Joe Gibbs Racing, Spire Motorsports clash over alleged theft of racing secrets
Sydney Haulenbeek
CHARLOTTE, N.C. (CN) — Joe Gibbs Racing, Spire Motorsports and Christopher Gabehart walked out of federal court Friday with a possible agreement in the works.
Gibbs Racing sued Christopher Gabehart, its former competition director, last Thursday, claiming that he planned to take photos of confidential racing data to its competitor Spire after accepting a new position.
It later amended its complaint, adding Spire Motorsports as a defendant and claiming it misappropriated trade secrets, used unfair trade practices and tortiously interfered with Gabehart’s employment contract by hiring him and “inducing” him to produce Gibbs Racing’s confidential competition secrets.
The parties were in federal court in Charlotte Friday over Gibbs Racing’s request for a temporary restraining order. It wants Gabehart prevented from working for Spire in a similar capacity to what he did for Gibbs Racing, and for him to agree to another review of his accounts and devices to ensure he doesn’t still have any of Gibbs Racing’s confidential data.
Counsel for the parties opened the hearing Friday afternoon by informing the judge that they had reached an agreement on part of the emergency request; that Gabehart, his wife and Gibbs Racing would consent to a forensic review of accounts. The parties hadn’t come to an agreement over Gibbs Racing’s push to keep Gabehart from working at Spire.
Counsel conferred with U.S. District Judge Susan Rodriguez for an hour in chambers, who returned to tell the court that the parties were going to try to reach an agreement and an additional hearing would be scheduled Monday if one could not be reached. Neither the judge nor the attorneys confirmed if the agreement was over a possible settlement or emergency relief in the case.
“There’s a lot of emotions on every side, there’s a lot that goes into this,” Rodriguez, a Donald Trump appointee, said.
The parties all argued over Gibbs Racing’s request to enforce a non-compete agreement signed by Gabehart and have him stop working for Spire, where he’s been confirmed as chief motorsports officer. There was also confusion over when he began working for Spire; none of the attorneys were able to confirm when his start date was, which baffled the judge.
Gabehart took photos of information to use in his role as chief motorsports officer for Spire, Sarah Hutchins, counsel for Gibbs Racing, told the court.
He could also work in a different capacity until the 18 month non-compete expired, she said, for NASCAR, in another racing series, or elsewhere in automotive engineering. She emphasized that Gibbs Racing would be harmed if there wasn’t a cooling period where the information Gabehart copied could become stale and less of a competitive threat.
Gabehart previously agreed that a non-compete agreement was necessary, and so the court should temporarily bind him from working for Spire, she said.
“Enjoining someone from working, that’s a big thing,” Rodriguez said, saying that she was conscious that it was someone’s livelihood at hand.
“Competition is at risk, people’s jobs are at risk and JGR [Joe Gibbs Racing] is at risk,” Hutchins said.
Cary Davis, counsel for Gabehart, assured the court that his client regrets his decision and has tried to make it right by paying for a previous examination of his cell phone and accounts.
“Mr. Gabehart does not run away from the pictures he took or the Spire folder,” Davis said. The photos were, he said, an example of years of work he put in at Gibbs Racing.
Gibbs Racing is speculating emergency relief based on the possibility of information being shared, which Gabehart has declared he has no plans to do, he added.
“Everybody’s on board here. We are not going to be using, storing JGR’s information,” Davis said.
Joshua Davey, counsel for Spire, said that the work Gabehart is doing for Spire is more development-involved and is more of an executive position than what he was doing for Gibbs Racing.
“Spire doesn’t need JGR competitive info, doesn’t want it… That’s not a motive in this at all,” he said.
“Mr. Gabehart is going to be supervising drivers that are going to compete against JGR this weekend,” Hutchins stressed. Rodriguez didn’t issue an order over the request, so Gabehart will be able to work the Cup Series race this Sunday.
Gabehart, who was present at the hearing, filed a declaration opposing the emergency request.
“This lawsuit is not about protecting trade secrets — it is about punishing a former employee for daring to leave,” Gabehart said, adding that the field is so specialized that if Gibbs Racing secures an injunction preventing him from working, that will “effectively exile” him from the profession.
Gibbs Racing breached his employment agreement before he did by withholding his wages, he said. Gabehart also said that he does not believe the non-compete agreement he had with Gibbs Racing is enforceable, and that his role at Spire is different to what he did for Gibbs Racing.
He made clear to the company that the promotion wasn’t as advertised and that things needed to change or he’d depart, Gabehart said, and instead of being tasked with overseeing all competitive operations, he was expected to coordinate with senior executives and family members to make decisions in a “dysfunctional organizational structure.”
Gabehart admits to taking photos of business data, but said he was aware of his confidentiality obligations and had no plan to use the information at Spire. There was also confusion over his final day at Gibbs Racing, he said, and he was sent a letter saying he was fired for cause two months after his wages were withheld.
Hutchins argued in court that Gabehart stopped working on Nov. 10, and therefore shouldn’t be paid for time he wasn’t working.
“It’s ridiculous that JGR should pay for the pleasure at the time in which he was attempting to steal from them,” she said.
Counsel for Gabehart and Spire declined to comment after the hearing.
“I’m just going to continue to fight for what’s right,” Joe Gibbs told Courthouse News.