America Greener Technologies Incorporated et al v. Enhanced Life Water Solutions LLC et al

Filing 126

ORDER REDACTED - IT IS THEREFORE ORDERED denying Plaintiffs' America Greener Technologies, Inc., American Greener Technologies Corporation, and AGT Softwave, Inc. Application for Temporary Restraining Order and Preliminary Injunction (Doc. 2 ). (See document for further details). Signed by Judge John J Tuchi on 3/23/16. (LAD)

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1 WO NOT FOR PUBLICATION 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 America Greener Technologies Incorporated, et al., 10 Plaintiffs, 11 12 13 14 No. CV-15-02491-PHX-JJT ORDER REDACTED v. Enhanced Life Water Solutions LLC, et al., Defendants. 15 At issue is Plaintiffs’ Application for Temporary Restraining Order and 16 Preliminary Injunction (Doc. 2, hereinafter “Motion”). Plaintiffs, America Greener 17 Technologies, Inc., American Greener Technologies Corporation and AGT Softwave, 18 Inc. (collectively, “Plaintiffs”), filed this lawsuit and their Motion on December 9, 2015. 19 (Doc. 1, Compl.; Mot.) In Plaintiffs’ Motion, they request that the Court issue a 20 temporary restraining order (“TRO”) and preliminary injunction to “enjoin Defendants 21 from their current actions which include infringement of Plaintiffs’ patent rights, 22 misappropriation of Plaintiffs’ trade secrets, violation of the Confidentiality clauses of 23 their employment agreement and the unjust enrichment of Defendants.” (Mot. at 1–2.) 24 The Court held a preliminary injunction hearing on January 28, 2016 (see Doc. 82), at 25 which Plaintiffs’ counsel stated the motion for a preliminary injunction would be limited 26 to the patent infringement and violation of the confidentiality and nondisclosure 27 agreement claims (Doc. 85, Tr. at 14). In advance of the hearing, the parties filed Bench 28 Briefs (Doc. 84, Pls.’ Bench Br., filed under seal; Doc. 81, Defs.’ Bench Br.), and the 1 parties also filed Closing Briefs after the hearing (Doc. 103, Pls.’ Closing Br., filed under 2 seal; Doc. 100, Defs.’ Closing Br.). The Court has considered the briefing filed in this 3 matter and evidence presented at the preliminary injunction hearing and, for the reasons 4 set forth below, denies Plaintiffs’ Application for Temporary Restraining Order and 5 Preliminary Injunction. 6 I. BACKGROUND 7 A. 8 Plaintiffs are a conglomerate that, among other things, provides water treatment 9 services. Defendant Gary Wilson and Michael Brown are the inventors of the patent 10 entitled “Apparatus for Generating a Multi-Vibrational Field,” registered with the United 11 States Patent and Trademark Office (“PTO”) as Patent No. 8,477,003 (“Patent ‘003”) 12 dated July 2, 2013. (Defs.’ Bench Br., Ex. 1, Patent.) Plaintiffs sought to acquire Patent 13 ‘003 and the technology, clients, and other assets of Soft Wave Innovations, Inc. 14 (“SWI”), of which Mr. Wilson was CEO and principal shareholder. (See Tr. at 27–31.) 15 On September 10, 2014, Mr. Wilson and Mr. Brown executed an Assignment Agreement 16 for Patent ‘003 to American Greener Technologies Corporation, represented by CEO 17 Michael Boyko (Defs.’ Bench Br., Ex. 3, Assignment Agreement), and the Assignment 18 was recorded with the PTO on September 15, 2014 (Defs.’ Bench Br., Ex. 4). Plaintiffs 19 and SWI continued to engage in business negotiations and entered into other agreements 20 regarding the assignment of Patent ‘003, royalty payments to Mr. Wilson and others, and 21 the sale of SWI and its assets to Plaintiffs. The Court only specifically addresses the 22 contracts relevant to its determination of the issues currently before it at this preliminary 23 injunction stage. Inventors and Assignment of the Patent 24 A series of actions occurred in the fall of 2014, further uniting the individual 25 Defendants and Plaintiffs. On October 31, 2014, Plaintiffs entered into an Asset Purchase 26 Agreement (“APA”) with SWI, under which Plaintiffs purchased SWI’s customer 27 contracts. (Defs.’ Bench Br., Ex. 11, APA.) Plaintiffs also hired individual Defendants 28 Gary Wilson, Brian Barker, Bruce Baker, and Stephen Clausi (Tr. at 46, 142, 144, 154), -2- 1 and they each signed a “Mutual Non-Disclosure and Confidentiality Agreement”1 with 2 Plaintiffs. (Defs.’ Bench Br., Exs. 7, 8, 9, 10, NDAs.) 3 Plaintiffs fired all four individual Defendants on May 15, 2015. (Pls.’ Hr’g 4 Ex. 25.) Defendants later formed and began providing water treatment services through 5 the companies Defendant Enhanced Life Water Solutions, LLC, a/k/a EL+ Solutions 6 (“ELWS”) and True Water Services, and they provided clients with the apparatus (the 7 “Accused Device”) that Plaintiffs claim infringes on Patent ‘003. (See Tr. at 154; Defs.’ 8 Closing Br. at 10–11.) 9 B. Patent ‘003 10 Patent ‘003 teaches an electromagnetic water treatment apparatus that delivers 11 multi-vibrational electromagnetic fields (“MVEM”), which are applied to water flowing 12 through a waterway. (Patent at 2.) MVEM fields are independent but may work 13 simultaneously and can be used for various applications including eliminating calcium 14 buildup in pipes, reducing soap usage in laundry, and reducing chlorine use in pools. 15 (Patent at 2.) Patent ‘003 has 17 claims including claim 1, which in part claims “an 16 apparatus comprising: a plurality of rods” and “a flexible spacer strip connecting ends of 17 each of the plurality of rods,” and claim 9, which claims “[t]he apparatus of claim 1, 18 further comprising a flexible housing containing the plurality of rods.” (Patent at 13–14.) 19 Claim 11 states “[a] method for generating a multi-vibrational electromagnetic field, the 20 method comprising moving current through a plurality of copper wire coils, each of the 21 copper wire coils wrapped around a rod, each of the rods being connected to a flexible 22 spacer strip, and each of the rods being disposed substantially parallel to each other.” 23 (Patent at 14.) Claim 12 provides, “[t]he method of claim 11, further comprising: 24 encasing the plurality of rods in a flexible housing; and wrapping the housing around a 25 pipe.” (Patent at 14.) Patent ‘003 includes drawings of the claims and further detail. 26 27 28 1 The Court refers to all four Mutual Non-Disclosure Agreements, which are exactly the same except as to the parties, collectively as the “NDAs.” -3- 1 2 C. The Preliminary Injunction Hearing 1. Development and Sale of the Accused Device 3 Mr. Wilson, as co-inventor of Patent ‘003, built the original units with SWI, which 4 Plaintiffs later acquired. (Tr. at 138.) Mr. Wilson, now acting as a consultant of ELWS, 5 also builds the Accused Devices, for which there is a pending patent application listing 6 him as the sole inventor. (Tr. at 140–41, 147; Doc. 86, Sealed Tr. at 5–6.) Mr. Wilson 7 stated devices built under his new patent compete with Plaintiffs but that he did not 8 disclose to Plaintiffs he was building his own units or that he filed a patent application. 9 (Tr. at 141, 145–46.) He did not recall exactly when he developed the idea for the 10 Accused Device, but he filed the patent application after signing the NDA, Letter of 11 Intent, and APA with Plaintiffs. (Tr. at 140–44.) He stated he most likely filed the patent 12 application before Plaintiffs terminated him and built a few Accused Devices prior to his 13 termination. (Sealed Tr. at 14.) Mr. Wilson stated he did not use any of his knowledge 14 from Patent ‘003 in making the Accused Device. (Sealed Tr. at 7.) He stated the Accused 15 Device creates a different electromagnetic field than the ‘003 Patent. (Sealed Tr. at 8.) 16 Bruce Barker’s company, True Water Services, conducts the sales and services for 17 ELWS of the Accused Device, and Mr. Clausi is a subcontractor for True Water Services 18 responsible for service on the devices and service reports. (Tr. at 153, 170–71.) After 19 Plaintiffs fired him, Bruce Barker, via True Water Services, entered into contractual 20 relationships with Plaintiffs’ clients. (See Tr. at 155, 157, 160–61.) 21 2. Marketing Materials, Customers and Service Contracts 22 Russell Corrigan, Director of Operations and custodian of records for America 23 Greener Technologies, Inc. and AGT Softwave (Tr. at 24) testified that he believed 24 Defendants had taken several of Plaintiffs’ marketing materials. Mr. Corrigan testified 25 that Plaintiffs’ investor pitch deck was available to the individual Defendants while they 26 were employees of Plaintiffs and the document was marked as confidential. (Tr. at 68– 27 69.) After viewing ELWS’s promotional video that included a Powerpoint slide that 28 showed ELWS’s customers, Mr. Corrigan stated he believed the slide was taken from -4- 1 Plaintiffs’ marketing files, but it was not clear whether he believed the slide was taken 2 from the pitch deck marked confidential (Pls. Hr’g Ex. 34) or a similar client list slide not 3 marked as confidential (Pls. Hr’g Ex. 33). (Tr. at 67–69.) Bruce Barker, Defendant and 4 former employee of Plaintiffs, testified that three of the entities listed on the ELWS 5 customer list slide in their promotional video were not ELWS customers, and he did not 6 know why they appeared on the slide. (Tr. at 175–76.) 7 In 2015, Plaintiffs began to receive termination letters from their then-current 8 clients who were previously SWI’s clients and whose contracts Plaintiffs had acquired 9 through the APA. (See Tr. at 69–70, 87–92.) Plaintiffs received termination letters from 10 the following six clients: the Church of Jesus Christ of Latter-day Saints on June 23, 2015 11 (Tr. at 70, Pls.’ Hr’g Ex. 35), True Leaf Farms on August 27, 2015 (Tr. at 71, Pls.’ Hr’g 12 Ex. 38), Growers Ice Co. on September 24, 2015 (Tr. at 73, Pls.’ Hr’g Ex. 40), Western 13 Precooling on September 28, 2015 (Tr. at 76, Pls.’ Hr’g Ex. 44), City of Thousand Oaks 14 on September 28, 2015 (Tr. at 77, Pls.’ Hr’g Ex. 45), and BC Systems, Inc.2 on 15 January 19, 2016 (Tr. at 82–83, Pls.’ Hr’g Ex. 48). (See also Tr. at 175–76.) Of these 16 clients, Western Precooling made up the largest source of revenue and was the “backbone 17 of [Plaintiffs’] customers.” (Tr. at 76.) All but one of the clients who submitted 18 termination letters to Plaintiffs were clients of ELWS/True Water Services at the time of 19 the hearing. (Tr. at 175–78.) 20 Bruce Barker also testified that Crown Cooling, a client that was part of the APA, 21 was Defendants’ client at the time of the hearing. (Tr. at 176–77.) With regard to another 22 client, Nucor Steel, Mr. Corrigan testified he believed that Nucor continued to be 23 Plaintiffs’ client (Tr. at 58, 66), but Bruce Barker testified that Nucor was ELWS’s client 24 and Plaintiffs’ equipment had been taken off Nucor’s plant (Tr. at 175). In addition, in 25 January 2016, one of Plaintiffs’ customers, Dole Foods, contacted Plaintiffs requesting 26 more favorable contract terms, which Mr. Corrigan believes was in response to 27 2 28 BC Systems, Inc. was not a SWI client transferred to Plaintiffs, as evidenced in the APA. (See APA at 23–24.) It is unclear whether BC Systems, Inc. was a client of ELWS/True Water Services at the time of the hearing. -5- 1 Defendants’ business proposals to Dole. (Tr. at 83–84.) After reaching out to the 2 customers from whom Plaintiffs received notices of termination, Plaintiffs learned that 3 clients were receiving the same type of services from a competing company owned, at 4 least in part, by the four individual Defendants. (Tr. at 78–79.) 5 Bruce Barker also testified regarding the actions he took with Plaintiffs’ clients 6 referenced above. He stated that Dole initially approached him, and only then did he 7 engage with the company. (Tr. at 175.) He also began a business relationship with True 8 Leaf Farms around June 15, 2015 and thereafter removed Plaintiffs’ units, replacing them 9 with Accused Devices without Plaintiffs’ knowledge or permission. (Tr. at 155, 157.) 10 Bruce Barker provided Growers Ice with a proposal for the same services Plaintiffs were 11 providing in July 2015 (Pls.’ Hr’g Ex. 50; Tr. at 160–61), and he engaged in business 12 negotiations with Western Precooling prior to the termination date of its contract with 13 Plaintiffs (Tr. at 166). 14 When SWI and Plaintiffs entered into the APA, Plaintiffs took over the SWI client 15 contracts without making any changes to the contracts. (Tr. at 181–82.) With regard to 16 previous knowledge of the terms and provisions of Plaintiffs’ client contracts, Bruce 17 Barker stated he was aware of the provisions from his previous work with SWI and 18 SWI’s client contracts entered into in 2012. (Tr. at 181.) He stated he possessed this 19 knowledge prior to when he signed the NDA, and SWI never instructed him to keep 20 information related to the client contracts confidential. (Tr. at 181.) Also, as a former 21 employee of Plaintiffs, Bruce Barker testified he did not believe Plaintiffs’ contracts with 22 customers were confidential. (Tr. at 151.) 23 3. The APA, NDAs and Confidentiality 24 At the hearing, the parties disputed whether the APA and NDAs included 25 provisions that would have made the individual Defendants’ actions with regard to 26 marketing materials, client lists, and other information a breach of those contracts. As for 27 the APA, it included no provision requiring SWI to keep former client identities 28 -6- 1 confidential after the APA and/or sale was concluded, and it also did not include a non- 2 compete provision. (Tr. at 92–93.) 3 With regard to the confidentiality of various materials, Plaintiffs’ representative, 4 Mr. Corrigan, stated that none of the client lists, service contracts, or accounting records 5 disclosed as Plaintiffs’ hearing Exhibits 3 and 4, and Exhibit 1.1 to the APA, were 6 marked as confidential. (Tr. at 94–96.) He was also not aware of any confidentiality 7 agreements between SWI and the individual Defendants. (Tr. at 94–96.) He further stated 8 he was aware that the individual Defendants and SWI attended various trade shows, 9 where they displayed the same list of clients that Plaintiffs had acquired. (Tr. at 96–99.) 10 Mr. Corrigan stated that because of this public disclosure and the individual Defendants’ 11 past relationships with the clients, there was no basis on which Defendants should have 12 reasonably understood that the client information should remain confidential. (Tr. at 98– 13 99.) He also stated that, for those same reasons, the identity of customers could not be 14 considered confidential. (Tr. at 98–99.) 4. 15 16 The Expert Report, Inspection of the Accused Device and Expert Testimony 17 Prior to the hearing, the parties agreed upon and retained a neutral expert witness, 18 Christopher Nicklaw, an electrical engineer with over 35 years of experience (Pls.’ Hr’g 19 Ex. 112), to conduct an inspection of the Accused Device.3 (See Doc. 28.) Prior to the 20 inspection, both parties exchanged and provided Mr. Nicklaw with their respective 21 proposed claim constructions and list of questions for Mr. Nicklaw to address in his 22 report. (See Doc. 41.) On January 7, 2016, Mr. Nicklaw heard presentations from the 23 parties and inspected the Accused Device at one of Defendants’ clients’ locations in 24 Yuma, Arizona. (See Docs. 31, 41, 62 at 3.) At the hearing, the parties stipulated that 25 Mr. Nicklaw is a qualified expert in the art, and the Court, Bruce Barker, and 26 Mr. Nicklaw together examined the Accused Device. (Sealed Tr. at 24, 28–29.) 27 3 28 The Court issued an Order on January 5, 2016 setting forth the parameters of Mr. Nicklaw’s inspection and evaluates his opinion and report as they conform to those parameters. (See Doc. 41.) -7- 1 In his Expert Report, Mr. Nicklaw examined and compared a device owned and 2 utilized by Plaintiffs and the Accused Device.4 (Docs. 62, 73, Expert Report,5 filed under 3 seal at 14, 17.) He stated that both Plaintiffs’ device under Patent ‘003 and the Accused 4 Device are comprised of inductive coils that are sleeved onto a water pipe, and that a 5 voltage signal unit, electrically connected to the inductive coil, is used to generate an 6 electromagnetic field to treat the water flowing through the pipe. (Expert Report at 14.) Mr. 7 Nicklaw opined that the construction of coils in Plaintiffs’ device under Patent ‘003 is 8 different than that in the Accused Device. (Expert Report at 17.) Upon inspection, he stated 9 that Plaintiffs’ device uses a plurality of coils to generate an electromagnetic field with 10 copper wire wrapped around partially insulated rods and the end of such rods connected to 11 a DC power supply to form a circuit. (Expert Report at 17.) He stated that in contrast, the 12 Accused Device uses one continuous wire wrapped around a “taped” sheet where the 13 varied density of the copper wire forms coils and the ends of the copper wire are connected 14 to a DC power supply. (Expert Report at 17.) Mr. Nicklaw concluded that the physical 15 water treatment devices he inspected would produce different electric and magnetic fields 16 in the pipes that they are wrapped around. (Expert Report at 17.) Mr. Nicklaw also 17 provided comments within Defendants’ proposed claim construction chart, but it is not 18 clear whether his comments reflect his comparison of the Patent ‘003 claims or Plaintiffs’ 19 device that he inspected with the Accused Device.6 (See Expert Report at 33–60.) 20 21 22 23 4 For the infringement analysis, the relevant comparison is between the ‘003 Patent and the Accused Device, not between a device owned by Plaintiffs that is one embodiment of Patent ‘003. 24 5 25 6 26 27 28 References to page numbers of the Expert Report refer to pages in Doc. 62. Mr. Nicklaw testified that he considered his task “as the claims of construction against the patent . . . and against the patent history,” and that he examined units owned by Plaintiffs and Defendants. (Sealed Tr. at 34.) In some parts of his testimony, it is not entirely clear whether Mr. Nicklaw is discussing his comparison of the Accused Device to the Patent ‘003 claims or, rather, to Plaintiffs’ device, a device the parties did not dispute is one embodiment of Patent ‘003. (See Sealed Tr. at 34.) Again, the Court did not consider Mr. Nicklaw’s opinions that went beyond his defined role to provide an explanation of the technology and compare Patent ‘003 and the Accused Device. -8- 1 At the hearing, Mr. Nicklaw testified that the Accused Device and Plaintiffs’ 2 device under Patent ‘003 both create electromagnetic fields in whatever they are wrapped 3 around, but that they are different and utilize distinct core materials. (Sealed Tr. at 34– 4 35.) He stated that due to the differences in construction in the two devices, they create 5 different electromagnetic fields in terms of intensity, which can be tested with certain 6 software. (Sealed Tr. at 35–36.) 7 Mr. Nicklaw testified that he compared the Accused Device to claim 1 of Patent 8 ‘003 and found the Accused Device did not use rods or connection of a plurality of rods, 9 but creates an electromagnetic field in a different way. (Sealed Tr. at 37.) He stated that 10 when comparing the Accused Device to claim 1, the Accused Device also did not use 11 flexible spacer strips. (Sealed Tr. at 37.) Mr. Nicklaw testified regarding claim 11 and 12 stated the Accused Device does not conform to the elements in claim 11, but rather uses a 13 construction based on a steel core with notches on the top, which wire is wrapped around 14 and held in place by tape. (Sealed Tr. at 39–40.) 15 With regard to claim 16, Mr. Nicklaw testified that Patent ‘003 teaches the use of 16 interconnected rods to form a “closed hoop” of current, and that the Accused Device uses 17 a continuous coil or wire run that avoids the “issue of handling individual rods,” and 18 “operate[s] effectively at a lower voltage and maintain[s] . . . resistance lower and 19 maintain[s] a different current level for . . . a different magnetic field.” (Sealed Tr. at 42.) 20 He further stated the Accused Device does not need the interconnected multiple rods and 21 multiple wires that Patent ‘003 teaches because the Accused Device uses a continuous 22 loop of wire around the metal sheet core. (Sealed Tr. at 42–43.) Finally, Mr. Nicklaw 23 concluded that the Accused Device is different from what Patent ‘003 claims. (Sealed Tr. 24 at 43.) 25 Mr. Nicklaw generally stated that Patent ‘003 and the Accused Device are the 26 same “in terms of principle, when they [Plaintiffs] take a metal rod and wrap it and then 27 they [Defendants] space it with spacers to do the same thing . . . It’s just how they do it is 28 different and, again, it’s because he [Defendants] chose to do a flat surface and the other -9- 1 guy [Plaintiffs] went individual rods.” (Sealed Tr. at 40.) Finally, in response to 2 questioning, Mr. Nicklaw stated the way the devices accomplished their goal was 3 “substantially different.” (Sealed Tr. at 40.) 4 II. LEGAL STANDARD 5 In order to obtain a preliminary injunction, Plaintiffs must show that “(1) [they 6 are] likely to succeed on the merits, (2) [they are] likely to suffer irreparable harm in the 7 absence of preliminary relief, (3) the balance of equities tips in [their] favor, and (4) an 8 injunction is in the public interest.” Garcia v. Google, Inc., 786 F.3d 733, 740 (9th Cir. 9 2015) (citing Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 9 (2008)). The Ninth 10 Circuit, employing a sliding scale analysis, has also stated “‘serious questions going to 11 the merits’ and a hardship balance that tips sharply toward the plaintiff can support 12 issuance of an injunction, assuming the other two elements of the Winter test are also 13 met.” Drakes Bay Oyster Co. v. Jewell, 747 F.3d 1073, 1078 (9th Cir. 2013) cert. denied, 14 134 S. Ct. 2877 (2014) (quoting Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 15 1132 (9th Cir. 2011)). It is under this standard that the Court evaluates Plaintiffs’ patent 16 infringement claim and their claim for violation of confidentiality and the non-disclosure 17 agreements. 18 III. ANALYSIS 19 As a threshold matter, the Court’s decision herein is based on the limited 20 information before it at the preliminary injunction stage. The Court has reviewed the 21 parties’ briefing, the Expert Report, and the evidence presented at the hearing, but the 22 Court does not have the benefit of the parties’ full discovery, leaving it with incomplete 23 information. The Court “remain[s] mindful that all findings of fact and conclusions of 24 law at the preliminary injunction stage are subject to change upon the ultimate trial on the 25 merits.” Jack Guttman, Inc. v. Kopykake Enters., Inc., 302 F.3d 1352, 1361 (Fed. Cir. 26 2002) (internal quotations omitted). 27 The Court does not consider Plaintiffs’ argument regarding their rights under a 28 “Secondary Assignment,” which they argue assigned to them nearly all of the water - 10 - 1 treatment technology Mr. Wilson developed, rather than just Patent ‘003. (See Pls.’ Hr’g 2 Ex. 11; Tr. at 39–41.) Plaintiffs first raised this theory at the preliminary injunction 3 hearing – they did not reference the Secondary Assignment in their prior briefing. (See 4 Docs. 1, 50.) Citing to Federal Rule of Civil Procedure 15, Defendants properly objected 5 to Plaintiffs’ introduction of the Secondary Assignment. (Tr. at 18–19.) Rule 15 provides 6 that leave to amend a complaint should be freely granted “when justice so requires.” Fed. 7 R. Civ. P. 15(a)(2). “The power to grant leave to amend, however, is entrusted to the 8 discretion of the district court, which ‘determines the propriety of a motion to amend by 9 ascertaining the presence of any of four factors: bad faith, undue delay, prejudice to the 10 opposing party, and/or futility.’” Serra v. Lappin, 600 F.3d 1191, 1200 (9th Cir. 2010) 11 (quoting William O. Gilley Enters. v. Atl. Richfield Co., 588 F.3d 659, 669 n.8 (9th Cir. 12 2009)). The Court finds that Plaintiffs are not entitled to amend because, by not raising 13 the Second Assignment theory until the preliminary injunction hearing, Defendants were 14 prejudiced by the lack of notice of the theory. In addition, the Court did not have notice 15 of such theory. Accordingly, because of Plaintiffs’ delay and the resulting prejudice to 16 Defendants, the Court, in its discretion, will not consider the Secondary Assignment 17 argument at this time. Plaintiffs may be able to later amend their Complaint to add this 18 theory, but the Court does not consider it in deciding the preliminary injunction motion. 19 A. 20 Plaintiffs argue that the Accused Device infringes on Patent ‘003 because it is 21 substantially similar to Patent ‘003. (Pls.’ Closing Br. at 10.) The Patent Act authorizes 22 district courts to grant injunctions to prevent the infringement of patent rights, but the 23 owner of a valid and infringed patent is not entitled to an injunction as a matter of right. 24 See 35 U.S.C. § 283. The four-factor Winter test applies to disputes arising under the 25 Patent Act. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 390 (2006). A district court 26 has the discretion to grant an injunction “in accordance with the principles of equity . . . 27 on such terms as the court deems reasonable.” See 35 U.S.C. § 283; see also eBay Inc., 28 547 U.S. at 391. The Supreme Court and the Federal Circuit have cautioned that “a Patent Infringement - 11 - 1 preliminary injunction is a drastic and extraordinary remedy that is not to be routinely 2 granted.” Intel Corp. v. ULSI Sys. Tech., Inc., 995 F.2d 1566, 1568 (Fed. Cir. 1993); see 3 Munaf v. Geren, 553 U.S. 674, 689 (2008). A preliminary injunction “should not be 4 granted unless the movant, by a clear showing, carries the burden of persuasion.” 5 Mazurek v. Armstrong, 520 U.S. 968, 972 (1997). 6 1. Likelihood of Success on the Merits 7 In order to obtain a preliminary injunction, Plaintiffs must first show they are 8 likely to succeed on the merits. See Winter, 555 U.S. at 9. Determining patent 9 infringement is a two-step process, wherein courts first construe the patent claims and 10 then determine whether every claim limitation, or its equivalent, is found in the accused 11 device. Roche Palo Alto LLC v. Apotex, Inc., 531 F.3d 1372, 1377 (Fed. Cir. 2008). A 12 party can allege infringement literally or under the doctrine of equivalents. Frank’s 13 Casing Crew & Rental Tools, Inc. v. Weatherford Int’l, Inc., 389 F.3d 1370, 1378–79 14 (Fed. Cir. 2004). “[L]iteral infringement requires that each and every limitation set forth 15 in a claim appear in an accused product.” Id. at 1378. Under the doctrine of equivalents, 16 “a product or process that does not literally infringe upon the express terms of a patent 17 claim may nonetheless be found to infringe if there is ‘equivalence’ between the elements 18 of the accused product or process and the claimed elements of the patented invention.” 19 Warner–Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 21 (1997) (citing Graver 20 Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 609 (1950)). 21 Here, based on Plaintiffs’ briefing (see Pls.’ Closing Br. at 10) and the parties’ 22 respective claim constructions (see Defs.’ Bench Br., Exs. 16, 17), Plaintiffs do not 23 appear to argue that the Accused Device literally infringes, and the parties have not raised 24 any dispute regarding the meaning and scope of claim terms. Rather, Plaintiffs allege that 25 the Accused Device is “substantially similar” to Patent ‘003 and “almost all of the 26 attributes of Patent ‘003 are present in the Accused Device.” (Pls.’ Closing Br. at 10) 27 (emphasis added.) Accordingly, the Court construes Plaintiffs’ argument as one of 28 - 12 - 1 infringement under the doctrine of equivalents, not literal infringement, and focuses the 2 analysis on whether Plaintiffs’ device and the Patent ‘003 claims are substantially similar. 3 Plaintiffs argue that the difference in form/material between the Accused Device 4 and the Patent ‘003 claims do not relieve Defendants of liability for patent infringement, 5 and the minor modifications of the Accused Device fall under the doctrine of equivalents. 6 (Pls.’ Closing Br. at 10–13.) A patentee may invoke the doctrine of equivalents if the 7 accused device performs “substantially the same function in substantially the same way 8 to obtain the same result . . . even though [the devices] differ in name, form or shape.” 9 Graver Tank, 339 U.S. at 608. “What constitutes equivalency must be determined against 10 the context of the patent, the prior art, and the particular circumstances of the case.” Id. at 11 609. The Federal Circuit has also required that the patentee prove “insubstantial 12 differences between the claimed and accused products or processes.” See Hilton Davis 13 Chem. Co. v. Warner-Jenkinson Co., 62 F.3d 1512, 1521–22 (Fed. Cir.) supplemented, 64 14 F.3d 675 (Fed. Cir. 1995), and rev’d on other grounds, 520 U.S. 17 (1997), and adhered 15 to, 114 F.3d 1161 (Fed. Cir. 1997). The Supreme Court has stated that the wording of 16 these various standards “is less important than whether the test is probative of the 17 essential inquiry: Does the accused product or process contain elements identical or 18 equivalent to each claimed element of the patented invention?” Warner-Jenkinson Co., 19 520 U.S. at 40. Two legal doctrines limit the determination of infringement under the 20 doctrine of equivalents: the “all elements” rule and prosecution history estoppel. DePuy 21 Spine, Inc. v. Medtronic Sofamor Danek, Inc., 469 F.3d 1005, 1013 (Fed. Cir. 2006). 22 a. All Elements Rule 23 “Each element contained in a patent claim is deemed material to defining the 24 scope of the patented invention, and thus the doctrine of equivalents must be applied to 25 individual elements of the claim, not to the invention as a whole.” Warner-Jenkinson Co., 26 520 U.S. at 29. “An analysis of the role played by each element in the context of the 27 specific patent claim will thus inform the inquiry as to whether a substitute element 28 - 13 - 1 matches the function, way, and result of the claimed element, or whether the substitute 2 element plays a role substantially different from the claimed element.” Id. 3 Plaintiffs fail to apply the doctrine of equivalents to each individual element of the 4 patent claim and only apply the doctrine to the invention as a whole. For example, Patent 5 ‘003 claims as individual elements “a plurality of rods” and “flexible spacer strips.” 6 (Patent at 1, 13–14.) Plaintiffs do not argue or identify specific elements of the Accused 7 Device as equivalent to these elements. The Court notes that the Accused Device utilizes 8 a metal sheet around which copper wire is wrapped and that this metal sheet, at first 9 blush, could appear to be a substitute element that matches the function, way, and result 10 of the claimed “plurality of rods” in Patent ‘003. The expert witness’s testimony and 11 report shows, however, that this structural difference is not insubstantial because it 12 creates a difference between how a device under Patent ‘003 and the Accused Device 13 would perform in the form of generating different MVEM fields, such that the two 14 devices’ functions are “substantially different.” See Graver Tank, 339 U.S. at 608. While 15 the Accused Device’s notches at the top of the metal sheet core that secure the wire 16 wrapped around it might be construed as playing the same role as the flexible spacer 17 strips claimed in Patent ‘003, again, the expert witness’s testimony and report indicate 18 that this difference in construction is not insubstantial because it changes the way the 19 devices function and the resulting MVEM fields. 20 The Court finds Plaintiffs have failed to apply the doctrine of equivalents to the 21 individual elements of each claim, and the expert witness’s testimony and report show 22 that even if the elements in the Accused Device could be construed as substitutes, 23 Plaintiffs have produced no evidence to show they match the function, way, and result of 24 the claimed elements in Patent ‘003. See Warner-Jenkinson Co., 520 U.S. at 29; Hilton 25 Davis Chem. Co., 62 F.3d at 1521–22. Accordingly, Plaintiffs have not shown a 26 likelihood of success on the merits of proving that the Accused Device infringes on 27 Patent ‘003 under the doctrine of equivalents. 28 - 14 - 1 b. Prosecution History Estoppel 2 Plaintiffs are also subject to prosecution history estoppel, which “requires that the 3 claims of a patent be interpreted in light of the proceedings in the PTO during the 4 application process.” Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 535 U.S. 5 722, 733 (2002). Prosecution history estoppel precludes a patentee from claiming 6 infringement and regaining, through litigation, subject matter or a purported equivalent 7 alleged to infringe, when the patentee narrowed the claim in response to a PTO rejection. 8 Festo Corp, 535 U.S. at 733–34 (quoting Wang Labs., Inc. v. Mitsubishi Elecs. Am., Inc., 9 103 F.3d 1571, 1578 (Fed. Cir. 1997)). When the PTO rejects a patent application, it is 10 because the patent examiner believes the original claim cannot be patented. Id. at 734. 11 Although an amendment to a patent application is not an absolute bar to a later claim of 12 infringement, when a patentee forgoes his or her appeal and submits an amended 13 application, courts may interpret such as a concession that the invention as patented does 14 not reach as far as the original claim. Id. In other words, estoppel arises when an 15 amendment is made to secure the patent and the amendment narrows the patent’s scope. 16 Id. at 736. 17 The patentee has the burden to show that an amendment was not for purposes of 18 patentability, and where no explanation is established “the court should presume that the 19 patent application had a substantial reason related to patentability for including the 20 limiting element added by amendment.” Id. at 739–40 (quoting Warner-Jenkinson, 520 21 U.S. at 33.) The court should also “presume that the patentee surrendered all subject 22 matter between the broader and narrower language.” Id. at 740. 23 Plaintiffs, as the moving party asserting infringement of Patent ‘003, have the 24 burden of proving the amendments made in response to the PTO’s rejection of an earlier 25 patent application do not surrender the alleged equivalents in question. See id.; (see 26 Doc. 69, Patent History at 73–80.) In June 2012, the PTO rejected the patent application 27 and all claims, 1-18, citing to 35 U.S.C. § 103(a) and finding that differences between 28 existing patents – the “Godoy Patent” and the “White Patent” – and the patent application - 15 - 1 would have been obvious to one of ordinary skill in the art at the time of the invention. 2 (See Patent History at 74–79.) In response, the inventors traversed the rejections and 3 submitted amendments. (See Patent History at 59–67.) The inventors added the following 4 language to claim 1: “and a flexible spacer strip connecting ends of each of the plurality 5 of rods” (Patent History at 59), and in describing the method for generating MVEM fields 6 in claim 12, added the underlined language: “each of the rods being connected to a 7 flexible spacer strip, and each of the rods being disposed substantially parallel to each 8 other” (Patent History at 61). Claim 17 was also amended to include “flexible” describing 9 the “spacer strip attached to each end of the elongated rods.”7 (Patent History at 62.) 10 Plaintiffs do not address prosecution history estoppel in their Bench or Closing 11 Briefs, let alone provide an argument against the presumption that the patentee’s 12 amendment of the claims in response to the PTO’s rejection is a general surrender of the 13 territory between the original claim and the amended claim. See Festo Corp., 535 U.S. at 14 740. The prosecution history indicates that the amendments were made to address the 15 PTO’s previous rejection on the basis of obviousness by including the more specific term 16 “flexible spacer strip” and emphasizing the “plurality of rods.” (See Patent History at 65.) 17 In the remarks submitted to the PTO with the amendments, the patentee specifically 18 addresses the “Godoy Patent,” explaining that it fails to teach and would not have 19 rendered obvious amended claim 1 “a flexible spacer strip connecting ends of each of the 20 plurality of rods,” and amended claims 12 and 17 also referencing the rods and flexible 21 spacer strip. (See Patent History at 65–66.) Based on the record before the Court, where 22 Plaintiffs have not addressed Defendants’ prosecution history estoppel argument and the 23 patent prosecution history shows the narrowing of claims, the Court cannot say Plaintiffs 24 25 26 27 28 7 The Court notes that the patentee’s remarks submitted with the amendments to the patent include the statement “any amendments herein that are not specifically made for the purpose of patentability are made for other purposes, such as clarification, and that no such changes shall be construed as limiting the scope of the claims or the application of the Doctrine of Equivalents.” (Patent History at 66.) Without further detail by the patentees as to which amendments were not specifically made for patentability, and given only this boilerplate language, the Court does not find this statement material to its analysis. - 16 - 1 have rebutted the presumption that estoppel applies and the alleged equivalents at issue 2 have been surrendered. See id. 3 At this stage, because Plaintiffs have not shown they are likely to overcome the 4 limitations of the all elements rule and prosecution history estoppel, they have failed to 5 show a likelihood of success on the merits that the Accused Device infringes upon Patent 6 ‘003 under the doctrine of equivalents.8 B. Unauthorized Use of Plaintiffs’ Confidential and Proprietary Information 7 8 9 10 11 12 13 14 15 16 17 18 19 Next, Plaintiffs argue that Defendants violated the NDAs and engaged in unauthorized use of Plaintiffs’ confidential and proprietary information. (Pls.’ Closing Br. at 13.) Specifically, Plaintiffs argue that Defendants’ use of their marketing materials, service reports, and customer lists violated the NDAs. (Pls.’ Closing Br. at 13–14.) Plaintiffs request that the Court enjoin Defendants’ continued use of Plaintiffs’ confidential and proprietary information. (Pls.’ Closing Br. at 1.) The Court notes that it has federal question jurisdiction over this matter where Plaintiffs bring claims that arise under the laws of the United States, including the patent infringement claim. See U.S.C. § 1331; 35 U.S.C. § 281. The Court has supplemental jurisdiction over Plaintiffs’ Arizona state law claims because they also involve the alleged unlawful use of Plaintiffs’ technology related to Patent ‘003 and related confidential and proprietary information. See 28 U.S.C. § 1367(a).9 As such, Plaintiffs’ 20 21 22 23 24 25 26 27 28 8 Defendants argue that Plaintiffs have not established they are entitled to enforce Patent ‘003 because Plaintiffs’ ownership is based on an assignment that is in turn contingent on a royalty agreement with Mr. Wilson, and Mr. Wilson has not yet received any royalty payments. (See Defs.’ Closing Br. at 16 n.61.) Because the Court does not find likelihood of success on the merits for Plaintiffs’ patent infringement claim at this point, it need not address Defendants’ argument regarding Plaintiffs’ ownership of Patent ‘003 at9this time. Defendants admit that this Court has subject matter jurisdiction and personal jurisdiction over Defendants. (Doc. 97, Am. Compl. at 3.) Because the Court is applying basic contract principles, the choice of law was not critical to the Court’s decision in this instance. The parties are advised they will need to demonstrate why Arizona law applies to any claims going forward. See Barba v. Seung Heun Lee, No. CV 09-1115-PHX-SRB, 2009 WL 8747368, at *9–10 (D. Ariz. Nov. 4, 2009) (citing Restatement (Second) of Conflict of Laws (1971) § 145(1) cmt. d). - 17 - 1 state law claims are closely related to the patent infringement claim and form part of the 2 same case or controversy. See id. 3 1. Likelihood of Success on the Merits 4 When interpreting contracts, such as the NDAs at issue here, courts seek to 5 ascertain and enforce the parties’ intent. ELM Ret. Ctr., LP v. Callaway, 246 P.3d 938, 6 941 (Ariz. Ct. App. 2010). To determine intent, courts “look[s] to the plain meaning of 7 the words as viewed in the context of the contract as a whole.” Id. at 941–42. 8 In the NDAs, “Confidential Information” is defined as “all information (in written, 9 oral or electronic form) that is disclosed between the parties and that is conspicuously 10 marked by the disclosing party . . . as being confidential, or should have been reasonably 11 understood by the receiving party . . . to be confidential.” (NDAs at 1.) The NDAs further 12 state: 13 14 15 16 Confidential Information shall include, without limitation, business, financial, accounting and marketing information, analyses, forecasts, predictions or projections, as well as technical information, software, demonstration programmes, routines, computer systems, techniques, documentation, designs, procedures, formulas, inventions, improvements, concepts, record files, memoranda, reports, drawings, plans, price lists, customer lists or other account information, trade secrets, know-how, and/or other intellectual property. 17 18 (NDAs at 1.) The NDAs also provide that certain information shall not be considered 19 Confidential Information, including that which: 20 21 22 23 24 “(a) is or becomes public domain through no action on the part of the Receiving Party; (b) is lawfully obtained from any other source other than the disclosing party (the “the Disclosing Party”), without an obligation to keep it confidential; (c) is previously known to the Receiving Party without an obligation to keep it confidential, as can be substantiated by written records . . .; or (f) is independently developed by the Receiving Party.” (NDAs at 2.) 25 The Court finds that it is unlikely that Plaintiffs will succeed on the merits of their 26 claim that Defendants violated the NDAs and engaged in unauthorized use of Plaintiffs’ 27 confidential and proprietary information. First, none of the items Plaintiffs argue 28 Defendants engaged in unauthorized use of – marketing materials (Pls.’ Hr’g Ex. 32, 33, - 18 - 1 34), service agreements (see, e.g., Pls.’ Hr’g Exs. 39, 41, 50, 118–123), and customer 2 lists10 – were Confidential Information under the NDAs by being conspicuously marked 3 as confidential. (See also Tr. at 94.) To the extent Plaintiffs argue Defendants used 4 Plaintiffs’ investor pitch deck, specifically the slide listing Plaintiffs’ clients, which was 5 marked as confidential, the client identities listed therein are not confidential under the 6 NDA for the reasons discussed below. Second, before SWI entered into the APA and 7 transferred its related interests to Plaintiffs, the individual Defendants working for SWI 8 attended various trade shows and displayed the names of their customers, which are the 9 same customers that Plaintiffs claim are confidential. (Tr. at 96–99.) Because Plaintiffs’ 10 clients’ identities were shown to the public at trade shows, and because of the individual 11 Defendants’ long-term relationships with their previous clients via SWI, Mr. Corrigan, 12 Director of Operations for Plaintiffs, stated there was no basis on which Defendants 13 should have reasonably understood the client identities, as produced in the client lists 14 used as marketing materials, were confidential. (Tr. at 98.) 15 The materials Plaintiffs claim are confidential also fall into the specific categories 16 outlined in the NDAs as information that shall not be considered Confidential 17 Information. With regard to marketing materials, ELWS’s promotional video includes a 18 Powerpoint slide with logos of customers that Plaintiffs allege Defendants took from 19 them. (Pls.’ Hr’g Ex. 32.) The customers included on the Powerpoint slide are the same 20 customers that were displayed to the public at the trade shows referenced above, and thus 21 the content of the marketing materials was in the public domain and is not Confidential 22 Information. (See NDAs at 2.) In addition, the marketing materials are not Confidential 23 Information under the NDAs because the identity of the clients was previously known to 24 the individual Defendants where those same clients were customers of SWI, with whom 25 26 27 28 10 Plaintiffs’ Closing Brief does not cite to specific exhibits when it refers to “AGT’s customer list” that Plaintiffs allege Defendants used in violation of the NDAs. (See Pls.’ Closing Br. at 13–14.) The Court notes that Plaintiffs’ hearing exhibits 3, 4, 33, 34 and 130 include lists of Plaintiffs’ and SWI clients. In addition, the APA with the list of former SWI clients was included as an exhibit to Defendants’ Bench Brief. (APA at 23–24.) The Court considers these various customer lists in its analysis. - 19 - 1 Defendants worked, and the individual Defendants were under no obligation to keep the 2 client identities confidential. (See Tr. at 94–96, 100; APA at 2.) Similarly, the second 3 type of material Plaintiffs allege Defendants engaged in unauthorized use of – client lists 4 – is non-Confidential Information as identified in the NDAs for the same two reasons. 5 The client lists and identities were put in the public domain at the trade shows and were 6 previously known to the individual Defendants without an obligation to keep that 7 information confidential. 8 As to the service contracts to which Plaintiffs cite, because the individual 9 Defendants worked for and/or with SWI, they were previously aware of the service 10 contract terms, and there is no evidence showing a separate confidentially agreement 11 between SWI and the individual Defendants requiring Defendants to keep the service 12 contract information confidential. (See Tr. at 94–96, 100, 103–05; NDAs at 2.) 13 Accordingly, the service contracts are also not Confidential Information. In addition, 14 although it is unclear which individual Defendant may have been responsible for initially 15 creating the customer service contracts while working for and/or with SWI, it is likely 16 that the individual Defendants “independently developed” those contracts that were later 17 transferred to Plaintiffs, further establishing that the service contracts are not Confidential 18 Information under the NDA. (See NDAs at 2.) 19 Plaintiffs point to the first clause in the NDAs and argue it expressly states the 20 primary purpose of the NDAs was to protect the parties from disclosure of “all 21 proprietary, technical and financial information and documentation.” (Pls.’ Closing Br. at 22 15) (emphasis in original.) However, the clause does not include the word “all,” and the 23 NDAs’ more specific provisions defining Confidential Information are clear and not 24 supplanted by the general opening clause. 25 Plaintiffs failed to show that their marking materials, service reports and contracts, 26 and customer lists were conspicuously marked as confidential or that the individual 27 Defendants should have reasonably understood they were confidential. Rather, the 28 present state of the evidence shows that the client lists and marketing materials should not - 20 - 1 be considered Confidential Information because they were in the public domain and were 2 previously known to the individual Defendants without any obligation between SWI and 3 Defendants to keep the information confidential. The service contracts were also 4 previously known to the individual Defendants without an obligation to keep the 5 information confidential. Accordingly, Plaintiffs are unlikely to succeed on their claim 6 that the individual Defendants violated the NDAs. 7 C. 8 Plaintiffs argue that Defendants’ disclosure of Plaintiffs’ customer lists violated 9 the Arizona Uniform Trade Secrets Act, A.R.S. §§ 44-401–407. (Pls.’ Closing Br. at 14.) 10 “To establish a claim for misappropriation of a trade secret, the claimant must first prove 11 a legally protectable trade secret exists.” Calisi v. Unified Fin. Servs., LLC, 302 P.3d 628, 12 631 (Ariz. Ct. App. 2013). When determining whether a trade secret exists under Arizona 13 law, courts first focus on whether the subject matter of the information is secret, and 14 second, whether reasonable efforts have been taken to keep the information secret. See 15 id.; A.R.S. §44-401(4). Contrary to Plaintiffs’ assertion that customer lists are always 16 considered trade secrets, courts consider a number of factors in making that 17 determination. See Calisi, 302 P.3d at 631–34. Arizona Uniform Trade Secrets Act 18 Here, the subject matter in the customer lists – the identity of the customers – was 19 not secret, and Plaintiffs did not make reasonable efforts to keep the information secret. 20 Plaintiffs were aware that prior to the APA, the individual Defendants had previously 21 shared the names of customers at trade shows and Plaintiffs shared their customer list in 22 their own marketing materials, and thus the client information was publicly available. 23 Plaintiffs also did not provide evidence tending to establish any of the factors that courts 24 consider when determining whether a customer list is a trade secret. See id. at 631–32. 25 Accordingly, at this preliminary injunction stage, Plaintiffs fail to show that the customer 26 lists are legally protectable trade secrets and that Defendants have violated the Arizona 27 Uniform Trade Secrets Act. See id. at 631; A.R.S. §44-401(4). 28 - 21 - 1 D. 2 For both their patent infringement and violation of confidentiality and NDA 3 claims, Plaintiffs have failed to satisfy their burden of demonstrating they have met the 4 first of the four elements of the preliminary injunction test, and the Court need not 5 consider the remaining three. See DISH Network Corp. v. F.C.C., 653 F.3d 771, 776 (9th 6 Cir. 2011); see also Garcia, 786 F.3d at 740. However, in some cases, the Ninth Circuit 7 has employed a sliding scale analysis weighing the four factors and has stated that 8 likelihood of success per se is not an absolute requirement. See Drakes Bay Oyster Co., 9 747 F.3d at 1085 (quoting Cottrell, 632 F.3d at 1132). The Court finds that Plaintiffs also 10 Irreparable Harm, Balance of Hardships and Public Interest fail to satisfy their burden under this standard. 11 Plaintiffs allege they will suffer irreparable harm due to loss of control over their 12 trade secrets, damage to their business goodwill and reputation, and loss of significant 13 market share. (Pls.’ Closing Br. at 15–17.) Plaintiffs also allege the balance of hardships 14 tips in their favor because Defendants have been and will continue to take Plaintiffs’ 15 clients while infringing on Plaintiffs’ patent and providing identical services. (Pls.’ 16 Closing Br. at 17–18.) Plaintiffs do not set forth an argument as to the public interest 17 factor. (See Pls.’ Closing Br.) The Court finds that under the sliding scale analysis, the 18 balance of hardships, irreparable harm to Plaintiffs, and public interest considerations are 19 not so significant as to outweigh Plaintiffs’ failure to meet their burden to show serious 20 questions going to the merits or likelihood of success on the merits. Cf. Cottrell, 632 F.3d 21 at 1135 (stating “environmental injury, by its nature, can seldom be adequately remedied 22 by money damages and is often permanent or at least of long duration”); Shell Offshore, 23 Inc. v. Greenpeace, Inc., 709 F.3d 1281, 1291 (9th Cir. 2013) (finding serious risk of 24 harm to human life constitutes an injury that would be irreparable). Unlike in other cases 25 where courts have found irreparable harm, such as the environmental injuries in Cottrell 26 and the potential of death and physical pain in Shell Offshore, Plaintiffs’ have not shown 27 such significant injury or that their alleged injuries can only be protected through a 28 preliminary injunction rather than monetary damages. See L.A. Mem’l Coliseum Comm’n - 22 - 1 v. Nat’l Football League, 634 F.2d 1197, 1202 (9th Cir. 1980) (monetary injury is not 2 considered irreparable). The Court concludes that likelihood of success on the merits of 3 Plaintiffs’ claims “is too remote to justify the extraordinary remedy of a preliminary 4 injunction.” Drakes Bay Oyster Co., 747 F.3d at 1085. 5 IV. CONCLUSION 6 Plaintiffs are not entitled to a temporary restraining order or preliminary injunction 7 as to their patent infringement and violation of the confidentiality and NDA claims where 8 they did not, by a clear showing, carry their burden of persuasion. See Mazurek, 520 U.S. 9 at 972. Plaintiffs did not satisfy their burden as to the first element of the preliminary 10 injunction test – likelihood of success on the merits – and because a preliminary 11 injunction is a drastic and extraordinary remedy never awarded as of right, the Court will 12 not grant an injunction here. See Drakes Bay Oyster Co., 747 F.3d at 1085; Intel Corp., 13 995 F.2d at 1568. 14 IT IS THEREFORE ORDERED denying Plaintiffs’ America Greener 15 Technologies, Inc., American Greener Technologies Corporation, and AGT Softwave, 16 Inc. Application for Temporary Restraining Order and Preliminary Injunction (Doc. 2). 17 IT IS FURTHER ORDERED that, while the Court enters this Order under seal 18 in consideration of the parties’ confidential information, the parties shall file under seal 19 joint proposed redactions to this Order by April 4, 2016. The Court will then enter a 20 redacted version of this Order on the public docket. 21 Dated this 23rd day of March, 2016. 22 23 Honorable John J. Tuchi United States District Judge 24 25 26 27 28 - 23 -

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