Doubleclick Inc. v. Paikin

402 F. Supp. 2d 1251, 2005 U.S. Dist. LEXIS 40712, 2005 WL 3272996
CourtDistrict Court, D. Colorado
DecidedDecember 1, 2005
Docket05-CV-1400-WDM/BNB
StatusPublished
Cited by15 cases

This text of 402 F. Supp. 2d 1251 (Doubleclick Inc. v. Paikin) is published on Counsel Stack Legal Research, covering District Court, D. Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Doubleclick Inc. v. Paikin, 402 F. Supp. 2d 1251, 2005 U.S. Dist. LEXIS 40712, 2005 WL 3272996 (D. Colo. 2005).

Opinion

ORDER

MILLER, District Judge.

This matter is before me on Plaintiff Doubleclick Inc.’s (Doubleclick) motion for a prehminary injunction. After consideration of the parties briefs and the testimony presented at the hearing, I conclude that the motion should be granted for the following reasons.

Background

Doubleclick is a Delaware corporation seeking a preliminary injunction to prevent Defendant Lori Paikin, a former employee, from violating confidentiality and non-competition agreements.

Doubleclick is in the business of providing cooperative data services and strategic and analytical services designed to help direct marketers succeed in their business. Paikin worked for their company as a Senior Vice President of Merchandise Services in their Abacus division until February of 2005, when she decided to leave the company. The parties entered into a separation agreement which provided that Paikin be placed on paid sabbatical for one month, and continue to pay her regular base salary for six months thereafter. These payments would be accelerated if Paikin got a new job that did not violate the separation agreement. In return, Pai-kin agreed to various waivers of liability and confidentiality and non-competition clauses which generally prohibited Paikin from ever disclosing DoubleClick’s confidential information, and from working for DoubleClick’s competitors for up to one year and seven months. The agreement also provided that if Paikin breached these prohibitions, that Doubleclick would be entitled to an injunction.

A few months later Paikin notified them that she had accepted a new job unrelated to her work with Doubleclick. In response, the company paid Paikin her remaining separation pay in a lump sum. Then, in July 2005, Doubleclick learned that Paikin was working for NextAction Corporation, a direct competitor of Doub-leclick. Therefore, Doubleclick seeks an order enjoining Paikin from violating the separation agreement and from misappropriating DoubleClick’s trade secrets.

Standard of Review

A temporary restraining order or preliminary injunction is an extraordinary remedy, and the right to relief must be clear and unequivocal. SCFC ILC, Inc. v. Visa USA, Inc., 936 F.2d 1096, 1098 (10th Cir.1991). The decision to grant injunctive relief is a matter of discretion. Id.

In order to obtain preliminary injunctive relief, the moving party must establish: (1) a substantial likelihood that *1255 the movant will eventually prevail on the merits; (2) a showing that the movant will suffer irreparable injury unless the injunction issues; (3) proof that the threatened injury to the movant outweighs whatever damage the proposed injunction may cause the opposing party; and (4) a showing that the injunction, if issued, woúld not be adverse to the public interest. Id. In cases where the movant has prevailed on the other factors, the Tenth .Circuit uses a liberal definition of “probability of success”: the plaintiff need only raise “questions going to the merits so serious, substantial, difficult and doubtful as to make them a fair ground for litigation and thus for more deliberate investigation.” Lundgrin v. Claytor, 619 F.2d 61, 63 (10th Cir.1980) (internal quotations omitted).

In addition, the following types of preliminary injunctions are disfavored and require that the movant satisfy an even heavier burden: (1) a preliminary injunction that disturbs the status quo; (2) a preliminary injunction that is mandatory as opposed to prohibitory; and (3) a preliminary injunction that affords the movant substantially all the relief they may recover at the conclusion of a full trial on the merits. O Centro Espirita Beneficiente Uniao Do Vegetal v. Ashcroft, 389 F.3d 973, 975 (10th Cir.2004) (citing SCFC ILC, 936 F.2d at 1098-99). These situations “must be more closely scrutinized to assure that the exigencies of the case support the granting of a remedy that is extraordinary even in the normal, cpurse.” Id. Moreover, “a party seeking such an injunction must make a strong showing both with regard to the likelihood of success on the merits and with regard to the balance of harms, and may not rely on [the Tenth Circuit’s] modified-likelihood-of-success-on-the-merits standard.” Id. at 976.

Discussion

1. Disfavored Categories of Preliminary Injunctions

a. Injunctions that Alter the Status Quo

In this case, the parties disagree about whether or not Doubleclick must meet the heightened burden from O Centro. Paikin argues that the requested injunction would disturb the status quo because it would force her to stop working at a job she has been at for several months. Conversely, Doubleclick argues that it merely seeks to restore the status quo.

In O Centro, a majority of the Tenth Circuit, sitting en baric, found that even though the plaintiffs had actively used an illegal drug in their religious ceremonies for years, the status quo was the enforcement of federal drug laws. Id. at 973. Plaintiffs argued that the status quo was their possession and sacramental use of the drug hoasca, and the government had altered the status quo by initiating drug enforcement actions against them. Rejecting this reasoning, Judge Murphy stated that:

It simply cannot be the case that a party can establish the status quo in a given case through secretive or clandestine activity. There is enough natural incentive to manipulation in events preceding litigation, and in litigation itself, without providing judicial endorsement of surreptitious conduct by wrapping it in a cloak of “status quo.” The “last peaceable uncontested status existing between the parties’ before the dispute developed,” 11A Wright & Miller § 2948, at' 136, is most surely the open and notorious actions of the parties before the dispute.

Id. at 981 (J. Murphy concurring). 1

*1256 Applying these principles to our case, I find that the parties’ positions before Pai-kin began to work for NextAction represent the status quo. Paikin’s testimony at the hearing indicates that she attempted to hide her employment with NextAction from Doubleclick. Under 0 Centro, she is not allowed to establish the status quo through secretive or clandestine activity. Moreover, although Paikin contests the validity of the separation agreement, Doubleclick has always maintained its enforceability. Therefore, the last peaceable uncontested status was before Paikin went to work for NextAction.

b. Mandatory as Opposed to Prohibitory Injunctions

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Bluebook (online)
402 F. Supp. 2d 1251, 2005 U.S. Dist. LEXIS 40712, 2005 WL 3272996, Counsel Stack Legal Research, https://law.counselstack.com/opinion/doubleclick-inc-v-paikin-cod-2005.