injunction – Attorney Evan Brown

February 18, 2024 Contracts, Licensing

Software reseller not entitled to preliminary injunction to protect customer relationships

Plaintiff CD appointed defendant SST to be the exclusive reseller to certain customers of CD’s software development platform. CD sued SST for breach, and SST likewise filed counterclaims for breach of contract and fraudulent inducement. SST sought a preliminary injunction against CD, asking that the court prohibit CD from unilaterally terminating the reseller agreement.

SST asserted, among other things, that it would suffer irreparable harm from this termination, citing potential loss of solicited clients and reputational damage. CD argued, however, that these asserted harms could be remedied monetarily, and thus did not qualify as irreparable.

The court agreed with CD, finding SST’s arguments regarding reputational damage and loss of client relationships to be speculative and unsupported by concrete evidence. As such, these claims did not meet the stringent criteria for irreparable harm, which requires a clear, immediate threat of injury that monetary compensation could not redress.

Further undermining SST’s claim of irreparable harm was the notion that any potential financial losses due to CD’s actions, including the costs associated with resolving issues with target accounts or transitioning to alternative software solutions, were quantifiable and thus recoverable in monetary terms. The court noted that SST’s reluctance to make additional payments to CD for resolving software access issues did not constitute irreparable harm, as those could be recouped in resolution of the contract dispute. Moreover, the court pointed out that SST’s concerns about CD not restoring access post-payment were speculative and lacked evidentiary support, given the record showing ongoing negotiations and concrete offers from CD.

Citizen Developer, LLC v. System Soft Tech., Inc., 2024 WL 554140 (M.D. Penn. February 12, 2024)

Old social media posts violated trade dress infringement injunction

The parties in the case of H.I.S.C., Inc. v. Franmar are competitors, each making garden broom products. In earlier litigation, the defendant filed a counterclaim against plaintiff for trade dress infringement, and successfully obtained an injunction against plaintiff, prohibiting plaintiff from advertising brooms designed in a certain way. Defendant asked the court to find plaintiff in contempt for, among other reasons, certain social media posts that plaintiff posted before the injunction, but that still remained after the injunction was entered. The court agreed that the continuing existence of such posts was improper and found plaintiff in contempt for having violated the injunction.

The court noted that the injunction prohibited “[a]dvertising, soliciting, marketing, selling, offering for sale or otherwise using in the United States the [applicable product trade dress] in connection with any garden broom products.” It observed that “[o]n the Internet and in social media, a post from days, weeks, months, or even years ago can still serve to advertise a product today.” The court cited to Ariix, LLC v. NutriSearch Corp., 985 F.3d 1107, 1116 n.5, in which that court noted that one prominent influencer receives $300,000 to $500,000 for a single Instagram post endorsing a company’s product – a sum surely including both the post itself and an agreement to continue allowing the post to be visible to consumers for a substantial duration of time. Interestingly, the court found that the nature of a social media post may be different from a television or radio advertisement that has a fixed air date and time. Accordingly, the court found that it was inappropriate for social media posts published before the injunction to stay online.

H.I.S.C., Inc. v. Franmar Int’l Importers, Ltd., 2022 WL 104730 (S.D. Cal. January 11, 2022)

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February 5, 2014 Defamation, First Amendment

Injunction against blogger violated the First Amendment

Prohibiting former tenant from blogging about landlord was unconstitutional prior restraint against speech.

Defendants wrote several blog posts critical of their former commercial landlord. The landlord sued for defamation and tortious interference, and sought an injunction against defendants’ blogging. The trial court granted the injunction, determining that defendants had “blogged extensively about [plaintiffs] and many of these blogs [were] arguably defamatory.” Although the court noted that a trial on the defamation claims was yet to be held, it ordered defendants “not to enter defamatory blogs in the future.”

Defendants sought review with the Court of Appeal of Florida. On appeal, the court reversed and remanded.

It held that injunctive relief was not available to prohibit the making of defamatory or libelous statements. “A temporary injunction directed to speech is a classic example of prior restraint on speech triggering First Amendment concerns.” But the court noted a limited exception to the general rule where the defamatory words are made in the furtherance of the commission of another intentional tort.

In this case, plaintiffs alleged another intentional tort – intentional interference with advantageous business relationships. But the court found that plaintiffs failed to present sufficient evidence to show they were entitled to an injunction for that claim. The trial court record failed to support an inference that the defendants’ blog posts had a deleterious effect upon defendants’ prospective business relationships.

Chevaldina v. R.K./FL Management, Inc., — So.3d —, 2014 WL 443977 (Fla.App. 3 Dist. February 5, 2014)

Image credit: By Maik Meid (Own work) [CC-BY-SA-3.0], via Wikimedia Commons

October 23, 2011 Employment, Litigation

Court requires fired social media employee to return usernames and passwords

Ardis Health, LLC v. Nankivell, 2011 WL 4965172 (S.D.N.Y. October 19, 2011)

Defendant was hired to be plaintiffs’ “video and social media producer,” with responsibilities that included maintaining social media pages in connection with the online marketing of plaintiffs’ products. After she was terminated, she refused to tell her former employers the usernames and passwords for various social media accounts. (The case doesn’t say which ones, but it’s probably safe to assume these were Facebook pages and maybe Twitter accounts.) So plaintiffs sued, and sought a preliminary injunction requiring defendant to return the login information. The court granted the motion for preliminary injunction.

The court found that plaintiffs had come forward with sufficient evidence to support a finding of irreparable harm if the login information was not returned prior to a final disposition in the case:

Plaintiffs depend heavily on their online presence to advertise their businesses, which requires the ability to continuously update their profiles and pages and react to online trends. The inability to do so unquestionably has a negative effect on plaintiffs’ reputation and ability to remain competitive, and the magnitude of that effect is difficult, if not impossible, to quantify in monetary terms. Such injury constitutes irreparable harm.

Defendant argued there would not be irreparable harm because the web content had not been updated in over two years. But the court rejected that argument, mainly because it would have been unfair to let the defendant benefit from her own failure to perform her job responsibilities:

Defendant was employed by plaintiffs for the entirety of that period, and she acknowledges that it was her responsibility to post content to those websites. Defendant cannot use her own failure to perform her duties as a defense.

Moreover, the court found that the plaintiffs would lose out by not being able to leverage new opportunities. For example, plaintiffs had recently hopped on the copy Groupon bandwagon by participating in “daily deal” promotions. The court noted that the success of those promotions depended heavily on tie-ins with social media. So in this way the unavailability of the social media login information also contributed to irreparable harm.

January 22, 2011 Privacy

College must reinstate nursing student who posted placenta picture on Facebook

Byrnes v. Johnson County Community College, 2011 WL 166715 (D. Kan., January 19, 2011)

Plaintiff nursing student and some of her classmates attended a clinical OB/GYN course at the local hospital in Olathe, Kansas last November. They got permission from their instructor to photograph themselves with a placenta. Plaintiff posted the photo on Facebook. She got expelled from school. Yes, I know you want to see the photo. Here it is.

So she sued the college for violation of her due process rights and sought an injunction ordering that she be reinstated. The court granted the motion.

The court found that the appeal process that the college provided to plaintiff was in no way a fair and unbiased opportunity for her to fully present her case before a neutral and unbiased arbitrator.

The instructor had granted permission for plaintiff to take the picture — and may have consented to its publication on Facebook — but plaintiff did not get an adequate chance to make that argument. The court observed that “photos are taken to be viewed,” and that “by giving the students permission to take the photos, which [the instructor] admitted, it was reasonable to anticipate that the photos would be shown to others.”

Also relevant in the analysis was the absence of any apparent privacy right implicated by showing the placenta. Nothing in the photo showed any patient identification, nor were any of the nursing students able to testify that they knew the patient’s identity. The court found it irrelevant that the placenta appeared to be “fresh,” rejecting the defendants’ implications that that would somehow indicate who the patient was.

Because plaintiff had shown a likelihood of success on her due process argument, and had met the other requirements for the injunction (such as a showing of irreparable harm if not reinstated), the court granted the order that plaintiff be permitted to take last semester’s final exams and permitted to go back to class.

March 3, 2008 First Amendment

Court lifts injunction off of Wikileaks

Court Lifts Injunction Against Web Site Accused of Posting Confidential Banking Documents

Bank Julius Baer & Co. Ltd v. Wikileaks, 535 F.Supp.2d 980, 2008 WL 554721 (N.D.Cal. February 29, 2008)

Switzerland-based Bank Julius Baer sued the Web site Wikileaks.org and the registrar of the domain name, and sought an injunction against the publication on the site of allegedly forged and confidential records of Bank Julius Baer customers. The court initially entered a permanent injunction agreed to between Julius Baer and the registrar, which called for a lockdown of the domain name’s registration. The court also, at first, entered a temporary restraining order (TRO) against the Web site, restraining the “display, use or dissemination of the property identified by [Bank Julius Baer] as private, personal banking information of its clients.”

In the days following the entry of injunctive relief, numerous parties seeking to be amicus curiae provided the court with additional information concerning the matter. This additional information led the court to reconsider the entry of the permanent injunction and the TRO. In an order dated February 29, 2008, the court dissolved both orders and denied Julius Baer’s motion for entry of a preliminary injunction.

Among the factors guiding the decision were the First Amendment and the efficacy of any injunction concerning the allegedly confidential banking information. The court noted the important free speech issues implicated, including the right to receive information as “a necessary predicate to . . . meaningful exercise” of free speech. It expressed concern that the previous publication of confidential information meant that “the cat is out of the bag,” and thus an injunction would be ineffective in protecting the privacy rights of the bank’s clients.

Further, the court found that the injunction in place was not the least restrictive means to achieve the plaintiff’s goals, and thus should be dissolved. On this point, the court suggested that a constitutionally-permissible injunction would call for limited redaction of information, while permitting the non-confidential parts of the documents to be displayed online.

Court flushes septic company’s request for injunction in copyright suit

Biosafe-One, Inc. v. Hawks, — F.Supp.2d —-, 2007 WL 4212411 (S.D.N.Y. November 29, 2007)

Back in 2005, industrial-strength septic system cleaning products company Bio-Safe One, Inc., needed a “jumbo mortgage,” so its president, one Jorgensen, did a web search for brokers and located Messrs. Hawks and Skierkowski, who helped Bio-Safe One with its mortgage needs. Although that transaction was over in June 2005, Jorgensen believed that Hawks and Skierkowski used information he had provided them during the mortgage transaction to start up a competing septic business.

Jorgensen and Bio-Safe One filed a lawsuit against Hawks and Skierkowski in New York federal court alleging, among other things, copyright infringement. They claimed that the competing enterprise illegally copied elements Bio-Safe One’s website.

The plaintiffs sought a preliminary injunction to prevent Hawks and Skierkowski from continuing what they believed to be copyright infringement. The court denied the motion for preliminary injunction.

It held that although the plaintiffs had established ownership of the copyright in the Bio-Safe One website by presenting a registration certificate for it, they failed to show that the defendants had engaged in illegal copying of any original elements of the site.

Applying the “ordinary observer test,” the court held that a side-by-side comparison simply would not prompt a person to regard the aesthetic appeal of the websites as the same. Rather, it was difficult to detect any similarities. The arrangement, photographs, and graphics on the websites were “decidedly dissimilar.” And the textual elements that were similar on the websites, including minor phrasing and terminology, were so far spaced throughout that they were not noticeable.

Accordingly, the court held that the plaintiffs would not likely succeed on their claim of copyright infringement.