Biomet 3i, LLC et al v. Land

Filing 46

OPINION AND ORDER DENYING 33 Motion for TRO. The evidentiary hearing on the Plaintiffs Motion for Preliminary Injunction is CONFIRMED for July 11, 2016. Signed by Judge Theresa L Springmann on 6/29/16. (mlc)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
BIOMET 3i, LLC, and ZIMMER US, INC.,
Plaintiffs,
v.
HEATHER LAND,
Defendant.

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CAUSE NO.: 1:16-CV-125-TLS

OPINION AND ORDER
This matter is before the Court on a Verified Motion for Temporary Restraining Order
[ECF No. 33], filed by Plaintiffs Biomet 3i, LLC and Zimmer US, Inc. (collectively “Zimmer
Biomet”) on June 8, 2016.
On April 12, 2016, Zimmer Biomet commenced this case by filing its Complaint for
Preliminary Injunction, Permanent Injunction, and Damages [ECF No. 1], which was filed
contemporaneously with Zimmer Biomet’s Motion for Preliminary Injunction [ECF No. 8]. On
May 3, 2016, the Defendant, Heather Land, responded by filing her Combined Motion to
Transfer Pursuant to 28 U.S.C. § 1404(a) or, in the Alternative, to Dismiss Pursuant to F.R.C.P.
12(b)(6) and 12(d) [ECF No. 19]. On May 9, 2016, the Court held a telephonic conference with
the parties, during which the Court granted Zimmer Biomet’s Motion for Expedited Discovery,
Preservation of Evidence, and Evidentiary Hearing on Motion for Preliminary Injunction [ECF
No. 10] and set briefing deadlines. On May 10, 2016, the Court referred the pending motions to
Magistrate Judge Susan L. Collins. An evidentiary before Judge Collins is set to begin on July
11, 2016.

Despite Zimmer Biomet not initially requesting a temporary restraining order (TRO), on
June 8, 2016, it moved for such relief after confirming “through discovery that Keystone [Dental,
LLC] has instructed Land to ignore the [Confidentiality, Non-Competition, and Non-Solicitation
Agreement for Sales Managers and Representatives] and, consistent with that instruction, Land
has engaged in multiple breaches of [that a]greement.” (V. Mot. TRO 1, ECF No. 33.) Zimmer
Biomet’s requested TRO would immediately enjoin and restrain Land from certain activities
through the July 11, 2016, preliminary injunction hearing. On June 17, 2016, the Defendant filed
her Response [ECF No. 42]. The Court held a telephonic conference on June 21, 2016, to address
the TRO, and at that time, the parties stated that they were satisfied with the current record, but
each side elected to present oral argument. Having taken this matter under advisement, the Court
now denies Zimmer Biomet’s request for a TRO.

FACTUAL BACKGROUND
Zimmer Biomet is in the “business of the development, manufacture, marketing,
distribution, and sale of orthopedic reconstructive, trauma, extremity, biologic, dental, and
surgical devices, implants, instruments, and other related and complementary products,
processes, and services throughout the United States and in foreign countries.” (Burke Aff. 1,
ECF No. 9-1.) In April 2011, Biomet 3i, LLC hired Land as a Territory Sales Manager, a
position she held until October 2011, when she was promoted to Regional Sales Manager. As a
Regional Sales Manager, Land’s territory covered Arizona, California, and Hawaii. After the
merger of Zimmer US, Inc., and Biomet, Inc., which occurred in June 2015, Land applied for the
position of Corporate Sales Specialty Manager at Zimmer Biomet. Around November 15, 2015,
Land was promoted to that position, and in this role “she would promote, market, sell, and

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service Zimmer Biomet products in Alaska, Arizona, California, Colorado, Hawaii, Idaho,
Minnesota, Montana, Nevada, North Dakota, Oregon, South Dakota, Utah, Washington,
Wisconsin, and Wyoming.” (Id. at 5.) Although Land signed a confidentiality and
noncompetition agreement in 2008, upon assuming her new role in November 2015, Land agreed
to the Confidentiality, Non-Competition and Non-Solicitation Agreement for Sales Managers
and Representatives (the “Agreement”).
On February 23, 2016, Land notified Jim Gerson, her Team Lead at Zimmer Biomet that
she intended to accept a position as Regional Sales Manager, Western Region, at Keystone
Dental, LLC (“Keystone Dental”). Although Gerson served as Team Lead, both Gerson and
Land reported directly to Adam Larkin, who is Zimmer Biomet’s Director of Sales Operations,
Specialty Markets and Training. Land also informed Larkin of her resignation, which was
confirmed by an e-mail dated February 24, 2016. Land continued to work at Zimmer Biomet
until March 2, 2016. On March 24, 2016, Zimmer Biomet sent Land a cease and desist letter
regarding her new position at Keystone Dental.

LEGAL STANDARD
Unless a temporary restraining order is issued ex parte, the movant must make the same
showing that is contemplated for a preliminary injunction. Levas v. Vill. of Antioch, Ill., 684 F.2d
446, 448 (7th Cir. 1982); YourNetDating, Inc. v. Mitchell, 88 F. Supp. 2d 870, 871 (N.D. Ill.
2000) (“The standards . . . appl[ied] when determining whether a TRO is appropriate are
analogous to the standards applicable when determining whether preliminary injunctive relief is
appropriate.”). However, a temporary restraining order is intended to preserve the status quo for
a brief period until a hearing can be held on the request for a preliminary injunction. Smith v.

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Wilson, Cause No. 3:07-cv-338-TS, 2007 WL 4324005, at *1 (N.D. Ind. Dec. 7, 2007). With this
scope in mind, injunctive relief “is an extraordinary and drastic remedy, one that should not be
granted unless the movant, by a clear showing, carries the burden of persuasion.” Mazurek v.
Armstrong, 520 U.S. 968, 972 (1997). “[T]he moving party must demonstrate a reasonable
likelihood of success on the merits, no adequate remedy at law, and irreparable harm absent the
injunction.” Planned Parenthood of Ind., Inc. v. Comm’r of Ind. State Dep’t Health, 699 F.3d
962, 972 (7th Cir. 2012).
Once the district court determines these threshold requirements are met, it must consider
the irreparable harm the plaintiff or defendant would suffer if the injunctive relief is denied or
granted, respectively. Stuller, Inc. v. Steak N Shake Enters., Inc., 695 F.3d 676, 678 (7th Cir.
2012). The district court must also consider the public interest in granting or denying an
injunction. Id. Balancing of harms is carried out by weighing each factor “against one another ‘in
a sliding scale analysis,’” id. (quoting Christian Legal Soc’y v. Walker, 453 F.3d 853, 859 (7th
Cir. 2006)), which is a “subjective and intuitive” approach that “permits district courts to weigh
the competing considerations and mold appropriate relief,” id. (quoting Ty, Inc. v. Jones Grp.,
Inc., 237 F.3d 891, 895–96 (7th Cir. 2001)) (internal quotation marks omitted). When it is more
likely that the moving party will succeed on the merits, the balance of harms may weigh less in
its favor. Girl Scouts of Manitou Council, Inc. v. Girl Scouts of U.S., Inc., 549 F.3d 1079, 1100
(7th Cir. 2008).

DISCUSSION
According to Zimmer Biomet, discovery has revealed that Land has committed several
breaches of the Agreement, including: (1) instructing her sales team at Keystone Dental to

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exploit a “confidential . . . distributorship concern in order to convert business” (V. Mot. TRO
2); (2) directing her Keystone Dental sales team, by using her knowledge of specific personnel
and product challenges at Zimmer Biomet, to target Zimmer Biomet’s customers; (3) directly
communicating with a Zimmer Biomet customer in an attempt to convert his business to
Keystone Dental; (4) offering and providing a Zimmer Biomet “tool” to her colleagues at
Keystone Dental (id.); and (5) taking instruction from Keystone Dental to ignore the Agreement.
In support of these allegations, Zimmer Biomet has presented six short e-mail chains and a blank
one-page form.
Based on this evidence, Zimmer Biomet asks this Court to immediately enjoin and
restrain Land from: (1) “[c]ontinuing to work [for] Keystone Dental . . . in the Restricted
Territory1 she covered as Zimmer Biomet . . . sales manager,” (V. Mot. TRO 1); (2) “[d]irectly
or indirectly soliciting (including managing the Restricted Territory for Keystone [Dental] or
otherwise being involved in Keystone[] Dental’s efforts to solicit) any person, corporation, or
other entity serviced, sold to, approached, or solicited, directly or indirectly, by Land during the
last eighteen months of her employment with Zimmer Biomet,” (id.); and (3) “[d]isclosing or
using any Confidential Information, as defined in [the Agreement],”2 (id.).

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According to Zimmer Biomet’s Verified Motion, the “Restricted Territory” means Alaska, Arizona,
California, Colorado, Hawaii, Idaho, Minnesota, Montana, Nevada, North Dakota, Oregon, South Dakota,
Utah, Washington, Wisconsin, and Wyoming. This appears to be an application of that term, as defined in
the Agreement. (Agreement ¶ 7.(a)(4), at 5, ECF No. 1-1 (“‘Restricted Territory’ is defined as (i) any
Customer-specific or geographic territory assigned to, or covered by, Employee during Employee’s last
two (2) years of employment with Company; (ii) any state or portion of any state assigned to Employee by
Company for purposes of any sales or service activities or responsibilities at any time during the two (2)
years preceding the termination of Employee’s employment with Company; or (iii) any county,
municipality or parish of any state or commonwealth assigned to Employee or in which Employee engaged
in any sales or service activities on behalf of Company at any time during the two (2) years preceding
termination of Employee’s employment with Company.”).)

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“‘Confidential Information’ includes, but is not limited to, any and all of Company’s trade secrets,
confidential and proprietary information and all other information and data of Company that is not generally
known to the public or other third parties who could derive economic value from its use of disclosure.

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Under Indiana law,3 noncompetition agreements are in restraint of trade and are
disfavored. Gleeson v. Preferred Sourcing, LLC, 883 N.E.2d 164, 172 (Ind. Ct. App. 2008).
Further, these agreements “are strictly construed against the employer and are enforced only if
reasonable” in terms of respecting the employer’s legitimate interests, the employee’s
restrictions, and the public interest. Id. Once it is determined that “the employer has asserted a
legitimate, protectible interest,” id., the employer must show that the agreement’s scope “is
reasonable in scope as to the time, activity, and geographic area restricted,” Cent. Ind. Podiatry,
P.C. v. Krueger, 882 N.E.2d 723, 729 (Ind. 2008).
Zimmer Biomet asserts that it has legitimate, protectable interests in “its customer
goodwill (including relationships with its customers), confidential information, and ensuring its
former employee does not use that information to benefit a competitor.” (Br. Supp. Mot. TRO 9,
ECF No. 34.) Indiana law recognizes “good will” as a protectable interest, which includes
“secret or confidential information such as the names and addresses of customers and the
advantage acquired through representative contact.” Gleeson, 883 N.E.2d at 173. Nevertheless,
“[a] confidentiality agreement ‘cannot make secret that which is not secret.’” Bodemer v. Swanel

Confidential information includes, without limitation, technical information such as product specifications,
compounds, formulas, improvements, discoveries, developments, designs, inventions, techniques, new
products and surgical training methods, and research and development information; confidential business
methods and processes; business plans and strategies; marketing plans and strategies; non-public financial
information including budgets, sales data, sales forecasts, sales quotas, and information regarding profits
and losses; office optimization and logistics information; information pertaining to current and prospective
customers; information pertaining to distributors and sales structures; pricing information; discount
schedules; costing information; personnel information; compensation structure, schedules and plans; and
information about current and prospective products or services, whether or not reduced to writing or other
tangible medium of expression, including work product created by Employee in rendering services for
Company.” (Agreement ¶ 2.(a), at 1.)
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For purposes of resolving Zimmer Biomet’s request for a TRO, the Court assumes, without deciding, that
Indiana law applies.

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Beverage, Inc., 884 F. Supp. 2d 717, 734–35 (N.D. Ind. 2012) (quoting Lanier Prof’l Servs., Inc.
v. Ricci, 192 F.3d 1, 5 (1st Cir. 1999)).
Even assuming, without deciding, that the Agreement between Zimmer Biomet and Land
is enforceable and permits injunctive relief in Zimmer Biomet’s favor, at this time the evidence
presented in support of the TRO is insufficient to establish that Zimmer Biomet will suffer
immediate and irreparable harm before the preliminary injunction hearing set for July 11, 2016.
First, Zimmer Biomet points to several short e-mails and asserts that these communications show
Land using her confidential knowledge to convert Zimmer Biomet’s business. In an email dated
March 15, 2016, Land discusses problems associated with a Zimmer Biomet vendor named
Miami Tissue Bank. Although this information may have been confidential at one point, the
affidavit of Christopher Johnson, a Regional Manager for Keystone Dental, demonstrates that
Keystone Dental had independent knowledge of this issue. Similarly, the e-mail dated March 18,
2016, references information contained in recall notices published by the Food and Drug
Administration.4 To the extent that this e-mail, along with the e-mail communications with Dr.
Polyakov that span from March 24–25, 2016, represent actions that violate the Agreement,
Zimmer Biomet has not shown any evidence that it lost a single sale or customer in any of the
sixteen states in which Land is allegedly prohibited from engaging customers. Cf. Zimmer, Inc. v.
Davis, 922 N.E.2d 68, 74–75 (Ind. Ct. App. 2010) (affirming the trial district’s denial of a
preliminary injunction based upon the balancing of the harms because “there was no evidence
that Zimmer had lost any sales, lost any customers for its products, or lost any consulting
surgeons as a result of [the defendant’s] employment with Biomet”).

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Given these circumstances, it would appear that even the Agreement itself no longer sought to control this
type of information. (Agreement ¶ 2.(b), at 2 (“Employee’s non-disclosure obligations shall continue as
long as the Confidential Information remains confidential and shall not apply to information that becomes
generally known to the public through no fault or action of Employee.”).)

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Second, Land’s e-mails discussing forms and forwarding the “Biomet tool” to colleagues
at Keystone Dental fail to establish imminent and irreparable harm to Zimmer Biomet. Although
the “tool” bears Biomet 3i’s letterhead, it is a blank form that does not appear to reveal any
information that could harm Zimmer Biomet’s business. Zimmer Biomet has not cited any
authority that identifies blank business forms as confidential information that may be protected
by a TRO, and it is unlikely any exists. See Bodemer, 884 F. Supp. 2d at 735 (noting at summary
judgment that the company “could not possibly argue” that every piece of information regarding
its business is confidential).
Third, Zimmer Biomet characterizes a February 15, 2016, e-mail from Keystone Dental
to Land as an instruction “to ignore her obligations to Zimmer Biomet.” (Br. Supp. Mot. TRO 6.)
The exact statement, “our lawyer says that as long as you were living in California when you
signed the . . . Agreement, it will not hold up in court. California is a right to work state. So, they
will make noises, but you have the right to work for whomever you wish” (Br. Supp. Mot. TRO
Ex. 6, at 1, ECF No. 34-6), may displease Zimmer Biomet. However, it is a stretch to say that
this legal opinion about the applicability of California law and its affect upon Land amounts to
an instruction to ignore the Agreement. And even if the e-mail did constitute an instruction to
ignore the Agreement, the record contains no evidence that Land has ignored the Agreement in a
way that caused harm to Zimmer Biomet.
Although counsel for Zimmer Biomet referenced a flash drive that is reportedly in Land’s
possession, the flash drive was not referenced in Zimmer Biomet’s TRO filings, none of its
contents are filed into the record, and it has not been shown that Land has used any of the
information stored on it.

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CONCLUSION
For these reasons, the Plaintiffs’ Verified Motion for TRO [ECF No. 33.] is DENIED.
The evidentiary hearing on the Plaintiffs’ Motion for Preliminary Injunction is CONFIRMED for
July 11, 2016.
SO ORDERED on June 29, 2016.
s/ Theresa L. Springmann
THERESA L. SPRINGMANN
UNITED STATES DISTRICT COURT

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