Yalda v. Phillips 66 Company et al

Filing 5

ORDER Denying Plaintiff's Request for a Temporary Restraining Order (re 1 Complaint) filed by Alan Yalda. Signed by Judge Anthony J. Battaglia on 10/26/2016.(dls)

1
2
3
4
5
6
7
8

UNITED STATES DISTRICT COURT

9

SOUTHERN DISTRICT OF CALIFORNIA

10
11

ALAN YALDA,

Case No.: 16-CV-2641 H - NLS
Plaintiff,

12
13
14

ORDER DENYING PLAINTIFF’S
REQUEST FOR A TEMPORARY
RESTRAINING ORDER

v.
PHILLIPS 66 COMPANY; and DOES 1
through 10, inclusive,

15
16

Defendants.

17
18
19
20
21
22
23
24
25
26
27
28

On October 24, 2016, Plaintiff Alan Yalda (“Plaintiff”), filed a verified complaint
asserting one cause of action against Phillips 66 Company and Does 1-10 (collectively
referred to as “Defendants”). (Doc. No. 1.) Plaintiff’s complaint requests a temporary
restraining order. (Doc. No. 1 ¶ 20–21, 26.) Pursuant to Local Civil Rule 7.1.d.1, the Court
finds the matter suitable for disposition on the papers, without oral argument. For the
reasons set forth below, Plaintiff has not demonstrated the requisite legal or factual basis
required to support the extraordinary nature of the remedy he seeks. Accordingly,
Plaintiff’s request for a temporary restraining order is DENIED.
BACKGROUND
Plaintiff is an individual who operates a gasoline service station located at 121 East
San Ysidro Blvd., San Ysidro, California 92173 (“the Station”). (Doc. No. 1 ¶ 1.)
1
16-CV-2641 H - NLS

1

Defendant, Phillips 66 Company, is a Delaware corporation doing business within the

2

County of San Diego. (Id. ¶ 2.) In July of 2016, Defendants sent Plaintiff a letter entitled

3

“Notice of Termination.” (Id. ¶ 10.) The letter informed Plaintiff that his Station had

4

allegedly failed a mystery shopper evaluation performed by Defendants. (Id.) The mystery

5

shopper evaluation is a program where the Defendants engage persons to visit service

6

stations disguised as ordinary patrons. (Id.) The mystery shoppers then inspect the stations

7

for cleanliness, landscaping, and uniforms worn by employees. (Id.) After the visit, the

8

service station is given an arbitrary score and discretionary standard. (Id.) Ultimately, the

9

July 25, 2016 letter sent to Plaintiff claimed that as Plaintiff had failed the mystery shopper

10

evaluation, Defendants were terminating Plaintiff’s franchise agreement and franchise

11

relationship effective November 22, 2016. (Id.)

12

Plaintiff alleges that Defendants do not have permission to terminate his franchise

13

based solely on the unsubstantiated mystery shopper evaluation. (Id. ¶ 11.) Instead,

14

Plaintiff argues that Defendants are using this arbitrary evaluation to eliminate certain

15

stations, including his own, so that Defendants can increase the number of service stations

16

owned by Defendants or its affiliates. (Id.)

17

Plaintiff’s only cause of action is under 15 U.S.C. § 2801 Violation of the Petroleum

18

Marketing Practices Act. (Id. at 3-4.) Plaintiff premises its claim on the contention that

19

Defendants’ decision to terminate Plaintiff’s franchise agreement was not made in good

20

faith or in the normal course of business. (Id. ¶ 15.) Plaintiff claims that the termination of

21

his Station is simply to increase the number of service station operated by Defendants and

22

eliminate Plaintiff as a competitor. (Id.) Plaintiff seeks injunctive and equitable relief,

23

compensatory and exemplary damages, and attorney’s fees. (Id. ¶ 26.) Additionally,

24

Plaintiff requests a temporary restraining order or preliminary injunction restraining and

25

enjoining Defendants from attempting to terminate or taking any further steps towards

26

terminating Plaintiff’s Station. (Id.)

27

///

28

///
2
16-CV-2641 H - NLS

1

LEGAL STANDARD

2

A temporary restraining order (“TRO”) is a form of preliminary injunctive relief

3

limited to “preserving the status quo and preventing irreparable harm just so long as is

4

necessary to hold a hearing, and no longer.” Granny Goose Foods, Inc. v. Bd. Of Teamsters,

5

415 U.S. 423, 439 (1974). “Status quo” means the “last uncontested status which preceded

6

the pending controversy.” GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1210 (9th

7

Cir. 2000) (quoting Tanner Motor Livery, Ltd. v. Avis, Inc., 316 F.2d 804, 809 (9th Cir.

8

1963)). It is “an extraordinary remedy that may only be awarded upon a clear showing that

9

the plaintiff is entitled to such relief.” Winter v. Natural Res. Def. Council, 555 U.S. 7, 22

10
11
12

(2008).
Federal Rule of Civil Procedure 65(b) empowers a court to grant a TRO without
written or oral notice to the adverse party “only if”:

13

(A) specific facts in an affidavit or a verified complaint clearly

14

show that immediate and irreparable injury, loss or damage will

15

result to the movant before the adverse party can be heard in

16

opposition; and

17

(B) the movant’s attorney certifies in writing any efforts made to

18

give notice and the reasons why it should not be required.

19

The Court’s substantive analysis on a motion for a TRO is substantially identical to

20

that on a motion for a preliminary injunction. See Stuhlbarg Int’l Sales Co. v. John D.

21

Brush & Co., 240 F.3d 832, 839–40 n.7 (9th Cir. 2001). Plaintiff must demonstrate: (1) a

22

likelihood of success on the merits; (2) a likelihood of suffering irreparable harm absent

23

injunctive relief; (3) the balance of equities tips in favor of injunctive relief; and (4)

24

injunctive relief is in the public interest. Winter, 555 U.S. at 20.

25

DISCUSSION

26

Aside from filing the verified complaint, Plaintiff has not presented the Court with

27

any authority or evidence to support its request for a TRO. The only reference to a TRO is

28

on the last two pages of the complaint and in Plaintiff’s prayer for relief. While the facts
3
16-CV-2641 H - NLS

1

alleged in the complaint show the potential for harm to Plaintiff if his Station is to be closed,

2

Plaintiff’s complaint provides no further facts or evidence to satisfy the special nature of

3

the remedy he seeks. Plaintiff only briefly states that if Defendants are permitted to

4

continue with its course of conduct, Plaintiff will lose his means of support, his franchise,

5

and his substantial investment. (Doc. No. 1 ¶ 19.)

6

Furthermore, Plaintiff’s brief and conclusory contentions are insufficient to

7

demonstrate that Plaintiff has a likelihood of prevailing on the merits as to any of the claims

8

asserted in the complaint as required by the issuance of a TRO. Plaintiff has also not

9

addressed whether it has notified Defendants of Plaintiff’s request for a TRO or included

10

a declaration detailing why the Court should proceed without affording Defendants notice

11

and an opportunity to respond. See Fed. R. Civ. P. 65(b) (detailing requirements for

12

proceeding without notice to the opposing party); S.E.C. v. ABS Manager, LLC, No.

13

13CV319, 2013 WL 524178, at *3 (S.D. Cal. Feb. 11, 2013) (discussing requirement of

14

notice in issuing a TRO).

15

Thus, finding Plaintiff has failed to support its request for a TRO with legal authority

16

or sufficient factual grounds for the relief requested, Plaintiff’s request for a TRO is

17

DENIED.

18
19

IT IS SO ORDERED.

20

Dated: October 26, 2016

21
22
23
24
25
26
27
28
4
16-CV-2641 H - NLS