Teledyne Technologies Incorpor v. Raj Shekar , 831 F.3d 936 ( 2016 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 15-2349
TELEDYNE TECHNOLOGIES
INCORPORATED, a Delaware
Corporation, doing business as
Teledyne Electronic Manufacturing
Services,
Plaintiff-Appellee,
v.
RAJ SHEKAR,
Defendant-Appellant.
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 15 C 1392 — Ronald A. Guzman, Judge.
ARGUED MAY 23, 2016 — DECIDED AUGUST 5, 2016
Before BAUER, POSNER, and WILLIAMS, Circuit Judges.
BAUER, Circuit Judge. Teledyne Technologies, Inc. (“Tele-
dyne”) obtained a temporary restraining order and, later, a
preliminary injunction against its former employee, Raj Shekar
(“Shekar”). Both required Shekar to return Teledyne’s equip-
ment and electronic information, which he retained following
2 No. 15-2349
his termination. Since Shekar refused to comply with either
order, Teledyne filed a motion for rule to show cause why
Shekar should not be held in contempt. The district court
granted the motion and scheduled an evidentiary hearing.
Prior to the hearing, Shekar filed a motion to vacate the
preliminary injunction.
Ultimately, the district court issued an order holding
Shekar in contempt and denying his motion to vacate the
preliminary injunction. Shekar appeals both rulings.
I. BACKGROUND
On February 3, 2015, Teledyne terminated Shekar’s employ-
ment. On February 13, 2015, Teledyne filed a verified com-
plaint for injunctive relief against Shekar in the United States
District Court for the Northern District of Illinois.
According to the verified complaint, as a Teledyne em-
ployee, Shekar had access to Teledyne’s servers, which
contained the company’s confidential information. After
Teledyne fired Shekar, Shekar “accessed or attempted to
access” Teledyne’s servers. There was also “a large data
transfer between Teledyne EMS’s server 20 and Shekar’s
laptop computer” on the day he was terminated. Further, in
the months prior to his termination, Shekar emailed Teledyne’s
confidential information to his personal email addresses and
saved it on his computer’s hard drive.
In addition, Teledyne’s verified complaint states that
Shekar had worked from home and used equipment provided
by Teledyne. This included a “laptop computer, a VPN token,
No. 15-2349 3
a projector, and a printer/scanner.” After his termination,
Shekar refused to return any of the equipment.
Teledyne’s verified complaint names several causes of
action against Shekar, such as violations of the Computer
Fraud and Abuse Act, the Illinois Trade Secrets Act, and the
Illinois Uniform Deceptive Trade Practices Act.1 Teledyne
sought injunctive relief that would require Shekar to return all
of Teledyne’s electronic information and equipment, as well as
produce his personal computers and electronic storage devices
to be inspected for Teledyne’s confidential information.
Teledyne also sought damages and other relief.
On February 17, 2015, the district court issued a temporary
restraining order requiring Shekar to return all of Teledyne’s
electronic information and equipment. It also ordered him to
identify in verified interrogatory responses all devices he
owned that were capable of storing electronic information.
Further, Shekar had to submit a declaration certifying that he
had returned all of Teledyne’s property, and that he had
retained all relevant devices and electronic information
without any alterations.
On March 5, 2015, Teledyne filed an amended motion for a
preliminary injunction. On March 10, 2015, the district court
held a hearing on the motion, which Shekar did not attend
(although the district court found that he had notice). The
district court granted Teledyne’s motion for the preliminary
injunction, noting that Shekar had “failed to comply with any
aspect of the [temporary restraining order].” Most of the
1
The underlying case is still pending in the district court.
4 No. 15-2349
preliminary injunction’s directives mirrored the earlier
temporary restraining order. But the preliminary injunction
also required Shekar to provide Teledyne with “unrestricted
access” to all of his devices that were capable of storing
electronic information.
On March 17, 2015, Teledyne filed a motion for rule to show
cause why the court should not hold Shekar in contempt for
violating the temporary restraining order and the preliminary
injunction. Teledyne argued that Shekar had refused to comply
with the preliminary injunction’s provisions. The district court
granted the motion and scheduled a hearing for April 30, 2015.
On April 27, 2015, Shekar filed a motion to vacate the
preliminary injunction. He claimed that he did not receive
notice of either the temporary restraining order or the prelimi-
nary injunction until after the orders were entered. Shekar also
stated that his lawyer had turned over all of Teledyne’s
equipment that was in his possession and that he did not have
any of Teledyne’s electronic information.
Following two evidentiary hearings, on June 17, 2015, the
district court entered a written order finding Shekar in con-
tempt for violating the temporary restraining order and the
preliminary injunction. The district court found that Shekar
had violated both orders by not producing several of his
devices that were capable of storing electronic information (i.e.
his personal computer, at least three external hard drives, and
his Teledyne iPhone accompanied with the correct password),
by not turning over or accounting for all of Teledyne’s elec-
tronic information that he possessed, by not providing com-
plete and truthful answers to Teledyne’s interrogatories, and
No. 15-2349 5
by not submitting a complete and truthful declaration of
compliance. In addition, the district court denied Shekar’s
motion to vacate the preliminary injunction because it found
that Shekar had actual notice of both the temporary restraining
order and the preliminary injunction. On June 24, 2015, Shekar
appealed the district court’s rulings.
II. DISCUSSION
Shekar argues that the district court abused its discretion in
holding him in contempt and erred in denying his motion to
vacate the preliminary injunction. Before we address the merits
of Shekar’s appeal, we must first determine whether we have
jurisdiction.
In general, an order holding a party in civil contempt is not
appealable while the litigation is pending. E.g., SEC v.
McNamee, 481 F.3d 451, 454 (7th Cir. 2007) (citations omitted).
There is an exception, however, in which we may have
jurisdiction if the order that the party in contempt violated is
itself appealable. Id. (citations omitted); see also In re Rimsat,
Ltd., 98 F.3d 956, 963 (7th Cir. 1996) (“Whether a judgment of
civil contempt is appealable at the time entered, rather than
later … depends on the appealability of the underlying order,
the order that the judgment of civil contempt is intended to
coerce the contemnor to obey.”). In this case, the district court
held Shekar in contempt for violating the preliminary injunc-
tion. Further, the underlying litigation is still pending. As a
result, Shekar can only appeal the district court’s contempt
order if he can also appeal the preliminary injunction.
Congress granted federal appellate courts jurisdiction over
certain interlocutory appeals, as enumerated in 28 U.S.C.
6 No. 15-2349
§ 1292(a). The statutory list includes “granting, continuing,
modifying, refusing or dissolving injunctions, or refusing to
dissolve or modify injunctions.” 28 U.S.C. § 1292(a)(1). But
interlocutory appeals must still conform with Federal Rule of
Appellate Procedure 4. Erb v. All. Capital Mgmt., L.P., 423 F.3d
647, 650 (7th Cir. 2005) (citing Otis v. City of Chicago, 29 F.3d
1159, 1167 (7th Cir. 1994) (en banc)). This Rule requires litigants
to file a notice of appeal “within 30 days after entry of the
judgment or order appealed from.” Fed. R. App. P. 4(a)(1)(A);
see also People of State of Ill. ex rel. Hartigan v. Peters, 871 F.2d
1336, 1339 (7th Cir. 1989) (“To obtain review of a district
judge’s decision to grant an injunction, the defendant must
seek review through a direct appeal within [30] days of the
district judge’s decision or give extraordinary reasons for not
having done so.”).
Here, the district court issued the preliminary injunction on
March 10, 2015. Shekar filed a notice of appeal of the district
court’s contempt order on June 24, 2015. By that time, more
than 30 days had passed since the preliminary injunction was
entered. As a result, Shekar’s appeal is untimely.
Although Shekar cannot appeal the underlying preliminary
injunction, he argues that he can still appeal the contempt
order because he is also appealing the district court’s denial of
his motion to vacate the preliminary injunction. But it is well
established that “a party seeking review of an interlocutory
order cannot enlarge the time for noticing an appeal by filing
a successive motion and appealing the denial of the latter
motion.” Erb, 423 F.3d at 650 (citations omitted).
No. 15-2349 7
Further, although 28 U.S.C. § 1292(a)(1) grants federal
appellate jurisdiction over orders that refuse to “dissolve” an
injunction, we noted in Securities and Exchange Commission v.
Suter that there are limits to this jurisdiction. 832 F.2d 988 (7th
Cir. 1987). In Suter, the district court entered a permanent
injunction against the appellant on February 6, 1986. Id. at 990.
Rather than timely appeal the injunction, the appellant filed
three motions to vacate the injunction. Id. The last of these
three motions was denied on November 7, 1986, which the
appellant then appealed. Id. We stated:
If … the only purpose of the motion [to vacate
the injunction] was to take a belated appeal from
the order entering the injunction, we penetrate
through form to substance and treat the appeal
from the denial of the motion to vacate as an
untimely appeal from the injunction, and dis-
miss the appeal for lack of jurisdiction.
Id. (citations omitted). In Suter, we found that it was a belated
appeal because the appellant had not argued that the facts or
law had changed since the injunction was originally entered,
but only that the injunction should not have been issued in the
first place. Id.
In this case, Shekar argues that the district court erred in
denying his motion to vacate the preliminary injunction
because it did not apply the correct “criteria governing
preliminary injunctive relief” and because “there is no basis in
the evidentiary record for finding that preliminary injunctive
relief was appropriate.” Shekar’s claim that the district court
did not apply the correct criteria for issuing a preliminary
8 No. 15-2349
injunction is wrong; the district court did apply the correct
criteria when it originally issued the preliminary injunction on
March 10, 2015.2 Furthermore, Shekar’s latter argument is
essentially that the preliminary injunction should not have
been entered in the first place; which is analogous to the
appellant’s failed argument in Suter.
Therefore, we do not have jurisdiction over Shekar’s appeal
of his motion to vacate the preliminary injunction because it is
merely a “belated appeal” of the initial preliminary injunction.
Suter, 832 F.2d at 990; see also Peters, 871 F.2d at 1339 (“[i]n
reviewing a denial of motions to dissolve an injunction … we
are not called upon to examine the district judge’s original
decision to impose an injunction”). Since Shekar cannot appeal
the preliminary injunction, he also cannot appeal the contempt
order while the underlying litigation remains pending in the
district court.3
2
In the June 17, 2015, order, the district court did not revisit the criteria for
issuing the preliminary injunction. It instead focused on Shekar’s arguments
raised in his motion to vacate the preliminary injunction.
3
Shekar cites Central States, Southeast & Southwest Areas Health & Welfare
Fund v. Lewis, 745 F.3d 283 (7th Cir. 2014), to support his appellate brief’s
jurisdictional statement. Although procedurally similar, the court in Lewis
did not address any issues involving Federal Rule of Appellate Procedure 4.
Therefore, it is not binding in this case. See R.R. Donnelley & Sons Co. v. FTC,
931 F.2d 430, 433 (7th Cir. 1991) (“Issues, even jurisdictional issues, lurking
in the record but not addressed do not bind the court in later cases.”)
(Citations omitted).
No. 15-2349 9
III. CONCLUSION
This appeal is DISMISSED.