Ever.Ag, LLC v. Milk Moovement, Inc. ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 DAIRY, LLC, a Delaware Limited No. 21-cv-02233 WBS AC Liability Company, 13 Plaintiff, 14 ORDER RE: MOTION FOR v. TEMPORARY RESTRAINING ORDER 15 MILK MOOVEMENT, INC., a/k/a Milk 16 Moovement, LLC, a foreign Corporation, 17 Defendant. 18 19 ----oo0oo---- 20 Plaintiff Dairy, LLC filed this action against 21 defendant Milk Moovement, Inc. on December 2, 2021 alleging 22 violations of the Defend Trade Secrets Act and the California 23 Uniform Trade Secrets Act. (Docket No. 1.) On December 10, 24 2021, Plaintiff moved for a temporary restraining order and order 25 to show cause as to why a preliminary injunction should not be 26 granted. (Docket No. 8.) Plaintiff seeks to enjoin defendant 27 from, among other things, using, copying, disclosing, or 28 1 transmitting plaintiff’s alleged trade secret information. (Id.) 2 Defendant filed an opposition to the motion on December 14, 2021. 3 (Docket No. 15.) 4 “The purpose of a temporary restraining order is to 5 preserve the status quo pending the complete briefing and 6 thorough consideration contemplated by full proceedings pursuant 7 to a preliminary injunction.” Occupy Sacramento v. City of 8 Sacramento, No. 2:11-CV-02873-MCE, 2011 WL 5374748, at *3 (E.D. 9 Cal. Nov. 4, 2011) (citing Granny Goose Foods, Inc. v. Teamsters, 10 415 U.S. 423, 438–39 (1974) (temporary restraining orders “should 11 be restricted to serving their underlying purpose of preserving 12 the status quo and preventing irreparable harm just so long as is 13 necessary to hold a hearing, and no longer”); Reno Air Racing 14 Ass’n. v. McCord, 452 F.3d 1126, 1131 (9th Cir. 2006); Dunn v. 15 Cate, No. 1:08-cv-873 NVW, 2010 WL 1558562, at *1 (E.D. Cal. 16 2010)). 17 In order to obtain a temporary restraining order or 18 preliminary injunction, the moving party must establish (1) it is 19 likely to succeed on the merits, (2) it is likely to suffer 20 irreparable harm in the absence of preliminary relief, (3) the 21 balance of equities tips in its favor, and (4) an injunction is 22 in the public interest. Winter v. Nat. Res. Def. Council, Inc., 23 555 U.S. 7, 20-21 (2008); Humane Society of the U.S. v. 24 Gutierrez, 558 F.3d 896, 896 (9th Cir. 2009); Credit Bureau 25 Connection, Inc. v. Pardini, 726 F. Supp. 2d 1107, 1132 (E.D. 26 Cal. 2010) (standards for temporary restraining orders and 27 preliminary injunctions are the same). 28 I. Likelihood of Success on the Merits 1 To obtain a temporary restraining order, plaintiff must 2 show a likelihood of success on the merits on each element of its 3 claims. See Sony Computer Entm’t, Inc. v. Connectix Corp., 203 4 F. 3d 596, 608 (9th Cir. 2000) (requiring plaintiff to show a 5 likelihood of success on each element of its claim). Here, under 6 both the Defend Trade Secrets Act of 2016 and the California 7 Uniform Trade Secrets Act, plaintiff must show not just the 8 existence and ownership of a trade secret and the 9 misappropriation of that information, but that “(1) the 10 information is not readily ascertainable through proper means, 11 (2) the information derives independent economic value, and (3) 12 the plaintiff took reasonable measures to keep such information 13 secret.” Cherokee Chem. Co., Inc. v. Frazier, No. 20-1757-MWF 14 (ASx), 2020 WL 8410432, at *3 (C.D. Cal. Dec. 14, 2020). 15 Even assuming plaintiff has made a sufficient showing 16 of the other elements of its claims, the moving papers do not 17 demonstrate that plaintiff took reasonable measures to keep 18 reports in defendant’s possession secret. Plaintiff claims the 19 reports, which it considers trade secrets, were sent to defendant 20 by its customer California Dairies, Inc. Plaintiff argues that 21 the reports are known to be confidential in the industry, but 22 provides no facts detailing how, if at all, plaintiff instructed 23 California Dairies, Inc. to keep this information confidential, 24 or that the reports were at the least labeled confidential. 25 Accordingly, plaintiff has not sufficiently shown a 26 likelihood of success on the merits as it has not demonstrated 27 that the reports are a trade secret. Plaintiff’s motion for a 28 temporary restraining order could be denied on this basis alone. 1 II. Irreparable harm 2 “Under Winter, plaintiffs must establish that 3 irreparable harm is likely, not just possible, in order to obtain 4 a preliminary injunction.” All. for the Wild Rockies v. 5 Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011). The irreparable 6 harm claimed here is that absent injunctive relief, plaintiff 7 will suffer loss of market share, loss of current and prospective 8 customers, and an increased risk that its confidential 9 information will be shared to third parties. 10 Assuming that these predicted effects constitute 11 irreparable harm, plaintiff still must demonstrate that the 12 injury is immediately threatened. See Caribbean Marine Servs. 13 Co. v. Baldrige, 844 F.2d 668, 674 (9th Cir. 1988) (citation 14 omitted). Plaintiff has not carried this burden. 15 In assessing the immediacy of the threatened injury and 16 irreparable harm, the court notes that plaintiff originally filed 17 its case in the Central District of California, No. 2:21-cv- 18 09279-PA-MAR, on November 29, 2021, which it voluntarily 19 dismissed on December 2, 2021, and plaintiff did not move for a 20 temporary restraining order while the case was open in the 21 Central District. After filing its complaint in this district, 22 plaintiff waited more than a week to move for a temporary 23 restraining order. 24 Further, plaintiff alleges that the trade secrets were 25 transmitted from its customer, California Dairies, Inc., to 26 defendant in September 2021. (Docket No. 8-3 at ¶ 5.) 27 Plaintiff’s counsel learned of this transmission through a former 28 employee of California Dairies, Inc., but has provided no nee nn ene IEE I OI OE OIE OS OED NE 1 information as to when plaintiff or plaintiff’s counsel became 2 informed of this transmission. (Id. at 7 8.) 3 Under these circumstances, plaintiff has not shown 4 specific facts demonstrating that immediate and irreparable 5 injury will result before the court could hear a motion for a 6 | preliminary injunction. See Fed. R. Civ. P. 65 (b) (1) (A); See 7 E.D. Local Rule 231(b) (court will consider whether applicant 8 seeking a temporary restraining order “could have sought relief 9 | by motion for preliminary junction at an earlier date without the 10 necessity for seeking last-minute relief by motion for temporary 11 restraining order,” and undue delay may constitute grounds to 12 deny the request). 13 Plaintiff provides general allegations of losing 14 customers and market share, but provides no specifics about the 15 harm that would occur in the brief period of time between now and 16 a hearing on the preliminary injunction that has not already 17 occurred since defendant received the alleged trade secrets in 18 September 2021. This failure to show immediate irreparable harm 19 therefore constitutes another basis for denying a temporary 20 restraining order. 21 IT IS THEREFORE ORDERED that plaintiff's motion for a 22 temporary restraining order be (Docket No. 8), and the same 23 hereby is, DENIED. Counsel shall submit a suggested schedule for 24 briefing and hearing plaintiff’s motion for a preliminary 25 injunction. . « ak. a bean, (hi. 26 Dated: December 15, 2021 WILLIAMB.SHUBB © 27 UNITED STATES DISTRICT JUDGE 28