Prehired, LLC v. Provins

District Court, E.D. California·Decided April 12, 2022·No. 2:22-cv-00384·Unknown

Opinion

PREHIRED, LLC, No. 2:22-cv-00384-TLN-AC Plaintiff, v. ORDER DENYING PLAINTIFF’S MOTION FOR A TEMPORARY Defendant. This matter is before the Court on Plaintiff Prehired LLC’s (“Plaintiff”) Motion for a Temporary Restraining Order (“TRO”). (ECF No. 5.) Defendant Matthew Provins (“Defendant”) has filed an opposition. (ECF No. 20.) Plaintiff has filed a reply. (ECF No. 23.) For the reasons set forth below, the Court hereby DENIES Plaintiff’s motion. /// /// /// /// /// /// /// /// Plaintiff is involved in the business of training and mentoring workers as to how to obtain a better job at a higher pay. (ECF No. 5-3, ¶ 5.) Plaintiff markets its services through website and social media sites such as LinkedIn. (Id. at ¶ 6.) Plaintiff charges a fee for its services; however, no fee is charged before a client obtains a job or completes the program. (Id. at ¶¶ 7–8.) On or about October 14, 2020, Plaintiff and Defendant signed a membership agreement, and Defendant thereafter completed his membership program without incident or complaint. (Id. at ¶¶ 11–12.) Plaintiff and Defendant subsequently entered into negotiations for Defendant to assist Plaintiff with marketing its business and training its clients. (Id. ¶ 13.) On May 1, 2021, Plaintiff and Defendant executed an agreement entitled “MTT Partner Service Agreement.” (Id. at ¶ 14.) In connection with the MTT Partner Service Agreement, the parties entered into a Non- Disclosure Agreement on May 20, 2021. (Id. at ¶ 15.) On August 26, 2021, Defendant terminated the MTT Partner Service Agreement in writing, which Plaintiff did not dispute. (Id. at ¶ 16.) According to Plaintiff, after the parties ended the MTT Partner Service Agreement, Defendant initiated a “campaign to damage the . . . business and to benefit his own business.” (Id. at ¶¶ 17–18.) On February 18, 2022, Defendant posted to LinkedIn stating among other things that Plaintiff leaves its customers in debt, Plaintiff sues its customers, Plaintiff is consumed by greed, and Plaintiff is filled with “gaslighting, [] false advertising and ethical issues.” (Id. at ¶ 18.) That same day, Defendant made another post on LinkedIn where he stated he “wanted to share [his] story,” including that Plaintiff dissuaded him from sharing his disability status to future employers. (Id. at ¶ 19.) Plaintiff made additional posts including one to Slack stating his “goal here is to get everyone released [from their contracts with Plaintiff] by make[ing] sure [Plaintiff] goes under,” and one to GoFundMe stating “Help People Scammed by [Plaintiff] Fight Back!” (Id. at ¶¶ 22–23.) Plaintiff alleges that in the short period following Defendant’s statements, multiple clients and potential clients have cancelled sales calls and meetings, cancelled executed contracts, and decided to not complete pending contracts with Plaintiff. (Id. at ¶ 25.) Plaintiff states many of these clients and potential clients have specifically referenced Defendant’s statements as their basis for withdrawing their business. (Id. at ¶ 26.) As a result of Defendant’s statements Plaintiff alleges it has lost a contract worth $20,000 and contractual partners whose work resulted in substantial revenue — including a partner who was expected to provide $2 million in revenue to Plaintiff. (Id. at ¶¶ 28, 30–31.) Plaintiff filed this action on March 1, 2022, bringing claims for trade libel and intentional interference with business relationships. (ECF No. 1.) A TRO is an extraordinary remedy. The purpose of a TRO is to preserve the status quo pending a fuller hearing. See Fed. R. Civ. P. 65. In general, “[TROs] are governed by the same standard applicable to preliminary injunctions.” Aiello v. One West Bank, No. 2:10-cv-00227- GEB-EFB, 2010 WL 406092, at *1 (E.D. Cal. Jan. 29, 2010) (internal citations omitted); see also Eastern District of California Local Rule (“Local Rule”) 231(a). Injunctive relief is “an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 22 (2008) (citing Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (per curiam)). “The purpose of a preliminary injunction is merely to preserve the relative positions of the parties until a trial on the merits can be held.” Univ. of Tex. v. Camenisch, 451 U.S. 390, 395 (1981); see also Costa Mesa City Emps. Ass’n v. City of Costa Mesa, 209 Cal. App. 4th 298, 305 (2012) (“The purpose of such an order is to preserve the status quo until a final determination following a trial.”); GoTo.com, Inc. v. Walt Disney, Co., 202 F.3d 1199, 1210 (9th Cir. 2000) (“The status quo ante litem refers not simply to any situation before the filing of a lawsuit, but instead to the last uncontested status which preceded the pending controversy.”). “A plaintiff seeking a preliminary injunction must establish [1] that he is likely to succeed on the merits, [2] that he is likely to suffer irreparable harm in the absence of preliminary relief, [3] that the balance of equities tips in his favor, and [4] that an injunction is in the public interest.” Winter, 555 U.S. at 20. A plaintiff must “make a showing on all four prongs” of the Winter test to obtain a preliminary injunction. Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011). In evaluating a plaintiff’s motion for preliminary injunction, a district court may weigh the plaintiff’s showings on the Winter elements using a sliding-scale approach. Id. A stronger showing on the balance of the hardships may support issuing a preliminary injunction even where the plaintiff shows that there are “serious questions on the merits . . . so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest.” Id. Simply put, plaintiffs must demonstrate, “that [if] serious questions going to the merits were raised [then] the balance of hardships [must] tip[ ] sharply” in [p]laintiffs’ favor in order to succeed in a request for preliminary injunction. Id. at 1134–35. Plaintiff requests the Court enjoin Defendant from continuing to publish false and defamatory statements while competing against Plaintiff. (ECF No. 5-1.) First, the parties dispute whether the statements made by Defendant are protected by the First Amendment as a prior restraint. The Court will first address the prior restraint issue and then address the factors set forth in Winter. A. Prior Restraint Defendant argues Plaintiff’s request that Defendant be restrained from “making further statements” would violate the First Amendment as a prior restraint. (ECF No. 20 at 9.) “The term prior restraint is used to describe administrative and judicial orders forbidding certain communications when issued in advance of the time that such communications are to occur.” Alexander v. United States, 509 U.S. 544, 550 (1993) (emphasis, citation, and quotation marks omitted). “Temporary restraining orders and permanent injunctions — i.e., court orders that actually forbid speech activities — are classic examples of prior restraints.” Id. (citation omitted). “[P]rior restraints on speech and publication are the most serious and the least tolerable infringement on First Amendment rights.” Neb. Press Ass’n v. Stuart, 427 U.S. 539, 559 (1976). “There is a heavy presumption against pr

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