WILMINGTON, Del. – Wal-Mart Stores Inc., the world’s largest retailer, won a bid for a court injunction to stop drugstore operator CVS Caremark Corp. from hiring its former executive vice president, Hank Mullany.
At a hearing Wednesday in Delaware Chancery Court in Wilmington, Judge Travis Laster granted Wal-Mart’s request for a preliminary injunction, barring Mullany’s hiring by CVS until a trial on the issue in early March. Wal-Mart sued CVS over claims Mullany’s hiring could violate a non-compete agreement.
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“Mr. Mullany didn’t have to leave. He could have gone to a non-competitor,” Laster said in granting Wal-Mart’s request. “The protection that Wal-Mart bargained for is precisely needed at this moment.”
Lawyers for Wal-Mart argued during Wednesday’s hearing that Woonsocket-based CVS would be privy to confidential information about its growth strategy and plans for a small-format store pilot program if it hired Mullany. Mullany, 52, is the former president of Wal-Mart’s northern U.S. division. He oversaw retail operations for more than 1,300 stores in 19 states, according to court documents.
Wal-Mart and CVS, the largest provider of prescription drugs in the U.S., compete over prescription and over-the-counter drugs, as well as beauty aids and health products, lawyers for Wal-Mart argued.
Wal-Mart started filling generic drug prescriptions for $4 an order in September 2006 and has more than 4,000 pharmacies in the U.S.
“We are disappointed with the court’s decision and are fully evaluating all of our options,” CVS spokeswoman Carolyn Castel said in an e-mailed statement. “In the interim, Larry Merlo, President and COO of CVS Caremark, will continue to be responsible for CVS/pharmacy retail operations.”
The case is Wal-Mart Stores Inc. v. Mullany, 6040, Delaware Chancery Court (Wilmington).
