Full opinion text
OPINION BASSLER, District Judge. Plaintiffs Laidlaw Transit, Inc. (“Laidlaw”) and Laidlaw, Inc. have moved for a preliminary injunction against Defendant Student Transportation of America, Inc. (“STA”), a company that competes directly against Laidlaw, and former Laidlaw executives, Defendants Denis Gallagher (“Gallagher”) and Thomas Gallagher, who have left Laidlaw to form STA. Plaintiffs also move for supplemental preliminary injunctive relief against Defendants Robert H. Byrne, former Laid-law legal counsel, and Defendants John Red-dan and Peter Pearson, former Laidlaw executives. The Court has jurisdiction pursuant to 28 U.S.C. § 1332 (diversity). For the reasons set forth below, the Court denies Plaintiffs’ request for a preliminary injunction and for supplemental preliminary injunc-tive relief. I.FINDINGS OF FACT Pursuant to Fed.R.Civ.P. 52(a), the Court makes the following findings of fact: 1. The Parties a. Laidlaw and Laidlaw, Inc. 1. Laidlaw, Inc. is a corporation organized and existing under the laws of the Nation of Canada- with its principal place of business in the Province of Ontario. (Ex. D-9, at 1). 2. Laidlaw, Inc.’s 1997 assets were over $6 billion, which was a 24% increase over its fiscal-year 1996 assets. (Tr. at 4:141.) 3. Laidlaw, Inc. had a 1997 revenue of over $3 billion, which was a 32% increase over fiscal-year 1996 revenue. (Tr. at 4:140-41.) 4. Laidlaw is a corporation organized and existing under the laws of the State of Delaware. (Tr. at 1:50.) 5. Laidlaw is a wholly owned subsidiary of Laidlaw, Inc. Laidlaw is in the transit business, specifically including school bus transportation. (Tr. at 1:49.) 6. Laidlaw is the principal consolidator in the school bus industry in North America. (Tr. at 4:141.) 7. Laidlaw’s 1997 revenues were $1.36 billion. (Tr. at 4:142.) 8. Laidlaw’s market share of school buses operated by the private sector in North America is 25%. (Tr. at 4:142.) 9. In terms of revenues, Laidlaw is three times larger than Ryder — its next largest competitor in the school bus transportation industry. (Tr. at 2:22.) b. STA 10. STA currently operates in three states: California, Oregon and Pennsylvania. In September 1998, STA will begin formal operations in New Jersey. (Tr. at 6:41.) 11. STA’s total assets are approximately $10 million. (Tr. at 6:41.) 12. STA’s current revenues are approximately $13 million. (Tr. at 6:41.) 13. STA currently owns approximately 450 school buses. (Tr. at 6:41.) 14. STA has approximately 400 employees in the school bus business. (Tr. at 6:41.) 15. Since its formation, STA has purchased four companies: (1) Santa Barbara Transportation in Santa Barbara, California; (2) North Bend Transportation in Oregon; (3) Bortner Bus (“Bortner”) in western Pennsylvania; and (4) George Ku & Sons (“Ku”) in western Pennsylvania. (Tr. at 6:16-17.) c.The Individual Defendants i. Gallagher 16. Gallagher is a 1976 graduate of Monmouth College with a B.S. in Business Administration. He has over 20 years of experience in the school bus transportation industry. (Tr. at 5:168-72.) 17. Gallagher is currently the Chairman and CEO of Global Passenger Services (“Global”). (Tr. at 5:166.) 18. Global has two subsidiaries — Travel-ways, Inc., an entertainment transportation company, which is involved with airlines, cruise lines, tour operators, and theme parks, and STA, which provides student transportation services. (Tr. at 6:12-13.) ii. Robert Byrne 19. Byrne attended the University of Windsor, Canada, where he received a degree in economics in 1980. Byrne attended Windsor Law School, where he earned an LLB in 1983. He is licensed to practice law in Ontario, Canada. (Tr. at 6:190-92.) 20. In 1985, Byrne joined a law firm specializing in taxation, where he stayed for approximately one year. In 1986, he joined the Toronto law firm Morris Rose, where he made partner in late 1989. At Morris Rose, he became involved with transportation clients, advising trucking, courier, and bus companies. (Tr. at 6:192-93.) 21. Byrne’s current position is Senior Vice President of Global Passenger Services and Senior Vice President, Legal Affairs for both Travelways and STA. (Tr. at 6:190.) iii. Peter Pearson 22. Pearson received a B.S. in Marketing from Gannon University in Pennsylvania in 1984. His first job after leaving Gannon was with Federal Express in 1985, where he worked until September of 1991. At the time of his departure from Federal Express, Pearson was a Premium Location Manager. (Tr. at 6:147-49.) 23. Pearson is now employed by STA and Travelways as Vice President of Operations for both companies. (Tr. at 6:147,156.) iv. John Reddan 24. Reddan graduated from St. Joseph’s College, New Jersey, in 1972. From 1967-1991, Reddan held various jobs in the human resources and labor relations fields. (Tr. at 7:48-50.) 25. Reddan’s current position is Vice President of Human Resources for Global Passenger Services. More than 90% of his time is spent on the Travelways business. (Tr. at 7:47.) v. Thomas Gallagher 26. Thomas Gallagher — Denis’s father— is 72 years old and is recovering from quadruple bypass surgery. (Tr. at 6:69.) 27. Thomas Gallagher does no substantive work for STA. Before his surgery, Thomas Gallagher came into the office twice a week for a couple of hours and works on tasks such as bus numbering and license and registrations. (Tr. at 6:70-71.) 2. The 1987 Sale of the Gallaghers’ Business a. Gallagher Enterprises, Inc. 28. From 1977-1979, Gallagher worked as a garage mechanic and bus dispatcher in Neptune, New Jersey for Coast Cities, Inc. (“Coast Cities”), a family business started by his grandfather in 1922. From 1978-1979, he was a bus dispatcher in Neptune. In 1979, he joined the management of Coast Cities, and from 1979 until 1984 he served as a Vice President of Coast Cities responsible for day-to-day operations in New Jersey. In 1984, Gallagher became President and CEO of Coast Cities, and acquired a 10% ownership interest in Gallagher Enterprises, Inc. (“Gallagher Enterprises”), the holding company for Coast Cities and its affiliates. (Tr. at 5:168-72.) 29. Gallagher owned Gallagher Enterprises along with his father, Thomas, and his brother, Doug. Denis and Doug each owned 10% of the shares of the company and Thomas owned the remaining 80%. (Tr. at 5:172.) 30. At the time the Gallaghers sold Gallagher Enterprises in 1987, it, through Coast Cities, had seven locations throughout New Jersey, owned approximately 400 school buses and was operating approximately 350, and was serving between 30 and 40 school districts in approximately 14 of the 21 counties in New Jersey. (Tr. at 5:178-80, 6:73; Ex. P-70.) 31. Gallagher Enterprises did no school bus transportation business outside the state of New Jersey. (Tr. at 5:178-79.) 32. Coast Cities was the largest independent school bus contractor in New Jersey at the time Laidlaw acquired it. (Tr. at 6:74; Ex. P-70.) b. Negotiations for the Sale of Gallagher Enterprises 33. From 1983 until May 1998, Nick Fer-reri served as a consultant to Laidlaw. He worked on between 50 and 100 acquisitions for Laidlaw during this period. (Tr. at 5:141-42.) 34. During the acquisition process, Fer-reri would send the vendor with whom he was negotiating: (1) a confidentiality agreement on Laidlaw letterhead that he had signed on behalf of Laidlaw; and (2) a letter from Laidlaw’s board of directors confirming that he was authorized to sign the confidentiality agreement on behalf of Laidlaw. Fer-reri received the letterhead from Vic Webster, who was president of Laidlaw at the time. (Tr. at 5:144-47.) 35. During the acquisition process, Fer-reri was responsible for conducting the initial due diligence for Laidlaw, as well as placing a value on the company to be purchased. (Tr. at 5:148-49.) 36. When Ferreri negotiated acquisitions of school bus companies for Laidlaw, he was Laidlaw’s primary negotiator. The Laidlaw attorneys would not become involved until it was time for the parties to sign the letter of intent. (Tr. at 5:145-46.) 37. Ferreri was acting as Laidlaw’s authorized agent during the preliminary negotiations for Laidlaw’s acquisition of Gallagher Enterprises. (Tr. at 5:151-52.) c. The 1987 Sales Agreement 38. On October 9, 1987, Laidlaw acquired Gallagher Enterprises (Tr. at 5:172; Ex. P-1.) 39. Laidlaw, Inc.’s subsidiary, Travel-ways, Inc., was the company that acquired Gallagher Enterprises. Travelways, Inc. later became Laidlaw. (Tr. at 1:53, 59, 4:52.) 40. Travelways, Inc., then Laidlaw, Inc.’s subsidiary, was incorporated in the State of Delaware and was qualified and authorized to do business in New Jersey. (Ex. P-84.) 41. Pursuant to the 1987 Sales Agreement (“Sales Agreement”), Laidlaw acquired the contracts, customers, goodwill and reputation of Gallagher Enterprises and its Coast Cities subsidiaries. (Tr. at 3:169-70, 6:103-04.) 42. The Sales Agreement provides that Travelways, Inc. would pay $3 million for all of the outstanding shares of Gallagher Enterprises, plus $1 million each to Denis and Thomas Gallagher as compensation for non-competition agreements. (Ex. P-1, Sales Agreement §§ 2.01 & 7.01(d).) 43. The Sales Agreement provided that both Denis and Thomas Gallagher would execute non-competition agreements, in the form of “Schedule F” attached to the Sales Agreement. On October 9,1987, Gallagher executed Schedule F. The consideration paid to Gallagher for the non-competition agreement was $1 million, payable in two $500,000 payments — the first on January 1, 1988 and the second on or before January 1, 1989. (Ex. P-1, Sales Agreement § 7.01(d); Ex. P-2, Schedule F.) 44. The only consideration paid to Gallagher for this non-competition agreement was the $1 million payment. (Tr. at 3:168.) 45. Paragraph (1) of the Non-Competition Agreements states as follows: The Covenantor covenants and agrees with Laidlaw that, for a period of five (5) years from the date hereof, or, if the Covenantor shall receive remuneration from Laidlaw or any of its affiliates after the date hereof, for a period of five (5) years from the date hereof or the date on which the Covenantor last receives remuneration from Laid-law, whichever is later that: (a) The Covenantor will not within the State of New Jersey, either directly or indirectly, as principal, agent, owner, employee, partner, shareholder, advisor or otherwise howsoever, own, operate or engage in the operation of or have any financial interest in or provide, directly or indirectly, financial assistance to any business operation, whether a proprietorship, partnership, joint venture, private company or otherwise howsoever, carrying on or engaged in any business identical with or similar to the school bus transportation business and related charter services carried on by the Company (the “Business”). (b) The Covenantor shall not directly, or indirectly for himself, itself or for any other person: (i) solicit passenger transportation business from or perform passenger transportation services for any person, company or other entity which is now a customer of the Company or is hereafter a customer of Laidlaw; or (ii) induce or attempt to persuade any person now employed by the Company to terminate his employment relationship; or (iii) advise any person not to do business with the Company or Laidlaw or any of Laidlaw’s affiliates. (c) The Covenantor shall not disclose or use without Laidlaw’s prior written consent any secret or confidential information or knowledge relating to the Company, the Business or Laidlaw or any affiliate thereof. (Exs. P-2 & P-3, ¶ 1.) 46. In the Sales Agreement, the Galla-ghers acknowledged that they received valid consideration for their Non-Competition Agreements. (Exs. P-2 and P-3, ¶ 2; see Tr. at 6:86.) 47. The Gallaghers further agreed that money damages could not adequately compensate Laidlaw for violations of the agreements and stipulated that Laidlaw would be entitled to injunctive relief in the event either of them violated his Non-Competition Agreement. (Exs. P-2 and P-3, ¶ 3; see Tr. at 6:87.) 48. The Sale Agreement also provided for Denis and Thomas Gallagher’s employment with Gallagher Enterprises, which was, at that point, a wholly-owned subsidiary of Laidlaw. (Ex. P-1, ¶ 7.01(h); Tr. at 4:52-53.) 49. The Sale Agreement guaranteed Gallagher employment for two years, commencing at closing. (Ex. P-1, ¶ 7.01(h).) 50. The Sale Agreement also provided that Gallagher would be paid $40,000 per year above the salary Laidlaw normally paid for Gallagher’s position. (Tr. at 6:129.) 51. The Sale Agreement guaranteed Thomas Gallagher employment for five years, commencing at closing. (Ex. P-1, ¶ 7.01(h).) 52. The parties agreed that the Sales Agreement “shall be governed by the law of New Jersey.” (Ex. P-1, Sales Agreement § 10.11.) 53. Laidlaw drafted the Sales Agreement, including Schedule F to that Agreement (Denis and Thomas Gallagher’s non-compete agreements). (Tr. at 3:158-59, 5:181.) 54. Shortly after the closing, Laidlaw transferred Gallagher to its payroll. (Tr. at 5:192.) 55. The parties vigorously dispute the time from which the Gallaghers’ non-competes began to run. The focus of this dispute is whether remuneration, as stated in the Sales Agreement, means the $1 million consideration for the non-eompetes, or is broader so that it includes salary. 56. When Laidlaw acquires a company, the principals of the acquired company often become Laidlaw employees. In such eases, Laidlaw contends that it often seeks to obtain a non-competition agreement that extends beyond the period of employment, in order to protect the purchased good will, as well as the goodwill that developed after Laidlaw came in with their capital strength and their own good will. (See Tr. at 1:55-56.) Laidlaw argues that the parties’ intent, as expressed in the Sales Agreement, was that the non-compete ran from the last date Gallagher drew salary from Laidlaw. 57. In contrast, Gallagher states that no one at Laidlaw ever explicitly told him that the five-year non-competition agreement would run for five years from when he ceased employment with the company. (Tr. at 5:188.) 58. Gallagher states that Ferreri told him that the five-year non-competition agreement would run from the date Laidlaw made its last $500,000 installment on the $1 million for the non-compete. Gallagher states, therefore, that it was his understanding that his five-year period of non-competition began to run when he received that final payment for the non-compete as opposed to any final salary for his employment with Laidlaw. (Tr. at 5:188.) 59. However, when Gallagher negotiated acquisitions on behalf of Laidlaw, on at least one occasion Gallagher stated that it was Laidlaw’s position that non-competes in their acquisition agreements started from the time one stopped working for Laidlaw or received any money from Laidlaw whatsoever. He also stated that “remuneration” as used in the acquisition agreements meant any kind of remuneration, be it wages, the non-compete consideration, or money for the sale of the business. (Tr. at 2:85,112.) 60. Gallagher recalls that he received the two $500,000 payments specified in the Sales Agreement sometime prior to January 1, 1989. Thus, Gallagher received the full $1 million remuneration for the non-compete agreement no later than January 1, 1989. (Tr. at 5:182-83; See Ex. P-2, Schedule F.) 3. The Individual Defendants’ Employment History a. Gallagher 61. Other than the two-year agreement contained within the Sales Agreement, Gallagher did not have a written or oral employment agreement with Laidlaw. After 1989, he was an at-will employee. (Tr. at 3:160-63, 4:112, 5:193.) 62. After the sale of Gallagher Enterprises to Laidlaw, Gallagher continued to work for Gallagher Enterprises as the Director of Operations. In 1988, he went to work for Laidlaw as Regional Vice President responsible for school bus operations in New Jersey, Delaware, and Pennsylvania. In 1992, Laid-law expanded his responsibilities to include Alabama and Georgia. In June 1994, Laid-law promoted him to Senior Vice President with responsibility for school bus operations on the East Coast. (Tr. at 5:194-95.) 63. In this position, Gallagher had marketing, sales and operational responsibilities for over 200 locations, 13,000 vehicles and 15,000 employees, which generated revenues in excess of $350 million. (Ex. P-46, Bates No. 100578 ¶ 5.) 64. He reviewed and approved bids made in the East Coast and was responsible for operations, employees, buses, customer contacts, and customer service. (Tr. at 5:196.) 65. Gallagher also served as Laidlaw’s chief marketing officer and headed Laidlaw’s National Marketing Council. (Tr. at 4:66.) He planned marketing strategy, including conversions. (Ex. P-40, ¶ 4.) 66. A “conversion” is when a provider of school bus transportation services convinces the school district that the district would be better off if the district converts from providing its own school bus transportation services to having a private contractor provide those services. (Tr. at 3:122-23.) 67. Gallagher was also a member of the Executive Committee of the Passenger Services Group. (Tr. at 4:70-71.) 68. In November or December of 1995, Gallagher, along with three others, met with an investment banker in New York City to discuss the possibility of forming a sightseeing business. (Tr. at 5:201-03.) 69. In February 1996, Gallagher decided to resign from Laidlaw. Gallagher tendered his resignation on February 28, 1996 and left on April 1,1996. (Tr. at 5:205.) 70. In 1987, Gallagher made $100,000 per year. This figure increased to $175,000 at the time he resigned. (Tr. at 4:71-73; Ex. P-1, Sales Agreement, ¶ 7.01(h).) 71. In September or October 1996, Gallagher became the CEO of Liberty Helicopters. (Tr. at 5:208-09.) 72. In December 1996, Gallagher helped form Sightseeing Tours of America, and Liberty Helicopters became one subsidiary of Sightseeing Tours of America. Sightseeing Tours of America subsequently purchased Golden Touch Transportation, an airline crew transportation business. (Tr. at 5:209-10, 6:8.) 73. Between February 1997 and May 1997, Gallagher had discussions with Golder, Thoma, Cressey, Rauner, Inc. (“GTCR”), a private equity firm, about the possibility of forming a new company. (Tr. at 6:9, 11.) 74. In May 1997, Gallagher reached a deal with GTCR to form a new company, Global. Two subsidiaries of Global were also formed at the time of closing: STA and Travelways, Inc. (Tr. at 6:11.) b. Byrne 75. Byrne began working at Laidlaw in June 1992. (Tr. at 6:195-96 .) 76. Byrne did not have a written employment contract with Laidlaw. He was an at-will employee. (Tr. at 1:65-66.) 77. At Laidlaw, Byrne was responsible for a variety of legal and business issues including, among other things, acquisitions, leases, customer agreements, assisting with bids for school bus contracts, demand letters, annual reports, documentation of corporate governance, mergers, windups, amalgamations, trademarks, and operating licenses work. (Ex. P-43, ¶ 20.) 78. During his tenure at Laidlaw, Byrne was responsible for acquisitions of school bus companies throughout the United States and Canada. (Tr. at 6:200-01; Ex. P-43.) 79. He worked on structuring the acquisitions as well as reviewing leases and any other legal issues that arose in connection with an acquisition. (Tr. at 4:76-77.) 80. Approximately one-half of the acquisitions Byrne worked on were school bus companies. (Tr. at 4:79-81, 6:201; Ex. P-43.) Accordingly to Laidlaw, Byrne was the primary legal support for many of the acquisitions of school bus companies. (See Tr. at 2:136.) 81. Byrne had access to Laidlaw’s purchase and sale agreements and prospect lists. (Tr. at 4:84-85.) 82. Otherwise, Byrne did not have any operational responsibilities, and he did not have management responsibilities for the operations side of Laidlaw’s business, but he was advising those managers. (Tr. at 4:133, 6:203.) 83. Byrne announced his departure from Laidlaw on December 13, 1996 and left approximately one week after that date. (Tr. at 6:212-14.) 84. Byrne initiated the employment discussions with Gallagher. (Tr. at 6:213.) 85. Byrne joined Sightseeing Tours of America at the end of December 1996 as a shareholder and employee. (Tr. at 6:212, 217.) 86. Byrne has been involved in 22 acquisitions for Global. Twenty of those acquisitions involved Travelways — Global’s motor-coach subsidiary. When Byrne left Laidlaw, Laidlaw was not involved in the motor-coach business in the United States. (Tr. at 6:216-17.) 87. Byrne has also worked on two STA acquisitions: (1) Santa Barbara Transportation in Santa Barbara, California, and (2) North Bend in Oregon. According to Byrne, Laidlaw did not show interest in acquiring either of those companies while Byrne was at Laidlaw. (Tr. at 6:216-17.) c. Pearson 88. Pearson did not have a written employment contract with Laidlaw. He was an at-will employee. (Tr. at 1:65-66.) 89. In September 1991, Pearson started working for Laidlaw. He held the position of District Director of Operations (“DDO”) for South and Central New Jersey from September 1991 to May or June 1992. (Tr. at 6:148-49.) 90. In May or June 1992, Pearson became a Division Manager in Pittsburgh for Laidlaw, with responsibility for seven or eight Laidlaw facilities or terminals and approximately 600 vehicles. He held this position until December 1996. The school bus transportation contracts that Pearson had responsibility for during this period were primarily in Westmoreland County, Pennsylvania. During this period, Pearson was responsible for three other counties in Pennsylvania, Fayette, Greene, and Allegheny Counties. In these latter three counties, however, Laidlaw had a total of only four contracts. (Tr. at 3:82-83, 6:149-52.) 91. Pearson was not responsible for the entire western portion of Pennsylvania. In fact, Laidlaw employed three additional division managers other than Pearson in western Pennsylvania at that time. (Tr. at 6:150, 152.) 92. In this position, he had extensive customer contact and assisted in contract negotiations. (Tr. at 3:82-83.) 93. On January 1,1996, Pearson was promoted to DDO in the Southeast, which included North Carolina, South Carolina, Florida, and Georgia. In January 1997, Pearson became Director of Business Development for Laidlaw for Florida, a position he held until he resigned from Laidlaw in September 1997. (Tr. at 1:95, 2:130, 6:153-54.) 94. In this last position, Pearson and his direct supervisor were responsible for developing business for Laidlaw through conversions of school .districts from using public transportation to private contractors. (Tr. at 2:130.) 95. Pearson initiated employment discussions with Gallagher. Pearson joined STA and Travelways on or about September 22, 1997. (Tr. at 6:155-56.) d. John Reddan 96. In August 1991, Reddan joined Laid-law as the Director of Human Resources for the Mid-Atlantic region. His responsibilities later expanded to include the entire east co.ast. At Laidlaw, Reddan had responsibility for labor contract negotiations and limited responsibility for recruiting. (Tr. at 7:50-52, 55-56.) 97. Reddan did not have a written employment contract with Laidlaw. He was an at-will employee. (Tr. at 1:65-66, 7:59.) 98. At Laidlaw, Reddan had no responsibilities for preparing bids for school bus transportation contracts, nor did he have any customer contacts. He never received or reviewed Laidlaw’s maintenance, conversion, or driver training manuals. He did not help prepare any business or strategic plans. Reddan never received copies of those plans. (Tr. at 7:56, 70-71.) 99. Reddan had access to all of Laidlaw’s labor agreements and costs, which are not public, as well as confidential salary and bonus information for all of the management staff and performance reviews for each of those people. He knows Laidlaw’s succession planning — who is promotable and Laid-law’s plan for developing those individuals. (Tr. at 4:83-84.) 100. Reddan does not know Laidlaw’s current labor costs. (Tr. at 7:72-73.) 101. Reddan left Laidlaw on January 24, 1997 due at least in part to health reasons. (Tr. at 7:64-69.) 102. While still at Laidlaw, Reddan initiated contact with Gallagher to see if Gallagher had any employment opportunities for him. Gallagher informed him that there was a position in human resources available at Sightseeing Tours of America. Reddan joined Sightseeing Tours of America at the end of January 1997 as the Vice President of Human Resources. (Tr. at 7:68-70.) 103. Reddan has never had operational responsibilities in any of the various positions he has held in the human resources field. (Tr. at 7:47, 50.) e. Thomas Gallagher 104. Thomas Gallagher retired from Laidlaw in late 1997. (Tr. at 1:89-90.) 105. When Thomas Gallagher left Laid-law, he did not have a written employment contract. He was an at-will employee. 106. As previously stated, Thomas Gallagher does no substantive work for STA. Before his heart surgery, Thomas Gallagher came into the office twice a week for a couple of hours to work on administrative tasks. (Tr. at 6:70-71.) 4. Laidlaw’s Stock-Option Non-Compete Agreements a. History 107. Laidlaw offered a Stock-Option Plan to senior officers of the company. In exchange for the stock options, participants were required to sign a non-competition agreement. (Tr. at 1:91-92; Ex. P-10.) 108. Laidlaw had two versions of the Stock-Option Non-Competition Agreement. The initial version was in effect under the 1984 Stock-Option Plan. The Plan and the Non-Competition Agreement were revised in 1991. (Tr. at 4:24-25.) 109. The 1984 Stock-Option Non-Competition Agreement covered a broader geographic area than the 1991 Stock-Option Non-Competition Agreement. The 1984 form provided that the. covenantor would not be involved in a competing business in any one of nine geographic areas, the broadest of which, included: “the geographical areas within which Laidlaw carries on the Business;” and “any municipality in which Laid-law does business, and 200 miles therefrom .” (Ex. D-16, ¶ 3(a).) 110. The 1984 non-compete prohibited the covenantor from competing “in any aspect of the business of transporting people by motor vehicle.” (Ex. D-16, ¶ 3.) 111. The non-compete period in the 1984 form was five years. (Ex. D-16, ¶ 3.) 112. In 1989, Gallagher entered the Stock-Option Plan and signed this 1984 version of the stock-option non-compete. (Ex. D-16.) 113. Laidlaw is not seeking injunctive relief pursuant to Gallagher’s 1989 stock-option non-compete agreement. (Tr. at 4:28-29.) 114. In an August 14,1987 letter, Jeffrey K. Wohlstadter of the Chicago law firm Fatten, Muchin & Zavis, rendered an opinion regarding Laidlaw’s 1984 version of the stock-option non-competition agreement (“Fatten Muchin Letter”). (Tr. at 5:102,105; Ex. D-6.) 115. In the Fatten Muchin Letter, Wohlstadter opined: We believe that Laidlaw’s standard waste and standard transit non-competition agreements would be extremely difficult to enforce anywhere in the United States, particularly because of the five year term and geographic scope of those agreements. (Ex. D-6.) 116. The Fatten Muchin Letter also advised Laidlaw that all non-competition periods in excess of one year risked being unenforceable, particularly with respect to lower level executives. (Ex. .D-6.) 117. The Fatten Muchin Letter urged Laidlaw to employ different non-compete provisions depending on the level or position of the executive. (Ex. D-6.) 118. Finally, the Fatten Muchin Letter advised Laidlaw to limit the geographic scope of the restraints to be imposed upon employees based on each individual’s exposure to specific confidential materials. (Ex. D-6.) 119. In the spring of 1989, Gallagher received the Fatten Muchin Letter in interoffice mail from Howard Wallack, who was his supervisor at the time. 120. Gallagher also participated in a Laidlaw management meeting in early 1989 during which management discussed the enforceability of Laidlaw’s standard stock-option non-competition agreements. (Tr. at 5:102-04.) 121. Gallagher kept a copy of the Fatten Muchin Letter in his personal file. (Tr. at 5:106-07.) 122. Although the letter was dated August 14, 1987, Laidlaw did not revise its standard stock-option non-compete agreement until 1991. (Tr. at 4:44.) 123. The revised agreement did incorporate some changes. The 1991 form provides that the covenantor will not be involved in a competing business “in the geographic area in which the Covenantor was actively involved in the management and operation” of Laidlaw. (Ex. P-9, ¶ 3(a).) 124. Also, the five-year period in the 1984 version was reduced to three years in 1991 form. (Ex. P-9, ¶3.) However, the Fatten Muchin Letter clearly indicated that time periods in excess of one year were risky, particularly for lower level executives. (Tr. at 4:44-45; Ex. D-6; Ex. D-9, Byrne Stock-Option Agreement.) 125. Additionally, although Laidlaw was advised in 1987 to vary the terms of its restrictive covenants depending on the level of the executive, Laidlaw chose to not vary the terms of the prohibitions in its stock-option non-competes. (Tr. at 4:44-46; Ex. D-6.) 126. Laidlaw was also advised to vary the restraints in the stock-option non-competes depending on the type of confidential information to which the executive was privy, but Laidlaw chose not to take this advice as well. (Tr. at 4:46 — 47; Ex. D-6.) 127. Bernard Vardzel, Laidlaw’s Regional Director of Maintenance, signed the same restrictive covenant as did Byrne in the Laid-law legal department, Reddan in Human Resources, or anyone else who participated in Laidlaw’s stock-option plan after 1991. (Tr. at 4:46-47). b. Byrne, Pearson, and Reddan Enter the Stock-Option Plan 128. In May 1993, Byrne received a letter stating that he had been approved for Laid-law’s stock-option program. About a month later, he received the stock-option non-compete. In June 1993, Byrne signed this non-compete agreement (which was dated May 1, 1993) and became a participant in Laidlaw’s Stock-Option Plan. (Tr. at 1:90-91, 6:205-08; Ex. P-9.) 129. Byrne did not seek independent legal advice prior to signing the Laidlaw stock-option non-compete agreement. (Tr. at 6:207-08.) However, there is no evidence to suggest that Laidlaw pressured Byrne to sign it immediately or without seeking independent legal advice. Furthermore, Byrne himself is an attorney. 130. Byrne received and exercised some options. (Tr. at 1:92, 94.) 131. Pearson enrolled in Laidlaw’s stock-option plan on May 1, 1992, and signed the stock-option non-compete at that time. (Tr. at 6:167-68; Ex. P-18, Pearson Stock-Option Agreement.) 132. Pearson did not seek independent legal advice prior to signing the Laidlaw stock-option non-compete agreement. He did not discuss the terms of the non-competition agreement with anyone at Laidlaw before he signed it. (Tr. at 6:183-84.) However, there is no evidence to suggest that Laidlaw pressured Pearson to sign it immediately or without seeking independent legal advice. 133. Although he received options in 1997, he never exercised those options. (Tr. at 1:96; 6:168-69.) 134. On May 1, 1992, Reddan signed Laidlaw’s stock-option non-compete agreement. (Tr. at 7:56-57; Ex. P-21.) 135. Reddan did not seek independent legal advice before signing the Laidlaw stock-option non-compete agreement. (Tr. at 7:57.) However, there is no evidence to suggest that Laidlaw pressured Reddan to sign it immediately or without seeking independent legal advice. 136. Reddan received options under the Stock-Option Plan; however, Reddan has never exercised any of the options he received. (Tr. at 1:96, 7:59.) c. Terms And Conditions of the Stock-Option Non-Competes 137. Paragraph 3 of the Stock-Option Non-Competition Agreements signed by Byrne, Pearson, and Reddan provides as follows: The Covenantor covenants and agrees with Laidlaw that for a period of three (8) years from the date on which the Covenantor ceases for any reason whatsoever to receive remuneration from Laidlaw that: (a) the Covenantor will not, either directly or indirectly, as principal, agent, owner, employee, partner, shareholder, advisor or otherwise howsoever own, operate or engage in the operation of or have any financial interest in or provide, directly or indirectly, financial assistance to any business operation, whether a proprietorship, partnership, joint venture, private company or otherwise howsoever, carrying on or engaged in any business identical with or similar to the business carried on by Laid-law at any time during the period of employment of the Covenantor by Laidlaw, with respect to which and in the geographic area in which the Covenantor was actively involved in the management and operation (the “Business”). (b) The Covenantor shall not directly, or indirectly, for himself or for any other person: (i) solicit business of the type described in clause 3(a) from or perform services in such business for any person, company or other entity which is now or hereafter a customer of Laidlaw; (ii) induce or attempt to persuade any person now or hereafter employed by Laidlaw to terminate his employment relationship; or, (iii)advise any person not to do business with Laidlaw. (c) The Covenantor shall not disclose or use without Laidlaw’s prior written consent any secret or confidential information or knowledge relating to the Business of Laidlaw. (Exhibits P-9, P-18 and P-21, ¶3.) Thus, pursuant to ¶ 3(a), Plaintiffs seek to prohibit Byrne from competing in the United States, Pearson from competing in the Southeastern United States and Western Pennsylvania, and Reddan from competing on the East Coast of the United States. (Memorandum of Law in Support of Plaintiffs’ Motion for Supplemental Preliminary Injunctive Relief (“Supp.P.I. Mov.Br.”) at 14.) 138. The Stock-Option Non-Competition Agreements state that Byrne, Pearson, and Reddan were “actively involved in the management and operation of the business of Laidlaw” and obtained “confidential information concerning the business and customer base of Laidlaw.” (Exs. P-9, P-18 & P-21, at 1.) 139. In the non-competition agreements, Byrne, Pearson, and Reddan acknowledged that they attended management and policy meetings, that they participated in the management of Laidlaw’s business, and that they have secret and confidential information relating to Laidlaw’s business. (Exs. P-9, P-18 & P-21, ¶ 2.) 140. Byrne, Pearson, and Reddan further agreed that if they violated their Agreements Laidlaw would be entitled to injunctive relief because money damages could not adequately compensate Laidlaw. (Exs. P-9, P-18 & P-21, ¶ 9.) 141. The only consideration recited in the Agreements for Laidlaw employees who signed the stock-option non-compete was a $10 payment and the opportunity to participate in the stock-option plan. (Tr. at 4:19— 20; Ex. P-9, at 1.) 142. None of the individual defendants actually received the $10 consideration. (Tr. at 4:19-20.) 143. Laidlaw’s stock-option non-compete agreement is a standard document drafted by Laidlaw. While the terms of the agreement are non-negotiable, an employee may choose not to participate in Laidlaw’s stock-option plan, and thus, can avoid signing the non-compete agreement. (Tr. at 2:67-68.) 144. If an employee refused to sign the stock-option non-compete, he was not fired, demoted, or in any way restricted from any confidential information. (Tr. at 3:182-83.) 145. In fact, Larry Jamison, who is currently Laidlaw’s District Manager for Northwestern New Jersey, who is in charge of 6 Laidlaw terminals, and who is very familiar with Laidlaw’s operations, its bidding, and the costs for the components of bids in New Jersey, decided not to, and does not, participate in Laidlaw’s stock-option plan. (See Tr. at 2:83,112,115-16.) d. STA’s Stock-Option Non-Competition Agreements 146. Gallagher’s new companies, STA and Travelways, also have a stock-option plan. Pearson and other employees of STA and Travelways have signed non-competition agreements in connection with participation in the stock-option plan. (Tr. at 7:33; Ex. P-81.) 147. The period of non-competition under those agreements is two years, beginning on the “Effective Date,” which is defined as “the date that the Covenantor last receives remuneration of any kind from [Travelways or STA].” (Ex. P-81, ¶ 1.1(a), (d).) 148. Gallagher signed the agreements on behalf of STA and Travelways. (Ex. P-81, at 6.) 149. Byrne supervised the outside counsel who drafted the agreements and instructed them with regard to the terms of those agreements. (Tr. at 7:33.) 150. The geographic scope of the STA non-competition agreements extends to “the territorial areas over which Covenantor had, at any time during his employment, either managerial responsibilities for the Corporations’ operations or business development responsibilities for the Corporations.” (Ex. P-81, ¶¶ 1.1(e), 2 .1.) 151. The STA non-competition agreements include, among other things, covenants not to engage, in any way, in activities that are competitive with STA; not to solicit customers of STA; not to solicit employees of STA; and not to disclose or use STA’s confidential information. (Ex. P-81, ¶ 2.1.) 5. Confidential or Proprietary Laidlaw Materials. 152. No Defendant removed any confidential or proprietary documents or materials from Laidlaw when he left Laidlaw. (Tr. at 6:49-50,166-67,169-70, 214, 7:90.) 153. Laidlaw admits that it has no evidence that any of the Defendants took any confidential or proprietary documents or materials with them when they left Laidlaw. (Tr. at 1:113-14.) 154. Defendants have done things that are inconsistent with their current position that there is no confidential information in the school bus business. 155. In Laidlaw’s Stock-Option non-competition agreements signed by Byrne, Red-dan and Pearson, they acknowledge that they obtained confidential information while employed by Laidlaw. (Exs. P-9, P-18, and P-21, ¶ 2.) 156. Gallagher and Byrne have each signed a Senior Management Agreement with Global, STA and Travelways. (Exs. P-71 & P-72; Tr. at 6:97-98.) 157. In the Senior Management Agreements, Gallagher and Byrne acknowledged and agreed that, as employees of STA, in the school bus business, they would obtain confidential information, including but not limited to, technology, methods of doing business, supplier and customer information, and information concerning acquisitions. (Exs. P-71 & P-72, ¶ 9(a).) 158. They further agreed that this confidential information was the property of STA and that STA’s continued success “depends in large part on keeping this Confidential Information from becoming known to competitors _” (Exs. P-71 & P-72, ¶ 9(a).) 159. Gallagher and Byrne each agreed that they would not, at any time, during or after his employment with STA, disclose or use for their own account any of this Confidential Information. (Exs. P-71 & P-72, ¶ 9(a).) 160. Gallagher’s and Byrne’s Senior Management Agreements with STA also include non-competition and non-solicitation provisions. (Exs. P-71 & P-72, ¶ 10.) 161. In the non-competition provision, Gallagher and Byrne acknowledged that, in the course of their employment with STA, they will become familiar with trade secrets and other confidential information. (Exs. P-71 & P-72, ¶ 10(a).) 162. Gallagher acknowledged that confidential information is used in preparing bids for school bus services even in states like New Jersey that have a competitive public bidding process. (Tr. at 6:23.) 163. In response to discovery requests directed to Gallagher, STA, and Byrne, each stated that STA’s “current bids, business plans, and related documents ... constitute highly proprietary, confidential business information.” (Exs. P-49, P-53, & P-54, Response Nos. 6 and 20.) 164. Pearson acknowledged that elements of bid preparation, like a company’s internal rate of return, are confidential. (Tr. at 6:165.) a. Laidlaw’s Bid Worksheet 165. The only document that Laidlaw contends Defendants took when they left Laidlaw is a “fill-in-the-blank” bid worksheet that is given to school districts without any confidentiality restrictions. (Tr. at 2:56-57; Ex. D-3.) b. Laidlaw’s Maintenance Manual 166. Laidlaw shares at least portions of the Laidlaw Maintenance Manual with prospective customers. (Tr. at 7:113.) 167. Vardzel, Laidlaw’s Regional Director of Maintenance, does not contend that any of Defendants took Laidlaw’s Maintenance Manual with them when they left Laidlaw. (Tr. at 2:165.) 168. Gallagher has never read Laidlaw’s maintenance policy, nor does he have any knowledge that any former Laidlaw employee whom Global hired took Laidlaw’s maintenance policy when that employee left Laid-law. (Tr. at 6:57-59.) 169. Although Pearson reviewed the Manual while at Laidlaw, he did not take a copy of Laidlaw’s maintenance manual with him when he left Laidlaw. He has never seen a copy of that manual at STA. (Tr. at 6:169-70.) 170. Reddan never received a copy of Laidlaw’s maintenance manual. (Tr. at 7:70.) 171. STA has not hired any former Laid-law employees who worked in maintenance at Laidlaw. (Tr. at 6:59.) 172. STA does not have a maintenance manual. Instead, STA uses a policy that was already in place at Santa Barbara Transportation before STA purchased that company. Moreover, all maintenance information can be obtained from the school bus manufacturer. (Tr. at 6:57-58.) c. Laidlaw’s Drivers’ Training Manual 173. Nothing about the contents of a drivers’ training manual is confidential or proprietary. STA receives its driver training information from its insurance company, Travelers Insurance, as well as from a coach company that Travelways purchased in Pennsylvania — Palmeri Motor Coach. (Tr. at 6:60-61.) 174. Gallagher never read Laidlaw’s Behind the Wheel Driver Training manual. He did not take that manual with him when he left Laidlaw. Nor does he have any knowledge that any former Laidlaw employees now employed by STA took a copy with them when they left Laidlaw. (Tr. at 6:60; see Ex. P-33.) 175. Although Pearson reviewed the “Behind the Wheel” manual while at Laidlaw, he did not take a copy of it with him when he left Laidlaw and he has not seen a copy of that manual at STA. (Tr. at 6:170.) 176. Reddan never received a copy of Laidlaw’s drivers’ training manual. (Tr. at 7:70.) d. Laidlaw’s Conversion Manual 177. After a district decides to “convert” in New Jersey, the district must follow the statutory contract-bidding framework in New Jersey, and award the contract to the lowest responsible bidder. (Tr. at 3:123.) 178. During his work at Coast Cities and Gallagher Enterprises, Gallagher was involved in several conversions. (Tr. at 5:173.) 179. There is nothing confidential about the conversion process because it simply entails being a good salesman — being able to convince the school district that it will be better off if it puts its school bus contract up for bid. STA does not have its own conversion program. (Tr. at 6:62-63.) Most of the contents of Laidlaw’s Contract Retention and Conversion Manual (“Conversion Manual”) are basic, common sense salesmanship. 180. Gallagher never read Laidlaw’s Conversion Manual while he was at Laidlaw. Gallagher did not take that Manual with him when he left Laidlaw; nor does he have any knowledge that any former Laidlaw employees now employed by STA took a copy with them when they left Laidlaw. (Tr. at 6:61-62.) 181. Pearson never read Laidlaw’s Conversion Manual either. He did not take a copy of the Conversion Manual with him when he left Laidlaw, and he has never seen a copy of that Manual at .STA. (Tr. at 6:166-67.) 182. Reddan never received a copy of Laidlaw’s Conversion Manual. (Tr. at 7:70.) e. Laidlaw’s Business and Strategic Plans 183. Gallagher left Laidlaw on April 1, 1996, before Laidlaw had begun work on the 1997 business plan. (Tr. at 6:51.) 184. Laidlaw’s business plans are revised each year. (Tr. at 4:136.) 185. Laidlaw’s strategic plans (as opposed to its business plans) are rolling two-to five-year plans that are refreshed every year. (Tr. at 4:137.) 186. Any information that Gallagher personally learned at Laidlaw regarding Laid-law’s business or strategic plans is at least two years old. (Tr. at 2:50-51.) 187. John Reddan does not have any knowledge of Laidlaw’s current business plan. Reddan did not prepare strategic or business plans while at Laidlaw, nor did he receive copies of such plans. (Tr. at 7:71.) f. Laidlaw’s Legal Files 188. Robert Byrne took no Laidlaw legal files with him when he left Laidlaw. He has not seen any Laidlaw files at STA. (Tr. at 6:214.) 189. Since leaving Laidlaw, Byrne has not used or disclosed any of the confidential legal information he obtained at Laidlaw, nor does be consider any of this information useful to him at STA. (Tr. at 6:220-21.) g. Laidlaw’s Route Tying Information 190. The primary software used by Laid-law to tie routes together in the school bus transportation industry is Edulog. Edulog is a commercially available software program. (Tr. at 2:52.) 191. Laidlaw had no written policy for how to “route tie.” (Tr. at 6:64-65.) 192. To effectively tie routes together, a school bus transportation provider only needs to know what time the buses have to be where — information that the school districts provide. Anyone can simply look through the bid specifications, determine route times, and work out route tying on his own based on what time the buses operate. (Tr. at 6:64-65.) 193. Gallagher’s experience at Laidlaw pertaining to route tying is not beneficial to him today at STA because route tying is relatively simple and straight forward in New Jersey. (Tr. at 6:64-65.) 194. Additionally, routes in New Jersey are set by the school district and can change every year. (Tr. at 2:143-44.) 195. Because routes change every year, computerized routing is not overly advantageous in New Jersey. (Tr. at 2:144; see Tr. at 2:52.) h. Laidlaw’s Hurdle Rates and Margins 196. Hurdle rates are expected levels of profitability or internal rates of return that a company wishes to achieve in order to maintain a level of profitability. (Tr. at 1:70.) 197. Hurdle rates vary with respect to different geographic locations, and they change over time. In part, this is due to the presence of competition at a given place and time. However, absent a dramatic change, there is a general historic trend in each district that does not vary greatly. (Tr. at 1:70-73.) 198. Gallagher does not know Laidlaw’s current internal return rates or its hurdle rates. The most recent information he had on Laidlaw’s hurdle rates and rates of return is from 1996. (Tr. at 6:52.) 199. John Reddan does not know Laid-law’s current internal rates of return, and he never had access to that information while he was employed by Laidlaw. (Tr. at 7:71-72.) i.Other Cost Components of a Bid 200. Labor, equipment, insurance, and most other costs that go into a bid for a school bus contract vary from district to district and from year to year. (Tr. at 2:40-50.) 6. Solicitation of Laidlaw Employees by Defendants 201. Gallagher and the other individual defendants did not initiate any employment conversations with any Laidlaw employee. To the extent any of the defendants had conversations with Laidlaw employees regarding employment at STA, Travelways or Global, it was the Laidlaw employee who first brought up the subject matter. (Tr. at 6:43-44,169, 233, 7:82-83.) 202. STA retained DHR International, Inc. (“DHR”), a professional search firm, to assist it in filling certain job positions. Neither Gallagher nor anyone else at STA asked DHR to target or solicit Laidlaw employees. Indeed, it was Denis Gallagher’s desire that DHR “stay out of Laidlaw.” (Tr. at 6:43-44; Ex. D-78, Affidavit of Robert E. Reilly, Jr. (“Reilly Affi”) (President DHR), ¶¶ 2-3.) 203. During DHR’s efforts to locate prospective candidates to fill the positions for STA, five or six Laidlaw employees and/or former Laidlaw employees did surface. However, any contact by DHR with Laidlaw employees was inadvertent and contrary to Gallagher’s instructions. (Reilly Affidavit, ¶¶ 3, 5.) 204. Reddan also had contact with DHR regarding Global’s efforts to hire a CFO for Travelways. Reddan specifically told the DHR employee with whom he had been in contact to stay away from Laidlaw employees. (Tr. at 7:83.) 205. Reddan never solicited Ray Burke to work for STA, Travelways, or Global. (Tr. at 7:89.) 206. Reddan did call Ray Burke, who was Laidlaw’s maintenance manager in the Memphis area, to see if Burke knew how Reddan could contact Charlie Martin, who had been with Laidlaw in Orlando but had since left the company. During that conversation, Burke asked Reddan if Global had any employment opportunities for him. Reddan responded that there were none at that time. (Tr. at 7:86-89.) 207. Gallagher never solicited Robert Hach for employment at Global, Travelways or STA, although they did talk from time to time about how Gallagher and his new businesses were doing. (Tr. at 6:44.) 208. In mid-1997, Hach had two discussions on his own with GTCR about joining Global. After reviewing GTCR’s investment memorandum, the term sheet, and discussing the matter with his wife, Hach ultimately decided to stay at Laidlaw. (Tr. at 6:45 — 48.) 209. Out of the approximately 2,000 individuals employed by Global and all of its subsidiaries, only about 20 of those individuals are former Laidlaw employees. (Tr. at 6:48-49.) 210. Byrne, who took detailed notes regarding the circumstances surrounding the hiring of the former Laidlaw employees who joined Global and its subsidiaries, is not aware of any former Laidlaw employee whom STA or Travelways solicited or recruited to leave Laidlaw. (Tr. at 6:221-33.) 7. Interference With Laidlaw’s Customer Relationships 211. The New Kensington Arnold School District is a Laidlaw customer as a result of a contract negotiated two years ago that was scheduled to run until 2001. (Tr. at 3:85.) 212. Pearson personally negotiated that contract for Laidlaw. (Tr. at 3:85, 6:178-80.) 213. After Pearson went to STA, he solicited business from the president of the New Kensington Arnold School District, at a convention, and convinced him to exercise a “90-day” provision in the Laidlaw contract that allowed the district to seek proposals for a new contract. (Tr. at 3:85-86.) 214. Pearson also invited the solicitor, the superintendent, the school board secretary, and school board members to dinner to tell them about STA. (Tr. at 6:178.) • 215. At some point after that dinner, the school board issued a request for proposals. (Tr. at 6:178-79.) 216. STA competed with Laidlaw for the new New Kensington Arnold contract. (Tr. at 6:158,160.) 217. Pearson also worked on Laidlaw’s proposal to Martin County, Florida when he was employed by Laidlaw. As a Laidlaw employee, he developed' relationships with the administrators, board members and local taxpayer groups influential in the decision to privatize. (Tr. at 3:114.) 218. Pearson met with the head of the taxpayer group and lobbied him on behalf of Laidlaw. (Tr. at 3:115.) 219., Then, he left Laidlaw and, shortly thereafter, met again with that gentleman, but this time on behalf of STA. (Tr. at 3:115.) 220. After joining STA, Pearson submitted a competing proposal to Martin County. (Tr. at 2:151, 6:177-78.) 221. Former Laidlaw employees now working for STA developed personal relationships with Laidlaw’s customers in New Jersey. In at least some instances, these people have used those relationships against Laidlaw, actually going to Laidlaw’s customers and soliciting business for STA by persuading the customers to put their existing contracts out to bid rather than renewing those contracts with Laidlaw. (Tr. at 2:87-88.) 8. The School Bus Transportation Market In New Jersey a. The New Jersey Public Bidding Process 222. School bus transportation contracts in New Jersey are generally one-year contracts, subject to renewal. (Tr. at 6:31.) ,223. In New Jersey, there are many small school districts. (Tr. at 6:64.) 224. Every school district bids their own routes. (Tr. at 6:64.) 225. Cyrena Cozzi has worked as the Transportation Coordinator of the Lower Camden Regional School District for 17 years. She has responsibilities for school bus contracting and bid specifications. Cozzi has been involved in the school bus bidding process for bus routes 14 times over her 17 years. (Tr. at 1:132-33,137.) 226. Bidding and contracting for public school bus transportation in New Jersey are regulated by statute. N.J.S.A. § 18A:18A-15, 37. 227. Pursuant to statute, each school board must make specifications and plans for school bus transportation contracts publicly available. Each school board is required to publish in various newspapers of record the fact that such a contract is open for bidding. The school board must provide information about where bid specifications can be obtained by any interested prospective bidder. All such advertisements must run for at least 10 days prior to the date fixed for receiving bids. (Tr. at 1:140-41; Ex. D-73, Affidavit of Theresa Coia (“Coia Aff.”) ¶ 3.) See also N.J.S .A. § 18A:18A-21. 228. Bid specifications are provided to anyone who contacts a school board to request them. Bidding is completely open to the public and is not in any way limited to those companies who may have bid in the past or who received invitations to bid. (Tr. at 1:141-42; Coia Aff. ¶ 3.) 229. Sealed school bus transportation contract bids are submitted to each regional school board. At a fixed time and place, all bids received by the school board are unsealed and announced. (Tr. at 1:142; Coia Aff. ¶ 4.) See also N.J.S.A. § 18A:18A-21. 230. In advance of bidding, any prospective bidder can obtain information regarding that school district’s prior or existing school bus contracts. Prospective bidders may also obtain information on bids that were submitted to the school board in the past in connection with existing or prior contracts. Competing companies can, and often do, obtain all prior information and prices that competitors have submitted in previous bidding contests for any school district. (Tr. at 1:143-47, 2:33-34; Coia Aff. ¶ 5.) 231. In New Jersey, every piece of paper that Laidlaw or any other competitor submits in connection with its bid is available to the members of the public once those bids are opened. (Tr. at 2:33-34.) 232. Numerous variable cost components enter into every bid. These components differ from bid to bid and from district to district and from year to year. (Tr. at 2:40-50.) 233. In addition, the school districts themselves change over time, and this would impact on the requirements that districts include in the school bus contract specifications. (Tr. at 1:138.) 234. By statute, New Jersey school districts must award school bus transportation contracts to “the lowest responsible bidder.” In Lower Camden Regional School District, this requirement has meant in practice that they take the lowest bidder. (Tr. at 1:147-49.) 235. In application, “responsible” means capable of performing the contractual duties. When school bus transportation contracts are signed, the contractor provides a performance bond or a surety bond to ensure that the contractor will fulfill the contract, or pay for the school district to find someone else to do it. (Tr. at 1:147,164-65.) 236. School districts generally do not consider customer goodwill, personal relationships, confidential data, or prior customer relationships in determining whether a bidder is responsible. (Tr. at 1:148-49.) 237. Cost or price is the predominant factor school districts consider in awarding school bus transportation contracts in New Jersey once the decision has been made to open the contract for bidding. (Tr. at 1:149, 164.) 238. Jamison, who has participated in approximately 1,000 bids in New Jersey, could not name a single instance where the lowest bidder who met all of the contract specifications set by the district did not receive the contract. The lowest responsible bidder requirement is enforced only in cases of extremely bad service by a previous provider. (Tr. at 2:108-09.) 239. Pursuant to statute, a school district may renew a school bus transportation contract with its current contractor as long as the renewal price does not exceed 30% of the original contracting price. Other than the renewal process and the public bidding process, there is no other way a contract can be awarded in New Jersey. (Tr. at 1:150-51.) 240. Thus, in New Jersey, contracts for school bus services are not required to be bid each year. Although they are generally one year contracts, as long as the price does not increase more than 30% above the original price, a school district may choose to renew the contract indefinitely without engaging in the public bidding process. (Tr. at 1:150-51, 2:86, 6:80; Ex. P-70.) 241. When Laidlaw purchases a bus company, it purchases not only that company’s contracts, but also the right to renew those contracts. (Tr. at 2:86.) 242. While goodwill, customer relationships, and corporate reputation are unimportant once a contract goes to the bidding process, they are important in obtaining renewals of contracts in New Jersey. (Tr. at 2:87, 89.) b. The State of Competition in New Jersey 243. On December 16, 1997, the State of New Jersey Commission of Investigation (“Commission of Investigation”) issued a report containing factual findings and recommendations stemming from its investigation into the New Jersey school transportation industry. This report sets forth findings of fact on critical issues currently facing the New Jersey school bus transportation industry, including the following: (1) Conditions which foster and permit collusive bidding and related abuses are prevalent throughout New Jersey’s school transportation system. ... [;] (2) Trends in pupil transportation in New Jersey reflect the appearance and growing dominance of large, multi-state bus companies that are both under-bidding and buying out smaller competitors.... [; and] (3)Many school district transportation programs involve vendors selected through an extremely narrow bidding process. In fact, one New Jersey school district reported having a single bidder for the last 35 years. (Ex. D-2, at 3; see Tr. at 2:27-29.) 244. One conclusion that the Commission of Investigation reached was that every effort should be made to bolster the bidding and the implementation processes to foster competition and competitive prices. (Ex. D-2, at 6-8.) 245. The Commission of Investigation also recommended: “Where applicable, the process of obtaining quotes should not be used to parcel out work to favored vendors. All bus companies within a reasonable distance should be contacted to submit quotes.” In addition, the Commission made other recommendations designed “to foster competition and to minimize conditions that breed collusion.” (Ex. D-2, at 7-8.) 246. Laidlaw operates approximately 2000 school buses in New Jersey. The total number of school buses in New Jersey is approximately 15,000, possibly more. (Tr. at 1:98, 6:81.) Laidlaw has about 20% of the New Jersey market for the private school bus transportation industry. (Tr. at 2:20-21.) 247. There are over 200 private school bus contractors in New Jersey. This includes larger contractors as well as small local contractors. (Tr. at 1:99, 2:98, 6:75.) 248. In a few instances, Laidlaw has submitted bids to school districts in New Jersey that were unopposed. (Tr. at 2:102.) c. STA’s New Jersey Operations 249. In New Jersey, bidding for school bus contracts for the 1998/1999 school year occurs predominately from May through August, 1998. (Tr. at 1:108.) 250. STA has not in the past operated, and is not currently operating, any school buses in New Jersey. (Tr. at 6:31.) 251.