Cos Bar dispute goes to judge
A judge has extended a temporary restraining order Cos Bar has filed against one of its former employees until April 30, following a six-plus-hour hearing held Thursday in Pitkin County District Court.
Next for Judge Gail Nichols will be to decide whether to make the order permanent in the form of an injunction.
Last week’s hearing included testimony from Elizabeth McGuire and Cos Bar executive Oliver Garfield. His mother, Lily Garfield, who started Cos Bar in 1976 and expanded it to a 14-store chain, was sequestered because she is a possible witness in the case.
Cos Bar sued McGuire on April 2, claiming she used the client database of the luxury cosmetics boutique, which also offers spa-type services, to bolster her business at her new job at the Ultimate Salon. McGuire in March blast texts and emails to her former Cos Bar customers, which constituted stealing the boutique’s trade secrets, alleged the lawsuit and attorney Chris Bryan at last week’s hearing.
“The evidence will further show that we are not trying to deprive Ms. McGuire from working in Aspen as an aesthetician,” Bryan said. “This is not a non-compete case.”
Bryan argued that McGuire, who signed the employee handbook, breached the terms by using the names of Cos Bar clients to drum up business. He likened McGuire’s tactics to “identity theft,” because Cos Bar “customers would no longer trust the company” after seeing their personal information used by a competitor.
James Fosnaught, one of McGuire’s two attorneys, however, maintained that McGuire simply collected the names over her time as a Cos Bar employee. She would store their information in her cellphone and did not steal a database or list of Cos Bar clients, he said.
“These are people she provided personal services to,” he said, also arguing that Cos Bar’s claim that it has suffered “irreparable harm” hasn’t been demonstrated.
“She did her own marketing on her own time to gain clients for herself,” he said.
McGuire, who began working at Cos Bar in November 2001 before taking a hiatus in the mid-2000s, said she has built her stable of Aspen clients over the years through networking and hard work.
She said that during her years at Cos Bar, she gathered clients “sometimes in the grocery store — City Market is a very social area — restaurants, literally on the streets, everywhere. Just about in any social activity, I’m very personable. I always talk about what I do with people.”
She admitted that she signed the employee handbook that addressed using Cos Bar contacts, but she never actually read it.
“I don’t believe I’ve ever read it,” she testified.
She also said she considered her Cos Bar customers to be her clients. Bryan disagreed, and said they are Cos Bar’s clients, which is the center of the dispute.
“There is no doubt in my mind that Ms. McGuire considered this information hers and they were her clients,” he said. Bryan also said McGuire using Cos Bar’s client information is no different than a Target employee taking a customer database to Wal-Mart.
Likewise, Oliver Garfield said Cos Bar’s client list is vital for its business.
“If we didn’t collect contact information — we’re a very event-driven business — we could not have customers come in for our promotions that are very important to our business,” he said.
Cos Bar’s contention that its client information is a trade secret is off-base, Fosnaught said.
“In this case, in order for there to be a trade secret, there has to be something that is a secret,” he said. “Anyone can walk into Cos Bar to get services. … It’s not a secret that people in Aspen get facials. It’s not a secret that people in Aspen are in bars talking about who does their facials. Looks are important in this town, so this is not the type of information that is confidential or a trade secret.”
Whatever the case, Judge Nichols said that temporarily, at least, McGuire can’t reach out to her former clients of Cos Bar. Cos Bar clients, however, can reach out to McGuire, the judge’s order said.
“This order prevents (McGuire) from using the customer contract information of any customer she serviced or learned about from a Cos Bar representative while employed at Cos Bar. This order does not prevent (McGuire) from receiving phone calls or other communications initiated by any customer (McGuire) serviced while employed at Cos Bar or from any customer about whom she learned from a Cos Bar representative while employed at Cos Bar.”
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