EQT Production v. Bochter, R. ( 2015 )

J-A07040-15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
EQT PRODUCTION COMPANY IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellant
v.
ROBERT M. BOCHTER, II; MATTHEW
PASQUINELLI; VENTURE ENERGY
SOLUTIONS, LLC; AND CONFLUENCE
ENERGY CONSULTANTS, LLC
Appellee No. 1405 WDA 2014
Appeal from the Order Entered August 4, 2014
In the Court of Common Pleas of Allegheny County
Civil Division at No(s): 11-005691
BEFORE: BENDER, P.J.E., LAZARUS, J., and MUNDY, J.
MEMORANDUM BY MUNDY, J.: FILED JULY 24, 2015
Appellant, EQT Production Company (EQT), appeals from the August 4,
2014 order denying its motion for preliminary injunctive relief, seeking to
enjoin Appellees Robert M. Bochter, II, Matthew Pasquinelli, Venture Energy
Solutions, LLC, and Confluence Energy Consultants, LLC (collectively,
Appellees) from competing with EQT for two years, and to create a
constructive trust relative to certain disputed proceeds, among other relief.
After careful review, we affirm in part, reverse in part and remand.
The trial court aptly summarized the factual history of this case as
follows.
[] EQT is a large and well-established
corporation engaged in natural gas production. As a
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necessary part of this business, EQT engages in the
lease and, occasionally, purchase of mineral rights
for exploration and development. The primary face
of the company in these efforts, when dealing with
landowners, are EQT’s landmen.
In 2014[,] Defendants Robert M. Bochter and
Matthew Pasquinelli[,] were among those landmen.
They were, to all appearances, successful and well-
compensated employees of EQT. In January of that
year, along with another partner not party to this
action, they formed two companies, Venture Energy
Solutions, LLC (Venture) and Confluence Energy
Consultants, LLC (Confluence). At least one of
these, like EQT, was in the business of acquiring
mineral rights. Bochter and Pasquinelli continued
their employment with EQT notwithstanding their
new status as competitors.
Soon after, [Bochter and Pasquinelli], through
Venture, entered into a deal to acquire an option to
purchase mineral rights from Carl and Alice Hildreth
(the Hildreth deal). They used EQT’s Geographic
Information System (GIS), a tool owned by EQT and
used by their landmen to organize both public and
proprietary information for use in acquiring mineral
rights. [Bochter and Pasquinelli] also saved
spreadsheets of public information produced using
the GIS to a Google Drive. The evidence does not
indicate that they also extracted and retained
proprietary information from the GIS, although
Bochter admitted to looking at non-public EQT
information regarding the Hildreth property. Venture
quickly resold the option to purchase, making a
significant profit. Bochter and Pasquinelli were
thereafter suspended then fired by EQT.
Venture also engaged in a transaction for
mineral rights with Charles and Eileen Schilling, but
this deal was not established by evidence to be
related in any way to proprietary EQT information.
EQT is now seeking monetary damages for
Bochter and Pasquinelli’s actions. In advance of its
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damage case, EQT is seeking Preliminary Injunctive
relief from th[e trial c]ourt, demanding that
[Appellees] be enjoined from doing business in
particular geographic areas and that a constructive
trust be established to hold the proceeds of the
Hildreth deal.
Trial Court Opinion, 10/23/14, at 3-4 (footnote omitted).
On April 1, 2014, EQT filed a complaint against Appellees seeking
damages and equitable relief for violation of the Pennsylvania Uniform Trade
Secrets Act,1 tortious interference with contract and prospective business
relations, tortious interference with prospective economic advantage, breach
of fiduciary duty/duty of loyalty, civil conspiracy, conversion, unjust
enrichment, and unfair competition. Contemporaneously with its complaint,
EQT filed a motion for an order to preserve documents, an order for
expedited discovery, and a motion for a special preliminary injunction. On
April 8, 2014, the trial court granted EQT’s motion for an order to preserve
documents, and separately ordered the parties to agree to a discovery
schedule. On April 15, 2014, EQT filed a renewed motion for a special
preliminary injunction. Following motions to compel certain discovery, EQT
filed a motion for adverse inferences based on Appellees’ lack of compliance
with discovery requests and orders. A hearing on EQT’s renewed motion for
preliminary injunction was held on June 5, 6, 10, and 16, 2014. On August
4, 2014, the trial court denied EQT’s renewed motion for adverse inferences
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1
12 Pa.C.S.A. §§ 5301-5308.
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and its motion for preliminary injunction. EQT filed a timely notice of appeal
on August 28, 2014.2
On appeal, EQT raises the following issues for our review.
[1]: Did the trial court err in entering an [o]rder
denying [EQT’S] motion for adverse inferences, when
adverse inferences are warranted because
[Appellees] spoliated evidence, withheld or failed to
produce evidence, and violated court orders
regarding preserving and producing evidence?
[2]: Did the trial court err in entering an [o]rder
denying [EQT’S] motion for a preliminary injunction
without considering whether a stolen compilation of
information was a trade secret?
[3]: Did the trial court err in entering an [o]rder
denying [EQT’S] motion for a preliminary injunction
imposing a constructive trust on all revenues that
[Appellees] received improperly, when an injunction
is necessary to preserve the status quo by
preventing [Appellees] from depleting the improperly
received revenues?
[4]: Did the trial court err in entering an [o]rder
denying [EQT’S] motion for a preliminary injunction
without addressing [EQT’S] other requests for
relief—enjoining [Appellees] from continuing to
possess or use EQT’s property, requiring [Appellees]
to immediately return EQT’s property, and requiring
[Appellees] to provide an accounting of revenues
received improperly—when these forms of relief were
appropriately raised before the trial court?
EQT’s Brief at 3-4.
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2
EQT and the trial court have complied with Pennsylvania Rule of Appellate
Procedure 1925.
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EQT’s first allegation of error faults the trial court for denying its
motion for adverse inferences due to Appellees’ discovery violations and
spoliation of evidence, and failing to apply those inferences in its
determination of EQT’s motion for a preliminary injunction. Id. at 30.
Before addressing the merits of EQT’s claim, we note the following principles
guiding our review.
“Spoliation of evidence” is the failure to preserve or
the significant alteration of evidence for pending or
future litigation. Pyeritz v. Commonwealth, 613
Pa. 80, 32 A.3d 687, 692 (2011). “When a party to
a suit has been charged with spoliating evidence in
that suit (sometimes called “first-party spoliation”),
we have allowed trial courts to exercise their
discretion to impose a range of sanctions against the
spoliator.” Id. (citing Schroeder v.
Commonwealth, Department of Transportation,
551 Pa. 243, 710 A.2d 23, 27 (1998)) (footnotes
omitted). This Court has stated:
“When reviewing a court’s decision to grant or
deny a spoliation sanction, we must determine
whether the court abused its discretion.”
Mount Olivet Tabernacle Church v. Edwin
L. Wiegand Division, 781 A.2d 1263, 1269
(Pa. Super. 2001) (citing Croydon Plastics
Co. v. Lower Bucks Cooling & Heating, 698
A.2d 625, 629 (Pa. Super. 1997) (recognizing
that “[t]he decision whether to sanction a
party, and if so the severity of such sanction, is
vested in the sound discretion of the trial
court”)). Such sanctions arise out of “the
common sense observation that a party who
has notice that evidence is relevant to litigation
and who proceeds to destroy evidence is more
likely to have been threatened by that
evidence than is a party in the same position
who does not destroy the evidence.” Mount
Olivet, 781 A.2d at 1269 (quoting Nation–
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Wide Check Corp. v. Forest Hills
Distributors, Inc., 692 F.2d 214, 218 (1st
Cir. 1982)). Our courts have recognized
accordingly that one potential remedy for the
loss or destruction of evidence by the party
controlling it is to allow the jury to apply its
common sense and draw an “adverse
inference” against that party. See Schroeder
v. Commonwealth of Pa., Dep’t of Transp.,
551 Pa. 243, 710 A.2d 23, 28 (1998). …
To determine the appropriate sanction
for spoliation, the trial court must weigh three
factors:
(1) the degree of fault of the party who
altered or destroyed the evidence; (2)
the degree of prejudice suffered by the
opposing party; and (3) whether there is
a lesser sanction that will avoid
substantial unfairness to the opposing
party and, where the offending party is
seriously at fault, will serve to deter such
conduct by others in the future.
Mount Olivet, 781 A.2d at 1269–70 (quoting
Schmid v. Milwaukee Elec. Tool Corp., 13
F.3d 76, 79 (3d Cir.1994)). …
Creazzo v. Medtronic, Inc., 903 A.2d 24, 28–29
(Pa. Super. 2006).
Parr v. Ford Motor Co., 109 A.3d 682, 701-702 (Pa. Super. 2014) (en
banc) (footnote omitted), appeal denied, --- A.3d ---, 2015 WL --------, No.
46 EAL 2015 (Pa. 2015) (per curiam).
Evidentiary rulings are committed to the sound
discretion of the trial court, and will not be overruled
absent an abuse of discretion or error of law. In
order to find that the trial court’s evidentiary rulings
constituted reversible error, such rulings must not
only have been erroneous but must also have been
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harmful to the complaining party. Appellant must
therefore show error in the evidentiary ruling and
resulting prejudice, thus constituting an abuse of
discretion by the lower court.
Whitaker v. Frankford Hosp. of City of Phila., 984 A.2d 512, 521-522
(Pa. Super. 2009) (internal quotation marks and citations omitted).
EQT specifically challenges the trial court’s determination that it did
not prove spoliation occurred. EQT’s Brief at 31-33. “The trial court denied
EQT’s motion for adverse inferences because it inexplicably held that EQT
did not demonstrate spoliation of evidence. The court never explained how
it arrived at that conclusion and it is impossible to see how it could have.”
Id. at 31. EQT recounts the evidence of Appellees’ non-compliance with the
trial court’s discovery orders and testimony tending to establish that
Appellees deleted information from computers that were provided. Id. EQT
concludes “[t]he deletion of computer files is undeniably spoliation of
evidence for which an adverse inference should be granted. … The trial
court’s failure to acknowledge these admitted deletions as spoliation is
reversible error.” Id. at 32-33.3
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3
Implicit in EQT’s argument is the contention the trial court should have
determined that discovery was complete for the purposes of its preliminary
injunction motion so that Appellees’ alleged violations of discovery orders
could lead to the conclusion of spoliation of the evidence and to the
imposition of sanctions. It is apparent the trial court declined to do so. In
its October 23, 2014 opinion, the trial court noted that the underlying case
was in its “early stages,” and discovery was an “ongoing process”. Trial
Court Opinion, 10/23/14, at 5. The trial court offered EQT additional time to
seek compliance of the discovery orders. Id. “[EQT] presented two Motions
(Footnote Continued Next Page)
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The trial court found, however, that EQT did not establish that
spoliation in fact occurred. Trial Court Opinion, 10/23/14, at 6.
The essential argument of [EQT] in its Motion for
Adverse Inference seems to be that [Appellees] must
have spoliated evidence because [EQT] failed to find
the proprietary information it expected to appear
upon discovery, or that the [Appellees] had not thus
far in the early stages of this litigation fully produced
all information requested by [EQT]. This is not, and
cannot be, sufficient for an adverse inference.
Id. at 5. Based on our review of the record, we conclude the trial court’s
factual findings in this regard are supported and its evidentiary ruling in
refusing to accept adverse inferences at this stage of the proceedings was
not an abuse of its discretion.
EQT’s remaining issues on appeal contain various allegations of trial
court error in denying its motion for preliminary injunction. We recount the
_______________________
(Footnote Continued)
to Compel discovery in advance of the hearing on their Motion for
Preliminary Injunction. EQT was offered an opportunity by this [c]ourt to
delay the hearing until its discovery requests had been fully answered. It
chose to go forward without [Appellees’] full compliance.” Id.
“[I]n general, discovery orders are not final, and are therefore
unappealable.” T.M. v. Elwyn, Inc., 950 A.2d 1050, 1056 (Pa. Super.
2008), quoting Jones v. Faust, 852 A.2d 1201, 1203 (Pa. Super. 2004).
“Discovery sanction orders are interlocutory and not appealable until final
judgment in the underlying action.” Baranowski v. Am. Multi-Cinema,
Inc., 688 A.2d 207, 208 n.1 (Pa. Super. 1997) (citation omitted), appeal
denied, 704 A.2d 633 (Pa. 1997). Accordingly, to the extent EQT challenges
the trial court’s underlying discovery and sanction orders, as opposed to the
trial court’s evidentiary decisions based on the then current status of
discovery at the preliminary injunction hearing, we are without jurisdiction to
address such claims. Id.; see also Pa.R.A.P 311, 341.
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following principles directing our review of these issues. “[T]he scope of
review in preliminary injunction matters is plenary.” Warehime v.
Warehime, 860 A.2d 41, 46 n.7 (Pa. 2004)
[O]ur review of a trial court’s order granting or
denying preliminary injunctive relief is highly
deferential. This highly deferential standard of
review states that in reviewing the grant or denial of
a preliminary injunction, an appellate court is
directed to examine the record to determine if there
were any apparently reasonable grounds for the
action of the court below. We will find that a trial
court had apparently reasonable grounds for its
denial of injunctive relief where the trial court has
properly found that any one of the following essential
prerequisites for a preliminary injunction is not
satisfied.
There are six essential prerequisites that a
party must establish prior to obtaining preliminary
injunctive relief. The party must show: 1) that the
injunction is necessary to prevent immediate and
irreparable harm that cannot be adequately
compensated by damages; 2) that greater injury
would result from refusing an injunction than from
granting it, and, concomitantly, that issuance of an
injunction will not substantially harm other
interested parties in the proceedings; 3) that a
preliminary injunction will properly restore the
parties to their status as it existed immediately prior
to the alleged wrongful conduct; 4) that the activity
it seeks to restrain is actionable, that its right to
relief is clear, and that the wrong is manifest, or, in
other words, must show that it is likely to prevail on
the merits; 5) that the injunction it seeks is
reasonably suited to abate the offending activity;
and, 6) that a preliminary injunction will not
adversely affect the public interest. The burden is on
the party who requested preliminary injunctive
relief[].
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Id. at 46-47 (internal quotation marks, citations and footnotes omitted).
“We may interfere with the chancellor’s decision only if the certified record
reveals that no grounds exist to support the decree, or that the rule of law
upon which the court relied was palpably erroneous or misapplied.” W.
Penn Specialty MSO, Inc. v. Nolan, 737 A.2d 295, 298 (Pa. Super. 1999)
(citation omitted).
EQT first claims the trial court erred in failing to determine if the public
information component of its GIS compilation, obtained and used by
Appellees, qualified as a trade secret. EQT’s Brief at 41. “The trial court []
erred by not analyzing whether EQT’s GIS compilation is entitled to trade
secret protection.” Id. EQT argues that compilations of public information
are included in the definition of trade secrets under common law and the
Pennsylvania Uniform Trade Secrets Act. Id. at 42-43, citing 12 Pa.C.S.A.
§ 5302. EQT then develops an argument for why trade secret status applies
to the GIS compilation in this case. Id. at 43-49. We conclude this
argument misses the point of the trial court’s ruling.
The trial court in fact allowed for the possibility that the GIS
compilation deserved trade secret protection. “[The trial court does] not
doubt that the GIS is a valuable tool for EQT, or that it, used as a tool for
the manipulation of data to achieve particular ends, is worthy of protection
as a trade secret.” Trial Court Opinion, 10/23/14, at 7. However, the trial
court determined that this fact did not excuse the lack of an evidentiary
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showing that Appellees continued to possess or have access to the GIS tool.
Id.
Without access to [the GIS], and without any
evidence that they retain any other proprietary
information which belongs to EQT, as distinguished
from public information also manipulable by the GIS,
there is no indication that any further harm will
ensue from their continued business operation, apart
from the simple fact of competition, from which EQT
has no protection.
Id. Consequently, the trial court determined that the sixth prerequisite
enumerated by Warehime was not established. “The offending activity
here is in the past. [Appellees] have no access to EQT’s GIS database, and
thus no ability, even if inclination, to repeat it. Estopping their future
business dealings will not change this, for good or ill….” Id.
Upon review of the record, we conclude the findings of the trial court
are supported. Absent EQT’s sought-after adverse inferences, the trial court
was within its discretion as evaluator of credibility and finder of fact to
conclude the evidence of Appellees’ continued ability to use proprietary
information was lacking. Accordingly, we conclude the trial court had
“apparently reasonable grounds” for its decision to deny preliminary
injunctive relief. See Warehime, supra.
EQT next faults the trial court for failing to grant the portion of its
preliminary injunction motion seeking to impose a temporary constructive
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trust on Appellees, relative to the proceeds from the Hildreth deal.4 EQT’s
Brief at 50. Specifically, EQT argues, “[t]he [trial] court expressly
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4
We recognize that it may not be appropriate to use the term “constructive
trust” by a party seeking the temporary freezing or sequestering of assets as
a form of preliminary injunctive relief.
A constructive trust arises when a person holding
title to property is subject to an equitable duty to
convey it to another on the ground he would be
unjustly enriched if he were permitted to retain it. …
The controlling factor in determining whether a
constructive trust should be imposed is whether it is
necessary to prevent unjust enrichment.
Santoro v. Morse, 781 A.2d 1220, 1231 (Pa. Super. 2001) (citations
omitted, emphasis added). Thus, a constructive trust is a final equitable
remedy, because preliminary limitations on an asset would not require its
conveyance to another. Based on this understanding, this Court has held
that a trial court’s grant of a constructive trust, purportedly as a preliminary
injunction, was in fact a final order. Robbins v. Kristofic, 643 A.2d 1079,
1082 (Pa. Super. 1994), appeal denied, 651 A.2d 541 (Pa. 1994). In
Robbins, the trial court entered an order as follows. “[I]t is hereby
ORDERED that a preliminary injunction issue requiring that [the holder of a
fund in Defendant’s name] be imposed with a constructive trust in favor of
Plaintiff and may not be withdrawn without further order of court.” Id. at
1081-1082. In rejecting the appellant’s challenge to the trial court’s grant of
the preliminary injunction, this Court held that the trial court’s imposition of
the constructive trust was a final order granting a permanent remedy upon a
determination of the merits, rendering the preliminary injunction portion of
the trial court’s order moot. Id. at 1082. Notwithstanding Robbins, this
Court in Santoro upheld “the trial court in the exercise of its broad equity
powers [to] order the temporary imposition of a constructive trust so
as to preserve the assets of [Defendant,] pending trial.” Santoro, supra at
1231 (emphasis added). Still other cases address this type of preliminary
injunctive relief without any reference to the term “constructive trust”. See,
e.g., Citizens Bank of Pa. v. Meyers, 872 A.2d 827 (Pa. Super. 2005).
Instantly, the relief sought by Appellant, i.e., to prevent dissipation of the
Hildreth deal proceeds pending the litigation, was clear regardless of
whether such relief is properly termed a temporary “constructive trust”, and
we proceed with this understanding in mind.
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recognized that EQT could be harmed by Defendants’ dissipation of the
Hildreth proceeds, but it concluded the harm of denying Defendants access
to their ill-gotten gains was higher. The [trial] court’s analysis was wrong as
a matter of law.” Id. at 53.
In assessing the evidence supporting EQT’s request for preliminary
injunctive relief in this regard against the six Warehime factors, the trial
court did acknowledge the first factor, immediate and irreparable harm to
EQT, was shown. Trial Court Opinion, 10/23/14, at 7-8. “EQT faces the risk
that allegedly profligate opposing parties will spend all proceeds of the
Hildreth deal and any subsequent business, thus reducing EQT’s ability to
collect any future judgments.” Id. Indeed, we conclude that finding is
supported by the record, as Appellee Bochter testified that $525,000 of the
$950,000 made from the Hildreth deal was already disbursed. N.T., 6/5-6,
10/14, at 165-166.5 However, the trial court determined the second and
third factors, i.e., the preliminary injunction will not substantially harm
Appellees, and any relief will restore the parties to their respective positions,
were not met. Id.
[Appellees] would be denied access to a significant
sum of money made in the exercise of that
profession until such a time as the underlying action
here is resolved. These are very serious harms for
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5
Notwithstanding this testimony, Appellees assert that EQT presented no
evidence of dissipation or likelihood of dissipation. Appellees’ Brief at 15.
However, as noted infra, the trial court did determine Appellees would likely
need to access those funds for further capital investment.
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small operators in a dynamic business that requires
significant capital investments to be made on short
notice.
Id. at 8.
We agree with EQT that the trial court misapplied the Warehime
factors. In Ambrogi v. Reber, 932 A.2d 969 (Pa. Super. 2007), appeal
denied, 952 A.2d 673 (Pa. Super. 2008), the defendants made an argument,
similar to the trial court’s position here, that restrictions on certain assets
would interfere with its ability to conduct its business.
[Defendants/Appellants] contend that the preliminary
injunction entered by the trial court in this case imposes
an unfair and intolerable burden by preventing them from
running their business in the accustomed manner. They
also complain that the preliminary injunction changes,
rather than preserves, the status quo between the parties
because it places Appellees in a better position than they
occupied before the injunction.
Id. at 978-979.
In response, the Ambrogi Court noted that because the goal of a
preliminary injunction was to preserve the status quo prior to the wrongful
act, the inability to use assets generated by the wrongful act cannot be
considered a hardship to the defendants. Id. at 979. “The relevant
standard requires that an injunction must address the status quo as it
existed between the parties before the event that gave rise to the lawsuit,
not to the situation as it existed after the alleged wrongful act but before
entry of the injunction.” Id. The Court held “that Pennsylvania law does not
preclude a trial court from granting a preliminary injunction to prevent
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dissipation of assets,” and affirmed the trial court’s preliminary injunction.
Id. at 975.
Like the defendants position in Ambrogi, the trial court here focuses
on the status quo at the time the preliminary injunction would have taken
effect rather than the status quo prior to alleged improper conduct by
Appellees in securing the Hildreth deal. See Trial Court Opinion, 10/23/14,
at 7-8. Viewed from the proper timeframe, we conclude Appellees are not
subject to a greater harm by an inability to use the disputed funds in their
ongoing business, because such allegedly ill-gotten funds would not have
been available to them then. See Ambrogi, supra at 975. Thus, we
conclude the trial court’s denial of preliminary injunctive relief limiting the
dissipation of the Hildreth deal proceeds involved a “rule of law upon which
the court relied[, which] was palpably erroneous or misapplied.” W. Penn
Specialty MSO, Inc., supra.
The trial court also deems the fifth Warehime factor, the relief is
suited to abate the harm, is unmet.6 Trial Court Opinion, 10/23/14, at 8.
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6
The trial court, in its October 23, 2014 opinion, did not specifically address
the remaining Warehime factors in connection with its denial of preliminary
injunctive relief in restricting further dissipation of the Hildreth deal
proceeds. We conclude, based on our review of the record, that these do
not present an impediment to relief. The trial court has acknowledged
generally that EQT’s right to relief is likely. “[Appellees] use of EQT’s GIS
led to one deal for a discrete and known amount of money.” Trial Court
Opinion, 10/23/14, at 7. “To establish a clear right to relief, the party
seeking an injunction need not prove the merits of the underlying claim, but
need only demonstrate that substantial legal questions must be resolved to
(Footnote Continued Next Page)
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EQT asserts the trial court “erred by holding that a constructive trust would
not abate Defendants’ past competition using EQT’s proprietary information.”
EQT’S Brief at 54. The trial court held as follows. “The offending activity
here is in the past. [Appellees] have no access to EQT’s GIS database, and
thus no ability… to repeat it. Estopping their future business dealings will
not change this, for good or ill, nor will placing the proceeds of the
Hildreth deal into trust.” Trial Court Opinion, 10/23/14, at 8 (emphasis
added).
Again, we agree with EQT that the trial court relied on an erroneous
application of the law. The trial court conflates the harm intended to be
abated by EQT’s distinct requests for injunctive relief. EQT’s first request
sought to restrict Appellees from competing through continued use of EQT’s
proprietary information. EQT’s Complaint, 4/1/14, at 33. Contrary to the
trial court’s conclusion, this was not the harm sought to be abated by its
request for injunctive relief to restrict the dissipation of the Hildreth deal
proceeds. Id. at 34. Clearly, prohibiting dissipation will not prevent future
use of proprietary information, but that is not the targeted harm in EQT’s
request for this relief, which was to prevent Appellees from contriving to
become judgment-proof. EQT’s Brief at 51; see also Ambrogi, supra at
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(Footnote Continued)
determine the rights of the parties.” SEIU Healthcare Pa. v.
Commonwealth, 104 A.3d 495, 506 (Pa. 2014) (citation omitted).
Additionally, we discern no adverse impact to the public interest. See
generally Warehime, supra.
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975. Consequently, we conclude that the trial court misapplied the law and
the Warehime factors to the facts of this case and unreasonably denied
EQT’s request to restrict the dissipation of the Hildreth deal proceeds.
Accordingly, we reverse that aspect of the trial court’s August 4, 2014 order
and remand for further proceedings consistent with this memorandum.
In its final issue, EQT faults the trial court for failing to rule on its
remaining requests for relief, including enjoining Appellees from continued
possession of EQT’s property, compelling return of any such property, and
providing an accounting. EQT’s Brief at 54-55. Relative to these requests
the trial court noted as follows. “[EQT] request[s] other forms of possible
injunctive relief, including a number of points which would be properly raised
in a Motion to Compel, but as those were never argued or briefed, they will
not be addressed.” Trial Court Opinion, 10/23/14, at 4 n.1. We discern no
error. While EQT insists it consistently argued for these bases of relief, we
note the first two share the same infirmity of proof denoted by the trial court
relative to its denial of preliminary injunctive relief connected to the
requested restriction on competition by Appellees. We agree also the
request for an accounting is more properly seen as a motion to compel but
the trial court is free to address that request in light of our remand of this
case.
Based on all the preceding, we affirm the trial court’s evidentiary
ruling refusing to apply adverse inferences to its determination of the merits
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of EQT’s request for a preliminary injunction. Additionally, to the extent EQT
challenges the trial court’s discovery rulings, the same are interlocutory and
not subject to our review. We further affirm that portion of the trial court’s
August 4, 2014 order denying EQT’s request for a preliminary injunction
relative to its request to restrict Appellees’ competition with EQT. However,
because the trial court misapplied the law and the Warehime factors to
EQT’s request for preliminary injunctive relief in the form of a restriction on
Appellees from dissipation of the Hildreth deal proceeds, we reverse that
aspect of the trial court’s August 4, 2014 order and remand for further
proceedings consistent with this memorandum.7
Order affirmed in part and reversed in part. Case remanded. Motion
to Strike granted. Jurisdiction relinquished.
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7
On January 12, 2015, Appellees filed with this Court a motion to strike
Hearing Exhibit 3 from EQT’s Amended Designation of record, because it is
not contained in the certified record. A review of the record reveals that, at
the conclusion of the third day of the hearing on the preliminary injunction,
the trial court directed the parties to submit a stipulation and or objections
relative to the admission of exhibits. N.T., 6/5-6,10/14, at 471. No such
stipulation or copy of the exhibits is contained in the record certified to this
Court. Accordingly, Appellee’s motion is granted and the exhibit was not
considered in our disposal of the merits of this appeal. See PHH Mortg.
Corp. v. Powell, 100 A.3d 611, 614 (Pa. Super. 2014) (noting “this Court
may consider only the facts that have been duly certified in the record when
deciding an appeal,” and striking attachments to a brief that did not appear
in the certified record).
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J-A07040-15
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 7/24/2015
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