Steede v. Freight Logic, Inc.

District Court, D. Kansas·Decided May 9, 2025·No. 2:25-cv-02136·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF KANSAS

SHANNON STEEDE,

Plaintiff, Intervenor Defendant, Counter Defendant,

v.

FREIGHT LOGIC, INC., Case No. 25-2136-DDC-TJJ

Intervenor Plaintiff,

MIKE LEVY and DAVID BURDICK,

Defendants, Counter Claimants.

MEMORANDUM AND ORDER

This case is back for round two. On April 7, 2025, the court denied pro se1 plaintiff Shannon Steede’s first Motion for a Temporary Restraining Order (TRO) (Doc. 7). Doc. 49. Now, the parties are back and, collectively, they pursue three more TRO and preliminary injunction (PI) motions, one filed by defendants, one filed by intervenor plaintiff, and one—a renewed motion—filed by plaintiff. Because the current motions turn on many of the same facts as plaintiff’s first motion, the court recaps round one in some detail, below.

1 Plaintiff proceeds pro se, so the court construes his pleadings liberally. See Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991) (holding that courts must construe pro se litigant’s pleadings liberally and hold them to a less stringent standard than formal pleadings drafted by lawyers). But the court does not assume the role as plaintiff’s advocate. Garrett v. Selby Connor Maddux & Janer, 425 F.3d 836, 840 (10th Cir. 2005). And our Circuit “has repeatedly insisted that pro se parties follow the same rules of procedure that govern other litigants.” Id. (citation and internal quotation marks omitted). In his part one TRO motion, plaintiff sought immediate relief after defendants Mike Levy and David Burdick removed plaintiff from his position as Chief Technical Officer (CTO) of Freight Logic, Inc. Defendant Levy serves as Freight Logic’s Chief Operating Officer and defendant Burdick serves as its President. Plaintiff’s first motion primarily requested reinstatement as CTO. Doc. 7 at 3. He argued that he “was unlawfully removed without a

proper shareholder vote[.]” Id. at 1. But he also asked for various other forms of relief—that the court install him as CEO, for example, and freeze the corporate assets while allowing plaintiff to maintain full control over all aspects of Freight Logic’s financial operations. Id. at 3–4. The court denied plaintiff’s initial TRO motion on two independently sufficient bases. First, plaintiff failed to show a likelihood of success on the merits. He premised his CTO reinstatement request on his position as a shareholder. Id. at 3. But the evidentiary hearing revealed that plaintiff never contributed the $100,000 cash required by the parties’ agreement to become a shareholder. See Doc. 49 at 6–7. And plaintiff’s other requests—which would have altered the status quo, thus requiring an enhanced showing of success on the merits—also

faltered. Plaintiff’s evidence simply failed to supply the requisite enhanced showing. See id. at 7–11. Second, the court held that plaintiff’s motion had failed to demonstrate the irreparable harm required to warrant a TRO. Id. at 13. The harms plaintiff recited either were compensable with monetary damages or threatened the corporation—Freight Logic—not plaintiff. See id. at 11–13. Now for round two. Plaintiff renews his request for a temporary restraining order and preliminary injunction. Doc. 77. In so doing, he purports to present “new and material evidence” uncovered “[s]ince the [c]ourt’s prior denial” that “justifies emergency injunctive relief.” Id. at 1. Even if this supplemental evidence could support a likelihood of success on the merits, however, none of it alters the court’s irreparable harm analysis. Plaintiff still hasn’t shown any harms to himself that money damages wouldn’t redress. So, the court denies plaintiff’s renewed motion, as well. Defendants Levy and Burdick also filed a Motion for Temporary Restraining Order and Preliminary Injunction (Doc. 58). But their motion suffers from a similar shortcoming. That is,

they primarily premise their motion on damages incurred by Freight Logic, not themselves as individuals. The court thus denies the individual defendants’ motion as well. Finally, intervenor plaintiff Freight Logic filed the third current Motion for Temporary Restraining Order and Preliminary Injunction (Doc. 27). Freight Logic’s motion fares better than the other two on the irreparable harm front. Freight Logic alleges injuries to its goodwill— a form of harm our court routinely considers irreparable. But, in the end, the court denies Freight Logic’s motion, too. Freight Logic fails to shoulder its burden, as the movant, to demonstrate substantial likelihood of success on the merits of any of its three causes of action: conversion, breach of fiduciary duty, and tortious interference.

The court held a hearing on plaintiff’s initial TRO motion on March 31, 2025, in which plaintiff and defendants Levy and Burdick participated. On April 29, 2025, the court held another TRO hearing, in which all parties participated. This Order thus issues after all parties have engaged in at least one hearing, produced evidence, and argued their positions in multiple rounds of briefing. Given this ample opportunity to advocate, the parties stipulated to advancing the second TRO hearing to a preliminary injunction hearing. See 11A Charles A. Wright, et al. Federal Practice and Procedure § 2951 (3d. ed. April 2025 Update) (“When the opposing party actually receives notice of the application for a restraining order, the procedure that is followed does not differ functionally from that on an application for a preliminary injunction . . . . [A]nd, if there is an adversary hearing . . . the ‘temporary restraining order’ may be treated as a preliminary injunction.”); see also Heavy Petroleum Partners, LLC v. Atkins, No. 09-cv-01077- EFM-KMH, 2010 WL 11565423, at *3 (D. Kan. May 25, 2010) (“Because this order is entered not ex parte, but after an evidentiary hearing in which both parties participated, produced evidence, and had an opportunity to have their arguments heard, the Court concludes that it need

not limit its order to a Temporary Restraining Order, but that the plaintiff is entitled to a preliminary injunction.”); 3M Co. v. Rollit, LLC, No. C 06-01225 JW, 2006 WL 8442072, at *2 (N.D. Cal. Apr. 5, 2006) (“The parties stipulated to advancing the hearing on the TRO to a hearing for a preliminary injunction.”). This Order thus decides all pending TRO and PI motions. I. Background The court recites the following facts from plaintiff’s Amended Complaint (Doc. 6), exhibits attached to that Complaint, defendant Freight Logic’s Intervenor Complaint (Doc. 26-1), the parties’ representations at the two hearings, and evidence submitted by both parties in connection with these motions.

Pre-Incorporation Founders’ Agreement On February 10, 2024, plaintiff and defendants Levy and Burdick signed a Pre- Incorporation Founders’ Agreement to found Freight Logic. Doc. 6-4 at 11. Schedule B of that agreement outlined the founders’ roles and responsibilities. Id. at 8–10. It assigned David Burdick the role of President, Michael S. Levy the role of Chief Operating Officer, and Shannon M. Steede the role of Chief Technology Officer. Id. at 8–9. The agreement provided that each founder “shall contribute” a specified sum “towards the expenses of the Startup[.]” Id. at 3. It set forth those initial capital contributions in Schedule D, with plaintiff’s contribution described as follows: “$100,000 CASH contribution within one year of incorporation” to “be reinvested into the company’s operating budget.” Id. at 10. The bylaws likewise provided that stock issuance would follow plaintiff’s contribution of “$100,000 by 2/1/25.” Doc. 6-2 at 3. At the first hearing, defendants contended—and plaintiff confirmed—that plaintiff never paid this $100,000. Transfer of Intellectual Property Provisions

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