WAUKESHA ó Waukesha
County Circuit Court Judge Robert Mawdsley ruled Monday
afternoon that a former Kohlís chief information officer
would be allowed to take the same position with an
international luxury retailer after the Menomonee Falls
companyís attorneys failed to prove that a temporary
injunction was necessary to protect the company and its
Kohlís sought to
stop Janet Schalk from taking the chief information
officer position with Hudson Bay Company, the parent
company of Sakís Fifth Avenue, Lord and Taylor and Saks
Off Fifth, arguing that HBC is a direct competitor and
that Schalkís knowledge of Kohlís confidential plans
could hurt the company.
argued that HBC was not a direct competitor of the
department store known for its discounts and that other
higher level executives had broader non-compete
agreements than Schalk.
Even though Mawdsley
ruled in favor of Schalk on Monday, it will be a few
days until she can start her new role. John Kirtley,
attorney for Kohlís, asked that the allowance of the
status quo would be granted until the end of the week to
allow him to speak with Kohlís about possibly filing an
appeal of the decision; Mawdsley allowed it.
Schalk took the stand in her defense and was asked
questions by her attorney, Saul Glazer. She said that
some of the information provided by Ryan Festerling,
senior vice president of human resources for Kohlís,
during testimony last week wasnít accurate. She said
that she did not help design Kohlís Innovation Center
and that she did not have as much of a strategic
planning role at Kohlís as Festerling had said she had.
During her testimony
Monday, Schalk said she was surprised that executives
higher in rank than she had more liberal non-compete
agreements. She provided examples of some key executives
who took positions at other retailers, such as
Abercrombie and Fitch, Talbots and Burlington Coat
Schalk also said
that no document she ever saw at Kohlís listed HBC as a
Kirtley pointed out
how an earlier draft of Schalkís contract for HBC listed
Kohlís as a competitor before it was revised. He also
argued that HBCís desire to get Schalk on board fast
indicated that she had knowledge they wished to use and
that knowledge and experience would have been affected
by Schalkís time at Kohlís.
He also said that
under the terms of the non-compete agreement, HBC could
be considered a direct competitor of Kohlís because it
has more than $1 billion in annual revenue, it is a
retail business and it has stores within 25 miles of a
Kohlís location, which is the criteria for a direct
competitor, according to Kohlís.
Under questioning by
Kirtley, Schalk agreed that HBC could be considered a
competitor under those terms.
While delivering his
verdict, Mawdsley said that whether HBC and Kohlís are
competitors depends on how you analyze the situation.
ďKohlís success is
not driven by her and the IT department,Ē Mawdsley.
Ultimately he said
he felt that Schalk should be able to take the position
at HBC because other executives who ranked higher than
she did did not have as narrow and restrictive of a
non-compete agreement as she and they were also privy to
the same confidential information, if not more of it.
<<EARLIER: Kohlís argues former executive violated