compete provision:

In the course of your employment with the company, you will have access to various information that is regarded by the company as highly confidential. In this regard you are expected not to divulge such information to any third party outside the company, or to other company employees, during or after your employment in any form or manner.

Such information shall remain the sole property of the company and shall not be used except to the extent necessary to promote the company business[.]

You shall also abide by the non-competition clauses and in particular, you shall strictly abide by article 127 of the United Arab Emirates Labor Law[.] You shall not engage in any competing business to that of the company and you shall not join a competitor for a period of at least two years from the date you leave the company for whatever reason. (Hamid Decl. Ex. 33, ¶ 8(a).)

Throughout his employment with Metito, Sonmale worked as a Senior Proposals Engineer in the United Arab Emirates ("UAE"). (P 56.1 Stmt. ¶ 7; D 56.1 Stmt. ¶ 3.) In that capacity, Sonmale prepared proposals and bids for prospective projects concerning the construction of water desalination and waste water treatment plants, machinery and equipment (D 56.1 Stmt. ¶ 3), and in aid of those duties Sonmale interacted with Metito's customers and had access to, among other things, a list of Metito's vendors and information on costs and prices (Sonmale Tr. 20:5-15; 25:23-26:5; 28:4-10).

By 2003, Sonmale had become unhappy working at Metito and began searching for a new job in engineering and environmental fields. (Sonmale Decl. ¶ 8.) Throughout 2003 and 2004, Sonmale submitted at least six applications for jobs in engineering and environmental to firms and employment search agencies. (Id.; Hamid Decl. Ex. 34.)

In January 2005, Sonmale learned of a position at GE and submitted an application through GE's online Career Opportunity System. (Sonmale Decl. ¶ 9; Verdonck Decl. ¶ 6.) Sonmale testified that he applied to GE unsolicited and that at the time he applied he did not know anyone at GE and had not spoken to anyone at GE. (Sonmale Decl. ¶ 9; Sonmale Tr. 33:19-34:2; 97:9-11.) Thereafter, Sonmale had an initial telephonic interview with Katya Verdonck, who at the time was employed as the Executive Recruiter for GE subsidiary GE Europe, with responsibility for job applicants throughout Europe, the Middle East and Africa. (D 56.1 Stmt. ¶¶ 10, 154, 155.) Sonmale had a second-round, in-person interview with Jean-Michel Freal-Saison, who appears to be the Hiring Manager for either GE Infrastructure or GE Water. (See D 56.1 Stmt. ¶ 10; P 56.1 Stmt. ¶ 37; D Resp. Stmt. ¶ 37; Verdonck Tr. 43:11-17.)

On March 31, 2005, Sonmale was preliminarily offered a position with GE subsidiary GEII, as a "Regional Waster Water Technical Support Leader, based in Dubai, UAE," contingent upon a successful background check and, since Sonmale is not a UAE citizen, procurement of a visa to work in the UAE. (D 56.1 Stmt. ¶¶ 10, 13; Hamid Decl. Ex. 36.) On May 5, Sonmale provided Metito with thirty-days' notice of his resignation due to "personal reasons." (D 56.1 Stmt. ¶ 14.) Metito asked Sonmale to stay on an additional twenty days to continue working on Metito's bid for the Dubai Festival City Project -- of which Sonmale was the lead proposal engineer -- and as a result, Sonmale continued to work for Metito until June 30, 2005. (D 56.1 Stmt. ¶ 15; P Resp. Stmt. ¶¶ 5, 15; Sonmale Decl. ¶ 13.)

The parties dispute when Sonmale informed Metito that he intended to work at GE, but it is clear that Metito was aware of this fact prior to Sonmale's resignation. On June 26, 2005, Metito's in-house counsel, Mohammed Abusinn, presented Sonmale with a letter entitled "Legal Notification." The letter stated, in part: "I understand that you were approached directly by General Electric Company ("GE" or "Potential Competitor") to join their operations in the UAE. I also understand that you have accepted GE's offer of employment and consequently, decided to resign your current job with the Company." (Hamid Decl. Ex. 38.) The letter also reiterated Sonmale's obligation to refrain from disclosing confidential information in his new job at GE:

[Y]ou will appreciate that upon you resigning your position with the Company to pursue other related career, it is likely that you would be confronted with situations or entrusted with new role and responsibilities where your knowledge of such Confidential Information may be tempting or attractive to introduce, use, implement or share with third parties and/or the Potential Competitor.

Whilst considering the above, I would like to remind you that despite your resignation, your contractual obligation not to divulge, use or share the Confidential Information with any third party including the Potential Competitor shall survive the termination of your contract of employment with the Company.


Sonmale signed the document, acknowledging that he "read, understood and agree[d]" to its contents. (Id.; D 56.1 Stmt. ¶ 17.) Sonmale has testified that he signed the document even though he disagreed with the statement that GE approached him because it was what Metito -- which was holding his passport and nearly 30,000 dirhams of his money (approximately $8000) -- wanted to hear. (Sonmale Tr. 112:6-113:10.)

When Sonmale resigned from Metito on June 30, 2005, his position was one level above entry-level and no employees reported to him. (D 56.1 Stmt. ¶¶ 5, 20.) Sonmale's annual salary of approximately $33,350 -- slightly above the average annual income in the UAE of $29,000 -- made him the fourth highest paid senior proposal engineer of the fourteen within his department. (D 56.1 Stmt. ¶ 4; P Resp. Stmt. ¶ 4; Halabi Decl. ¶ 13.) Metito asserts that Sonmale had worked on numerous "high-level" projects during his tenure at Metito, though neither explains what made the projects "high-level" nor what role Sonmale played. (Halabi Decl. ¶ 14.)

Upon his resignation, Sonmale -- a citizen of India who had been in the UAE on a Metito-sponsored work visa -- returned to India where he stayed until September, when he commenced employment with GE. (P Resp. Stmt. ¶ 20; D 56.1 Stmt. ¶ 21.) Because Metito did not consent to transfer Sonmale's employment to GE, UAE law rendered Sonmale ineligible to obtain a new work visa or residency permit in that country for a period of six months. (P Resp. Stmt. ¶ 22.) Sonmale sought and suggested to GE ways to circumvent this six-month ban; however, GE insisted that it would "strictly follow the local regulation." (Hamdi Decl. Ex. 39.) In an email dated July 3, 2005, Sonmale expressed a desire to "join any offices of GE at the earliest." (Hamdi Decl. Ex. 39 at GE0000352.)

Through email correspondence in early August 2005, in response to an inquiry by GE, Sonmale informed GE that his contract with Metito contained a two-year non-compete provision separate and apart from the six-month ban on working in the UAE. (Hamid Decl. Ex. 40.) Metito and GE agree that this is the first time anyone at GE learned of this contractual restriction. (Hr'g Tr. 5:11-15; D 56.1 Stmt. ¶ 18.)

On September 14, 2005, Sonmale began working for GE subsidiary GE Betz, in Bahrain. (D 56.1 Stmt. ¶¶ 24-25; P 56.1 Stmt. ¶ 11.) In March 2006, at the end of the six-month ban, Sonmale obtained a visa and began working in Dubai for GEII, another GE subsidiary, as a "Technical Manager," but continues to provide services to GE Betz. (D 56.1 Stmt. ¶¶ 27, 153; P 56.1 Stmt. ¶ 13.) The parties agree that Sonmale's duties and responsibilities at GEII are identical to those he had at ...

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