September 30, 2019 Practice Points

Tips on Filing for Preliminary Injunction in Trade Secret Cases

Considerations when seeking an emergency injunction

By Christopher W. Tackett

As a prelude to my upcoming ABA article regarding the distinctions between the Defend Trade Secret Act and the analogous various state adoptions of common law regarding trade secrets, this Practice Point serves to offer practical tips for a party seeking to quickly obtain an emergency preliminary injunction in a trade secret case. The following are a few quick tips to consider when seeking an emergency injunction.

  1. File Your Underlying Action Using a Verified Complaint
    The complaint can then be used as sworn statements from the client in support of your motion for preliminary injunction. This will help speed up the process of getting your motion for preliminary injunction filed and having in the necessary sworn statements in support from your client.
  2. Keep in Mind That There Is a Federal Question Basis to File in Federal Court

    Practitioners should remember that there is federal question basis to file a complaint, and thus your motion for injunction, in federal court under the Defend Trade Secrets Act (DTSA). Do note, however, that the DTSA does not apply retroactively. Thus, the DTSA will be available as a basis for your claim only if the misappropriation occurred after the DTSA’s enactment on May 11, 2016. See Defend Trade Secrets Act, Pub. L. No. 114-153 (DTSA). But, in this context, the prospective-only nature of the DTSA should have no practical impact. (If the alleged misappropriation happened three years ago, and you are telling the judge an emergency injunction is needed, you likely have bigger problems in your endeavor than whether the DTSA will be used as the basis for the claim.)
  3. Think Intelligently about Forum and Venue

    If your local state court that is the appropriate venue lacks resources to hear an injunction motion on an expedited basis, filing in federal court may well be your best bet. But, do not reflexively file in federal court simply because there is a federal question basis to do so. Think carefully about what best suits your client and the complexity of the issues underlying their trade secret allegations.
  4. Get Directly to the Source of Your Factual Allegations!

    This tip cannot be stressed enough and is often overlooked. Because the preliminary injunction motion and hearing to follow soon after represents an expedited proceeding, it can be common to use one’s main client contact as the point person for learning all the underlying facts on the fly. But, this shortcut is not enough and can lead to misunderstandings and inaccuracies between your papers and the testimony presented at hearing. When you are asking for extraordinary relief, it is best to avoid any appearance of inconsistency in your pitch. Thus, interview the source of any factual allegations yourself, and ensure that you have complete command of those facts when you seek the extraordinary and expedited relief of a preliminary injunction. Furthermore, this will help bolster your knowledge and expertise with the underlying facts, which will only serve to improve your chances in the hearing.
  5. Seek Expedited Discovery in Support

    Rule 26(d) of the Federal Rules of Civil Procedure allows federal courts to adjust the timing and sequence for conducting discovery, and allow for early discovery, which would generally not open in federal court until after the parties’ 26(f) conference. This gives courts the discretion to order discovery on an expedited basis, so that it can be conducted prior to a preliminary injunction hearing. When there is good cause shown—such as a party pursuing an emergency injunction to protect trade secrets from being used by a competitor—courts generally will grant a motion for expedited discovery.

    Practitioners should keep in mind, however, that taking this step will also open their clients up to responding to expedited discovery in advance of the preliminary injunction hearing. Thus, if you are a claimant that already has everything needed to meet its burden, you may want to strategically choose to forgo this step.
  6. In Extreme Cases Involving High-Value IP, Be Aware of the Ex Parte Seizure Remedy under the DTSA

    Practitioners should be aware that the DTSA grants a unique remedy allowing a claimant to potentially obtain an ex parte seizure order, as set forth under 18 U.S.C. §1836(b)(2). The DTSA provides, however, that the ex parte seizure remedy is only available under “extraordinary circumstances,” when the remedy is required to stop the “propagation or dissemination” of the subject trade secrets at issue. Further, the DTSA requires that any court issuing an ex parte seizure order must order a subsequent hearing within seven days after granting the seizure. So, if asking for the ex parte seizure remedy, one should be prepared to head to court and put forth their proof within seven days. Although this remedy is worth noting, in many instances an interim order under Rule 65 requiring preservation of subject devices should be enough.

Christopher W. Tackett is of counsel with Roetzel in Columbus, Ohio.

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