Primo Broodstock, Inc. v. American Mariculture, Inc. et al

Filing 84

OPINION AND ORDER granting in part and denying in part 21 Plaintiff's Alternative Motion for Preliminary Injunction. The preliminary injunction will issue under separate order. Signed by Judge John E. Steele on 4/27/2017. (KP)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
PRIMO BROODSTOCK, INC.,
Texas corporation,

a

Plaintiff,
v.

Case No: 2:17-cv-9-FtM-29CM

AMERICAN MARICULTURE, INC.,
a
Florida
corporation,
AMERICAN PENAEID, INC., a
Florida
corporation,
and
ROBIN PEARL.
Defendants.
OPINION AND ORDER
This matter comes before the Court on Plaintiff's Alternative
Motion for Preliminary Injunction (Doc. #21) filed on January 26,
2017 and Supplement to the Motion for Preliminary Injunction (Doc.
#68) filed on February 28, 2017.

Defendants filed a Response in

Opposition (Doc. #39) on February 7, 2017 and a Supplement to the
Response (Doc. #64) on February 21, 2017.
hearing on the Motion on February 10, 2017.
forth

below,

the

Court

grants

in

part

The Court conducted a
For the reasons set
and

denies

in

part

Plaintiff’s request for injunctive relief.
I.
Former United States Supreme Court Justice Byron White quoting a “piscatorially favored” Louisiana district court – once
described shrimp as “a gustatory delight.”

Deepsouth Packing Co.

v. Laitram Corp., 406 U.S. 518, 518 (1972) (quoting Laitram Corp.
v. Deepsouth Packing Co., 301 F. Supp. 1037, 1040 (E.D. La. 1969)).

Benjamin Buford Blue (“Bubba”), of “Forrest Gump” fame, memorably
called shrimp “the fruit of the sea.” 1

To assist Mother Nature’s

efforts and produce enough of this “fruit” to satisfy society’s
cravings for the “gustatory delight,” people around the world have
turned to shrimp farming. 2 This case involves a dispute between
American business partners-turned-competitors in that industry.
Primo

Broodstock,

Inc.

(Plaintiff

or

Primo)

is

a

Texas

corporation engaged in the business of studying shrimp genetics
and breeding and selling “highly disease-resistant” shrimp from
the Ecuadorian litopenaeus vannamei strain.

(Doc. #20, ¶¶ 10-11.)

Defendant Robin Pearl (Mr. Pearl) has an extensive background in
shrimp

farming

and

is

the

co-founder

of

defendants

American

Mariculture, Inc. (AMI) and American Penaeid, Inc. (API).
#41, ¶¶ 2, 4.)

(Doc.

AMI is a supplier of fresh and frozen shrimp,

which is produced at AMI’s large shrimp farming facility (the AMI
Facility) located in St. James City, Florida.
AMI’s wholly-owned subsidiary, formed in 2016.
A.

(Id. ¶ 5.)

API is

(Doc. #40, ¶ 40.)

The Mutual Nondisclosure Agreement
The parties’ relationship began in December 2014, when AMI

hired Neil Gervais (N. Gervais) – at the time, Primo’s lead
scientist – to serve as a paid consultant to help API improve the
viability of its shrimp farming operations.

1

“Forrest
Picture.

Gump”

was

the

1994

Academy

2

(Doc. #41, ¶ 18, 31.)

Award

winner

for

Best

Shrimp farming is the practice of producing new shrimp through
controlled breeding operations, as opposed to fishing them out of
the sea.
- 2 -

On December 11, 2014, Plaintiff and AMI entered into a Mutual
Nondisclosure Agreement (the NDA) (Doc. #20-1) for the purpose of
“explor[ing] a business possibility in connection with which each
may disclose its Confidential Information to the other,” and under
which each party agreed not to “use” or “disclose” the other’s
“Confidential

Information.”

It

did

not

take

long

for

this

business possibility to become a reality.
B.

The Grow-Out Agreement
On January 1, 2015, Plaintiff and AMI formalized a new written

agreement (the Grow-Out Agreement), 3 the “primary goal” of which
was “to use a defined portion of AMI grow-out capacity to produce
broodstock for Primo for sale to third parties.”

(Doc. #20-2.)

Specifically, AMI agreed to grow young, post-larval shrimp supplied by Primo - to large adult size at the AMI Facility in
Florida. 4

AMI would then either sell the live adult shrimp back

to Primo at fixed prices based on the animal’s weight, or “harvest”
(kill) the animals to sell as fresh or frozen dead shrimp, with
the proceeds belonging exclusively to AMI. (Id. ¶¶ 1, 3, 4, 9.)
The Grow-Out Agreement states that Primo shrimp are considered
Plaintiff’s intellectual property and prohibits AMI from selling
or transferring any live Primo Shrimp to others without Plaintiff’s
permission.

(Id. ¶¶ 7, 8.)

3

The Grow-Out Agreement was signed by Mr. Pearl and Ken Gervais
(K. Gervais), Primo’s President. (Doc. #41, ¶ 31.)
4

Primo’s own facility in Texas did not have the space necessary
to grow out sufficient quantities of shrimp to meet the demand
that Primo believed it could generate.
- 3 -

C.

The State Court Lawsuit and Resultant “Term Sheet”
The

business

relationship

quickly

began

to

deteriorate.

Among other perceived breaches, Defendants claimed Plaintiff was
not repurchasing the live adult shrimp, as required by the GrowOut Agreement.

This, in turn, was causing Defendants to incur

significant costs to maintain the large animals, which already
exceeded the size at which Plaintiff was supposed to buy them back.
In January 2016, Defendants threatened to harvest all live Primo
shrimp of a certain size that Plaintiff did not buy back within
ten days.

Plaintiff filed suit in state court seeking a temporary

restraining order to prevent this shrimp-ocide. (Doc. #20, ¶ 44.)
Ultimately, the parties resolved the dispute out of court.
On January 28, 2016, Mr. Pearl and Randall Aungst (Mr. Aungst),
Primo’s Vice President, signed a one-page handwritten “Term Sheet”
(Doc. #20-3), giving Primo until April 30, 2016 to remove all of
its live shrimp from the AMI Facility. 5

Ultimately, Plaintiff

left about 46,000 live adult shrimp at the Facility, which it could
not afford to repurchase, as well as 650,000 shrimp that were too
young to buy back.

(Doc. 20, ¶¶ 51, 52.)

The Term Sheet does not

state what would happen to any live animals not removed from the
Facility by April 30, 2016.

The Amended Complaint avers, however,

that Mr. Aungst “obtained unqualified verbal assurances from [Mr.]
Pearl prior to executing the Term Sheet that, consistent with

5

The parties disagree on whether this was an “accommodation”
affording Plaintiff an extra three months to buy back the live
Primo shrimp if it chose to do, so or instead imposed a contractual
repurchase obligation on Plaintiff. (See Doc. #53, p. 71.)
- 4 -

Sections 3 and 7 of the Grow-Out Agreement, AMI would harvest
(i.e., kill) all live shrimp left behind on April 30, 2016.”
¶ 50.)
D.

(Id.

Mr. Pearl denies he ever made any such statement.

Defendants’ Disposition of Primo’s Animals
In late July 2016, Plaintiff learned that Mr. Pearl and the

newly-formed

API

were

seemingly

attempting

to

attract

buyer

interest, particularly in China, for the shrimp Primo had left at
the AMI Facility.

(Id. ¶ 59.)

At the time, Primo animals were

available for purchase in China only through Primo’s exclusive
distributor, Haimao Group.

(Id. ¶ 37.)

Plaintiff’s attorney sent AMI a cease and desist letter (Doc.
#20-5) on August 30, 2016, which stated that any sale of Primo’s
shrimp would constitute a breach of the NDA and the Grow-Out
Agreement.

The September 16, 2016 response of AMI’s attorney

(Doc. #20-6) disputed this contention and asserted that Plaintiff
possessed no continued rights in the live shrimp left at the AMI
Facility past April 30, 2016.

The letter asserted further that

AMI was entitled to sell or otherwise dispose of the animals as it
pleased.
E.

This Federal Lawsuit
1)

The First Motion for TRO

Plaintiff filed suit in federal court on January 9, 2017 (Doc.
#1) and immediately moved for an ex parte temporary restraining

- 5 -

order (Motion for TRO) (Doc. #2). 6

The Motion for TRO sought to

enjoin Defendants for fourteen days “from shipping, selling or
otherwise removing or relocating any shrimp broodstock in their
possession or under their control, whether directly or indirectly,
pending determination of whether such broodstock [were] descended
or derived from Primo’s broodstock.”
contended

that

Plaintiff’s

distribution

control

would

of

(Id. p. 36.)

live

permit

Primo

others

Shrimp
to

Plaintiff
outside

study

and

of

then

replicate, through breeding, the animals’ genetic superiority,
destroying the “decades of painstaking selection, testing, crossbreeding, and trial and error [that was needed for Plaintiff] to
finally achieve what is recognized as the heartiest and most
disease-resistant shrimp ever created.”

(Id. pp. 2-3.)

The Court denied the Motion for TRO (Doc. #9) primarily on
the ground that there was no “true emergency” justifying a grant
of ex parte relief.

To the contrary, the evidentiary materials

showed that the shrimp whose distribution Plaintiff sought to
enjoin “ha[d] been available for distribution since at least as
early as July 2016” and had seemingly already been sent to China
– the geographic location of primary concern to Plaintiff – the
previous month.

(Id. p. 5.)

In other words, “the genie [was]

likely already out of the bottle.”

6

(Id.)

Moreover, there was

The original Complaint alleged claims of common law conversion,
trade secret misappropriation, and “passing off” under the Lanham
Act.
- 6 -

nothing indicating that future shipments had been scheduled, let
alone were imminent.
2)

(Id.)

The Amended Complaint and Renewed Motion for TRO

On January 26, 2017, Plaintiff filed a nine-count Amended
Complaint (Doc. #20), as well as a Renewed Motion seeking a
temporary

restraining

order

(Renewed

Motion

for

TRO)

or,

alternatively, a preliminary injunction (Alternative Motion for
Preliminary Injunction) (both Doc. #21). 7

The Renewed Motion for

TRO alleged that, absent an injunction, Defendants would be able
to “effectively eliminate Primo from the Chinese market.”
at 52.)

(Id.

This claim was based on allegations regarding Defendants’

wide-scale breeding operations in China, as well as Defendants’
use of the “Primo” trade name in connection with the animals they
send to China for further breeding and for sale to farmers. 8

(Id.

¶¶ 50-59.)

The Renewed Motion for TRO requested an ex parte order

enjoining

Defendants

from

shipping

any

shrimp

and

from

“advertising or otherwise marketing or making any reference to any
products or services that in any way, directly or indirectly,

7

The Amended Complaint asserts claims for breach of contract;
conversion; defamation; trade secret misappropriation under the
Defend Trade Secrets Act, 18 U.S.C. § 1836; trade secret
misappropriation under the Florida Uniform Trade Secrets Act, Fla.
Stat. §688.001 et seq.; unfair competition under Section 43(a) of
the Lanham Act, 15 U.S.C. §1125(a); unfair competition under
Florida common law; violation of the Florida Unfair and Deceptive
Trade Practices Act, Fla. Stat. § 501.201 et seq.; and unjust
enrichment.
8

As discussed in greater detail below, Plaintiff also claims that
Defendants are lying to the Chinese market about the “pure” genetic
makeup of the shrimp and the “completeness” of the Primo genetic
bank they supposedly now possess.
- 7 -

relate[d] to the manufacturing, marketing, distributing, shipping,
offering for sale, selling, or conducting of research, testing, or
analysis of the viability of Primo shrimp.”

(Doc. #21-7, p. 4.)

The Court again found insufficient evidentiary grounds to
grant the ex parte relief sought.

Specifically, there was “no

plausible indication that additional shipments [of any shrimp
would] occur before Defendants ha[d] the opportunity to be heard
on th[e] matter.”

(Doc. #25, pp. 5-6.)

The fact that, after

receiving Defendants’ attorney’s response to the cease and desist
letter, Primo delayed taking legal action for months also mitigated
against an award of emergency ex parte relief.

(Id. p. 6.)

Nonetheless,

rights,

perhaps

appreciating

billions

of

the

dollars,

“significant
at

stake,”

legal
the

Court

and

expedited

Defendants’ response to, and a hearing on, Plaintiff’s pending
Alternative Motion for Preliminary Injunction.
3)

(Id. pp. 5, 7.)

Request For Preliminary Injunction

Primo now seeks an order enjoining Defendants, and those
acting in concert, from:
1.

manufacturing, marketing, distributing, shipping,
offering for sale, or conducting of research, testing,
or analysis of the viability[,] of Primo Shrimp;

2.

soliciting (or assisting others in such solicitation)
of shrimp breeders, shrimp distributors, shrimp
farmers, or consultants in the shrimp industry that
in any way, directly or indirectly, relates to the
manufacturing, marketing, distributing, shipping,
offering for sale, selling, or conducting of research,
testing, or analysis of the viability[,] of Primo
Shrimp;

3.

disclosing Plaintiff’s confidential, proprietary or
trade secret information to others, including but not
- 8 -

limited to any shrimp breeders, shrimp distributors,
shrimp
farmers, or consultants in the shrimp
industry;
4.

advertising or otherwise marketing or making any
reference to any products or services that in any way,
directly or indirectly, relates to the manufacturing,
marketing, distributing, shipping, offering for sale,
selling, or conducting of research, testing, or
analysis of the viability[,] of Primo Shrimp,
including, inter alia, on Defendants’ websites.

(Doc. #68-3.)
Plaintiff
injunction

argues

because

that

it

Defendants

is

entitled

continue

to

to:

a

(i)

preliminary
breach

the

restrictive covenants contained in the NDA and in the Grow-Out
Agreement; (ii) convert Primo’s property; (iii) misappropriate the
“trade secrets” embodied in the superior genetics of Primo’s
twenty-four “unique” families of shrimp; and (iv) and engage in
unfair competition and violate the Lanham Act and the Florida
Unfair and Deceptive Trade Practices Act by continuing to “mislead
the world markets into believing that [Defendants], and they alone,
have the ‘real Primo’” – all of which will cause Plaintiff to
suffer continued, irreparable harm.
Defendants oppose a preliminary injunction, except as to the
use

of

the

“Primo”

name.

Regarding

Plaintiff’s

claim

of

irreparable harm absent an injunction, Defendants note that any
Primo shrimp left at the AMI Facility have since died, and point
out

that

Primo

has

remained

in

business

in

the

year

since

Defendants began breeding and selling the shrimp Primo did not
repurchase by April 30, 2016.
assert

that,

in

contrast,

(Doc. #64, p. 16.)

issuance
- 9 -

of

the

broad

Defendants
injunction

Plaintiff seeks – namely, an order enjoining Defendants from
breeding and selling its animals - will result in “a loss of
employment for [Defendants’] 25 current employees [and] a complete
loss of investment for AMI’s investors.” 9

(Doc. #39, p. 24.)

Defendants contend further that “the American public will lose the
largest current supplier of U.S.-grown, all natural, fresh shrimp,
which will reduce the ability of the United States to become selfsufficient in its domestic seafood supply.” 10

(Id.)

To the extent

the Court does grant the injunction Plaintiff seeks, Defendants
request a bond of at least $10 million to cover the damages they
expect to incur through the end of trial.
II.
“[A]

preliminary

injunction

in

advance

of

trial

is

an

extraordinary remedy” whose purpose “is to preserve the positions
of the parties as best [the court can] until a trial on the merits
may be held.”
2011)

Bloedorn v. Grube, 631 F.3d 1218, 1229 (11th Cir.

(citations

omitted).

Primo

seeks

“a

‘traditional’

injunction, which may be issued as either an interim or permanent
remedy

for

certain

breaches

constitutional rights.”

of

common

law,

statutory,

or

Klay v. United Healthgroup, Inc., 376

9

At the hearing, attorneys for both parties described this case
as “bet the company litigation” for their clients.
10

Mr. Pearl’s Affidavit states that “[t]he United States' seafood
trade deficit is $11.2 billion (2014 NOAA), which makes seafood
the second largest trade deficit item of natural resources second
only to oil. This complete reliance on imports makes the United
States' seafood supply a major threat to United States' [sic] food
security.” (Doc. #41, ¶ 9.)
- 10 -

F.3d

1092,

1097

(11th

Cir.

2004)

(footnote

omitted).

A

traditional injunction is warranted where the movant succeeds in
establishing four things: (1) that it has a substantial likelihood
of success on the merits of one or more of its claims; (2) that it
will suffer irreparable injury, absent an injunction; (3) that the
harm posed to the party opposing the injunction does not outweigh
the movant’s threatened injury; and (4) that the injunctive relief
sought is not adverse to the public interest.

Id.; Siegel v.

Lepore, 234 F.3d 1163, 1176 (11th Cir. 2000) (en banc) (per
curiam).

The

“failure

to

meet

even

one

[of

prerequisites] dooms” a request for injunctive relief.

these

four

Wreal, LLC

v. Amazon.com, Inc., 840 F.3d 1244, 1248 (11th Cir. 2016).

Where

an injunction is deemed warranted, the court has considerable
discretion in shaping the particular relief afforded.

Pac. & S.

Co. v. Duncan, 792 F.2d 1013, 1014–15 (11th Cir. 1986) (“Framing
an injunction appropriate to the facts of a particular case is a
matter peculiarly within the discretion of the district judge.”
(quoting Gore v. Turner, 563 F.2d 159, 165 (5th Cir. 1977))).
III.
The Court now turns to whether Plaintiff has shown entitlement
to injunctive relief for each of the claims for which such relief
has been requested, 11 and if so, the scope of relief that is
appropriate under the facts of the case.

11

Plaintiff’s Alternative Motion for Preliminary Injunction does
not request injunctive relief based on the claims for defamation
(Count III) and unjust enrichment (Count IX).
- 11 -

A.

The Breach of Contract Claim (Count I)
Count I of the Amended Complaint asserts a breach of contract

claim against AMI, for which Plaintiff requests an award of money
damages, including punitive damages.

Count I also seeks an order

(1) enjoining AMI “from further breaches of the NDA . . . [and]
the Grow-Out Agreement,” and (2) requiring AMI “to kill all Primo
shrimp in its possession for sale as dead fresh or frozen shrimp
product into the market.”

(Doc. #20, ¶¶ 93-97.)

According to

Plaintiff, under Florida law, where an enforceable restrictive
covenant is breached, irreparable harm is presumed, and an award
of injunctive relief is typically warranted.
53, pp. 9, 136.)

(Docs. ## 21, ¶ 17;

Plaintiff also invokes a provision in the NDA

stating that “each party agrees and acknowledges that any . . .
violation [of the obligations imposed] will cause irreparable
injury to [Plaintiff],” entitling Plaintiff “to obtain injunctive
relief against . . . the continuation of any such breach.”

(Id.

p. 9 (quoting Doc. #20-1, ¶ 10).)
Defendants admittedly sold at least 2,330 live shrimp that
Primo left at the AMI Facility (Doc. #64-1, ¶ 10), and they also
admittedly bred Primo shrimp with shrimp from other sources to
create the new “High Vigor” hybrid line that API now sells.
#41, ¶ 101.)

(Doc.

Defendants argue that no injunction is warranted,

however, since Plaintiff is unlikely to succeed on the merits of
the breach of contract claim, and since Plaintiff cannot show
irreparable harm absent an injunction.

Specifically, Defendants

contend that: (1) shrimp do not fall within the NDA’s definition
- 12 -

of “Confidential Information”; (2) the Term Sheet terminated the
Grow-Out Agreement and transferred title in the remaining Primo
animals at the AMI Facility to Defendants; and (3) due to their
short lifespan, any live shrimp left at the AMI Facility on April
30, 2016 have since died. (Doc. #39, pp. 9-13.)
Normally, a breach of contract claim will not support issuance
of a preliminary injunction because breaches can typically be
remedied

through

an

award

of

money

damages.

See

United

Steelworkers of Am., AFL-CIO-CLC v. USX Corp., 966 F.2d 1394, 1405
(11th Cir. 1992) (injunctive relief on the plaintiff’s breach of
contract claim deemed inappropriate where an “adequate remedy at
law in the form of money damages” existed); Stand Up for Animals,
Inc. v. Monroe Cty., 69 So. 3d 1011, 1013 (Fla. 3d DCA 2011)
(“Because the allegations assert no more than a breach of contract
compensable by a damage award, no irreparable harm essential to
secure injunctive relief . . . could be demonstrated.”).

While

the Court will assume without deciding that Primo is, in fact,
eligible for injunctive relief for its breach claim based on the
above-mentioned

language

in

the

NDA

and/or

Fla.

Stat.

§

542.335(1)(j), this assumption does not obviate Primo’s obligation
to “show a sufficient likelihood that [it] will be affected by the
allegedly unlawful conduct in the future” in order “to obtain [the]
forward-looking [injunctive] relief” that it seeks.

Wooden v. Bd.

of Regents of Univ. Sys. of Ga., 247 F.3d 1262, 1283 (11th Cir.
2001); see also Hoop Culture, Inc. v. GAP Inc., 648 F. App'x 981,
986 (11th Cir. 2016) (“[P]ast harm is not a basis for preliminary
- 13 -

injunctive relief, which requires a showing of likely future injury
if an injunction does not issue.”).

Indeed, the Eleventh Circuit

has stressed that the presumption of irreparable injury created
under Florida law by the breach of a restrictive covenant is
“rebuttable,” 12 Proudfoot Consulting Co. v. Gordon, 576 F.3d 1223,
1231 (11th Cir. 2009) (citing JonJuan Salon, Inc. v. Acosta, 922
So.2d 1081, 1084 (Fla. 4th DCA 2006)), and a remote (or nonexistent) possibility of future irreparable harm is sufficient to
rebut that presumption.

TransUnion Risk & Alternative Data Sols.,

Inc. v. Challa, No. 16-11878, --- Fed. App’x ---, 2017 WL 117128,
at *3 (11th Cir. Jan. 12, 2017).
Thus, a threshold question underlying Plaintiff’s entitlement
to injunctive relief as to its claim for breach of contract is
whether Defendants are capable of breaching the NDA or the GrowOut

Agreement

in

additional harm.
1)

the

future,

thereby

exposing

Plaintiff

to

The answer is no.

The Non-Disclosure Agreement

Paragraph 3 of the NDA imposes on Defendant AMI the obligation
“(i) to hold in trust and confidence and not disclose to any third
parties . . . any Confidential Information and (ii) not to use any
Confidential Information for any purpose other than to carry out

12

Similarly, multiple courts of appeals have held that a
contractual stipulation as to irreparable harm – like the one in
the NDA - does not relieve the movant’s burden of proving that
such harm is actually expected to occur.
E.g., Dominion Video
Satellite, Inc. v. Echostar Satellite Corp., 356 F.3d 1256, 1266
(10th Cir. 2004); Patio Enclosures, Inc. v. Herbst, 39 F. App'x
964, 970 (6th Cir. 2002); Smith, Bucklin & Assocs., Inc. v.
Sonntagz, 83 F.3d 476, 481 (D.C. Cir. 1996).
- 14 -

discussions concerning, and the undertaking of, the Relationship.”
(Doc. #20-1, ¶ 3.)
continues

to

Plaintiff alleges that “AMI breached and

breach

the

NDA

by

failing

to

preserve

the

‘Confidential Information’ (as defined in the NDA) that had been
imparted to it by Primo, including by transferring both males and
females of several highly desirable, disease-resistant lines to
the AMI’s [sic] agents and instrumentalities.”

(Doc. #20, ¶ 84.)

Defendants dispute that they have used or disclosed anything that
constitutes “Confidential Information” under the NDA.
“[P]arties to a contract have the right to define the terms
of that contract.”
1150

(11th

Cir.

Buce v. Allianz Life Ins. Co., 247 F.3d 1133,
2001)

(Barkett,

J.,

concurring);

see

also

Okeechobee Resorts, L.L.C. v. E Z Cash Pawn, Inc., 145 So. 3d 989,
993 (Fla. 4th DCA 2014) (“Contracts are voluntary undertakings,
and contracting parties are free to bargain for — and specify —
the terms and conditions of their agreement.”).

As relevant here,

the NDA defines “Confidential Information” as “any information,
technical data, or know-how, including, but not limited to, that
which relates to . . . research, product plans, [and] products.”
(Doc. #20-1, ¶ 2.)

Defendants argue that Plaintiff is not likely

to succeed with the merits of this claim because “there has been
no showing by Primo that the subject shrimp constitute information,
technical data, or know-how,” as is necessary to bring Defendants’
activities within the scope of Paragraph 3’s prohibitions.
#64, p. 12.)

- 15 -

(Doc.

But Plaintiff’s argument is not that a Primo shrimp itself
constitutes “information, technical data, or know-how”; rather, it
is that “genetic material traceable to Primo Shrimp” constitutes
“Confidential

Information.”

(Doc.

#68,

p.

22.)

It

is

this

“information relating to a product” that was “used” when Defendants
created

new

hybrids

using

Primo

shrimp

Defendants sold Primo shrimp to others.
why

shrimp

genetics

would

not

fall

and

“disclosed”

when

The Court sees no reason
within

the

NDA’s

broad

“information relating to a product” definition to which the parties
agreed. 13

See United States v. Kriesel, 720 F.3d 1137, 1145 (9th

Cir. 2013) (“The district court also properly concluded that the
blood sample itself is a tangible object, and the genetic code
contained within the blood sample is information.”).
But – and ultimately dispositive on Plaintiff’s request for
injunctive

relief

-

Plaintiff’s

assertion

that

all

genetic

material traceable to Primo shrimp is Confidential Information is
not supported by the record.

The evidentiary materials instead

show that Plaintiff has never deemed “confidential” the genetic
material contained in one pure shrimp or in a hybrid (or “locked” 14)

13

The NDA was actually supplied (and required) by AMI, not Primo.
(Doc. #53, p. 65.)
14

According to Mr. Pearl, the combination of a male breeder shrimp
and a female breeder shrimp from different family lines creates a
“locked” pair. “Locked pairs are production breeders that when
crossed will produce a hybrid that will perform very well, but if
a farmer were then to propagate future shrimp using these hybrids,
the offspring would be severely inbred and thus would have poor
results. This is how genetic shrimp broodstock companies” – like
Primo – “protect their stocks and ensure that hatcheries keep
ordering replacement breeders after each cycle.” (Doc. 41, ¶ 26.)
- 16 -

pair.

Rather, the information Primo considers “confidential” is

the genetic material contained in Primo’s “crown jewels”: a “pure
breeder pair,” i.e., a male and a female from the same family line.
Indeed, this is the information Plaintiff has scrupulously sought
to protect by never providing pure breeder pairs to anyone other
than AMI.
genetic

(See Doc. #20, ¶¶ 132-33 (“The breeder pairs of a single

family

of

shrimp

constitute

trade

secrets

of

Primo.

Primo’s maintained the secrecy of its trade secrets by not making
its breeder pairs available for sale but only a male or female of
a particular family line.”).)

As Plaintiff’s counsel explained

in further detail at the preliminary injunction hearing:
[Primo doesn’t] sell the breeders, males and
females, to [its] clients. And even Haimao,
[Primo’s] exclusive distributor, does not get
a male and a female [from the same family].
What they get is an A and a B. And that AB
combination, through [Primo’s] testing and
through all the[] work that [Primo’s] done
over time, has been able to produce 80 plus
percent.
So [that’s] the information that's secret
here, that's confidential - and the only
parties that got it[,] is Mr. Pearl's company.
. . . They're the only parties that got A and
B [breeders] together from the same family. .
. . [Mr. Pearl] basically got the keys to the
castle.
(Doc. #53, pp. 14-15.)

Indeed, the reason Primo admittedly did

not sign NDAs with others to whom it sold live shrimp was because
no one else was “handling breeder pairs.”

(Doc. #53, pp. 127-28.)

Limiting the definition of “Confidential Information” to the
genetic material contained in pure Primo breeder pairs is fatal to
Plaintiff’s claim for injunctive relief as to the NDA because,
- 17 -

despite

Defendants’

access

to

those

breeder

pairs,

there

is

insufficient evidence that Defendants actually bred or sold those
pairs.

To the contrary, it appears that Defendants did not

actually know the family lines of the shrimp Primo supplied. 15
Moreover, all of those breeder pairs have since died. 16
also Doc. #53, pp. 45, 151-52.)

(Id.; see

As such, not only has Plaintiff

has not shown a substantial likelihood that Defendants “used” or
“disclosed” Plaintiff’s “Confidential Information” in the past,
Plaintiff cannot establish that Defendants are likely to do so in
the future.

Accordingly, Primo is not entitled to injunctive

relief on its claim for breach of the NDA.

15

Defendants contend they “received absolutely no information
whatsoever about Primo’s breeder pairs.”
(Doc. #64, p. 13.)
According to Mr. Pearl, “[t]he shipments of pure Primo PLs [postlarval shrimp] from Primo to AMI were never accompanied by any
paperwork. We had to guess as to its quantity, age, and family
line, etc. [A]t the time I assumed [Primo] would be able to figure
out what family was what using their DNA-marking protocols.”
(Doc. #41, ¶ 38; see also id. ¶ 46 (“[N]one of the pure PL shipments
had clearly defined origins, there was no certain way of knowing
which family was which.”).)
Thus, “once Primo abandoned the
shrimp to AMI, AMI bred the abandoned shrimp not with each other,
as [it] might have done had AMI had information regarding the
breeder pairs, but with other non-Primo shrimp at AMI.”
(Doc.
#64-1, ¶ 17.)
Plaintiff acknowledges that Defendants were not
supplied “a full genomic analysis of the breeder pairs” but claims
that “each family line was scrupulously tracked.” (Doc. #68, p.
19.)
Emails exchanged between Mr. Pearl and K. Gervais support
Defendants’ claim that they were not provided adequate paperwork
regarding the Primo animals’ genetics or family lines. (Doc. 411, p. 13.)
16

“[T]he shrimp in question have a fairly short life span.” (Doc.
#64, p. 15.) At the time of the hearing, Defendants’ shrimp were
two generations removed from (i.e. the “grandchildren” of) the
Primo shrimp left at the AMI Facility on April 30, 2016. (Doc.
#53, p. 152.)
- 18 -

2)

The Grow-Out Agreement

Plaintiff also alleges that Defendants have breached the
restrictive covenants contained in Paragraphs 3 and 7 of the GrowOut Agreement.

Paragraph 3 states that “[i]n the event an animal

cannot be sold in an agreed upon time or size the animal will be
killed and sold as dead fresh or frozen shrimp product into the
market.”

Under

Paragraph

7,

AMI

is

prohibited

from

using,

transferring, or selling “Primo shrimp of any size” without Primo’s
written authorization, including using a “Primo animal in AMI or
alternative shrimp maturation, hatchery or grow-out facility.”
According to Plaintiff, Defendants breached these covenants
by

selling

and

breeding

the

live

shrimp

that

Primo

did

not

repurchase from AMI by April 30, 2016, and continue to breach the
covenants by breeding and selling hybrid shrimp derived from that
proprietary stock.

Defendants respond that they have not breached

the restrictive covenants because the Term Sheet (i) transferred
title in the animals left at the AMI Facility to AMI and (ii)
extinguished

the

Grow-Out

Agreement’s

restrictive

covenants. 17

Defendants further contend that, even if the Grow-Out Agreement
does embody a bailment relationship – as might have restricted
their ability to sell or breed the shrimp even after April 30,
2016 – those restrictions applied only to the “pure” animals left

17

In support, Defendants rely on the “Terminate Agreement” and
“AMI to provide Bill of Sale” language in the Term Sheet. (Doc.
#20-3.)
- 19 -

at the AMI Facility - all of which have since died – not to any
hybrids derived therefrom. 18

(Doc. #64, p. 15.)

The covenants limit Defendants’ actions as to “Primo animals”
and “Primo shrimp.”

The Grow-Out Agreement does not, however,

explicitly define these terms.

Plaintiff would seemingly have the

Court construe “Primo shrimp” (and presumably “Primo animals”) as:
(i) any proprietary shrimp Plaintiff delivered
to AMI, (ii) any shrimp, including all hybrids
and “mutts,” 19 derived in any way from any
proprietary shrimp Plaintiff delivered to AMI,
or (iii) any shrimp delivered to any of the
AMI Defendants from any source that are[,] or
are derived in any way from[,] any of
Plaintiff’s proprietary shrimp.
(Doc. #68, p. 1 n.1.)

In other words, Plaintiff asks the Court

to construe the terms “Primo shrimp” and “Primo animal” as all
shrimp – whether larval or post-larval - having even the smallest
fraction

of

the

same

genetic

makeup

as

one

of

Plaintiff’s

“proprietary shrimp.”

18

“Bailment” is “a contractual relationship among parties in which
the subject matter of the relationship is delivered temporarily to
and accepted by one other than the owner.” S & W Air Vac Sys.,
Inc. v. Dep't of Revenue, State of Fla., 697 So. 2d 1313, 1315
(Fla. 5th DCA 1997) (citing 5 Fla. Jur.2d Bailments § 1 (1978)).
“As a general rule, delivery of the item to the bailee must give
him or her the right to exclusive use and possession of the item
for the period of the bailment.” Meeks ex rel. Estate of Meeks
v. Fla. Power & Light Co., 816 So. 2d 1125, 1129 (Fla. 5th DCA
2002) (citing 8A Am. Jur. 2d Bailments § 28 (1997)).
19

In his Supplemental Affidavit, Mr. Pearl defines shrimp “mutts”
as the 3.6 million Nauplii (one-day old shrimp larvae) that Primo
sent Defendants pursuant to a separate agreement “as a way to
compensate [Defendants] for [Primo’s] fail[ure] to comply with the
Grow-Out Agreement by shipping [pure] breeders.” (Doc. #64-1, ¶
12.) Mr. Pearl asserts that Primo had no “right to re-purchase
these [mutt] shrimp or restrict [Defendants’] use of these shrimp.”
(Id.)
- 20 -

Defendants do not believe the Grow-Out Agreement restricts
what they can do with the hybrid animals they have created from
either the pure Primo shrimp or the “mutts.”

The Court agrees

that Plaintiff has not established a likelihood of succeeding with
its

interpretive

position.

This,

in

turn,

forecloses

the

possibility of future breaches of the Grow-Out Agreement and
thereby renders injunctive relief unavailable. 20
“It is well settled that the actual language used in the
contract is the best evidence of the intent of the parties . . .
.”

Rose v. M/V "Gulf Stream Falcon", 186 F.3d 1345, 1350 (11th

Cir. 1999) (citations omitted); MDS (Can.) Inc. v. Rad Source
Techs., Inc., 143 So. 3d 881, 890 (Fla. 2014).

Paragraph 9 states

that: “AMI is to receive Post-larva from Primo and grow them to at
least 20g in specifically designate [sic] tanks. . . . All live
animals grown out from designated tanks for the sole purpose of
producing Primo broodstock remain the property of Primo at all
times.” 21

(Doc. #20-2, ¶ 9 (emphasis added).)

Nauplii (the “mutt”

shrimp) are not post-larval animals; they are “larva in usually
the first stage after leaving the egg.”
Dictionary,

Nauplius, Merriam-Webster

https://www.merriam-webster.com/dictionary/NAUPLII

20

It is, therefore, unnecessary for the Court to address whether
the Term Sheet is an enforceable agreement that extinguished the
restrictive covenants in the Grow-Out Agreement and transferred
title in the Primo shrimp from Plaintiff to Defendants.
21

Primo’s attorney’s cease and desist letter states that, under
the Grow-Out Agreement, “the parties agreed that AMI was to receive
post-larva shrimp from Primo and AMI was to raise these shrimp
until they reached adult size.” (Doc. #20-5 (emphasis added).)
- 21 -

(last accessed April 27, 2017); see also Country of Origin of
Shrimp;

Shrimp

Hatching

&

Grow-Out

Operations;

Substantial

Transformation, HQ 562998, 2004 WL 2303667, at *1, 2 (May 21,
2004). 22
Because the Grow-Out Agreement ostensibly does not apply to
Nauplii, Plaintiff is not likely to succeed in establishing that
covenants

restricted

Defendants’

ability

descendants of those “mutt” shrimp.

to

breed

and

sell

See Int'l Bhd. of Elec.

Workers Sys. Council U-4 v. Fla. Power & Light Co., 627 F. App'x
898, 902 (11th Cir. 2015) (“In interpreting a contract, we must
read the words of the contract in the context of the contract as
a whole.”); cf. “S&B/BIBB Hines PB 3 Joint Venture v. Progress
Energy Fla., Inc., 365 F. App'x 202, 207 (11th Cir. 2010) (“Courts
will

not

rewrite

unambiguous

contracts

to

make

them

more

advantageous for one of the parties or to ‘relieve one of the
parties from the apparent hardship of an improvident bargain.’”
(quoting Home Dev. Co. of St. Petersburg, Inc. v. Bursani, 178
So.2d 113, 117 (Fla. 1965))).

As such, the Court will not enjoin

future breeding operations involving these mutt shrimp or the sale
of their descendants, nor require Defendants to harvest them.

22

“Under Florida contract law . . . . [c]ourts may resort to
reference materials to determine the accepted plain meaning of a
particular term.” Nat'l R.R. Passenger Corp. (Amtrak) v. Rountree
Transp. & Rigging, Inc., 422 F.3d 1275, 1284 (11th Cir. 2005)
(citing Burns v. Barfield, 732 So.2d 1202, 1205 (Fla. 4th DCA
1999)); see also Roper v. City of Clearwater, 796 So. 2d 1159,
1162 (Fla. 2001) (“Where terms which are key to the analysis have
not otherwise been defined, the Florida courts have looked to
various sources for definitions.”).
- 22 -

The second contract interpretation question - whether the
restrictive covenants encompass hybrids derived from the “pure”
Primo shrimp Defendants received from Plaintiff - reveals a latent
ambiguity in the Grow-Out Agreement.

“A latent ambiguity is said

to exist where a contract fails to specify the rights or duties of
the parties in certain situations” - in this case, the fate of the
ill-gotten fruits of Defendants’ putative breach.

MDS (Can.) Inc.

v. Rad Source Techs., Inc., 720 F.3d 833, 844 (11th Cir. 2013)
(quoting Forest Hills Util., Inc. v. Pasco Cnty., 536 So.2d 1117,
1119 (Fla. 2nd DCA 1988)).

In such case, “extrinsic evidence is

necessary for interpretation or a choice between two possible
meanings.” 23

Id.; see also LSQ Funding Grp., L.C. v. EDS Field

Servs., 879 F. Supp. 2d 1320, 1332 (M.D. Fla. 2012) (“If a latent
ambiguity exists, extrinsic evidence is admissible to determine
the intent of the parties.”).
proferentem

requires

against the drafter.”

[the

Furthermore, “the rule of contra

Court]

to

construe

any

ambiguities

Alexandra H. v. Oxford Health Ins. Inc.

Freedom Access Plan, 833 F.3d 1299, 1307 (11th Cir. 2016).
The

extrinsic

evidence

available

to

the

Court

supports

resolution of the hybrid-shrimp ambiguity in Defendants’ favor –

23

A patent ambiguity, in contrast, “arises from defective,
obscure, or insensible language, and Florida law does not permit
the introduction of extrinsic evidence to discern the parties'
intentions.” MDS (Can.), 720 F.3d at 844 (citing Ace Elec. Supply
Co. v. Terra Nova Elec., Inc., 288 So.2d 544, 547 (Fla. 1st DCA
1973)).
- 23 -

at least at this preliminary stage. 24

The record shows that the

purpose of the restrictive covenants at issue was to prevent anyone
from obtaining the invaluable “keys to [Primo’s] castle”: female
and male breeders from the same Primo family line. 25 (Doc. #53, p.
15). Because Plaintiff has not demonstrated a likelihood of success
on the merits of its claim that the restrictive covenants encompass
the use or sale of hybrids, 26 and because Defendants currently
possess only hybrids, an order enjoining Defendants’ actions with
respect to the sale or breeding of those animals is not warranted. 27

24

The rule of contra proferentem is also appropriately invoked
here. At the hearing, Defendants’ attorney stated that the GrowOut Agreement was drafted by K. Gervais. (Doc. #53, pp. 86-87.)
Primo’s attorney objected to this statement because no evidence
had been presented as to who drafted the Agreement.
The Court
overruled the objection and provided Plaintiff’s counsel the
opportunity to “argue to the contrary on rebuttal.” (Id. p. 57.)
Plaintiff’s attorney did not present any rebuttal argument.
25

(Id. pp. 16 (“The only way to reproduce the genetic makeup of
the breeder to create more breeders that you can then create
combinations and hybrids is to -- is to have testing, et cetera,
et cetera, that allows you to establish that pure family line.
It's a blue blood. Each one is a blue bloodline.”), 117 (“[W]e’re
talking about breeder pairs. That’s what matters here. It’s not
the offspring we care about. They can sell the offspring.”).)
26

On the issue of hybrids, Defendants’ counsel noted at the hearing
that dog breeders “have no control over whether the consumer or
the purchaser of those pups goes out and breeds them with another
type of dog to create hybrids.” (Doc. #53, p. 101.) In response,
Plaintiff’s attorney stated: “You can take the puppies. You can
take all the puppies you want. There's nothing you can do with
them. Nobody wants to buy your bred puppies.
They want the
parents, that's who they want, the mom and dad, Seattle Slew and,
you know, whoever else . . . Seattle Slew has mated with. That's
who they want.” (Id. p. 128.)
27

The same analysis applies to Plaintiff’s conversion claim; even
if Defendants converted Plaintiff’s property – the pure Primo
shrimp – the subsequent death of those animals means there is no
basis for believing that any future conversion is possible.
- 24 -

B.

The Trade Secret Misappropriation Claims (Counts IV and V)
Plaintiff

also

seeks

an

injunction

to

prevent

violation of federal and state trade secret laws.
contends

that

Defendants

have

“misappropriated

continued
Plaintiff

numerous

trade

secrets belonging to Primo embodied in the genetic code of its
living shrimp and the male and female breeder pairs of each shrimp
broodstock family containing highly desirable production traits.” 28
(Doc. #20, ¶ 129.)

Defendants respond that Plaintiff is unlikely

to succeed with its claims for trade secret misappropriation,
primarily because

there

proposition

animal

that

is

no

case

genetics

law

obtained

breeding can constitute a trade secret.
Both

the

federal

Defend

supporting

Trade

through

the

broad

selective

(Id. pp. 16-17.)

Secrets

Acts 29 (DTSA)

and

Florida’s Uniform Trade Secrets Act (FUTSA) authorize a court to
grant

an

injunction

misappropriation

of

to
a

prevent
“trade

“actual”
secret.”

1836(b)(3)(A)(i); Fla. Stat. § 688.003(1).

or

“threatened”

18

U.S.C.

§

Under the DTSA,

the term “trade secret” means all forms and
types of financial, business, scientific,
technical,
economic,
or
engineering
information . . . if 28

To support this claim, Plaintiff has presented the Court with a
number of cases purportedly holding that plant genetics can
constitute a trade secret, which secret is misappropriated when
another uses or discloses those genetics through unauthorized sale
or breeding.
29

The DTSA applies “only to acts of misappropriation occurring
after the effective date of May 11, 2016.
Adams Arms, LLC v.
Unified Weapon Sys., Inc., No. 8:16-CV-1503-T-33AEP, 2016 WL
5391394, at *5-6 (M.D. Fla. Sept. 27, 2016). Defendants have not
argued that the actions underlying Plaintiff’s DTSA claim occurred
before that date.
- 25 -

(A) the owner thereof has taken reasonable
measures to keep such information secret; and
(B) the
information
derives
independent
economic value, actual or potential, from not
being generally known to, and not being
readily ascertainable through proper means by,
another person who can obtain economic value
from the disclosure or use of the information.
18 U.S.C. § 1839(3). 30

“Information that is generally known or

readily accessible to third parties cannot qualify for trade secret
protection.”

Am. Red Cross v. Palm Beach Blood Bank, Inc., 143

F.3d 1407, 1410 (11th Cir. 1998) (citing Bestechnologies, Inc. v.
Trident Envtl. Sys., Inc., 681 So.2d 1175, 1176 (Fla. 2d DCA
1996)).

Ultimately, “[w]hether information constitutes a ‘trade

secret’ is a question of fact.”

Penalty Kick Mgmt. Ltd. v. Coca

Cola Co., 318 F.3d 1284, 1291 (11th Cir. 2003) (citations omitted).
As relevant here, to “misappropriate” a trade secret means to
disclos[e] or use . . . a trade secret of
another without express or implied consent by
a person who . . . [a]t the time of disclosure
or use, knew or had reason to know that her or
his knowledge of the trade secret was . . .
[a]cquired under circumstances giving rise to
a duty to maintain its secrecy or limit its
use.
18 U.S.C. 1839(5)(B)(ii)(II); see also Fla. Stat 688.002(2).
Thus, to succeed on Counts IV (DTSA) and V (FUTSA), Primo
must establish that Defendants: (i) possessed “information” of
“independent economic value” that (a) was lawfully owned by Primo

30

FUTSA’s definition of “trade secret” is nearly identical, but
does not limit the definition of “information” to “financial,
business,
scientific,
technical,
economic,
or
engineering
information.” See Fla. Stat. § 688.002(4).
- 26 -

and (b) for which Primo took reasonable measures to keep secret,
and (ii) “used” and/or “disclosed” that “information,” despite
(iii)

a duty to maintain its secrecy.

See Am. Red Cross, 143

F.3d at 1410 (“In a trade secret action, the plaintiff bears the
burden of demonstrating both that the specific information it seeks
to protect is secret and that it has taken reasonable steps to
protect this secrecy.” (citing Lee v. Cercoa, Inc., 433 So. 2d 1,
2 (Fla. 4th DCA 1983))).
Defendants

vigorously

dispute

that

an

animal’s

genetic

information can be a trade secret, even if the genetics embody
superior

traits

Defendants

resulting

contend

further

from
that,

selective

breeding

specifically,

Primo

efforts.
shrimp

genetics cannot meet the definition of “trade secret,” since the
shrimp “originated in Ecuador[] [and have] been sold and resold
all over the world,” (Doc. #53, p. 111), and since Plaintiff did
not take reasonable - or any - measures to keep that information
secret.

(Id. p. 101.)

Whether

Plaintiff

indeed

possesses

a

“trade

secret”

and

whether Defendants “misappropriated” that secret are questions for
another day.

Assuming Primo shrimp genetics constitute a trade

secret, and assuming Defendants continue to misappropriate that
trade secret by breeding the “grandchildren” of those shrimp, 31

31

See Penalty Kick, 318 F.3d at 1292 (“[A]n actor is liable for
using the trade secret with independently created improvements or
modifications if the result is substantially derived from the
trade secret.” (quoting Restatement (Third) of Unfair Competition
§ 40 cmt. c. (1995))).
- 27 -

the putative trade secret’s real, intrinsic value derives from,
and is irreparably harmed by, another’s access to a pure Primo
breeder

pair. 32

Plaintiff

has

provided

no

support

for

the

proposition that Defendants’ continued sale of hybrid animals –
the only type of shrimp that remains in their possession - will
irreparably
Plaintiff).

harm

the

value

Accordingly,

of

that

an

genetic

injunction

misappropriation grounds is not warranted.

trade
on

secret

trade

(or

secret

See Winter v. Nat.

Res. Def. Council, Inc., 555 U.S. 7, 22 (2008) (“Our frequently
reiterated standard requires plaintiffs seeking preliminary relief
to demonstrate that irreparable injury is likely in the absence of
an injunction.”); Bd. of Regents of State of Fla. By & Through
Univ. of S. Fla. v. Taborsky, 648 So. 2d 748, 754 (Fla. 2d DCA
1994) (“Florida courts uniformly recognize their ability to grant
injunctive

relief

misappropriation

of

to

prevent

trade

secrets

further
or

injury

protected

for

the

research.”

(emphasis added)); see also Faiveley Transp. Malmo AB v. Wabtec
Corp., 559 F.3d 110, 118–19 (2d Cir. 2009) (observing that a
misappropriator’s mere use of a trade secret for profit in a way
that is not likely to impair the value of the secret undermines a
finding of irreparable harm).

32

(Doc. #53, p. 117 (“[T]he reason why this is confidential
information, the reason why it is a secret to us is because we
don't transmit the breeder pairs. . . . [Defendants] were the only
ones who got the breeder pairs. They were the only ones who could
actually replicate what we did. . . . And anybody who doesn't have
the breeder pair is just breeding it with something else, and that
doesn't create the line anymore.”).)
- 28 -

C.

Unfair Competition, the Lanham Act, and the FDUTPA (Counts V,
VII, and VIII)
Plaintiff

also

seeks

an

order

enjoining

Defendants

from

continuing to engage in unfair competition under Florida law and
from committing further violations of the Lanham Act and the
Florida Deceptive and Unfair Trade Practices Act (the Competition
Claims).

The Competition Claims arise primarily from Plaintiff’s

allegation that “Defendants have made, and continue to make, false
and misleading statements to a host of commercial enterprises about
[Defendants’] non-existent and unlawful ‘rights’ over significant
portions

of

Primo’s

property rights.”

broodstock

and

associated

intellectual

(Doc. #21, ¶ 44.)

Specifically, Plaintiff contends that Defendants are calling
the shrimp they send to China “Primo” shrimp and are lying about
the

“pure”

genetic

makeup

of

those

animals

customers and trade on Primo’s reputation.”

“to

confuse

the

(Doc. #68-1, ¶ 60.)

According to Plaintiff, the world is “clamoring for the ‘real
Primo’ shrimp,” and Defendants’ statements continue to “mislead
the world markets into believing that [Defendants], and they alone,
have the ‘real Primo.’”

(Doc. #68, p. 2.)

Plaintiff believes

that, seeking to capitalize on their access to Primo shrimp,
Defendants have implemented a “scheme to obfuscate the market in
China – and ultimately the world – regarding the genuineness of
Plaintiff’s proprietary shrimp broodstock.”

(Doc. #21, p. 2.)

As

part of this “scheme,” Defendants sell live breeder shrimp to
Chinese companies whose names contain the word “Primo” (or who

- 29 -

otherwise advertise that they sell “real Primo” shrimp).
#68, pp. 25-27.)

(Doc.

Further, rather than clarify that the breeders

they supply to these companies are merely hybrids derived from
pure Primo stock, Defendants continue to propagate the illusion
that the live shrimp they sell are “the real Primo.”
This

scheme

has

“already

caused

and,

more

(Id. p. 2.)

importantly,

will

continue to cause even more confusion regarding the genuineness of
shrimp that Plaintiff markets as ‘Primo’ broodstock[] . . . [and]
further erode confidence in Plaintiff as the legitimate source of
Primo Shrimp.”
Defendants

(Doc. #21, ¶ 45.)
contend

that

any

statements

they

have

made

regarding their rights over the shrimp and the animals’ genetics
are truthful.

Further, while Defendants do “agree that the use

of [the Primo] name is improper,” they assert that the name is
being used by their Chinese customers, over whom Defendants “have
no direct control.” 33

(Id. p. 20, n.7.)

Defendants do not,

however, “necessarily oppose” an injunction preventing use of the
“Primo” name.

(Doc. #53, p. 111.)

They claim, in fact, to have

already requested their distributors “cease using the name ‘Primo’
in any capacity while marketing [Defendants’] products.”
1)

(Id.)

The Evidentiary Materials

Plaintiff relies primarily on five documents to support the
Competition Claims.

The first is a translated article titled

33

According to Mr. Pearl, Defendants sell their hybrid shrimp
derived from Primo breeders under the name “High Vigor,” not
“Primo.” (Doc. #41, ¶ 101.)
- 30 -

“API: Who is the real ‘Primo?’ This question is left to the Chinese
farmer to answer.” (Doc. #21-3, pp. 9-22.)

This article allegedly

appeared in a Chinese trade magazine called Fish First and was
also posted on the website of a company named Primo (China)
Broodstock Co., Ltd (Primo China) on or around January 18, 2017. 34
(Doc. #21-3, ¶¶ 4, 5.)

The article features a Q & A with Mr.

Pearl, as well as one with Fusheng Huang (Mr. Huang), who is the
CEO of Primo China.

(Id. p. 17.)

In the article, Mr. Pearl -

whose photograph appears on page two – purportedly discusses the
history of API’s shrimp and states that API “selected Primo (China)
Broodstock Co., Ltd. to be [API’s] official recognized partner” in
China. 35
(China),

(Id. p. 16.)
is

“the

Mr. Huang states that his company, Primo

officially

designated

partner[]

of

high-

resistance ‘Primo’ shrimp breeding by API in China” (id. p. 19),
and “welcome[s]

the

customers

who

are

confident

and

full

of

34

The article was translated from Chinese into English by Helen
Guan (Attorney Guan), an attorney in China who claims to be fluent
in English. (Doc. #21-3, ¶¶ 2, 3, 6.)
35

In his Affidavit, Mr. Pearl avers that he never used the term
“Primo” in the written answers he provided to those interview
questions” (Doc. #41, ¶ 114), which answers he attaches to his
Affidavit (Doc. #41-2, pp. 66-70).
It is unclear to the Court
whether those answers represent all of the material Mr. Pearl
submitted, particularly since they contain no discussion of AMI’s
history with Plaintiff or business relationship with Primo China
– two issues discussed in the article in fairly significant detail.
Mr. Pearl’s Affidavit also states that “Primo is not a word that
can be translated into Chinese.
As a result there are several
different translations in use.” (Doc. #41, ¶ 113.) One of these
words is “Puruimo” and another is “Pulimao.” (Id.) According to
Mr. Pearl, “Primo’s attorneys conveniently translate every mention
of Pulimao or Puruimo as being Primo, when in fact they are
completely different in Chinese.” (Id.) No additional materials
are provided to support these assertions.
- 31 -

intention about the ‘Primo’ to join us to make the shrimp better
together.”

(Id.

p. 21.)

The second document is a transcription of video recordings
(Doc. #21-2, pp. 9-12) taken at a November 3, 2016 “Primo shrimp”
sales presentation held in China before approximately 55 to 60
people. 36

There

presentation:

one

were
by

at

least

(former

three

speeches

Defendant)

given

Charles

at

the

Tuan,

who

introduced Mr. Pearl, one by Mr. Pearl, and one by Mr. Huang.
According to the transcript of those speeches, 37 when introducing
Mr. Pearl, Mr. Tuan asks (referring to Defendants’/Mr. Huang’s
product): “If it’s the real Primo, then why need change the name?
. . . [A]ll breeder sources are written in black and white on the
paper and establish for you that these are the real Primo.”
#21-1, p. 9.)

(Doc.

Mr. Tuan then tells the audience that “the breeder

source of Haimao” – presumably Plaintiff – “is fake.”

(Id.)

After being introduced, Mr. Pearl first thanks his “agents
who are helping [API] promote Primo Broodstock here in China” and
then discusses the failed business relationship between Primo and
AMI.

(Doc. #21-1, pp. 9-10.)

He states that Primo had removed

only one family of broodstock from AMI’s facility by April 30,

36

The recordings were taken by Yijun Zhang, who is a manager at
Haimao – Plaintiff’s exclusive Chinese distributor. (Doc. #21-4,
¶ 2.) Plaintiff has provided the Court with “true copies” of the
recordings, and Defendants have not objected to the recordings’
authenticity.
37

Attorney Guan interpreted and transcribed the recordings of Mr.
Tuan and Mr. Huang (Doc. #21-3, ¶¶ 10, 13), and Mr. Pearl’s speech
was transcribed by Steven Jakubowski, Plaintiff’s attorney. (Doc.
#21-1, ¶ 7.)
- 32 -

2016, leaving Defendants with “the full bank of genetics at [their]
farm.”

(Id. p. 11.)

Mr. Pearl also notes that Defendants are

“spending a lot of time and a lot of money taking the Primo APE
animal[] 38. . . to the next level.” 39

(Id.)

During his speech, Mr. Huang asserts that “Primo does not
have breeder shrimp” (Doc. #21-3, p. 27), and discusses how he set
up a new company - Primo China - “for purposes of importing the
Primo shrimp” to China. 40

(Doc. #21-3, p. 28.)

The third document is a brochure allegedly given to those who
attended the November 3, 2016 presentation, and which contains
material in both Chinese and English.

(Doc. #21-4, ¶ 6.)

Among

other things, the brochure states that “Primo abandoned over
650,000 animals and all its genetic material” at the AMI Facility.
(Id. p. 10.)
The

fourth

document

is

a

translated

article

allegedly

published in a Chinese magazine called Agricultural Wealth on or
around February 13, 2017. 41

(Doc. #67-2, pp. 2, 9-13.)

Mr. Pearl

(whose photograph again appears on page two) allegedly states that

38

“APE” stands for “All Pathogen Exposed,” which means that the
animals have survived “a full virus attack.” (Doc. #21-3, p. 13.)
39

The Court has briefly reviewed the video recording of Mr. Pearl’s
speech and can confirm the accuracy of Attorney Jakubowski’s
transcription of the portions just quoted.
40

There is no indication that, during the presentation, Mr. Pearl
ever corrected or otherwise addressed Mr. Tuan’s or Mr. Huang’s
allegations that Plaintiff has no “real” breeder shrimp left and
is instead supplying “fake” Primo shrimp.
41

Attorney Guan also translated this article.
- 33 -

(Doc. #67-2, ¶ 5.)

“most of the broodstock of API in [the] Chinese market came from
Primo (China),” which imports its “disease-free” shrimp “from
API.”

(Id. p. 9.)

“official

designated

He also states that Primo China is API’s
‘Primo’

production partner in China.”

high

resistance

PL

[post-larvae]

(Id. p. 10.)

The final document is the transcription of cell phone video
recordings (Doc. #67-2, pp. 15-37) allegedly taken at a February
10, 2107 promotional event held in Northern China called “Hello,
Who Is the Real Primo?”. 42

The event was sponsored by Hainan

Dingda Agriculture Co., Ltd. (Dingda), a Chinese company claiming
to be “the first company to introduce the Primo breeder shrimp” in
China, and which also appears to use the name “Dingda Primo PL.”
Some of the statements allegedly made at the event include:
•

A statement by the event hostess that “API designated
and authorized Dingda to market Primo breeder shrimp.”
(Doc. #67-2, p. 18.)

•

Statements by “Mr. Liang” – presumably Dingda’s
President or CEO – that “Dingda Primo PL has brought
new hope to the gloomy farming market” in China (id.),
and that the “Dingda Primo PLs [that] came from API. .
. . are the real Primo.” (Id. at 22.)

•

A statement made by Mr. Pearl via video-conference
thanking Mr. Liang for “entrust[ing] [API] to stock his
Dingda hatchery with [API’s] breeders.” 43 (Id. at 21.)

42

The video was recorded by Teng Zhou, a Haimao salesman, and
provided to Attorney Guan for translation on or about February 14,
2017. (Doc. #68-2, ¶ 6.)
43

According to the translated conference agenda, Mr. Pearl was
scheduled to give a speech in person at the event, to be followed
by a “PRIMO trademark Q & A.” (Doc. #49, p. 4.) He ultimately
called in via video-conference, in order to attend the February
10, 2017 preliminary injunction hearing.
- 34 -

2)

Plaintiff’s Entitlement to Injunctive Relief

According

to

Plaintiff,

these

documents

demonstrate

that

Defendants have violated the Lanham Act (as well as the FDUTPA and
Florida’s unfair competition law) and should be enjoined in a way
that inhibits their continued ability to do so.

The Lanham Act

serves to “protect persons engaged in commerce within the control
of

Congress

against

unfair

competition”

–

that

is,

against

“injuries to business reputation and present and future sales.” 44
Lexmark Int'l, Inc. v. Static Control Components, Inc., 134 S. Ct.
1377, 1389–90 (2014).

As relevant here, Section 43(a) of the

Lanham Act imposes liability on
(1) Any person who, on or in connection with
any goods or services, or any container for
goods, uses in commerce any word, term, name,
symbol, or device, or any combination thereof,
or any false designation of origin, false or
misleading description of fact, or false or
misleading representation of fact, which-(A) is likely to cause confusion, or to cause
mistake, or to deceive as to the affiliation,
connection, or association of such person with
another
person,
or
as
to
the
origin,
sponsorship, or approval of his or her goods,
services, or commercial activities by another
person[.]
15 U.S.C. § 1125(a)(1)(A)).

44

The Court’s discussion of Plaintiff’s Lanham Act claim also
encompasses Plaintiff’s unfair competition and FDUTPA claims. See
Sovereign Military Hospitaller Order of Saint John of Jerusalem of
Rhodes & of Malta v. Fla. Priory of Knights Hospitallers of
Sovereign Order of Saint John of Jerusalem, Knights of Malta,
Ecumenical Order, 702 F.3d 1279, 1296 (11th Cir. 2012) (“The
success of [a plaintiff’s] state unfair competition and FDUTPA
claims is tied to the federal Lanham Act claims for infringement
and false advertising.” (citing Nat. Answers, Inc. v. Smithkline
Beecham Corp., 529 F.3d 1325, 1333 (11th Cir. 2008))).
- 35 -

As far as the Court can tell, Plaintiff’s Lanham Act claim is
based

on

(1)

Defendants’

alleged

dissemination

of

false

or

misleading representations of fact, in connection with the genetic
makeup of the shrimp they sell to China, and (2) Defendants’
alleged

deceptive

exploitation

name[]

[and]

Primo’s goodwill for [Defendants’] commercial benefit.” 45

(See

Doc. #21, ¶¶ 42-45.)

of

“the

‘Primo’

Succeeding on a claim of false advertising

in violation of Section 43(a) requires plaintiff to establish:
(1) the advertisements of the opposing party
were
false
or
misleading;
(2)
the
advertisements deceived, or had the capacity
to deceive, consumers; (3) the deception had
a material effect on purchasing decisions; (4)
the misrepresented product or service affects
interstate commerce; and (5) the movant has
been — or is likely to be — injured as a result
of the false advertising.
Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1260 (11th Cir.
2004) (citations omitted).

A claim of deceptive use of a name (or

one of false designation of origin, i.e., “passing off” or “palming
off”) requires a plaintiff to show “(1) that the plaintiff had
enforceable trademark rights in the mark or name, and (2) that the
defendant made unauthorized use of it such that consumers were

45

Although the Amended Complaint also avers that “Defendants’ acts
have caused and, unless enjoined, will continue to cause Primo’s
tradename and proprietary products to be tarnished[] [and]
diluted” (Doc. #20, ¶ 159), Plaintiff has not pled a Section 43(c)
“dilution” cause of action under the Lanham Act.
- 36 -

likely to confuse the two.” 46
Servs.,

Inc.,

508

F.3d

Custom Mfg. & Eng'g, Inc. v. Midway

641,

647

(11th

Cir.

2007)

(citations

omitted).
“Under the Lanham Act, a court may issue an injunction to
prevent the use of a ‘false or misleading representation of fact’
in ‘commercial advertising or promotion,’” Osmose, Inc. v. Viance,
LLC, 612 F.3d 1298, 1323 (11th Cir. 2010) (quoting 15 U.S.C. §§
1116, 1125(a)(1)(B)), or to prevent the commercial use of a “any
word, term, name, symbol, or device” in a way likely to confuse or
deceive consumers.

See W. Union Holdings, Inc. v. E. Union, Inc.,

316 F. App'x 850, 853-54 (11th Cir. 2008) (per curiam); Jellibeans,
Inc. v. Skating Clubs of Ga., Inc., 716 F.2d 833, 838 & n.12 (11th
Cir. 1983).
According to Plaintiff, an injunction is warranted because
Defendants’ actions “have caused, and will continue to cause,
confusion regarding the affiliation, connection, or association of
Defendants to Primo’s proprietary shrimp broodstock and Primo’s
tradename”

(Doc.

#20,

genuineness

of

shrimp

¶

156),
that

and

“confusion

Plaintiff

regarding

markets

as

the

‘Primo’

broodstock” (Doc. #21, ¶ 45); will “dilute” and “tarnish” the

46

“[A] false designation of origin claim[] . . . proscribes the
behavior of ‘passing off’ or ‘palming off,’ which ‘occurs when a
producer misrepresents his own goods or services as someone
else's.’” Midway Servs., 508 F.3d at 647 (quoting Dastar Corp. v.
Twentieth Century Fox Film Corp., 539 U.S. 23, 28 n. 1 (2003)).
The original Complaint labeled the Lanham Act claim as one of
“passing off” (i.e., false designation of origin) but the Amended
Complaint does not. It is therefore unclear whether Plaintiff’s
claim is one of “confusing use of a name” or for “palming off.”
- 37 -

“Primo” trade name and Primo’s products (Doc. #20, ¶ 159); and
will continue to “erode confidence in Plaintiff as the legitimate
source of Primo Shrimp.”

(Doc. #21, ¶ 45.)

These actions have

allegedly already resulted in “lost sales of authentic Primo shrimp
broodstock.”
While

(Doc. #20, ¶ 165; see also Doc. #21-5, ¶ 13.)

Defendants

apparently

do

not

oppose

a

preliminary

injunction restricting Defendants’ use of the “Primo” name (Doc. #53,
p. 111), they also believe Plaintiff is unlikely to succeed on the

merits of its Lanham Act claim, since all of Defendants’ statements
have been “entirely truthful.”

(Doc. #39, pp. 19-20.)

Defendants

also claim that API and Mr. Pearl have “studiously avoided giving
any impression of association with Primo” and “have no direct
control over [Mr. Huang],” who “formed his company prior to any
affiliation with . . . Defendants.”

(Id. p. 20 & n.7; see also

Doc. #53, p. 106.)
The Court finds that Plaintiff has carried its burden of
demonstrating a substantial likelihood of success on its Lanham
Act claim.

First, Defendants’ statement that it possesses Primo’s

“full genetic bank” was likely false and resulted in injurious
consumer confusion and/or deception.

In so concluding, the Court

credits Mr. Aungst’s affidavit testimony that Plaintiff never
provided Defendants with breeders from more than six of Primo’s
family lines (Doc. #21-2, ¶ 26) – a far cry from Primo’s “full
bank” of twenty-four families.

The Court also considers the fact

that, in June 2016, Defendants conducted “a DNA genetic analysis of
all animals of AMI,” including shrimp from sources other than Primo,

- 38 -

which revealed that Defendants had only fourteen different groups of
animals. 47

(Doc. #41, ¶ 101.)

Moreover, the evidence belies Defendants’ assertions that
they “have studiously avoided giving any impression of association
with Primo” (Doc. #29, p. 20), and want no association with the
Primo trade name because of the company’s “horrible reputation.”
(Doc. #41, ¶ 108.)

The record demonstrates that, at least in

China – “the world’s largest shrimp farming country” (Doc. #41-2,
p. 69) – using the name “Primo” in connection with shrimp is
financially advantageous. 48

“API,” in contrast, seemingly had

little reputation or goodwill in China prior to associating with
the name “Primo.”

(Doc. #68-2, p. 2.)

Indeed, rather than

distance themselves from Primo, API chose to work with Mr. Huang
after he had already formed a company called “Primo China,” and
allowed Mr. Pearl to attend events designed to tout the “realness”
of the “Primo” shrimp API ships to its Chinese distributors.

Mr.

Pearl himself has used the word “Primo” to refer API’s product,
and has thanked API’s agents for helping to promote that “Primo”
product in China.

(Doc. #21-3.)

The Court is also persuaded that failure to grant a Lanham
Act injunction would likely result in continued – and irreparable

47

It is difficult to see how Defendants could claim, in good faith,
that they possessed all of Primo’s pure genetic lines, while
simultaneously asserting they received no paperwork or genetic
information about the animals Primo sent.
48

It is clear from the translated documents that Chinese shrimp
distributors and shrimp farmers’ want “real Primo” shrimp. (E.g.,
Docs. ## 21-3, p. 29; 68-2, pp. 27-28.)
- 39 -

- harm to Primo’s reputation and goodwill, at least in China.
Ferrellgas Partners, L.P. v. Barrow, 143 F. App'x 180, 190 (11th
Cir. 2005) (per curiam) (“Grounds for irreparable injury include
loss of control of reputation, loss of trade, and loss of goodwill.
Irreparable injury can also be based upon the possibility of
confusion.” (quoting Pappan Enters., Inc. v. Hardee's Food Sys.,
Inc., 143 F.3d 800, 805 (3d Cir. 1998))); Abbott Labs. v. Mead
Johnson & Co., 971 F.2d 6, 16 (7th Cir. 1992) (“[I]t is virtually
impossible

to

ascertain

intangible

harms,

such

the
as

precise

damage

to

economic

consequences

reputation

and

loss

of
of

goodwill, caused by such violations [of the Lanham Act].”); see
also Nane Jan, LLC v. Seasalt & Pepper, LLC, No. 2:14-CV-208-FTM29CM, 2014 WL 5177655, at *7 (M.D. Fla. Oct. 14, 2014) (finding a
likelihood of irreparable harm where “[d]amage to plaintiff’s
reputation and goodwill would be difficult to quantify and could
not be undone through an award of money damages”).

Not only is

the Court confident that this injury outweighs whatever harm (if
any) that a preliminary injunction may cause Defendants, the public
has an interest in ensuring that American businesses compete fairly
with each other, both at home and abroad, and refrain from engaging
in trade practices that confuse and deceive consumers.
Because all four elements for injunctive relief are satisfied
as to Plaintiff’s Lanham Act claim, the Court finds that Plaintiff
is entitled to a preliminarily injunction, tailored in scope to
curb

the

harmful

effects

Defendants’

dissemination

of

false

commercial statements and use of the “Primo” name have caused.
- 40 -

The preliminary injunction shall apply to Defendants, Defendants’
officers, agents, servants, employees, and attorneys, and other
persons

who

are

in

“active

concert”

or

“participation”

with

Defendants, within the meaning of Federal Rule of Civil Procedure
65(c)(2),

and

injunction.

who

receive

proper

notice

of

the

preliminary

See ADT LLC v. NorthStar Alarm Servs., LLC, No. 16-

15351, --- F.3d ---, 2017 WL 1364978, at *2 (11th Cir. 2017).
Such persons and entities are enjoined from the following:
1.

Referring to AMI’s or API’s shrimp as “Primo” anything,
including “Primo shrimp,” “Primo animals,” “Primo
breeders,” or “Primo broodstock”;

2.

Stating that AMI’s or API’s shrimp were created by
breeding a male shrimp and a female shrimp from the same
Primo family line 49;

3.

Stating that AMI or API acquired or possessed Primo’s
“genetic bank” or “full genetic bank” or that Primo left
or abandoned its “genetic bank” or “full genetic bank”
at the AMI Facility; and

4.

Appearing via teleconference, videoconference, or in
person at any Primo China or Dingda promotional event.

The preliminary injunction will enter by separate order.
Additionally, the Court finds, in the exercise of its discretion,
that

no

bond

is

necessary

for

this

preliminary

injunction.

BellSouth Telecomms., Inc. v. MCIMetro Access Transmission Servs.,
LLC, 425 F.3d 964, 971 (11th Cir. 2005) (“[I]t is well-established
that the amount of security required by the rule is a matter within

49

Defendants are not, however, enjoined from stating that certain
of their animals were derived from pure Primo stock, whose genetic
makeup was unknown to Defendants at the time. Indeed, to fail to
mention Primo at all could constitute grounds for a “reverse
passing off” claim under the Lanham Act. See Dastar, 539 U.S. at
28 & n.1.
- 41 -

the discretion of the trial court, and the court may elect to
require no security at all.” (internal alterations and quotation
omitted)); TracFone Wireless, Inc. v. Washington, 978 F. Supp. 2d
1225, 1235 (M.D. Fla. 2013) (finding no bond necessary where
preliminary injunction issued on Lanham Act claim only).
Accordingly, it is hereby
ORDERED:
Plaintiff's Alternative Motion for Preliminary Injunction
(Doc. #21) is GRANTED in part and DENIED in part as set forth
herein.

The preliminary injunction will issue under separate

order.
DONE and ORDERED at Fort Myers, Florida, this 27th day of
April, 2017.

Copies:
Counsel of Record

- 42 -