ENV Tech v. Suchard
Filing
83
PRELIMINARY INJUNCTION. Defendant Suchard enjoined and restrained pursuant to the terms of this order (see attached). Bond previously posted by EnvTech shall apply to this preliminary injunction. Signed by Judge Howard D. McKibben on 11/1/12. (Copies have been distributed pursuant to the NEF - JC)
1
2
3
4
5
6
7
8
UNITED STATES DISTRICT COURT
9
DISTRICT OF NEVADA
10
11
12
13
14
15
16
ENVTECH, INC.,
)
)
Plaintiff,
)
)
vs.
)
)
TALMOR SUCHARD, SENTRO
)
TECHNOLOGIES, LTD, and SENTRO
)
TECHNOLOGIES, LLC,
)
)
Defendants.
)
_________________________________ )
3:11-cv-00523-HDM-WGC
ORDER
17
Plaintiff EnvTech (“EnvTech”)has filed an amended complaint
18
asserting multiple claims against defendants Talmor Suchard
19
(“Suchard”), Sentro Technologies LTD, and Sentro Technologies, LLC
20
(“Sentro Nevada”).
Plaintiff has also filed a motion for
21
preliminary injunction (#47), proposed interim injunctive relief
22
(#73), and on October 31, 2012, a “Request for Urgent Entry of
23
Injunctive Relief” (#78).
On October 31, 2012, the court entered a
24
temporary restraining order enjoining and restraining Suchard from
25
sending out or transmitting any letters or other forms of
26
communication to oil refineries disclosing EnvTech’s proprietary
27
chemical blends and cleaning processes, or other confidential,
28
1
1
proprietary, and trade secret information belonging to EnvTech.
2
The court thereafter conducted a telephonic hearing on the Request
3
for immediate injunctive relief (#78).
4
Factual Background
5
This order follows.
EnvTech claims to be the “world’s primary provider” of
6
chemical cleaning solutions to oil and gas refineries.
7
80 percent of the market for cleaning and neutralization of “HF
8
Alkylation” units – accounting for 40-60 percent of its business –
9
and with a “significant presence in other types of unit cleaning,”
10
EnvTech bases its success on its proprietary chemical formula and
11
processes that it claims no other company has been able to
12
duplicate.
13
refinery process, and they are not in all refineries.
Controlling
HF Alkylation units are a small part of the overall
14
Suchard is an Israeli citizen and former EnvTech employee.
15
Prior to working for EnvTech from 2005 to 2011, Suchard spent seven
16
years in the oil and gas refinery business.
17
Suchard’s job responsibilities at EnvTech included visiting
18
clients, pitching work, and overseeing the cleaning processes, and
19
he had access to EnvTech’s proprietary chemical formula and
20
cleaning process.
21
time was spent in chemical cleaning of HF Alkylation units.
22
Suchard admits he cleaned other types of units, he claims he did so
23
only a few times and was not in charge of those projects.
24
however, produced evidence demonstrating that Suchard was also
25
involved in drafting proposals for decontamination of heat
26
exchangers, vapor phase cleaning unrelated to HF Alkylation, and
27
cleaning of vacuum towers, crude oil units, crude oil exchangers,
28
desalters, FCC Units, and heavy oil units. (Pl. Reply to Mot.
Suchard asserts that the vast majority of his
2
While
EnvTech,
1
2
Prelim. Inj. Exs. 4, 7-8; Suchard Decl. in Support of Removal ¶ 3).
As part of his employment, Suchard signed an at-will
3
employment agreement (“EA”) and a “Trade Secrets and
4
Non-Competition Agreement” (“TSNCA”).
5
Suchard to maintain the confidentiality of EnvTech’s trade secrets
6
and proprietary information, to not compete against it, and to not
7
solicit EnvTech clients.
8
The agreements required
Suchard was terminated from EnvTech in May 2011.
While still
9
employed by EnvTech, and after his termination up to the present
10
time, Suchard allegedly used and is using EnvTech’s confidential
11
and proprietary information to compete against it, including
12
soliciting EnvTech’s clients and creating two competing businesses.
13
Suchard does not deny that he has created oil and refinery cleaning
14
businesses, but denies that they compete with EnvTech, denies that
15
he has done any work for EnvTech clients, and denies using any of
16
EnvTech’s confidential and trade secret information.
17
Preliminary Injunction Standard
18
“An injunction is a matter of equitable discretion and is an
19
extraordinary remedy that may only be awarded upon a clear showing
20
that the plaintiff is entitled to such relief.”
21
v. Carlton, 626 F.3d 462, 469 (9th Cir. 2010) (internal quotation
22
marks omitted).
23
Earth Island Inst.
To obtain a preliminary injunction, EnvTech must show: (1) it
24
will probably prevail on the merits; (2) it will likely suffer
25
irreparable injury if relief is denied; (3) the balance of equities
26
tips in its favor; and (4) an injunction is in the public interest.
27
Winter v. Natural Res. Defense Council, Inc., 555 U.S. 7, 129 S.
28
Ct. 365, 374 (2008).
3
1
Alternatively, an injunction may issue under the “sliding
2
scale” approach if there are serious questions going to the merits
3
and the balance of hardships tips sharply in EnvTech’s favor, so
4
long as EnvTech still shows a likelihood of irreparable injury and
5
that an injunction is in the public interest.
6
Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011).
7
“Serious questions are those which cannot be resolved one way or
8
the other at the hearing on the injunction.”
9
Angeles County, 339 F.3d 920, 926-27 (9th Cir. 2003) (internal
10
quotation marks omitted) (citing Republic of the Philippines v.
11
Marcos, 862 F.2d 1355, 1362 (9th Cir. 1988)).
12
promise a certainty of success, nor even present a probability of
13
success, but must involve a ‘fair chance of success on the
14
merits.’”
15
I. Likelihood of Success/Serious Questions
16
Alliance for the
Bernhardt v. Los
They “need not
Marcos, 862 F.2d at 1362.
While employed by EnvTech, Suchard signed agreements to not
17
disclose EnvTech’s confidential, proprietary, and trade secret
18
information, (TSNCA §§ 1.3, 1.4, 1.6, 1.7; EA ¶ 18), and to not
19
“engage or participate in any competitive activity relating to the
20
subject matter of his ... hiring by” EnvTech, (TSNCA § 1.8).
21
review of the record indicates that these agreements are likely
22
enforceable.
23
the enforceable agreements.
A
It also indicates that Suchard is likely violating
24
The most recent filings by EnvTech present evidence
25
demonstrating threats by Suchard to immediately disclose
26
confidential, proprietary and trade secret information belonging to
27
EnvTech to at least 100 refineries.
28
contains persuasive evidence that Suchard has engaged and continues
4
In addition, the record
1
to engage in competitive activities relating to the subject matter
2
of his hiring – that is, Suchard is competing or attempting to
3
compete with EnvTech in the cleaning of oil and gas refinery units.
4
Significantly, while employed by EnvTech, he cleaned and/or drafted
5
proposals for cleaning for several different types of units.
6
Accordingly, pending full review of EnvTech’s motion for
7
preliminary injunction, the court concludes that EnvTech has shown
8
at least serious questions going to, if not a likelihood of success
9
on, the merits of its claim that Suchard is violating his
10
employment agreements.
11
II. Likelihood of Irreparable Harm
12
The disclosure of confidential trade secret information would
13
cause immediate and irreparable harm to EnvTech.
14
the evidence of Suchard’s conduct, the court also concludes that
15
Suchard’s competitive activities threaten to undermine EnvTech’s
16
goodwill and market share and would also therefore result in
17
irreparable harm.
18
III. Balance of Hardships
19
Further, given
EnvTech’s potential loss of confidential, proprietary, and
20
trade secret information and of market share greatly outweighs
21
Suchard’s inability to work in the field of oil and gas refinery
22
cleaning insofar as it relates to work he performed for EnvTech,
23
particularly in light of the most recent filing reflecting efforts
24
by Suchard to disclose confidential, proprietary and trade secret
25
information that belongs to EnvTech.
26
the balance of hardships tips in EnvTech’s favor.
27
28
5
Accordingly, the court finds
1
2
IV. Public Interest
“The public interest inquiry primarily addresses impact on
3
non-parties rather than parties.”
4
Dist. Court, 303 F.3d 959, 974 (9th Cir. 2002).
5
potentially impacted by an injunction would be clients and
6
potential clients of EnvTech and Suchard.
7
fewer options for chemical cleaning and may have to pay more for
8
such services.
9
chemical cleaning services exist and are able to thrive in part
Sammartano v. First Judicial
The nonparties
Those clients would have
On the other hand, the businesses that provide
10
because of trade secret protection.
11
secrets would greatly undermine EnvTech’s business, would
12
discourage innovation in the field, and could eventually reduce the
13
number of businesses engaged in the cleaning of oil and gas
14
refineries.
15
interest favors the protection of EnvTech’s confidential and trade
16
secret information and therefore favors the issuance of a
17
preliminary injunction.
18
Conclusion
19
Failure to protect trade
On balance, the court concludes that the public
EnvTech has shown a likelihood of success on, or at the very
20
least serious questions going to, the merits of its contractual
21
claims, that it faces likely irreparable harm in the absence of an
22
injunction, that the balance of hardships tips sharply in its
23
favor, and that the public interest favors an injunction.
24
Accordingly, a preliminary injunction is properly issued pending a
25
full hearing on EnvTech’s motion for preliminary injunction.
26
is particularly justified because of Suchard’s conduct, which has
27
led to Suchard’s counsel’s request to withdraw as counsel and the
28
likelihood that the court will grant the withdrawal and of
6
This
1
necessity have to vacate the November 7, 2012, date set for the
2
hearing on the original motion for injunctive relief and reset it
3
at a future time when Suchard has obtained new counsel or
4
represents himself.
5
Procedure 65 the court hereby enters its order enjoining and
6
restraining defendant Talmor Suchard and his agents, assigns, or
7
affiliates from the following:
8
1.
Accordingly, pursuant to Federal Rule of Civil
Using in any way, or disclosing to anyone, any of
9
EnvTech’s confidential and proprietary information and
10
trade secrets, including but not limited to EnvTech’s
11
strategic planning information, the chemical formulas it
12
has developed to service its customers, identities or
13
information on its customers including attributes and
14
preferences, and the unique processes and procedures
15
EnvTech has developed to service its customers;
16
2.
Sending out or transmitting any letters or other forms of
17
communication to oil refineries stating that EnvTech’s
18
chemicals contain unspecified carcinogens;
19
3.
Holding himself out to anyone as affiliated with EnvTech
20
or use EnvTech’s name, trademarks, literature or
21
documents for any purpose whatsoever;
22
4.
Engaging in any type of chemical cleaning business
23
related to activities Suchard participated in while
24
employed by EnvTech, including:
25
a. HF Alkylation Unit Cleaning;
26
a. Decontamination of Heat Exchangers;
27
b. Cleaning of Vacuum Towers;
28
c. Cleaning of Crude Oil Units;
7
1
d. Cleaning of Crude Oil Exchangers;
2
e. Cleaning of Desalters;
3
f. Cleaning of FCC Units;
4
g. Vapor Phase Cleaning;
5
h. Cleaning of Heavy Oil Units; and
6
5.
Soliciting or encouraging any person or entity with whom
7
EnvTech has done business while Suchard was employed with
8
EnvTech to cease doing business with EnvTech and to do
9
business with defendants, the Suchard affiliates, or any
10
11
12
other third party.
The bond previously posted by EnvTech shall apply to this
preliminary injunction.
13
IT IS SO ORDERED.
14
DATED: This 1st day of November, 2012.
15
16
____________________________
UNITED STATES DISTRICT JUDGE
17
18
19
20
21
22
23
24
25
26
27
28
8
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?