Crocs, Inc. v. Leyden et al

Filing 14

Order granting Crocs' Motion for Temporary Restraining Order(Related Doc # 2 ); granting Crocs' Motion for order (Related Doc # 4 ) allowing expedited discovery. See order for further details. Motion Hearing set for 4/1/2013 at 01:00 PM in Courtroom 575 before Judge John R. Adams on Crocs' request for preliminary injunction. Judge John R. Adams on 3/21/13.(L,J)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

CROCS, INC.,

Plaintiff,
v.
JERRY LEYDEN, et al.,

Defendant.

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CASE NO.: 5:13CV579

JUDGE JOHN ADAMS
ORDER AND DECISION

This matter comes before the Court on Motion by Plaintiff Crocs, Inc. for a
Temporary Restraining Order. The Court has been advised, having reviewed the parties’
motions and supporting affidavits, and having heard argument from the parties via a
telephone conference conducted on March 21, 2013. For the reasons that follow, the
motion is GRANTED.
I.

Facts
Defendant Jerry Leyden was employed as an expert by plaintiffs in litigation

entitled Geshke v. Crocs in the United States District Court for the District of
Massachusetts. As a part of his retention as an expert, Leyden became bound by a
confidentiality agreement wherein he agreed that he would be precluded from sharing
confidential information with any entity that has been or is currently in litigation with
Crocs.
At some point in the recent past, Crocs became aware that Leyden was once again
retained as an expert in litigation in Washington state court entitled Soo v. J.C. Penny
Corporation, Inc. In both matters, Leyden was called upon to opine about the likelihood
that a certain type of footwear would become caught in an escalator. In Geshke, he

examined Crocs footwear. In Soo, he was asked to examine the footwear of a direct
competitor of Crocs – footwear that Crocs refers to as knockoffs of their brand.
Upon learning that Leyden was offering an opinion in Soo, Crocs set forth to
examine the basis of his opinion, believing that it was improperly built upon confidential
information he had obtained in Geshke. During the ensuing research by Crocs, Crocs
learned that Leyden had retained confidential information following the Geshke matter,
despite his obligation to return it. To his credit, Leyden admitted having the information
and immediately returned it, explaining that trouble communicating with prior counsel had
resulted in the retention of the information.
In response to Crocs inquiry and its pending motion herein, Leyden has asserted
that he did not rely upon any confidential information in reaching his results in Soo. In
fact, Leyden contends that all of his testing was completed in both Geshke and Soo without
any reliance upon Crocs’ confidential information.
The Court now reviews the parties’ arguments.
II.

Law and Analysis
When determining whether to issue a temporary restraining order or a preliminary

injunction, this Court considers the following four factors:
(1) whether the movant has a ‘strong’ likelihood of success on the merits;
(2) whether the movant would otherwise suffer irreparable injury; (3)
whether issuance of a preliminary injunction would cause substantial harm
to others; and (4) whether the public interest would be served by issuance of
a preliminary injunction.
McPherson v. Michigan High Sch. Athletic Ass’n, 119 F.3d 453, 459 (6th Cir.1997) (en
banc) (quoting Sandison v. Michigan High Sch. Athletic Ass’n, 64 F.3d 1026, 1030 (6th
Cir.1995)). This Court must balance the four factors while noting that none should be
considered a prerequisite to the grant of a preliminary injunction. See United Food &
Commercial Workers Union, Local 1099 v. Southwest Ohio Reg’l Transit Auth., 163 F.3d

341, 347 (6th Cir. 1998).

Moreover, a plaintiff must present clear and convincing

evidence in support of the four factors. Procter & Gamble Co. v. Stoneham, 140 Ohio
App.3d 260, 267-68 (Ohio Ct. App. 2000).
A. Likelihood of success on the merits
Leyden’s declaration asserts that he has not in any shared confidential information
or utilized such information as an expert in Soo. However, Crocs has highlighted that
Leyden’s report in the Geshke litigation details the information that he reviewed before
forming his ultimate opinion.

The information reviewed specifically references

confidential information supplied by Crocs under the confidentiality agreement. In turn,
Leyden’s report in the Soo litigation specifically references the opinions he formed in
Geshke, thereby inserting his review of that confidential information into the Soo litigation.
At this stage of the proceedings, Crocs has demonstrated a strong likelihood of
success on the merits. While Leyden puts forth a showing that his testing did not rely
upon confidential information, documentary evidence, namely his report in Geshke,
indicates that his final opinion was based upon numerous factors, including a review of
confidential information. As such, whether intentional or not, it strongly appears that
Leyden has violated the confidentiality agreement.
B. Irreparable injury
The Court agrees with Crocs that it would suffer irreparable injury if Leyden were
permitted to go forward with his expert duties in Soo without further examination of
whether he has breached the confidentiality agreement. The Soo litigation involves J.C.
Penney, an entity currently involved in litigation with Crocs. Moreover, the shoes at issue
in Soo were manufactured by a direct competitor of Crocs. Accordingly, any disclosure of
Crocs’ confidential information would result in significant irreparable injury. Moreover,
as Leyden would undoubtedly be examined about the precise bases for his opinion, there is

little doubt that his deposition would include an examination of all the underlying
documentation he relied upon to reach his final opinion, documentation that includes
Crocs’ confidential information.
C. Substantial harm to others
There is no indication that granting the TRO will cause any harm to others. The
Court learned during the telephone conference in this matter that the discovery deadline in
the Washington state case does not expire until the third week of April. As this Court will
have concluded the preliminary injunction well before that date, the Court cannot foresee
any harm to any third party.
D. Public interest
The public interest lies in ensuring that confidentiality agreements are fulfilled and
that confidential information is not inadvertently or intentionally provided to third parties.
III.

Conclusion
Crocs’ motion for a temporary restraining order is GRANTED. Defendants shall

cease, desist and refrain from:
a. violating the terms of the Confidentiality Order entered in Geshke v. Crocs, Inc.,
No. 1:10-cv-11567-RGS, United States District Court for the District of Massachusetts;
b. producing confidential information and/or materials obtained from Crocs
pursuant to the Confidentiality Order while in the capacity of an endorsed Fed. R. Civ. P.
26(a)(2) expert in Geshke v. Crocs, Inc., No. 1:10-cv-11567-RGS, United States District
Court for the District of Massachusetts;
c. testifying in any capacity as witness in Soo, et al v. J.C.. Penney Corp., Inc., et
al., No. 11-2-16771-2 SEA, currently pending in the King County Superior Court, State of
Washington until such further Order from this Court enters with a specific finding that no
violation of the Confidentiality Order has occurred.

This prohibition includes the

deposition scheduled for March 22, 2013.

Said deposition SHALL NOT GO

FORWARD.
This Order shall expire after 14 days, unless within the time so fixed, for good
cause shown, it is extended for another 14 days, unless the party against whom the order is
directed consents that it may be extended for a longer period.
A Hearing on Plaintiffs Application for Preliminary Injunction is hereby set for
April 1, 2013, at 1:00 p.m. in Courtroom 575, 2 South Main St., Akron, OH 44308.
Sworn testimony and evidence to be presented and cross-examination to be permitted.
The Parties are permitted to conduct expedited discovery in preparation for the
Preliminary Injunction Hearing. Accordingly, Crocs’ motion for expedited discovery is
GRANTED. This discovery shall include Leyden’s deposition.
Plaintiff shall post bond in the amount of $500, under Fed. R. Civ. P. 65(C).
IT IS SO ORDERED.

Date: March 21, 2013

____/s/ Judge John R. Adams_______
JUDGE JOHN R. ADAMS
UNITED STATES DISTRICT COURT