Robert Kuntz, Kunodu, Inc., and B-K Interests, LLC v. EVI, LLC , 999 N.E.2d 425 ( 2013 )


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  • FOR PUBLICATION
    ATTORNEY FOR APPELLANTS:                    ATTORNEYS FOR APPELLEE:
    ERIC E. SNOUFFER                            DANIEL D. BOBILYA
    Snouffer & Snouffer                         DANIEL J. HOLDEN
    Fort Wayne, Indiana                         Bobilya Law Group, LLC
    Fort Wayne, Indiana
    Oct 10 2013, 10:46 am
    IN THE
    COURT OF APPEALS OF INDIANA
    ROBERT KUNTZ, KUNODU, INC.,                 )
    and B-K INTERESTS, LLC.,                    )
    )
    Appellants-Defendants,                )
    )
    vs.                            )    No. 02A03-1301-PL-14
    )
    EVI, LLC,                                   )
    )
    Appellee-Plaintiff.                   )
    APPEAL FROM THE ALLEN SUPERIOR COURT
    The Honorable Daniel G. Heath, Judge
    Cause No. 02D01-1207-PL-226
    November 13, 2013
    OPINION - FOR PUBLICATION
    ROBB, Chief Judge
    Case Summary and Issues
    Appellants Robert Kuntz, Kunodu, Inc., and B-K Interests, LLC (collectively,
    “Kuntz”) appeal the trial court’s issuance of a preliminary injunction and award of
    attorney fees in favor of EVI, LLC (“EVI”). Kuntz raises the following issues for our
    review: (1) whether the trial court erred in granting a preliminary injunction prohibiting
    Kuntz from competing against EVI; (2) whether the trial court improperly modified the
    terms of the parties’ covenant not to compete in conjunction with its grant of a
    preliminary injunction; (3) whether the trial court abused its discretion by awarding
    attorney fees to EVI; and (4) whether the trial court erred by entering a nunc pro tunc
    entry modifying its award of attorney fees for EVI.
    We conclude that the trial court did not abuse its discretion by granting a
    preliminary injunction against Kuntz; however, the trial court improperly extended the
    duration of the parties’ covenant not to compete. Further, we conclude that the trial court
    erred by awarding attorney fees to EVI at this stage of the proceedings. Accordingly, we
    affirm in part, reverse in part, and remand for further proceedings.
    Facts and Procedural History1
    Kuntz had been in the business of selling, repairing, and rebuilding electric
    automobile parts, such as alternators and starters, since 1976. Beginning in 1991, Kuntz
    1
    We heard oral argument in this case on October 22, 2013, at Purdue University. We commend counsel
    for their advocacy and thank the faculty, staff, and Executive MBA students at Purdue for their participation and
    hospitality.
    2
    owned and operated Kunodu, Inc. d/b/a Auto Electric (“Kunodu”), which was located at
    709 East Washington Street in Fort Wayne, Indiana. In April of 2007, Kuntz sold the
    assets of Kunodu to JS Hare, Inc. (“JS Hare”). In connection with that asset sale, JS Hare
    and Kuntz, as an individual or through his solely owned company B-K Interests, LLC,
    entered into multiple contractual agreements.      Those agreements included an asset
    purchase agreement, a covenant not to compete (“Noncompete Agreement”), a security
    agreement, a promissory note, and a lease agreement. The lease agreement (“the Lease”)
    between Kuntz and JS Hare provided that JS Hare would lease the property at 709 East
    Washington for a five-year term and granted JS Hare an option to purchase the property
    at the expiration of the Lease.
    On November 22, 2011, JS Hare entered into an agreement with EVI whereby
    EVI was authorized to manage all aspects of JS Hare’s business. And on December 12,
    2011, JS Hare sold its assets to EVI, including its goodwill and assets which JS Hare had
    acquired in the asset purchase from Kuntz. As part of that asset sale, JS Hare assigned its
    rights under the Lease and the Noncompete Agreement to EVI.
    Sometime in late 2011, Kuntz became aware that EVI was managing JS Hare and
    doing business at 709 East Washington. Between late 2011 and early 2012, Kuntz had
    multiple conversations with EVI during which the parties attempted to negotiate an
    extension of the Lease or sale of the property to EVI. However, these negotiations were
    unsuccessful, and the Lease expired, according to its terms, on March 31, 2012.
    3
    Although Kuntz knew that EVI had been managing JS Hare, he was not aware of the
    asset sale between JS Hare and EVI until March or April of 2012.2
    At some time prior to April 30, 2012, EVI became concerned that Kuntz had been
    engaged in certain activities in violation of the Noncompete Agreement and sent a letter
    to Kuntz voicing those concerns. On July 18, 2012, EVI filed suit against Kuntz and
    requested a preliminary injunction. The trial court held a hearing on the request for
    preliminary injunction on October 18, October 30, and November 7, 2012. On December
    17, 2012, the trial court entered its findings of fact and conclusions of law and issued an
    order granting EVI’s request for preliminary injunction and entered a judgment for
    attorney fees against Kuntz. On January 3, 2013, the trial court amended its judgment for
    attorney fees nunc pro tunc, increasing the award from $11,351.50 to $34,808. Kuntz
    now appeals. Additional facts will be provided below.
    Discussion and Decision
    I. The Preliminary Injunction
    Kuntz’s primary contention on appeal is that the trial court erred by granting
    EVI’s request for a preliminary injunction.                      For the reasons discussed below, we
    conclude that the trial court did not abuse its discretion by granting the preliminary
    injunction against Kuntz.
    2
    At this point, the facts are unclear as to when exactly Kuntz learned of the asset sale between JS Hare and
    EVI. Kuntz’s brief indicates that he knew of the asset sale in “March or April, 2012,” Appellant’s Brief at 3, and
    EVI states that Kuntz was “officially made aware” in April of 2012. Appellee’s Brief at 4. The trial court’s findings
    of fact do not state the time at which Kuntz first had knowledge of the asset sale.
    4
    A. Standard of Review
    The grant or denial of a preliminary injunction rests within the sound discretion of
    the trial court, and our review of that decision is limited to whether there was a clear
    abuse of discretion. Apple Glen Crossing, LLC v. Trademark Retail, Inc., 
    784 N.E.2d 484
    , 487 (Ind. 2003). When granting or refusing to grant a preliminary injunction, the
    trial court must make special findings of fact and conclusions of law. Ind. Trial Rule
    52(A)(1). The reviewing court determines whether the findings support the judgment.
    Am. Arbitration Ass’n v. N. Miami Cmty. Schs., 
    866 N.E.2d 296
    , 300 (Ind. Ct. App.
    2007). The trial court’s findings or judgment will be reversed only if they are clearly
    erroneous. 
    Id. A finding
    of fact is clearly erroneous if the record lacks evidence or
    reasonable inferences from the evidence to support it. 
    Id. To obtain
    a preliminary injunction, the moving party must show by a
    preponderance of the evidence: (1) a reasonable likelihood of success on the merits by
    establishing a prima facie case, (2) remedies at law are inadequate, resulting in
    irreparable harm pending resolution of the substantive action if a preliminary injunction
    is not granted, (3) the balance of harms favors preliminary injunction such that the
    threatened injury to the movant outweighs the injunction’s potential harm to the
    nonmovant, and (4) the public interest would not be disserved. Apple Glen 
    Crossing, 784 N.E.2d at 487-88
    .
    5
    B. Kuntz’s Breach of the Noncompete Agreement
    The trial court’s issuance of the preliminary injunction was founded upon its
    determination that EVI demonstrated a prima facie case that Kuntz was in violation of the
    Noncompete Agreement. The Noncompete Agreement states in pertinent part:
    For purposes of this Agreement, “Non-compete Period” shall mean the
    period that begins on the effective date of this Agreement and ends on
    October 7, 2014, except that the “Non-Compete Period” shall be extended
    by the duration of any violation by [Kuntz] of the terms of Paragraph 2 of
    this Agreement.
    ***
    Noncompetition and Nonsolicitation. [Kuntz] will not at any time, directly
    or indirectly, on [his] own behalf or on behalf of any third party, whether as
    an agent, employee, employer, officer, director, shareholder, member,
    consultant, independent contractor, lender, investor, creditor, partner,
    principal or in any other competitive capacity:
    (a) Employ or seek to employ any person who was an employee of the
    Buyer during the Non-compete Period; or
    ***
    (c) “compete” (as hereinafter defined) with Buyer within the Market Area
    during the Non-compete Period . . . .
    ***
    For purposes of this Agreement, “compete,” “competes,” and “competing”
    shall mean to engage or seek to engage in activities or the provision of
    products or services in the Market Area that are identical or substantially
    similar to those activities engaged in or products or services provided by
    the Seller during the Service Period including, without limitation, the sale,
    rebuilding, refurbishing, and distribution of automotive starter [sic],
    alternators, and batteries. For the purpose of this Agreement, “competitor”
    shall mean any person, business or entity that “competes,” as defined
    above. Seller and Kuntz acknowledge that Seller is selling to Buyer the
    goodwill of a business and make the preceding covenants in consideration
    6
    for and as a necessary condition of that transaction and for other good and
    valuable consideration received or to be received by them.
    Appellant’s Appendix at 193-94.
    At the hearing, EVI presented evidence of Kuntz’s breach of the Noncompete
    Agreement. Specifically, the trial court found that Kuntz engaged in activities prohibited
    by the Noncompete Agreement on at least thirty separate occasions during the
    noncompetition period and that he had personally repaired or rebuilt starters or alternators
    for persons whom he considered friends on at least a half-dozen occasions. Further, the
    trial court found that there was evidence to support the position that Kuntz violated the
    terms of the Noncompete Agreement by leasing the 709 East Washington Street property
    to a competitor of EVI, after EVI vacated the premises on March 31, 2012. The evidence
    contained in the record supports these findings, which are sufficient to constitute a prima
    facie showing that Kuntz acted contrary to the Noncompete Agreement.3 However,
    Kuntz maintains that the trial court’s findings as to his violation of the Noncompete
    Agreement are clearly erroneous or the result of an improper interpretation and
    application of the Noncompete Agreement.4 We disagree.
    3
    Additionally, the trial court found that Kuntz violated the Noncompete Agreement by employing a
    former employee of JS Hare and by using a commercial account to purchase automotive parts from a wholesale
    vendor and provide those parts to other people.
    4
    Kuntz also argues that certain findings made by the trial court were impermissibly based upon hearsay
    testimony, which was admitted by the trial court over Kuntz’s objection. The trial court admitted the testimony on
    the grounds that the declarant was the person testifying at the hearing. Although this evidence was unnecessary to
    make EVI’s prima facie showing, we note for the benefit of the parties and the trial court that the availability of the
    declarant as a testifying witness does not in and of itself exempt his out-of-court statements from the rule barring
    hearsay. See K.F. v. State, 
    961 N.E.2d 501
    , 513-15 (Ind. Ct. App. 2012), trans. denied; see also Ind. Evidence Rule
    801 & 803; Modesitt v. State, 
    578 N.E.2d 649
    , 652-54 (Ind. 1991).
    7
    First, Kuntz claims that because the Noncompete Agreement was between Kuntz
    and JS Hare, competition with EVI could not constitute a violation of the agreement.
    Essentially, Kuntz argues that the term “Buyer” in the agreement is defined as JS Hare
    and does not include the successors or assigns of JS Hare, and therefore, the Noncompete
    Agreement cannot be enforced by EVI. We find this argument unavailing. Section 10 of
    the Noncompete Agreement provides: “All the terms, covenants and conditions of this
    Agreement shall be binding upon, and inure to the benefit of, and be enforceable by the
    parties hereto and their respective successors, heirs, personal representatives, executors
    and assigns.” Appellant’s App. at 195. This provision clearly demonstrates that the
    parties to the agreement, including Kuntz, anticipated the possibility that the contract may
    be assigned. Indeed, JS Hare’s rights under the agreement were assigned to EVI after
    EVI purchased assets from JS Hare.5 Therefore, EVI may enforce the Noncompete
    Agreement against Kuntz.
    Second, Kuntz argues that the trial court erred by finding that Kuntz’s lease
    agreement with a competitor of EVI’s violates the Noncompete Agreement. Particularly,
    Kuntz takes issue with the trial court’s determination that his role as a lessor amounts to
    him competing as a “creditor” under the terms of the agreement. Kuntz cites Wineteer v.
    Kite, 
    397 S.W.2d 752
    (Mo. Ct. App. 1965), for the proposition that leasing to a
    competitor is not a violation of a covenant not to compete absent an express provision
    5
    As a general matter, Indiana common law allows for the assignment of contractual rights absent an
    expression of contrary intent by the parties. See Chrysler Fin. Co., LLC v. Indiana Dep’t of State Revenue, 761
    N.E2.d 909, 912 (Ind. T.C. 2002). The Noncompete Agreement does not countenance any clear intent to avoid
    assignment. Further, Kuntz does not argue that the contract was not—or could not be—validly assigned and thus
    has forfeited that issue.
    8
    restricting such leasing. We note first that Wineteer is not binding and acts only as
    persuasive authority for this court. That said, we believe that Kuntz reads the Wineteer
    decision too broadly, and it can be distinguished from this case. In Wineteer, the court
    dealt with a non-competition provision stating that the parties “agree[d] not to compete
    directly or indirectly.” 
    Id. at 754.
    The court noted that the parties made no effort to
    amplify the provision and that the brevity of the provision rendered it only a generalized
    restriction. 
    Id. at 755.
    In the absence of evidence that the parties had considered a more
    expansive application of their agreement, the court declined to extend it to prevent
    leasing to a competitor. 
    Id. By contrast,
    the Noncompete Agreement at issue here
    contains a nearly exhaustive list of roles in which Kuntz is prohibited from acting as a
    competitor: “Seller and Kuntz will not at any time [compete], directly or indirectly, on
    their own behalf or on behalf of any third party, whether as an agent, employee,
    employer, officer, director, shareholder, member, consultant, independent contractor,
    lender, investor, creditor, partner, principal or in any other competitive capacity[.]”
    Appellant’s App. at 193. Considering the broad scope of this provision and the inclusion
    of language prohibiting competition “in any other competitive capacity,” it is apparent
    that the intent and legal effect of the provision is to restrict all competitive activity in any
    capacity. We believe that Kuntz’s role as lessor for a competitor of EVI is prohibited
    competition under the terms of the Noncompete Agreement.6
    6
    We emphasize that our determination that the Noncompete Agreement prohibits leasing to a competitor
    is based on the overall scope and language of the agreement, rather than the singular restriction that Kuntz refrain
    from competing as a “creditor.”
    9
    In addition to establishing a reasonable likelihood of success on the merits, the
    remaining requirements for a preliminary injunction have also been met, and Kuntz does
    not specifically challenge the court’s determination on the remaining elements. With
    respect to a showing of irreparable harm, the parties agreed that a breach of the
    Noncompete Agreement “would cause irreparable harm to the Buyer, and that such
    damage would be incapable of precise measurement, that no adequate remedy at law
    would exist for such breach . . . .” Appellant’s App. at 194. Although such an agreement
    is not dispositive, it is persuasive in determining that a preliminary injunction is
    appropriate. Moreover, EVI directs us to a number of decisions in which this court has
    found injunctive relief as an appropriate remedy for violation of a covenant not to
    compete. See, e.g., Robert’s Hair Designers, Inc. v. Pearson, 
    780 N.E.2d 858
    , 870 (Ind.
    Ct. App. 2002); Norlund v. Faust, 
    675 N.E.2d 1142
    , 1149-50 (Ind. Ct. App. 1997), trans.
    denied.   Regarding the balance of harms, the court did not abuse its discretion by
    concluding that the harm to EVI of continued violation of the Noncompete Agreement by
    Kuntz outweighs any potential harm to Kuntz by issuing a preliminary injunction. And,
    lastly, we agree that the public interest is not disserved by the issuance of a preliminary
    injunction under these circumstances.
    In sum, we conclude that the trial court did not abuse its discretion by granting
    EVI’s request for preliminary injunction.
    10
    C. Pre-existing Breach
    Kuntz contends that even if his conduct would have constituted a breach of the
    Noncompete Agreement, he was no longer bound to that agreement due to pre-existing
    breaches by JS Hare.            Kuntz maintains that several pre-existing breaches occurred,
    including defaults under both the security agreement and the Lease.7 In response, EVI
    maintains that Kuntz failed to properly plead an affirmative defense, and even if he had
    preserved the defense of pre-existing breach, Kuntz failed to prove default or waived any
    claim of previous default by failing to enforce his rights under the agreements.
    First, we address EVI’s contention that Kuntz failed to properly plead an
    affirmative defense regarding pre-existing breach by JS Hare or EVI. We recognize the
    trial court’s findings indicate that it, too, believed that arguments concerning pre-existing
    defaults were not properly before the court. We disagree. Kuntz’s Answer to Plaintiff’s
    Complaint, Affirmative Defenses, and Counterclaims (“Kuntz’s Answer”) states in
    Paragraph 11 of the Counterclaims section:
    Even if EVI was a party to the Non-Compete Agreement or had other rights
    to enforce same, neither Kunodu nor Kuntz are bound by the restrictions in
    the Non-Compete Agreement as JS Hare is and has been in default of the
    Asset Purchase Agreement . . . since at least December 12, 2011. Under
    the plain language of the Non-Compete Agreement, the restrictive terms are
    not enforceable in the event of a default.
    Appellant’s App. at 135. Indiana Trial Rule 8(C) states that “[i]f the pleading mistakenly
    designates a defense as a counterclaim or a counterclaim as a defense, the court shall treat
    7
    Alleged defaults of the security agreement include assigning, moving, and selling collateral without
    Kuntz’s written consent and failing to keep the collateral in good repair. Alleged defaults of the Lease include
    assigning the Lease without Kuntz’s written consent, surrendering the property in poor condition, and failing to pay
    real estate taxes called for under the Lease.
    11
    the pleading as if there had been a proper designation.” Thus, the fact that Kuntz asserted
    a prior default by JS Hare as a counterclaim, rather than a defense, is of no great import.
    We believe Kuntz’s Answer is sufficient to satisfy the requirements of notice pleading
    and preservation of an affirmative defense, Lafary v. Lafary, 
    476 N.E.2d 155
    , 158-59
    (Ind. Ct. App. 1985), and to allow Kuntz to defend on a theory of pre-existing breach.8
    See Ind. Trial Rule 8(F) (“All pleadings shall be so construed as to do substantial justice,
    lead to disposition on the merits, and avoid litigation of procedural points.”). To the
    extent the trial court’s findings and judgment sought to preclude Kuntz from presenting
    an affirmative defense concerning prior default by JS Hare, we find that determination to
    be clearly erroneous.
    Although we conclude that Kuntz has preserved his affirmative defense, we do not
    believe that those arguments, at this juncture, are sufficient to render the trial court’s
    preliminary injunction an abuse of discretion.                         EVI need only show a reasonable
    likelihood of success by establishing a prima facie case. Apple Glen 
    Crossing, 784 N.E.2d at 488
    . EVI has made this showing, and the facts necessary to determine whether
    8
    Ironically, Kuntz points out that EVI failed to plead waiver as an affirmative defense in its Answer to
    Counterclaims and contends that EVI should be precluded from arguing Kuntz either waived or is estopped from
    making any claim of pre-existing default by JS Hare. Waiver and estoppel are affirmative defenses. Ind. Trial Rule
    8(C). Ordinarily, an affirmative defense is waived if not specifically pled in the answer or raised at trial. Nelson v.
    Gurley, 
    673 N.E.2d 497
    , 500 n.3 (Ind. Ct. App. 1996). Here, evidence relating to these arguments was presented by
    EVI without objection, and the trial court considered the arguments in its findings. Therefore, EVI’s arguments as
    to waiver and estoppel have not been forfeited. See Ind. Trial Rule 15(B) (“When issues not raised by the pleadings
    are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in
    the pleadings.”); Warner v. Riddell Nat’l Bank, 
    482 N.E.2d 772
    , 776 (Ind. Ct. App. 1985), trans. denied. Moreover,
    we do not believe that Kuntz will suffer any unfair prejudice by allowing EVI to continue to argue waiver or
    estoppel going forward.
    12
    JS Hare previously defaulted and whether Kuntz waived any prior default are unclear,
    undeveloped, and disputed among the parties.
    Preliminary injunctions protect the rights of the parties by “maintaining the status
    quo as it existed prior to the controversy, until the issues and equities in a case can be
    determined after a full examination and hearing” and “prevents harm to the moving party
    that could not be corrected by a final judgment.” AGS Capital Corp., Inc. v. Prod. Action
    Int’l, LLC, 
    884 N.E.2d 294
    , 314 (Ind. Ct. App. 2008), trans. denied. We believe that
    these goals are best achieved in this case by maintaining the preliminary injunction until
    the issues of pre-existing default and waiver are fully developed and vetted in the first
    instance by the trial court.
    It is important to note that our analysis at the preliminary injunction stage is
    confined to the question of whether there has been a prima facie showing and the moving
    party has demonstrated a reasonable likelihood of success on the merits. This has been
    done, so our inquiry is at its end. Neither our decision nor the trial court’s issuance of a
    preliminary injunction is an indicator of which party is entitled to ultimate success on the
    merits. It remains to be seen whether the scales may be tipped by the parties’ additional
    arguments regarding default, waiver, and estoppel.
    II. Extension of Time Period in Covenant Not to Compete
    Kuntz contends that the trial court erred by entering a judgment “modify[ing] the
    terms of the Non-Compete Agreement at the preliminary injunction stage.” Appellant’s
    Brief at 24. He asserts that the trial court’s determination subverts the purpose of the
    13
    preliminary injunction, which is merely to maintain the status quo until the case can be
    heard and decided on the merits.
    In fact, the trial court concluded “[Kuntz’s] violations of the Non-compete
    commenced on approximately at [sic] the beginning of April, 2012, until the date of this
    Order enjoining [Kuntz] from violating the Non-compete, or about eight (8) months. The
    Non-compete is, hereby, extended from October 7, 2014, until June 7, 2015.”
    Appellant’s App. at 44. The trial court’s conclusion is based upon a provision of the
    Noncompete Agreement, which provides that its restrictions “shall be extended by the
    duration of any violation by [Kuntz] of the terms of Paragraph 2 of this Agreement.”
    Appellant’s App. at 193.
    We disagree with Kuntz’s characterization of the trial court’s judgment as a
    “modification” of the Noncompete Agreement, because the agreement itself already
    contemplates an extension of the agreement for the term of any violation. That said, we
    understand Kuntz’s concern, as the trial court’s order granting preliminary injunction is
    neither a declaratory judgment nor a permanent injunction occurring as a final disposition
    on the merits. The purpose of a preliminary injunction is to “preserve the status quo as it
    existed before a controversy, pending a full determination on the merits of the dispute.”
    Stoffel v. Daniels, 
    908 N.E.2d 1260
    , 1272 (Ind. Ct. App. 2009). The status quo is the
    “last, actual, peaceful and non-contested status which preceded the pending controversy.”
    N. Ind. Pub. Serv. Co. v. Dozier, 
    674 N.E.2d 977
    , 987 (Ind. Ct. App. 1996) (citation
    omitted). In our view, the last uncontested position of the parties was the Noncompete
    14
    Agreement as it existed prior to litigation; that is, the Noncompete Agreement was
    enforceable until October 7, 2014.
    The trial court’s conclusion that the period of the Noncompete Agreement should
    be extended beyond October 7, 2014 due to a violation by Kuntz is premature at this
    stage of the litigation and goes beyond the purpose of a preliminary injunction. Any
    court-ordered extension of the Noncompete Agreement would be appropriate only after a
    full examination of the case on the merits and a final determination that a violation
    occurred. Therefore, we conclude that the trial court abused its discretion by extending
    the duration of the Noncompete Agreement as part of the preliminary injunction.
    III. Attorney Fees after Preliminary Injunction
    Finally, Kuntz argues that the trial court erred by awarding attorney fees to EVI in
    conjunction with its entry of the preliminary injunction. We agree.
    Indiana follows the “American Rule,” which requires that generally “a party must
    pay his own attorneys’ fees absent an agreement between the parties, a statute, or other
    rule to the contrary.” R.L. Turner Corp. v. Town of Brownsburg, 
    963 N.E.2d 453
    , 458
    (Ind. 2012).   Here, there is an agreement between the parties regarding attorney fees.
    The Noncompete Agreement states: “In any action brought to enforce this Agreement,
    the prevailing party shall be entitled to recover its reasonable attorneys’ fees and other
    costs incurred in that action or proceeding and in any appellate proceedings relating
    thereto from the other party or parties . . . .” Appellant’s App. at 194 (emphasis added).
    A “prevailing party” is
    15
    [t]he party to a suit who successfully prosecutes the action or successfully
    defends against it, prevailing on the main issue, even though not necessarily
    to the extent of his original contention. . . . To be such does not depend
    upon the degree of success at different stages of the suit, but whether, at the
    end of the suit, or other proceeding, the party who has made a claim against
    the other, has successfully maintained it.
    BLACK’S LAW DICTIONARY 1188 (6th ed. 1990). A party prevails by “a judgment
    following a full trial of the merits or by consent decree or settlement that grants them the
    relief sought.” AGS Capital 
    Corp., 884 N.E.2d at 316
    . “Inherent in the definition of
    preliminary judgment is the fact that a judgment on the merits has yet to be made” and
    “the prevailing party is yet to be determined.” 
    Id. EVI’s attainment
    of a preliminary injunction marks only a success at one stage of
    the litigation and does not afford it prevailing party status. Therefore, we conclude that
    the trial court erred by awarding attorney fees to EVI after entry of the preliminary
    injunction.9
    Conclusion
    We conclude that the trial court’s decision to grant a preliminary injunction
    against Kuntz was not an abuse of discretion; however, the trial court improperly
    extended the duration of the Noncompete Agreement. Further, we conclude that the trial
    court erred by awarding attorney fees to EVI upon entry of the preliminary injunction.
    Accordingly, we affirm in part, reverse in part, and remand for further proceedings
    9
    Because we conclude that the trial court’s award of attorney fees was inappropriate, we need not address
    the issue of whether the trial court erred by entering a nunc pro tunc entry modifying its award of attorney fees for
    EVI.
    16
    Affirmed in part, reversed in part, and remanded.
    NAJAM, J., and RILEY, J., concur.
    17