Opinion
CIVIL ACTION NO. 2:10cv1058-MHT.
January 21, 2011
OPINION AND ORDER
In this lawsuit, based on diversity-of-citizenship jurisdiction, 28 U.S.C. § 1332, plaintiffs Fruit of the Loom, Inc. and Russell Brands, LLC claim that defendant Lonnie C. Bishop violated a "Trade Secrets and Non-Competition Agreement" he signed while employed by Russell. Bishop now works for Gildan Activewear Charleston, Inc., a competitor of the plaintiffs in the activewear business. At both Russell and Gildan, Bishop has worked as a manager in the distribution center. The plaintiffs have asked the court to enjoin Bishop preliminarily from working or providing services to Gildan during the pendency of this case. Based on the evidence presented at an evidentiary hearing on January 20, 2011, the plaintiffs' preliminary-injunction motion will be denied.
It is in the sound discretion of the trial court whether to issue a preliminary injunction. International Cosmetics Exchange, Inc. v. Gapardis Health Beauty, Inc., 303 F.3d 1242, 1246 (11th Cir. 2002). A party seeking a preliminary injunction must satisfy a four-part test showing: (1) that it has a substantial likelihood of success on the merits; (2) that it would be irreparably harmed if an injunction were not granted; (3) that such harm outweighs the harm that would accrue to the opposing party if the injunction were granted; and (4) that the injunction would not be adverse to the public interest. American Civil Liberties Union of Florida, Inc. v. Miami-Dade County School Bd., 557 F.3d 1177, 1198 (11th Cir. 2009). "[A] preliminary injunction is an extraordinary and drastic remedy not to be granted unless the movant clearly established the `burden of persuasion' as to each of the four prerequisites." Siegel v. LePore, 234 F.3d 1163, 1176 (11th Cir. 2000) (en banc) (per curiam).
FIRST PART: At best, it is a close question whether the plaintiffs have established that they will succeed on the merits in the present case. The non-compete agreement at issue provides:
"You agree that, for a period of twelve (12) months after termination of your employment with [Russell], you will not . . . work or provide services for a Competitor . . . in an area, position or capacity in which you gained particular knowledge or experience during your employ with [Russell], involving the sale, design, or manufacture of Competitive Products . . ."
Def.'s Br. at 4 (Doc. No. 21). All parties agree that the language preceding "involving the sale, design, or manufacture" applies to Bishop. He is working "in an area, position or capacity" at Gildan "in which [he] gained particular knowledge or experience" at Russell. The parties also agree that Bishop has had no involvement with the "design" or "manufacture" of products at either Russell or Gildan. The only question remaining is whether his former or current position involves "sales."
Based on the limited evidence presented so far to the court and reading the contract against the plaintiffs as required by the agreed-upon applicable Kentucky law, see B. Perini Sons v. Southern Ry. Co., 239 S.W.2d 964, 965 (Ky. 1951) (stating that "a contract is read liberally in favor of the person who accepts it rather than in favor of the person who draws it and submits it to the other person for acceptance"), the court believes that it is more likely that a factfinder would reasonably conclude that Bishop's job as a distribution manager does not involve "sales." As stated, at both Russell and Gildan, Bishop has worked in the distribution area, not in the identifiably separate sales area in either company. While it could be argued that all distribution relates to, and thus involves, sales, this is a slippery-slope argument that could lead to the non-compete agreement encompassing all aspects of Gildan's business, for essentially all aspects of the business relate to sales in one way or another. Thus, the plaintiffs have not shown they have a substantial likelihood of success on the merits.
SECOND PART: A showing of irreparable injury is "the sine qua non of injunctive relief," Northeastern Fla. Chapter of Ass'n of Gen. Contractors v. City of Jacksonville, 896 F.2d 1283, 1285 (11th Cir. 1990) (quoting Frejlach v. Butler, 573 F.2d 1026, 1027 (8th Cir. 1978)), for, "even if plaintiffs establish a likelihood of success on the merits, the absence of a substantial likelihood of irreparable injury would, standing alone, make preliminary injunctive relief improper." Siegel, 234 F.3d at 1176. Also, the irreparable injury asserted must be neither remote nor speculative, but actual and imminent. Id. Most notably, the harm must be of a kind that cannot be remedied by monetary damages. "The possibility that adequate compensatory or other corrective relief will be available at a later date, in the ordinary course of litigation, weighs heavily against a claim of irreparable harm." United States v. Jefferson County, 720 F.2d 1511, 1520 (11th Cir. 1983). "An injury is irreparable only if it cannot be undone through monetary remedies." Ferrero v. Associated Materials Inc., 923 F.2d 1441, 1449 (11th Cir. 1991).
In this case, the plaintiffs have presented no convincing evidence that they will be irreparably harmed by Bishop's continued employment at Gildan while this suit is resolved. First, Bishop has already been at Gildan for almost two months, with no sign that his employment there has harmed the interests of the plaintiffs. The plaintiffs have not identified any information Bishop has not already divulged to Gildan that a preliminary injunction entered now would keep him from divulging. Therefore, the court cannot see how an injunction would serve any purpose at this point in time. Second, while it is true that "the loss of customers and goodwill is an irreparable injury," BellSouth Telecommunications, Inc. v. MCIMetro Access Transmission Services, LLC, 425 F.3d 964, 970 (11th Cir. 2005) (quoting Ferrero v. Associated Materials Inc., 923 F.2d 1441, 1449 (11th Cir. 1991)), the plaintiffs have presented no evidence that they will lose customers or goodwill as a result of Bishop's employment by Gildan. See Curves Intern., Inc. v. Mosbarger, 525 F.Supp.2d 1310, 1314 (M.D. Ala. 2007) (Thompson, J.) (finding that plaintiff had presented no evidence of loss of customers or goodwill already that would lead the court to believe that further such losses were likely absent an injunction). Finally, the court is not convinced why, should the plaintiffs succeed on the merits, monetary damages will not suffice in this case.
THIRD PART: Also, balancing the equities weighs in favor of Bishop. Forcing him to quit his job throughout the pendency of a lawsuit would place a significant hardship on him and his family, especially considering how long civil lawsuits generally take to resolve in the federal court system. There is no evidence that a similar hardship will befall the plaintiffs if a preliminary injunction is denied.
FOURTH PART: Finally, there is no evidence that denying a preliminary injunction in this case would be adverse to the public interest.
The plaintiffs have not presented evidence sufficient to fulfill the four requirements for a preliminary injunction. Most notably, they have failed to establish a likelihood of success on the merits or irreparable harm.
***
Accordingly, it is the ORDER, JUDGMENT, and DECREE of the court that plaintiffs Fruit of the Loom, Inc. and Russell Brands, LLC's motion for preliminary injunction (Doc. No. 2) is denied.
DONE, this the 21st day of January, 2011.
A copy of this checklist is available at the website for the USCA, 11th Circuit at www.ca11.uscourts.gov Effective on April 9, 2006, the new fee to file an appeal will increase from $255.00 to $455.00. CIVIL APPEALS JURISDICTION CHECKLIST1. Appealable Orders: Appeals from final orders pursuant to 28 U.S.C. § 1291: 28 U.S.C. § 158Pitney Bowes, Inc. v. Mestre, 701 F.2d 1 365 1 28 U.S.C. § 636 In cases involving multiple parties or multiple claims, 54Williams v. Bishop, 732 F.2d 885 885-86 Budinich v. Becton Dickinson Co., 108 S.Ct. 1717 1721-22 100 L.Ed.2d 178LaChance v. Duffy's Draft House, Inc., 146 F.3d 832 837 Appeals pursuant to 28 U.S.C. § 1292(a): Appeals pursuant to 28 U.S.C. § 1292(b) and Fed.R.App.P. 5: 28 U.S.C. § 1292 Appeals pursuant to judicially created exceptions to the finality rule: Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 546 93 L.Ed. 1528Atlantic Fed. Sav. Loan Ass'n v. Blythe Eastman Paine Webber, Inc., Gillespie v. United States Steel Corp., 379 U.S. 148 157 85 S.Ct. 308 312 13 L.Ed.2d 199 2. Time for Filing: Rinaldo v. Corbett, 256 F.3d 1276 1278 4 Fed.R.App.P. 4(a)(1): 3 THE NOTICE MUST BE RECEIVED AND FILED IN THE DISTRICT COURT NO LATER THAN THE LAST DAY OF THE APPEAL PERIOD — no additional days are provided for mailing. Fed.R.App.P. 4(a)(3): Fed.R.App.P. 4(a)(4): Fed.R.App.P. 4(a)(5) and 4(a)(6): Fed.R.App.P. 4(c): 28 U.S.C. § 1746 3. Format of the notice of appeal: See also 3pro se 4. Effect of a notice of appeal: 4
Courts of Appeals have jurisdiction conferred and strictly limited by statute: (a) Only final orders and judgments of district courts, or final orders of bankruptcy courts which have been appealed to and fully resolved by a district court under , generally are appealable. A final decision is one that "ends the litigation on the merits and leaves nothing for the court to do but execute the judgment." , 368 (11th Cir. 1 983). A magistrate judge's report and recommendation is not final and appealable until judgment thereon is entered by a district court judge. (c). (b) a judgment as to fewer than all parties or all claims is not a final, appealable decision unless the district court has certified the judgment for immediate review under Fed.R.Civ.P. (b). , (11th Cir. 1984). A judg ment which resolves all issues except matters, such as attorneys' fees and costs, that are collateral to the merits, is immediately appealable. 486 U.S. 196, 201, , , (1988); , (11th Cir. 1998). (c) Appeals are permitted from orders "granting, continuing, modifying, refusing or dissolving injunctions or refusing to dissolve or modify injunctions . . ." and from "[i]nterlocutory decrees . . . determining the rights and liabilities of parties to admiralty cases in which appeals from final decrees are allowed." Interlocutory appeals from orders denying temporary restraining orders are not permitted. (d) The certification specified in (b) must be obtained before a petition for permission to appeal is filed in the Court of Appeals. The district court's denial of a motion for certification is not itself appealable. (e) Limited exceptions are discussed in cases including, but not limited to: , , 69S.Ct. 1221, 1225-26, (1949); 890 F.2d 371, 376 (11th Cir. 1989); , , , , (1964). The timely filing of a notice of appeal is mandatory and jurisdictional. , (11th Cir. 2001). In civil cases, Fed.R.App.P. (a) and (c) set the following time limits: (a) A notice of appeal in compliance with the requirements set forth in Fed.R.App.P. must be filed in the district court within 30 days after the entry of the order or judgment appealed from. However, if the United States or an officer or agency thereof is a party, the notice of appeal must be filed in the district court within 60 days after such entry. Special filing provisions for inmates are discussed below. (b) "If one party timely files a notice of appeal, any other party may file a notice of appeal within 14 days after the date when the first notice was filed, or within the time otherwise prescribed by this Rule 4(a), whichever period ends later." (c) If any party makes a timely motion in the district court under the Federal Rules of Civil Procedure of a type specified in this rule, the time for appeal for all parties runs from the date of entry of the order disposing of the last such timely filed motion. (d) Under certain limited circumstances, the district court may extend the time to file a notice of appeal. Under Rule 4(a)(5), the time may be extended if a motion for an extension is filed within 30 days after expiration of the time otherwise provided to file a notice of appeal, upon a showing of excusable neglect or good cause. Under Rule 4(a)(6), the time may be extended if the district court finds upon motion that a party did not timely receive notice of the entry of the judgment or order, and that no party would be prejudiced by an extension. (e) If an inmate confined to an institution files a notice of appeal in either a civil case or a criminal case, the notice of appeal is timely if it is deposited in the institution's internal mail system on or before the last day for filing. Timely filing may be shown by a declaration in compliance with or a notarized statement, either of which must set forth the date of deposit and state that first-class postage has been prepaid. Form 1, Appendix of Forms to the Federal Rules of Appellate Procedure, is a suitable format. Fed.R.App.P. (c). A notice of appeal must be signed by the appellant. A district court loses jurisdiction (authority) to act after the filing of a timely notice of appeal, except for actions in aid of appellate jurisdiction or to rule on a timely motion of the type specified in Fed.R.App.P. (a)(4).