36 | November/December 2021 | BAEC Bulletin
BY KEVIN M. HOGAN AND SEAN C. MCPHEE Western District Case Notes
Temporary Restraining Orders In Lake Region Medical, Inc. v. Pike , 21-cv-00844-LJV-LGF (Aug. 20, 2021)—an action for breach of contract, unfair competition, and tortious interference with contract—plaintiff sought a temporary restraining order and preliminary injunction against a former employee and his new employer (a direct competitor) based on a twenty-six-week non-compete clause in plaintiff’s “separation agreement” with the former employee. Noting that temporary restraining orders and preliminary injunctions are “drastic remedies” requiring the movant to establish, among other things, “a likelihood of success on the merits” and that it “is likely to suffer irreparable harm before a decision on the merits can be rendered,” the Court found that these elements were lacking, and denied the motion. In doing so, the Court first determined that plaintiff was not likely to succeed on the merits because the non-compete clause only precluded plaintiff’s former employee from undertaking duties at his new employer that were “substantially similar” to those undertaken for plaintiff, but his respective duties “appear[ed] to be very different.” The Court then held that, because plaintiff failed to demonstrate that it is likely to prove the former employee breached the separation agreement, plaintiff also “failed to demonstrate irreparable harm”—i.e. “injury that is neither remote nor speculative, but actual and imminent and that cannot be remedied by an award of monetary damages.” Appointment of Lead Class Action Plaintiff In In re Eastman Kodak Securities Litigation , 21-cv-06418-EAW (Aug. 2, 2021), a consolidated class action seeking damages under the Securities Exchange Act of 1934, multiple motions for the appointment of lead plaintiff were filed. Many were later withdrawn, but three remained, and the Court was tasked with determining which plaintiff was “most capable of adequately representing the interests of class members.” To make that determination, the Private Securities Litigation Reform Act directs the Court to consider, among other things, who has the largest financial interest in the relief sought by the class, which is primarily determined by the approximate amount of losses suffered. While one of the three competing plaintiffs argued that another had not suffered any losses attributable to the fraud because the latter sold its shares prior to any revelations of fraud, the Court disagreed and found that the latter had the greatest financial interest in the outcome of the litigation, notwithstanding its short sales of defendant’s stock. And, because the latter otherwise satisfied the requirements of Fed. R. Civ. P 23, it was the most appropriate lead plaintiff. Motion to Change Venue In Fritz v. Realpage, Inc ., 20-cv-7055-CJS-MWP (Aug. 20, 2021), a case referred to the Magistrate Judge for all non-dispositive pretrial matters, plaintiff alleged defendant had violated federal and state Fair Credit Reporting Acts when defendant issued allegedly inaccurate screening reports with respect to two apartments in western New York, causing the landlords to deny plaintiff’s applications for tenancy. Defendant moved to transfer venue to Texas, where its headquarters, leadership team, and computer servers all were located. The Court first ruled that the motion to change venue fell within the scope
KEVIN M. HOGAN Managing Partner Phillips Lytle LLP
SEAN C. MCPHEE Partner Phillips Lytle LLP
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