Basic Principles of Equitable Remedies Flashcards
Preliminary Injunctions – 11th circuit
Elements test:
1) likelihood of success on the merits
2) irreparable harm will result if not enjoined
3) Balance of hardships favors P
4) public interest is not disserved
Morgan Stanley
1) no likelihood of success as non-solicit agreement was not rx
2) no irreparable harm because injury is compensable with damages
3) balance favors D because they would lose their jobs
4) public interest disserved because people can’t access services
Prelim Injunctions - 8th circuit
Same as 11th but factors
CDI
Workers in ND take all the clients of CDI when they start their own firm. CDI sought preliminary injunctions, but
1) no likelihood of success, CDI contends they stole trade secrets but don’t meet burden of proof (not dispositive)
2) injury already occurred so no irreparable harm, plus could get money damages
3) Balance favors P, as they would lose their jobs
4) Public interest disserved because people should be able to do business with whomever
Non-solicit and non-competes, and trade secrets
Non-solicitation
- must be reaosnable georgaphically and temprally
Non-competes
1) ok as long as it’s limited geographically/temporally
Exception: In CA, noncompetes are unenforceable unless someone is selling a business, you can preclude seller from competing. Noncompetes with employees are enforceable but duty of loyalty applies
Duty of loyalty
shouldn’t work for others working against your employer
Trade secret misappropriation
1) information that has value and value is maintained through secrecy
2) most likely not a trade secret if readily identifiable to the public (in CDI, anyone could find out who the oil clients were)
2nd circuit sliding scale
a) irreparable harm will occue, and then either
1) likelihood of success on the merits, or
2) serious question
b) balance of hardships in favor of P
Citigroup v. VCG
Didn’t show likelihood of success on merits but there was serous question about arbitrability of VCG’s claims
TRO’s
on notice: same as prelim injunction
Without notice requires:
1) specific facts in affidavit or verified complaint that immediate and irreparable injury will occur
2) writing from moving party’s attorney demonstrating efforts to notify and reasons why notification would be adverse
Injunction bonds
P must pay a bond in case D is wrongfully enjoined
Bond caps liability amount
Courts can waive bond or set at $0
U.S., agents, officers, don’t have to pay bond
Sprint v. Cat Communications
Sprint enjoined Cat and paid $250,000 bond, but complying with injunction racked up millions in costs for Cat. Injunction dissolved, rather than bond amount changing
Consolidation
Can consolidate preliminary injunction hearing with trial on the merits but must give notice
Recovery of Damages/Nintendo
Bond is executed when it’s found that D was wrongfully enjoined
Permanent Injunctions
Ebay test - 4 factors
1) must establish irreparable harm
2) remedies at law are not available
- -use same facts for factors 1 and 2–
3) balance of hardships between P/D
4) public interest not disserved
also consider court supervision
requires trial on merits
courts more likely to grant permanent injunction if there is real threat of future/ongoing bad conduct
Defenses to requests for injunctions – unclean hands
Misconduct must have immediate/necessary relation to the injunction sought
exception when P is serving public interest
Salomon v. Vockel
V left S and took clients. S tried to get injunction but S had V do the same thing to Merrill Lynch previously. So no injunction granted
Defenses – Laches
must show D suffered prejudice due to P’s unreasonable delay. Elements:
1) Unreasonable delay – length, rx excuse?
2) Prejudice
- -either D relied on delay, or delay caused loss of witnesses/evidence
SoL starts at time P should have known
Jarrow Formulas
J sought injunction claiming Nutrition Now had misleading and false claims about its products. Contests advertisements but only brings claim after 7 years.
Public interest served? No evidence public was actually harmed by NN’s claims so no
Violations of Equitable Decrees – Contempt
Direct – in front of judge
Indirect – outside of courtroom
Indirect Contempt
a) Civil – requires C+C evidence D was not Rx diligent in complying. Right to jury trial not entitled
Civil Compensatory
make P whole for D’s noncompliance
Can get attorney’s fees
Cancer Research
Civil Coercive
Wronke
Criminal contempt
BRD standard
Requires jury trial if >6 months jail time or “serious fine”
Persons Bound by Injunctions
1) the parties
2) parties’ current officers, agents, attorneys, employees, and
3) others in active concert with any of these
Need actual notice! Successor companies can be bound by injunctions, but must have notice
Roe v. Operation Rescue
Action for injunctive relief to stop blockades of abortion clinics.
Injunction was against Operation Rescue National.
Trial court says Operation Rescue can’t be held in contempt as the campaign was put on by National.
Problem is that OR was very involved with ORN with respect to this campaign. Terry (OR founder) authored a letter encouraging people to support ORN’s campaign, on ORN’s letterhead, but signed it on behalf of OR (didn’t maintain distinction). Letters were jointly sent by both organizations celebrating the success of the campaign. Seem to be essentially interchangeable.
Terry was not physically present at the blockade, but was an instigator of the conduct.
Will still be bound by injunction for instigating others to do prohibited conduct
