Superior Scape, Inc. v. JCB Design & Build, LLC

CourtDistrict Court, E.D. Michigan
DecidedJanuary 3, 2022
Docket3:21-cv-12889
StatusUnknown

This text of Superior Scape, Inc. v. JCB Design & Build, LLC (Superior Scape, Inc. v. JCB Design & Build, LLC) is published on Counsel Stack Legal Research, covering District Court, E.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Superior Scape, Inc. v. JCB Design & Build, LLC, (E.D. Mich. 2022).

Opinion

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION ______________________________________________________________________

SUPERIOR SCAPE, INC.,

Plaintiff,

v. Case No. 21-12889

JCB DESIGN & BUILD, LLC, and JASON BRYAN

Defendants. __________________________________/

OPINION AND ORDER DENYING PRELIMINARY INJUNCTION

Plaintiff Superior Scape, Inc., brings this action under the federal Defend Trade Secrets Act (“DTSA”), 18 U.S.C. § 1836(b), and further asserts Michigan state law claims for breach of contract and tortious interference with business relationships. (ECF No. 1, PageID.22-40.) It alleges that Defendant Jason Bryan, and his competing company Defendant JCB Design & Build, LLC (“JCB”), have misappropriated trade secrets, unfairly competed, and solicited Plaintiff’s employees in violation of a settlement agreement between the parties. Plaintiff has requested a jury trial on these issues and further seeks more than $300,000 in damages pursuant to a liquidated damages clause. On December 9, 2021, Plaintiff brought an emergency, ex parte motion for a temporary restraining order or preliminary injunction. (ECF No. 2.) The crux of its motion is that Defendants must be enjoined from soliciting Plaintiff’s “long-term and well-trained H-2B employees”1 in violation of their settlement agreement, and such action must be taken immediately or else Plaintiff faces the possibility of losing these H-2B employees for their term of employment, which begins in April 2022. (ECF No. 2, PageID.165.) The court denied the request for a temporary restraining order, but it directed Defendants to

show cause why a preliminary injunction should not be issued against them. (ECF No. 4.) Defendants filed a response (ECF No. 20), and Plaintiff replied. (ECF No. 13.) For the reasons set forth below, Plaintiff’s motion for a preliminary injunction will be denied. I. BACKGROUND Plaintiff is a landscaping company that has operated in Southeastern Michigan since 1984. (ECF No. 2, PageID.166-67.) Defendant Bryan began working for Plaintiff over ten years ago, eventually working his way up in the company and becoming vice president. (Id., PageID.167.) In his role as vice president, Defendant Bryan was given access to an array of important trade information, such as customer contacts, workers’ compensation data, pricing and costs data, financial information, and more. (Id.)

However, his relationship with the company began to deteriorate after he was demoted for poor performance and began taking steps to start his own, competing landscaping company. (Id., PageID.168.) According to Plaintiff, before quitting the company, “Defendant Bryan had secret meetings with certain long-term and critical foremen and seasonal employees in an attempt to convince them to leave [Plaintiff] and join his

1 According to the Department of Labor (“DOL”), the “H-2B nonimmigrant program permits employers to temporarily hire nonimmigrants to perform nonagricultural labor or services in the United States. The employment must be of a temporary nature for a limited period of time such as a one-time occurrence, seasonal need, peakload need or intermittent need.” H-2B Program, U.S. Department of Labor, https://www.dol.gov/agencies/whd/immigration/h2b (last visited December 30, 2021). competing company.” (Id.) He also allegedly took and misappropriated other confidential information and trade secrets to which he had access. (Id., PageID.169.) These facts gave rise to a lawsuit filed by Plaintiff on April 8, 2021. (Id., PageID.170.) The parties resolved the dispute and entered into a settlement agreement.

(Id.) The agreement provided, among other things, that “Defendants would return all trade secrets, pay [Plaintiff] $72,000, refrain from soliciting [Plaintiff’s] employees and customers, change the name of their company, stop using images of [Plaintiff’s] work in their advertising and social media postings, and refrain from making disparaging remarks.” (Id.; ECF No. 1-2, PageID.112.) The alleged breach of this settlement agreement is the basis of the present action before the court. Notably, the settlement agreement’s non-solicitation provision provides that Plaintiff “is entitled to liquidated damages in the amount of $30,000 for each violation or breach and is entitled to reimbursement for its costs and attorney fees incurred in having to enforce this provision of the Agreement.” (ECF No. 1-2, PageID.112.)

Plaintiff claims “Defendants have shamelessly, intentionally and repeatedly breached the Settlement Agreement since it was signed.” (ECF No. 2, PageID.171.) The primary issue is that Defendants “have been contacting [Plaintiff’s] long-term and critical H-2B employees and soliciting them to leave . . . and join Defendant Bryan’s competing business.” (Id.) More specifically, it alleges that two employees of Defendant JCB, Antonio Gonzalez and Alex Mora, have contacted at least ten of Plaintiff’s employees and asked them to work for Defendants. (ECF No. 1, PageID.21; ECF No. 2, PageID.179.) Affidavits submitted by three of Plaintiff’s employees—Raúl Santana, Jose Antonio Luquin Coronel, and Julio Osvaldo Ramirez Loreto—assert that they were in fact solicited by Defendants and offered jobs. (ECF Nos. 1-3, 1-4, 1-5.) The catalyst of these allegations appears to be an August 2021 barbeque cookout party for Antonio Gonzalez’s son’s birthday; among the attendees were some of Plaintiff’s employees. (ECF No. 1-5, PageID.140; ECF No. 2, PageID.172; ECF No. 10, PageID.266.)

Defendants claim that no solicitation occurred at this party. They further maintain that they have never solicited any of Plaintiff’s employees, nor do they plan to. Defendants submitted three declarations from Defendant Bryan, Antonio Gonzalez, and Alex Mora attesting to this fact. (ECF Nos. 10-3, 10-4, 10-5.) The exigency of Plaintiff’s motion stems from its concern regarding the H-2B employee application process. Plaintiff maintains that the timing of Defendant’s alleged breaches is critical because between January 3 and January 5, 2022, employers must submit H-2B applications in a lottery “for employment beginning April 1, 2022 or later for the 2022 landscaping season.” (ECF No. 2, PageID.165.) Plaintiff “suspects that Defendants intend to take advantage of this timing and are actively soliciting in breach

of the Settlement Agreement for employment and sponsorship of” Plaintiff’s employees. (Id.) It fears, in part due to a labor shortage, that it “will be unable to hire or replace any H-2B workers if Defendants are permitted to solicit and sponsor them for employment and are not immediately enjoined.” (Id.) II. STANDARD

The court considers four factors when deciding whether to grant a preliminary injunction. First, the court must determine “whether the plaintiff has established a substantial likelihood or probability of success on the merits of his claim.” Liberty Coins, LLC v. Goodman, 748 F.3d 682, 689-90 (6th Cir. 2014). Next, the court must consider “whether the plaintiff would suffer irreparable injury if a preliminary injunction did not issue.” Id. Finally, the court must analyze “whether the injunction would cause substantial harm to others” and “whether the public interest would be served if the court were to grant the requested injunction.” Id.

The four factors “are to be balanced against each other. A preliminary injunction is an extraordinary remedy which should be granted only if the movant carries his or her burden of proving that the circumstances clearly demand it.” Overstreet v. Lexington- Fayette Urb. Cty.

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Bluebook (online)
Superior Scape, Inc. v. JCB Design & Build, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/superior-scape-inc-v-jcb-design-build-llc-mied-2022.