Dayton Superior Corporation v. Yan et al

Filing 9

ENTRY AND ORDER GRANTING 3 DAYTON SUPERIOR'S APPLICATION FOR A TEMPORARY RESTRAINING ORDER. This TRO shall become effective at the time and date when Plaintiff posts the security amount with the Court. It shall remain in effect for fourteen (14) days. Signed by Judge Thomas M Rose on 11/13/12. (ep)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON
DAYTON SUPERIOR CORPORATION,
Case No. 3:12-cv-380
Plaintiff,
Judge Thomas M. Rose
-vJULIAN Z. YAN, et al.,
Defendants.
______________________________________________________________________________
ENTRY AND ORDER GRANTING DAYTON SUPERIOR’S
APPLICATION FOR A TEMPORARY RESTRAINING ORDER
______________________________________________________________________________
Now before the Court is an application for a Temporary Restraining Order (“TRO”) by
Plaintiff Dayton Superior Corporation (“Superior”). (Doc. #2.) Superior seeks to restrain
Defendants Julian Z. Yan (“Yan”), Michael R. Klover (“Klover”) and Epoxy Products Company,
LLC (“EPCO”) from using Superior’s trade secrets and Yan from competing with Superior.
The Court has held two hearings on the TRO. One on November 8, 2012, and one on
November 9, 2012. Neither Yan nor Klover were represented at these hearings. The other Parties
were represented.
To obtain injunctive relief, a movant must first show that there is no adequate remedy at
law for the alleged injury. Dana Corp. v. Celotex Asbestos Settlement Trust, 251 F.3d 1107,
1118 (6th Cir. 2001). If this is shown, the court must then weigh four factors: (1) whether the
movant is likely to prevail on the merits; (2) whether the movant would suffer irreparable injury
if the court does not grant the TRO; (3) whether a TRO would cause substantial harm to others;
and (4) whether a TRO would be in the public interest. Samuel v. Herrick Memorial Hospital,
201 F.3d 830, 833 (6th Cir. 2000)(citing Glover v. Johnson, 855 F.2d 277, 282 (6th Cir. 1988)).

RELEVANT FACTUAL BACKGROUND
Superior and Unitex
Superior is a manufacturer and distributor of commercial construction chemical systems
and related products, including a line of epoxy-based products. (Declaration of David DeBruler
(“DeBruler Dec.”) ¶¶ 2,3 Nov. 6, 2012.) Superior is a successor to Zea Corporation, Inc. which
did business as “Unitex.” (Declaration of Andy Gaines (“Gaines Dec.”) ¶ 3 Nov. 6, 2012.)
Unitex products were, and still are, developed and sold from a facility in Kansas City, Missouri.
(Id. ¶ 4.)
In September of 2010, Superior acquired the assets of Unitex, including the Unitex trade
name. (Id.) Unitex specialized in manufacturing and selling epoxy-based products, specifically
epoxy construction chemicals and related products, such as epoxy grouts, epoxy chocks, epoxy
sealers and epoxy overlays. (Id. ¶ 3.)
Epoxy products consist primarily of an epoxy resin and a hardening agent. (DeBruler
Dec. ¶ 2.) Some epoxy-based products also incorporate an aggregate component. (Id.) Epoxy
products vary by the differing proportions of the main components, the chemical process for
combining the components and the additional materials and chemicals that may be added at
various phases of production. (Id.)
Confidential Product Development Information
Superior develops and produces its products using processes, materials, knowhow, tools
and recipes kept in strict confidence (the “Confidential Product Development Information”). (Id.
at ¶ 3.) The Confidential Product Development Information is known in varying degrees by
Superior employees and consultants but is not generally known outside of Superior. (Id. at ¶ 4.)

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Also, Superior does not share or sell its Confidential Product Development Information. (Id.)
Superior stores its chemical formulas and processes on a password-protected, off-network
computer. (Id.) Any employee who works with the Confidential Product Development
Information must execute a confidentiality agreement. (Id. at ¶ 9.) Also, computerized access to
the Confidential Product Development Information is heavily restricted. (Id. at ¶ 10.) Finally, the
computers are maintained “off network.” (Id.)
Access to Superior’s laboratories is restricted to employees who are subject to a
confidentiality agreement. (Id. at ¶ 11.) Materials may not be removed without prior
authorization. (Id.)
Confidentiality is further maintained by the difficulty inherent in reverse engineering the
Unitex products. (Id. at ¶ 12.) Reverse engineering would, at best, reveal the basic chemical
components but would not reveal the chemical processes for combining the basic components
and other chemicals. (Id.) Reverse engineering would also not necessarily reveal the existence of
small amounts of other necessary chemicals. (Id.)
Superior alleges that it enjoys competitive advantages by using the Confidential Product
Development Information. (Id. at ¶ 5.) Specifically, Superior produces superior quality
construction products that are tailored to meet changing customer needs for products that can be
used in a variety of construction environments. (Id.) By adding Unitex’s product lines, Superior
was able to add competitive epoxy-based construction products to the Confidential Product
Development Information. (Id. at ¶ 7.)
In 2010, Superior invested $2.23 million in Unitex technology and proprietary formulae.
(Id. at ¶ 8.) This amount does not include costs that Superior has incurred since 2010 or other

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hidden costs. (Id.) A Superior competitor wanting to duplicate the Confidential Product
Development Information “from scratch” would incur similar expenses. (Id.)
Confidential Customer Development Information
Superior also develops and maintains confidential information related to its current and
prospective customers, including strategies and plans, customer information, pricing
information, and other proprietary business information (the “Confidential Customer
Development Information”). (Gaines Dec. ¶ 5.) Superior enjoys competitive advantages by using
the Confidential Customer Development Information. (Id. at ¶ 6.)
Using the Confidential Customer Development Information, Superior identifies markets
or customers where Superior should direct its sale efforts. (Id.) Keeping this information
confidential prevents competitors from using Superior’s efforts to identify such customers or
markets. (Id. at ¶ 7.) Keeping this information confidential also prevents competitors from
exploiting Superior’s efforts because pricing is subject to change for a variety of reasons. (Id. at
¶ 8.) Most importantly, maintaining customer contact information and technical requirements is
critical to Superior’s efforts to stay up-to-date with emerging customer needs. (Id. at ¶ 9.)
Due to the critical competitive advantages and high costs associated with developing and
updating the Confidential Customer Development Information, Superior makes strong efforts to
keep such information secret. (Id. at ¶ 11.) Any employee working with the Confidential
Customer Development Information must execute a confidentiality agreement. (Id.) Also, all
computerized access to Confidential Customer Development Information is heavily restricted,
requiring a password and other authenticating criteria which is entered by an employee who is
subject to the confidentiality agreement. (Id. at ¶ 12.)

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In 2010, Superior invested $8.14 million to purchase Unitex customer relationships and
the Unitex trade name. (Id. at ¶ 5.) Anyone duplicating Superior’s Unitex-related Confidential
Customer Development Information “from scratch” would incur similar expenses. (Id.)
Yan’s Employment With Superior
Unitex employed Yan as Technical Director, responsible for research and product
development, quality control and raw material selection and purchasing. (DeBruler Dec. ¶ 13.)
Yan was educated and trained, and had prior work experience, in the field of chemistry. (Id.)
Yan had access to all Unitex product formulations, materials and suppliers. (Id. at ¶ 14.)
Yan’s employment with Unitex was governed by the Employment Agreement and
Unitex’s standard Noncompetition and Nondisclosure Agreement (“NDA”). (Id. at ¶¶ 15, 16.) In
the NDA, Yan acknowledged disclosure to him of Confidential Information1. (Id. at ¶ 17.) Yan
also agreed to not “use, publish, disclose, appropriate or communicate” the Confidential
Information. (Id. at ¶ 18.) Finally, Yan acknowledged that he “could threaten the value of the
Employer’s business if the Employee were to compete with Employer’s business. (Id. at ¶ 19.)
Consequently, Yan promised not to compete with Superior for a period of one year following
separation. (Id.) Superior succeeded to all rights under the NDA. (Id.)
In 2010, in connection with Superior’s acquisition of Unitex, Superior hired Yan as a
Senior Technical Manager. (Id. at ¶ 20.) Yan’s duties at Superior included research and
development, quality control and raw material selection and purchasing. (Id.) At Superior, Yan
specifically worked with chemical products, including form releases, cures, sealers and epoxies.

1

The Confidential Information includes the Confidential Product Development
Information and the Confidential Customer Development Information.
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(Id.)
After being hired by Superior, Yan executed a Confidential Information & Inventions
Agreement (the “Yan Confidential Information Agreement”). Id. at ¶ 21.) Therein, Yan
acknowledged that he would have access to Superior’s trade secrets and other confidential
information, including Unitex product formulations, raw materials and raw materials suppliers.
(Id.) Also therein, Yan agreed to never disclose Confidential Information. (Id.)
After being hired by Superior, Yan also executed (1) a Conflict of Interest Agreement
providing that he would protect corporate information and avoid undue outside influence on his
work-related activities and (2) a Policy Acknowledgment Agreement providing that information
and information technology assets are and shall remain the property of the Corporation. (Id. at ¶
22.)
On July 12, 2012, Yan entered into a Consulting Services Agreement. (Id. at ¶ 22.)
Generally, this Agreement created new obligations and preserved previously-created obligations
pertaining to Yan and his business relationship with Superior. (Id.) In effect, the provisions of
the aforementioned agreements, particularly relating to Yan’s duty to keep Superior’s
Confidential Information secret, remained in full force and effect. (Id.)
On September 27, 2012, Superior terminated Yan’s Consulting Agreement. (DeBruler
Dec. ¶ 26.) After his termination, Yan returned his company-owned laptop computer to Superior
in an inoperable condition. (Id. at ¶ 27.) Superior believes that Yan intentionally caused damage
to the laptop computer to hide evidence that he had removed or inappropriately accessed
Confidential Information from the laptop.(Id.)

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Klover’s Employment With Superior
Klover was employed by Unitex in a sales/account management position. (Id. ¶ 24.)
Klover worked with Yan at Unitex in the same location for about six years. (Id.)
Superior hired Klover in connection with its acquistion of Unitex. (Gaines Dec. ¶ 16.)
Klover’s duties at Superior included account management and sales growth. (Id.) While at
Superior, Klover had access to Confidential Customer Development Information including trade
secrets such as customer and supplier lists, sales information, pricing information, marketing
arrangements, strategies, business plans, internal performance statistics and customer
specifications. (Id. at ¶ 17.)
When Superior hired Klover, Klover executed a Confidential Information & Inventions
Agreement (the “Klover Confidential Information Agreement”). (Id.) Klover also signed a
Conflict of Interest Agreement and a Policy Acknowledgment. (Id. at ¶ 18.)
On February 10, 2012, Klover terminated his position with Superior ostensibly due to
dissatisfaction with compensation. (Id. at ¶ 19.) He took with him six years of experience with
Superior/Unitex is sales and account management. (Id.)
On December 15, 2011, prior to terminating his position with Superior and unbeknownst
to Superior, Klover, among others, formed EPCO. (Id. at ¶ 22.) Klover used his position at
Superior to establish a new “private label” customer account with Superior under the EPCO
name. (Id. at ¶ 20.) Private label meant that the customer would provide its own label for the
products. (Id.)
Klover caused the account to be set up so that EPCO would receive excessively low
pricing. (Id. at ¶ 21.) While still employed by Superior, Klover caused EPCO to order products

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from Superior manufactured according to Superior’s proprietary specifications. (Id.)
In January of 2012, EPCO began operating its business involving the mixing of
chemicals to make concrete construction products. (Affidavit of Laszlo Goodell (“Goodell Aff.”)
¶¶ 6,7 Oct. 29, 2012.) EPCO manufactured epoxy grout and epoxy chock. (Id. at ¶ 9.) EPCO
operates its business at 14000 Norby Road, Grandview, Missouri. (Id. at ¶¶ 2,5.) Finally, EPCO
appears to be selling products that are the same or similar to Superior’s Unitex products and
selling them to Superior’s current and prospective customers. (Gaines Dec. ¶ 23.)
Yan’s Employment With EPCO
Because Klover does not have the advanced scientific expertise required to operate a
functional chemicals mixing operation, he would need technical assistance from someone like
Yan. (DeBruler Dec. ¶ 25.) In fact, Yan is employed at EPCO. (Goodell Aff. ¶ 9.) Further, all of
the chemical formulas used in EPCO’s products were provided by Yan. (Id. ¶ 12.)
Frequently when EPCO had a technical problem with chemical mixing, Klover would say
that he was going to call “Julian.” (Id.) Laszlo Goodell (“Goodell”), a former EPCO employee,
first saw Yan at EPCO sometime in January, February or March of 2012. (Id. ¶ 13.) Between
January and September of 2012, Goodell saw Yan with Klover in the Norby Road facility at least
5 to 10 times. (Id. at ¶ 14.)
When Yan was at the Norby Road facility, he oversaw and directed how to handle and
mix the chemicals used to make EPCO’s products. (Id.) EPCO’s processes improved as the
result of Yan’s involvement. (Id.) Finally, Yan was involved in dealing with EPCO’s prospective
customers. (Id.)

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NO ADEQUATE REMEDY AT LAW
Before granting injunctive relief, the Court must determine if Superior has an adequate
remedy at law for its trade secrets claim and its covenant-not-to-compete claims. The trade
secrets claim will first be considered.
Because trade secrets rights include the right to exclude, the damages arising from the
misappropriation of trade secrets is irreparable and impossible to calculate. Deutsch Inv. Mgmt.,
Inc. v. Riverpoint Capital Mgmt., No. 1:02-CV-577, 2002 U.S. Dist. LEXIS 16147 at *18 (S.D.
Ohio Aug. 22, 2002.) “Therefore, where it is shown that the defendant has misappropriated the
plaintiff’s trade secrets, a preliminary injunction ordinarily should issue.” Id.
In this case, Superior has presented evidence that Yan, Klover and EPCO have
misappropriated Superior’s trade secrets. Thus, there is no adequate remedy at law for Superior’s
trade secrets claim.
Where an employee works for a competitor is a substantially similar capacity to the
position he held while working for the employer, there is no adequate remedy at law and
injunctive relief is appropriate. Prosonic Corp. v. Stafford, 539 F. Supp.2d 999, 1007 (S.D. Ohio
2008). In this case, Superior has presented evidence that Yan and Klover are working for EPCO,
a competitor, in substantially similar capacities to the positions they held while working at
Superior. Thus, there is no adequate remedy at law for Superior’s covenant-not-to-compete
claims. Finding no adequate remedy at law for Superior’s claims, the Court next weighs the four
factors to determine if injunctive relief should issue.

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INJUNCTIVE RELIEF FACTORS
Likelihood of Success On the Merits - Trade Secrets Claims
The Court first considers Superior’s likelihood of success on the merits of its trade
secrets claims. Under Ohio’s Uniform Trade Secrets Act, actual or threatened misappropriation
of a plaintiff’s trade secrets may be enjoined. Ohio Rev. Code § 1333.62(A). To prevail on a
misappropriation of trade secrets claim, a plaintiff must show (1) that a trade secret exists; (2)
that the defendant acquired the trade secret as a result of a confidential relationship; and (3) that
the defendant engaged in unauthorized use of the trade secret. Heartland Home Fin., Inc. v.
Allied Home Mtg. Cap. Corp., 258 F. App’x 860, 861 (6th Cir. 2008).
The Existence of a Trade Secret
A trade secret is information that derives independent economic value, actual or
potential, from not being generally known to other persons and is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy. Ohio Rev. Code § 1333.61(D). For
example, chemical formulations and pricing policies generally not known outside of a company
have been found to be the company’s trade secrets. Penetone Corp. v. Palchem, Inc., 627 F.
Supp. 997, 1006 (N.D. Ohio 1985). Also, listings of names, addresses, or telephone numbers that
have not been published or disseminated or have not otherwise become a matter of general
public knowledge have been found to be trade secrets. Fred Sigel Co., L.P.A. v. Arter and
Hadden, 707 N.E.2d 853, 862 (Ohio 1999).
Efforts to restrict physical access to trade secrets and requiring employees to execute
confidentiality agreements have been found to be reasonable steps to protect trade secrets. Valco
Cincinnati, Inc. v. N & D Machining Service, Inc., 492 N.E.2d 814, 819 (Ohio 1986). The

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protection of computerized records through password-based access restrictions has also been
deemed reasonable protection. The Rightthing, LLC v. Brown, No. 3:09 CV 135, 2009 WL
249694 at *8 (N.D. Ohio Feb. 2, 2009).
In this case, there is evidence that the Confidential Information constitutes trade secrets
under Ohio law. There is evidence that the Confidential Product Development Information is not
generally known in the industry and not easily replicated or reverse engineered. Also, the
Confidential Product Development Information is reasonably protected by several layers of
security, such as password protections, non-disclosure agreements, restrictions on off-site access
and restrictions on physical access to where the Confidential Product Development Information
is housed. Finally, Superior invested over $2.23 million to acquire and develop the Confidential
Product Development Information. Therefore, there is evidence that the Confidential Product
Development Information includes protectable trade secrets.
Like the Confidential Product Development Information, there is evidence that the
Confidential Customer Development Information is not generally known to Superior’s
competitors. Superior reasonably protects the Confidential Product Development Information
with password-protected computer access, with confidentiality agreements and by limiting
access. Superior has invested at least $8.14 million to acquire and develop the Confidential
Customer Development Information relating to Unitex products. Therefore, there is evidence that
the Confidential Customer Development Information includes protectable trade secrets..
Trade Secret Acquired as a Result of Confidential Relationship
A confidential relationship may be inferred from the circumstances surrounding the
relationship between the owner of the trade secret and the defendant. Vanguard Transp. Sys.,

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Inc. v. Edwards Transfer & Storage Co. Gen. Commodities Div., 673 N.E.2d 182, 185 (Ohio Ct.
App. 1996). Also, where an express agreement bars disclosure of trade secrets, the defendant
acquires trade secrets through a confidential relationship. MEMC Elec. Materials v.
Balakrishnan, No. 2:12-CV-344 , 2012 WL 3962905 at *7 (S.D. Ohio Sept. 11, 2012).
In this case, there is evidence that both Yan and Klover agreed in writing to protect
Superior’s trade secrets. Thus, there is evidence that Yan, Klover and EPCO acquired the trade
secrets by exploiting Yan’s and Klover’s confidential relationships with Superior.
Unauthorized Use of the Trade Secret
The unauthorized use, or misappropriation, of trade secrets means (1) the acquisition of a
trade secret by one with knowledge that acquisition was improper or (2) the disclosure or use of
a trade secret. Ohio Rev. Code § 1333.61(B). Also, under the “inevitable disclosure rule,” a
former employee working for a competitor will be enjoined because an individual cannot
compartmentalize a competitor’s knowledge and disclosure or misappropriation of trade secrets
is inevitable. Balakrishnan, 2012 WL 3962905 at *9 (citing Dexxon Digital Storage, Inc. v.
Haenszel, 832 N.E.2d 62, 68-69 (Ohio Ct. App. 2005)).
In this case, both the statutory definition and the “inevitable disclosure rule” apply. With
regard to the statutory definition of misappropriation, there is evidence that Yan, Klover and
EPCO have each misappropriated Superior’s Confidential Information. There is also evidence
that Yan and Klover have used the Confidential Information and disclosed it to EPCO with
knowledge that the acquisition was improper. Thus, there is evidence that EPCO has acquired
the Confidential Information, knowing that Yan’s and Klover’s disclosure of it was improper.
With regard to the “inevitable disclosure rule,” there is evidence that Yan has proprietary

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knowledge of Superior’s products, manufacturing process and specialized chemical methods.
Yan also has information regarding Superior’s product’s strengths and weaknesses and
Superior’s marketing strategy. Similarly, there is evidence that Klover has specialized
knowledge of Superior’s customer contacts, customer needs and pricing strategies. There is
evidence that both Yan and Klover are now employed by EPCO, one of Superior’s direct
competitors. Thus, it is inevitable that Yan and Klover will disclose Superior’s trade secrets to
EPCO. Therefore, Yan and Klover have misappropriated Superior’s trade secrets violating their
confidentiality obligations to Superior. In sum, based upon the evidence presented, Superior has
shown a likelihood of success on its trade secrets claims.
Likelihood of Success On the Merits On Noncompete Claim
The Court next considers Superior’s likelihood of success on the merits of its
noncompete claim. In Missouri, a covenant not-to-compete is valid if the agreement’s
restrictions are reasonable. Sigma Chem. Co. v. Harris, 605 F. Supp. 1253, 1260 (E.D. Mo.
1985). A covenant not-to-compete is reasonable if the geographic and temporal restrictions
“serve the employer’s legitimate protectable interest[s].” Id. If an employer’s customer base is
geographically diverse, a broad geographic scope is appropriate. Id. Finally, Missouri courts
routinely uphold non-compete agreements with terms of one year or longer. See Kessler-Heasley
Artificial Limb Co., Inc. v. Kenney, 90 S.W.3d 181 (Mo. Ct. App. 2002)(5 years); Washington
Cty. Mem. Hosp. v. Sidebottom, 7 S.W.3d 542 (Mo. Ct. App. 1999)(1 year); Schott v. Beussind,
950 S.W.2d 621 (Mo. Ct. App. 1997)(2 years).
The NDA signed by Yan is governed by Missouri law. Superior’s strong and protectable
interest in the maintenance of customer relationships and the secrecy of its Confidential

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Information justifies enforcement of the NDA. By executing the NDA, Yan agreed to not work
for or disclose Confidential Information to a Superior competitor for a period of one year after
his separation. Thus, enforcement of the NDA is reasonable.
There is evidence that Yan now works for EPCO, which is a Superior competitor that
operates 20 miles from Yan’s previous work station at the Unitex facility. Thus, there is
evidence that Superior has a strong likelihood of success on the merits of its noncompete claim.
Irreparable Injury
Irreparable injury generally results from a competitor’s misappropriation of trade secrets
due to “the potential for lasting and unjust competitive harm that would not otherwise occur.”
Novak v. Farneman, No. 2:10-CV-768, 2010 WL 4643002 at *6 (S.D. Ohio Nov. 9, 2010). In
addition, an actual threat of irreparable injury may be established by showing that the employee
possessed the employer’s trade secrets. Id.
Irreparable injury also generally results from a competitor’s misappropriation of
confidential customer information. See Salinger v. Colting, 607 F.3d 68,81 (2d Cir. 2010)(a loss
that is difficult to replace or difficult to measure is irreparable); Stuhlbarg Int’l Sales Co. v. John
D. Brush & Co., Inc., 240 F.3d 832, 841 (9th Cir. 2001)(evidence of threatened loss of
prospective customers or goodwill is irreparable harm); Muniauction, Inc. v. Thompson Corp.,
502 F. Supp.2d 477, 482-83 (W.D. Pa. 2007)(loss of market share is irreparable injury), rev’d on
other grounds, 532 F.3d 1318 (Fed. Cir. 2008).
In this case, there is evidence that Superior will suffer irreparable injury without an
injunction. First, Superior has the right to exclude Klover, Yan and EPCO from the use of its
trade secrets. Yet, the evidence shows that Yan is using proprietary chemical formulas and

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methods that belong to Superior. The evidence also shows that Klover is using pricing
information, customer contacts, sales strategies, customer specifications and other information
belonging to Superior and used by Superior to compete in the market. In sum, there is evidence
that the threat of disclosure or misappropriation of Superior’s trade secrets constitutes irreparable
injury.
Superior is also suffering irreparable injury from the misappropriation of its confidential
customer information. There is evidence that Yan and Klover are using Superior’s trade secrets
to gain unfair competitive advantages and damaging Superior’s market share and customer
growth. There is also evidence that EPCO is taking Superior’s market share of epoxy-based
construction products and is inevitably acquiring customers that otherwise would have purchased
products from Superior.
Finally, there is evidence that Superior is suffering irreparable injury from Yan’s
violation of the NDA. Many courts have found that a mere violation of a covenant not-tocompete is an irreparable injury. Pro Edge, L.P. v. Gue, 374 F. Supp.2d 711, 749 (N.D. Iowa
2005). Further, a substantial threat of substantial harm exists when a defendant employee possess
knowledge of a former employer’s trade secrets and begins working in a position that causes the
employee to compete directly with the former employer or the product line that the employee
formerly supported. Prosonic, 539 F. Supp.2d at 1007 (citing Jacono v. Invacare Corp., No.
86605, 2006 WL 832451 at *7 (Ohio Ct. App. Mar. 30, 2006)). Finally, where the employee
works for a competitor in a substantially similar capacity to the prior position he held, the prior
employer suffers irreparable harm. Id.
In this case, there is evidence that Yan possess Superior’s Confidential Information and is

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using it to assist EPCO in producing epoxy construction products in competition with Superior.
There is also evidence that Superior has lost market share and prospective customers since
EPCO began competing with Superior. Finally, there is evidence that Yan has specialized
knowledge that he could use in his employment with EPCO to compete with Superior.
Substantial Harm
The Court must next consider whether a preliminary injunction would cause substantial
harm to others. The only harm from the issuance of an injunction would be to Yan, Klover and
EPCO. Yet, these parties cannot be heard to complain about the effect that a TRO would have on
their business, even though a TRO may shut down the business. See Apple Computer v. Franklin
Computer Corp., 714 F.2d 1240, 1255 (3d Cir. 1983)(if a knowing infringer could be heard to
complain, a knowing infringer would be permitted to construct its business around its
infringement which is an unacceptable result).
Public Interest
Finally, the Court must consider whether the issuance of a TRO would be in the public
interest. Generally, upholding reasonable contracts is in the public interest. Prosonic, 539 F.
Supp. 2d at 1008. In addition, maintaining commercial ethics and protecting trade secrets in
which a plaintiff has substantially invested are in the public interest. Kendall Holdings, Ltd. v.
Eden Cryogenics LLC, 630 F. Supp.2d 853, 869 (S.D. Ohio 2008). Finally, the public interest is
served in the enforcement of valid restrictive covenants contained in lawful contracts. ALTA
Analytics, Inc. v. Muuss, 75 F. Supp.2d 773, 786 (S.D. Ohio 1999).
Based upon the evidence presented thus far, the public interest favors enjoining Yan,
Klover and EPCO. Superior has shown that it has substantially invested in the innovation

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underlying the Unitex products and thus is protecting these trade secrets. The NDA is an
enforceable contract that includes a valid restrictive covenant.
CONCLUSION
Based upon the evidence presented, there is no adequate remedy at law. Further, the
balance of equities favors enjoining Yan, Klover and EPCO. The evidence indicates that
Superior has a likelihood of success on the merits on its trade secrets and noncompete claims.
The evidence also indicates that Superior will suffer irreparable injury if Yan, Klover and EPCO
are not enjoined. A TRO would not cause substantial harm to others aside from those
purportedly acting illegally and the issuance of a TRO would be in the public interest.
TEMPORARY RESTRAINING ORDER
1. Julian Z. Yan must cease and desist using, disclosing and communicating the
confidential information and trade secrets of Dayton Superior; and
2. Julian Z. Yan must cease and desist from engaging in any business activity in
competition with Dayton Superior, including any business activity on behalf of, or in
conjunction with EPCO; and
3. Michael R. Klover must cease and desist using, disclosing and communicating the
confidential information and trade secrets of Dayton Superior; and
4. EPCO must cease and desist using, disclosing and communicating the confidential
information and trade secrets of Dayton Superior.
Bond
Federal Rule of Civil Procedure 65(c) provides that a court may issue a TRO “only if the
movant gives security in an amount that the court considers proper to pay the costs and damages

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sustained by any party found to have been wrongfully enjoined or restrained.” In this case,
based on EPCO’s annual profits and other possible damages, the Court sets the security amount
at $250,000.
Effective Dates
This TRO shall become effective at the time and date when Superior posts the above
security amount with the Court. It shall remain in effect for fourteen days.
DONE and ORDERED in Dayton, Ohio this Thirteenth Day of November, 2012.
s/Thomas M. Rose
_______________________________
THOMAS M. ROSE
UNITED STATES DISTRICT JUDGE
Copies furnished to:
Counsel of Record
Julian Z. Yan (at his last known address and at EPCO)
Michael R. Klover (at his last know address and at EPCO)
Epoxy Products Company, LLC
Attorney Doug Weems

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