1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 EUROFINS ELECTRICAL AND Case No. 5:24-cv-06340-EJD ELECTRONIC TESTING NA, LLC, 8 ORDER GRANTING TEMPORARY Plaintiff, RESTRAINING ORDER 9 v. 10 Re: Dkt. No. 3 SGS NORTH AMERICA INC., et al., 11 Defendants.
12 On September 9, 2024, Plaintiff Eurofins Electrical and Electronics Testing NA, LLC 13 (“Eurofins”) initiated the present action and filed a Motion for Temporary Restraining Order and 14 Order to Show Cause re: Preliminary Injunction (“TRO Motion”).1 See Compl., ECF No. 1; Mot. 15 for Temp. Restraining Order and Order to Show Cause (“TRO Mot.”), ECF No. 3. The Court held 16 a status conference on this matter on September 12, 2024. ECF No. 25. Counsel for Eurofins and 17 Defendant SGS North America Inc. (“SGS”) appeared at the September 12, 2024, conference. Id. 18 For the reasons discussed at the status conference and explained below, the Court GRANTS 19 Eurofins’s requests for a TRO, which will expire at 11:59 p.m. on September 26, 2024, subject to 20 further modification. 21 I. BACKGROUND 22 Eurofins alleges the following. Eurofins is a testing company that operates a wireless 23 testing services laboratory in Santa Clara. Compl. ¶ 1. Eurofins alleges that its former employees, 24 Defendants Jose Eleazar Zuniga Juarez (“Juarez”) and Duong Duong (“Duong”) (collectively, 25
26 1 Eurofins also filed a Motion for Expedited Discovery, ECF No. 4, which counsel for Eurofins 27 and SGS indicated at the September 12, 2024, status conference may be resolved through stipulation. The Court therefore defers ruling on the Motion for Expedited Discovery at this time. 1 “Individual Defendants”), misappropriated its trade secret information and shared it with 2 Eurofins’s competitor, SGS, so that SGS could open its own wireless testing laboratory in Santa 3 Clara. See id. Juarez and Duong have since left Eurofins and are currently employed at SGS. Id. 4 ¶ 6. Eurofins learned this information when it found Juarez’s personal email account still signed 5 into Eurofins’s company computer after he quit to work for SGS. Id. ¶ 7. In this personal email 6 account, Eurofins found messages sent from Juarez, Duong, and another service provider, Gary 7 Chou (“Chou”), to Juarez’s new SGS email account from January 2024 to August 2024. Id. 8 Eurofins alleges that these emails contained information relating to Eurofins’s test chambers 9 layout, equipment specifications, testing results, pricing information, and other client information. 10 Id. ¶¶ 7, 10, 103–17. Eurofins alleges that SGS plans to imminently use Eurofins’s trade secrets to 11 open its new wireless testing laboratory in September 2024. Id. ¶ 9. Based on these allegations, 12 Eurofins brings claims for trade secret misappropriation, breach of Individuals Defendants’ 13 confidentiality agreements, intentional interference with contractual relations, breach of duty of 14 loyalty, conversion, and unfair competition. See id. 15 II. LEGAL STANDARD 16 The purpose of a temporary restraining order is to “preserv[e] the status quo and prevent[] 17 irreparable harm just so long as is necessary to hold a hearing, and no longer.” Granny Goose 18 Foods, Inc. v. Bhd. Of Teamsters & Auto Truck Drivers, 415 U.S. 423, 439 (1974). Any 19 temporary restraining order, therefore, is a temporary measure to protect the applicant’s rights until a hearing can be held. A temporary restraining order is “not a preliminary adjudication on 20 the merits but rather a device for preserving the status quo and preventing the irreparable loss of 21 rights before judgment.” Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415, 1422 (9th 22 Cir. 1984) (citation omitted). 23 Under Federal Rule of Civil Procedure 65(a), an applicant is entitled to a temporary 24 restraining order upon demonstrating four factors: (1) the applicant “is likely to succeed on the 25 merits”; (2) the applicant “is likely to suffer irreparable harm in the absence of preliminary relief”; 26 (3) the balance of equities favors the requested preliminary relief; and (4) the “injunction is in the 27 1 public interest.” Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 20 (2008). 2 III. DISCUSSION 3 The Court finds all four factors met. 4 First, Eurofins has demonstrated that it is likely to succeed on the merits of at least one 5 claim: trade secret misappropriation. Trade secret misappropriation generally requires a showing 6 that a defendant acquired trade secrets with reason to know the trade secrets were acquired by 7 improper means. Cal. Civ. Code § 3426.1; 18 U.S.C. §§ 1836, 1839. A “trade secret” is 8 information that (1) derives independent economic value from being kept confidential; and (2) is 9 the subject of reasonable efforts to maintain secrecy. Cal. Civ. Code § 3426.1(d); 18 U.S.C.A. § 10 1839(6). Here, Eurofins specifically alleged and attached emails showing that Individual 11 Defendants shared with SGS schematic diagrams for Eurofins’s chambers; information regarding 12 Eurofins’s equipment; client information, communications, and pricing; a screenshot of Eurofins’s 13 software for invoicing and scheduling; and multiple compliance reports. See Compl. ¶¶ 103–17. 14 The Court finds that this information is likely protectable as trade secrets. The information may 15 derive independent economic value from remaining confidential from Eurofins’s competitors, 16 such as SGS. Eurofins sought to keep this information confidential through measures including 17 confidentiality agreements, limiting access to the lab, requiring individualized logins to access 18 trade secret data, and password protecting lab computers. Id. ¶ 4. The Court also finds that this 19 information was acquired by improper means. 20 Second, Eurofins established that it is likely to suffer irreparable harm in the absence of 21 relief. These harms include disclosure of confidential information, interference with customer 22 relationships, loss of good will, and injury to reputation. 23 Third, equitable principles are not offended by the issuance of a TRO that does no more 24 than require Defendants to comply with the law. 25 Fourth, given the clear showing of immediate irreparable harm and likelihood of success 26 on the trade secret claim, the Court need not engage in an extended analysis of the public’s 27 interest. See Stormans, Inc. v. Selecky, 586 F.3d 1109, 1139 (9th Cir. 2009). Even so, the Court 1 finds that the public interest is served by the issuance of the narrow TRO here because, again, the 2 TRO requires no more than is already required by law. 3 IV. CONCLUSION AND TEMPORARY RESTRAINING ORDER 4 The Court GRANTS Eurofins’s request for a limited temporary restraining order. This 5 Order expires at 11:59 p.m. on September 26, 2024. The Court will not require a bond at this 6 time. 7 The Court also ORDERS all parties, including Individual Defendants, to appear for a 8 status conference at 1:30 p.m.
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1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 EUROFINS ELECTRICAL AND Case No. 5:24-cv-06340-EJD ELECTRONIC TESTING NA, LLC, 8 ORDER GRANTING TEMPORARY Plaintiff, RESTRAINING ORDER 9 v. 10 Re: Dkt. No. 3 SGS NORTH AMERICA INC., et al., 11 Defendants.
12 On September 9, 2024, Plaintiff Eurofins Electrical and Electronics Testing NA, LLC 13 (“Eurofins”) initiated the present action and filed a Motion for Temporary Restraining Order and 14 Order to Show Cause re: Preliminary Injunction (“TRO Motion”).1 See Compl., ECF No. 1; Mot. 15 for Temp. Restraining Order and Order to Show Cause (“TRO Mot.”), ECF No. 3. The Court held 16 a status conference on this matter on September 12, 2024. ECF No. 25. Counsel for Eurofins and 17 Defendant SGS North America Inc. (“SGS”) appeared at the September 12, 2024, conference. Id. 18 For the reasons discussed at the status conference and explained below, the Court GRANTS 19 Eurofins’s requests for a TRO, which will expire at 11:59 p.m. on September 26, 2024, subject to 20 further modification. 21 I. BACKGROUND 22 Eurofins alleges the following. Eurofins is a testing company that operates a wireless 23 testing services laboratory in Santa Clara. Compl. ¶ 1. Eurofins alleges that its former employees, 24 Defendants Jose Eleazar Zuniga Juarez (“Juarez”) and Duong Duong (“Duong”) (collectively, 25
26 1 Eurofins also filed a Motion for Expedited Discovery, ECF No. 4, which counsel for Eurofins 27 and SGS indicated at the September 12, 2024, status conference may be resolved through stipulation. The Court therefore defers ruling on the Motion for Expedited Discovery at this time. 1 “Individual Defendants”), misappropriated its trade secret information and shared it with 2 Eurofins’s competitor, SGS, so that SGS could open its own wireless testing laboratory in Santa 3 Clara. See id. Juarez and Duong have since left Eurofins and are currently employed at SGS. Id. 4 ¶ 6. Eurofins learned this information when it found Juarez’s personal email account still signed 5 into Eurofins’s company computer after he quit to work for SGS. Id. ¶ 7. In this personal email 6 account, Eurofins found messages sent from Juarez, Duong, and another service provider, Gary 7 Chou (“Chou”), to Juarez’s new SGS email account from January 2024 to August 2024. Id. 8 Eurofins alleges that these emails contained information relating to Eurofins’s test chambers 9 layout, equipment specifications, testing results, pricing information, and other client information. 10 Id. ¶¶ 7, 10, 103–17. Eurofins alleges that SGS plans to imminently use Eurofins’s trade secrets to 11 open its new wireless testing laboratory in September 2024. Id. ¶ 9. Based on these allegations, 12 Eurofins brings claims for trade secret misappropriation, breach of Individuals Defendants’ 13 confidentiality agreements, intentional interference with contractual relations, breach of duty of 14 loyalty, conversion, and unfair competition. See id. 15 II. LEGAL STANDARD 16 The purpose of a temporary restraining order is to “preserv[e] the status quo and prevent[] 17 irreparable harm just so long as is necessary to hold a hearing, and no longer.” Granny Goose 18 Foods, Inc. v. Bhd. Of Teamsters & Auto Truck Drivers, 415 U.S. 423, 439 (1974). Any 19 temporary restraining order, therefore, is a temporary measure to protect the applicant’s rights until a hearing can be held. A temporary restraining order is “not a preliminary adjudication on 20 the merits but rather a device for preserving the status quo and preventing the irreparable loss of 21 rights before judgment.” Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415, 1422 (9th 22 Cir. 1984) (citation omitted). 23 Under Federal Rule of Civil Procedure 65(a), an applicant is entitled to a temporary 24 restraining order upon demonstrating four factors: (1) the applicant “is likely to succeed on the 25 merits”; (2) the applicant “is likely to suffer irreparable harm in the absence of preliminary relief”; 26 (3) the balance of equities favors the requested preliminary relief; and (4) the “injunction is in the 27 1 public interest.” Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 20 (2008). 2 III. DISCUSSION 3 The Court finds all four factors met. 4 First, Eurofins has demonstrated that it is likely to succeed on the merits of at least one 5 claim: trade secret misappropriation. Trade secret misappropriation generally requires a showing 6 that a defendant acquired trade secrets with reason to know the trade secrets were acquired by 7 improper means. Cal. Civ. Code § 3426.1; 18 U.S.C. §§ 1836, 1839. A “trade secret” is 8 information that (1) derives independent economic value from being kept confidential; and (2) is 9 the subject of reasonable efforts to maintain secrecy. Cal. Civ. Code § 3426.1(d); 18 U.S.C.A. § 10 1839(6). Here, Eurofins specifically alleged and attached emails showing that Individual 11 Defendants shared with SGS schematic diagrams for Eurofins’s chambers; information regarding 12 Eurofins’s equipment; client information, communications, and pricing; a screenshot of Eurofins’s 13 software for invoicing and scheduling; and multiple compliance reports. See Compl. ¶¶ 103–17. 14 The Court finds that this information is likely protectable as trade secrets. The information may 15 derive independent economic value from remaining confidential from Eurofins’s competitors, 16 such as SGS. Eurofins sought to keep this information confidential through measures including 17 confidentiality agreements, limiting access to the lab, requiring individualized logins to access 18 trade secret data, and password protecting lab computers. Id. ¶ 4. The Court also finds that this 19 information was acquired by improper means. 20 Second, Eurofins established that it is likely to suffer irreparable harm in the absence of 21 relief. These harms include disclosure of confidential information, interference with customer 22 relationships, loss of good will, and injury to reputation. 23 Third, equitable principles are not offended by the issuance of a TRO that does no more 24 than require Defendants to comply with the law. 25 Fourth, given the clear showing of immediate irreparable harm and likelihood of success 26 on the trade secret claim, the Court need not engage in an extended analysis of the public’s 27 interest. See Stormans, Inc. v. Selecky, 586 F.3d 1109, 1139 (9th Cir. 2009). Even so, the Court 1 finds that the public interest is served by the issuance of the narrow TRO here because, again, the 2 TRO requires no more than is already required by law. 3 IV. CONCLUSION AND TEMPORARY RESTRAINING ORDER 4 The Court GRANTS Eurofins’s request for a limited temporary restraining order. This 5 Order expires at 11:59 p.m. on September 26, 2024. The Court will not require a bond at this 6 time. 7 The Court also ORDERS all parties, including Individual Defendants, to appear for a 8 status conference at 1:30 p.m. on September 26, 2024, at which time the parties may discuss 9 extending the temporary restraining order, modifying the terms of the temporary restraining order, 10 revisiting SGS’s request for a bond, and/or setting a hearing and briefing schedule for a Motion for 11 Preliminary Injunction. Counsel for SGS is ORDERED to appear at the status conference with 12 Individual Defendants. In the event that counsel for SGS does not intend on representing 13 Individual Defendants at that time, Individual Defendants are ORDERED to bring counsel or 14 inform the Court of the status of their representation. 15 TEMPORARY RESTRAINING ORDER 16 All Defendants, their agents, employees, partners, any others acting in concert or on their 17 behalf or any other individual or entity having actual notice of this Order by personal service or 18 otherwise are TEMPORARILY RESTRAINED and ENJOINED from the following acts: 19 1. As it relates to all Defendants and their agents, employees, partners, any others acting 20 in concert or any other individual or entity having actual notice of this Order by 21 personal service or otherwise: 22 a. utilizing, disclosing or misusing any trade secrets or confidential information 23 belonging to Eurofins, including, without limitation, Eurofins laboratory and 24 test-chamber schematics, equipment lists and information, invoices, pricing, 25 testing schedules, test reports and results, client and prospect lists, marketing, 26 sales and strategic plans, business research, client purchasing histories, 27 technical processes, non-public internal financial information, and customer 1 files; 2 b. transferring to any third party any trade secrets or confidential information 3 belonging to Eurofins including, without limitation, Eurofins laboratory and 4 test-chamber schematics, equipment lists and information, invoices, pricing, 5 testing schedules, test reports and results, client and prospect lists, marketing, 6 sales and strategic plans, business research, client purchasing histories, 7 technical processes, non-public internal financial information, and customer 8 files; and 9 c. destroying, altering, deleting, or relinquishing control over to any third party, 10 any and all copies and versions (whether hard copy, native, or electronic) of 11 any documents or electronically stored information on any computer, hard 12 drive, or mobile device (including but not limited to emails, text messages, 5 13 communications over social media and any other electronic, typewritten, 14 handwritten, recorded, or printed matter of any kind) relating to the subject 3 15 matter of this lawsuit; 16 2. As it relates to Individual Defendants, their agents, employees, partners, any others 3 17 acting in concert or any other individual or entity having actual notice of this Order by 18 personal service or otherwise: 19 a. violating, or participating in the violation of, any of the terms of their respective 20 Confidentiality Agreements, attached as Exhibits 1 and 2 to the Verified 21 Complaint. 22 IT IS SO ORDERED. 23 Dated: September 12, 2024 24
EDWARD J. DAVILA 26 United States District Judge 27 28 Case No.: 5:24-cv-06340-EJD ORDER GRANTING TEMPORARY RESTRAINING ORDER