Oregon Tool Inc v. IronCraft LLC

CourtDistrict Court, E.D. Washington
DecidedAugust 23, 2023
Docket4:23-cv-05110
StatusUnknown

This text of Oregon Tool Inc v. IronCraft LLC (Oregon Tool Inc v. IronCraft LLC) is published on Counsel Stack Legal Research, covering District Court, E.D. Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Oregon Tool Inc v. IronCraft LLC, (E.D. Wash. 2023).

Opinion

1 FILED IN THE 2 EASTERU N. S D. I SD TI RS IT CR TI C OT F C WO AU SR HT I NGTON Aug 23, 2023 3 SEAN F. MCAVOY, CLERK 4 5 UNITED STATES DISTRICT COURT 6 EASTERN DISTRICT OF WASHINGTON 7 OREGON TOOL, INC. f/k/a BLOUNT Case No. 4:23-CV-05110-MKD INTERNATIONAL, INC., 8 Plaintiff, TEMPORARY RESTRAINING 9 ORDER vs. 10 AND IRONCRAFT, LLC; and 11 CHRISTOPHER L. HAEFER, and his ORDER GRANTING EXPEDITED marital community, DISCOVERY 12 Defendants. ECF Nos. 6, 7 13

14 Before the Court is Plaintiff Oregon Tool’s (“Oregon Tool”) Motion for 15 Limited Expedited Discovery, ECF No. 6, and Plaintiff’s Emergency Motion for 16 Temporary Restraining Order and Order to Show Cause Why a Preliminary 17 Injunction Should Not Issue, ECF No. 7. On August 11, 2023, the Court held a 18 hearing on the pending motions. ECF No. 36. Lance A. Pelletier, Devin Smith, 19 Ryan Kelly, and Jessica G. Mason appeared on behalf of Oregon Tool. Jack M. 20 Lovejoy, Brittany A. Madderra, and Blake Marks-Dias appeared on behalf of 1 Defendant IronCraft, LLC (“IronCraft”). Matthew R. Kelly appeared on behalf of 2 Defendant Christopher L. Haefer (“Haefer”).

3 Oregon Tool seeks a temporary restraining order to prevent the unlawful use 4 of its trade secrets, and an order granting expedited discovery related to the alleged 5 misuse of its trade secrets. For the reasons stated at the hearing and set forth

6 below, Oregon Tool’s motion for a temporary restraining order is GRANTED IN 7 PART, and its motion for expedited discovery is GRANTED IN PART. 8 BACKGROUND 9 Oregon Tool is a manufacturer of forestry, agriculture, and construction

10 tools and equipment. ECF No. 8 at 2 ¶ 2. Woods Equipment Company (“Woods”) 11 is a wholly owned subsidiary of Oregon Tool. ECF No. 8 at 2 ¶ 2. IronCraft is a 12 competitor, although offering “quality at a lower price[,]” with a focus on

13 construction products, as compared to Woods, who offers “a premium product” for 14 “a higher price[,]” with a focus on agriculture products. ECF No. 24 at 5 ¶ 21. 15 Haefer worked for Oregon Tool as a district manager for sales, covering 16 several western states. ECF No. 24 at 2 ¶ 3. At the start of his employment,

17 Haefer signed a Non-Compete Agreement and received a copy of the Oregon Tool 18 handbook. ECF No. 8 at 4 ¶ 8; ECF Nos. 8-1, 8-2. 19 Haefer represents that he began to seek employment elsewhere on May 7,

20 2023. ECF No. 24 at 5 ¶ 17. Haefer represents in his declaration that, on May 18, 1 2023, he received a call from an IronCraft employee and became interested in 2 joining IronCraft. ECF No. 24 at 3 ¶ 8. Haefer represents that he decided to join

3 IronCraft on May 21, 2023. ECF No. 24 at 3 ¶ 8. However, Mike Kucharski, 4 IronCraft’s director of Digital and Dealer Development, submitted an Offer of 5 Employment form signed by Haefer dated May 12, 2023. ECF No. 26-1.

6 On May 18, 2023, while still working for Oregon Tool, Haefer sent an email 7 to his private email address attaching two excel spreadsheets containing Oregon 8 Tool customer and salesperson information. ECF Nos. 8-5, 8-6; ECF No. 24 at 2 9 ¶¶ 5, 6. The first, “List A,” “contains over 1,300 Oregon Tool customer

10 distributors, those customers’ recent sales volumes, current price discounts, and 11 other nonpublic and competitively sensitive financial and business information.” 12 ECF No. 8 at 7 ¶ 13. The second, “List B,” “lists Oregon Tool salespersons, those

13 salespersons’ recent financial performance, and other financial data of their 14 assigned customer distributors.” ECF No. 8 at 8 ¶ 14. 15 On May 21, 2023, Haefer resigned from Oregon Tool to work for IronCraft, 16 ECF No. 8 at 5 ¶ 10, as indicated in a public announcement dated June 28, 2023,

17 Haefer. ECF No. 8-3. Following Haefer’s resignation, Oregon Tool investigated 18 the circumstances surrounding his termination and learned of Haefer’s emails to 19 himself. ECF No. 8 at 6-7 ¶ 12. Oregon Tool notes that, following Haefer’s

20 resignation, other employees and salespeople have left Oregon Tool to work for 1 IronCraft, that one such employee contacted a current Oregon Tool employee 2 asking for a collection of data, and another contacted a current Oregon Tool

3 customer, in a purportedly inappropriate manner. ECF No. 8 at 8-9 ¶¶ 15-17. 4 On July 28, 2023, Oregon Tool filed a Complaint, and on August 1, 2023, 5 filed its First Amended Complaint. ECF Nos. 1, 3. On August 2, 2023, Oregon

6 Tool filed the instant motions seeking a temporary restraining order and expedited 7 discovery. ECF Nos. 6, 7. 8 LEGAL STANDARD 9 A. TRO

10 “[T]he legal standards applicable to TROs and preliminary injunctions are 11 ‘substantially identical.’” Washington v. Trump, 847 F.3d 1151, 1159 n.3 (9th Cir. 12 2017) (quoting Stuhlbarg Int’l Sales Co., Inc. v. John D. Brush & Co., Inc., 240

13 F.3d 832, 839 n.7 (9th Cir. 2001)). To obtain a TRO, “a plaintiff must establish 14 ‘that he is likely to succeed on the merits, that he is likely to suffer irreparable 15 harm in the absence of preliminary relief, that the balance of equities tips in his 16 favor, and that an injunction is in the public interest.’” No on E v. Chiu, 62 F.4th

17 529, 536 (9th Cir. 2023) (quoting Winter v. NRDC, Inc., 555 U.S. 7, 20 (2008)). 18 The court is to apply a “sliding scale” approach to these factors; a strong showing 19 of one element may offset a weaker showing of another. hiQ Labs, Inc. v.

20 LinkedIn Corp., 31 F.4th 1180, 1188 (9th Cir. 2022). “[W]hen the balance of 1 hardships tips sharply in the plaintiff’s favor, the plaintiff need demonstrate only 2 serious questions going to the merits.” Id. (quotations omitted).

3 It is generally the party seeking an injunction’s burden to demonstrate that 4 injunctive relief is warranted. Right to Life of Cent. Cal. v. Bonta, 562 F. Supp. 3d 5 947, 955 (E.D. Cal. 2021). The rules of evidence are relaxed in preliminary

6 injunctive proceedings, and a preliminary injunction may only be awarded upon a 7 clear showing of evidence supporting each factor. Perlot v. Green, 609 F. Supp. 8 3d 1106, 1116 (D. Idaho 2022). 9 B. Expedited Discovery

10 Fed. R. Civ. P. 26(d)(1) provides that a district court may permit expedited 11 discovery prior to a Fed. R. Civ. P. 26(f) conference. “In the Ninth Circuit, courts 12 use the ‘good cause’ standard to determine whether discovery should be allowed to

13 proceed prior to a Rule 26(f) conference.” Rovio Entm't Ltd. v. Royal Plush Toys, 14 Inc., 907 F. Supp. 2d 1086, 1099 (N.D. Cal. 2012). “Good cause,” in this context, 15 may be found whether the need for expedited discovery outweighs the prejudice to 16 the responding party. Synopsys, Inc. v. AzurEngine Techs., Inc., 401 F. Supp. 3d

17 1068, 1076 (S.D. Cal. 2019). Factors that district courts consider for the inquiry 18 include “(1) whether a preliminary injunction is pending; (2) the breadth of the 19 discovery requests; (3) the purpose for requesting the expedited discovery; (4) the

20 burden on the defendants to comply with the requests; and (5) how far in advance 1 of the typical discovery process the request was made.” Id. (quoting Am. LegalNet, 2 Inc. v. Davis, 673 F.

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Oregon Tool Inc v. IronCraft LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/oregon-tool-inc-v-ironcraft-llc-waed-2023.