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Digital Mentor, Inc. v. Ovivo USA, LLC

United States District Court, W.D. Washington, Seattle

February 21, 2018

DIGITAL MENTOR, INC., Plaintiff,
v.
OVIVO USA, LLC; OVIVO U.S. HOLDING INC.; VALERE MORISSETTE; MARC BARBEAU; DOES 1-20, Defendants.

          ORDER

          The Honorable Richard A. Jones, United States District Judge.

         This matter comes before the Court on Plaintiff Digital Mentor, Inc.'s (“Digital”) Motion for Preliminary Injunction. Dkt. # 38. Defendants oppose the Motion. Dkt. # 45. For the reasons that follow, the Court DENIES Plaintiff's Motion for Preliminary Injunction.

         I. BACKGROUND

         Digital is an engineering consulting service that developed a mobile computing system, DigitalMentor, for the waste and wastewater industry to allow companies to monitor and maintain their equipment on mobile devices. Dkt. # 1 ¶ 1. Defendant Ovivo USA, LLC provides equipment for water and wastewater treatment facilities throughout the United States and around the world[1]. Id. ¶ 2. In March of 2014, Digital marketed DigitalMentor to Ovivo for use in their facilities and in conjunction with the sale of their equipment. The parties then entered into a licensing agreement (“Master Agreement”). Pursuant to that licensing agreement, Digital agreed to create and license DigitalMentor for Ovivo's facilities and customers under the name “DigitalOPS” and Ovivo granted Digital a non-exclusive limited license to Ovivo's Standard Operating Procedures (“SOP”), manuals, technical drawings, etc. Dkt. # 11-1 at 10; Dkt. # 23 at 5. On or about November 1, 2014, Digital and Ovivo entered into a Non-Disclosure Agreement (“NDA”). Dkt. # 1 ¶ 127.

         On December 29, 2017, Digital filed a Complaint against Ovivo seeking injunctive relief, alleging that Ovivo violated the Defend Trade Secrets Act, 18 U.S.C. 1836, et seq. (“DTSA”), the Racketeer Influenced and Corrupt Organizations Act ("RICO”), 18 U.S.C. 1961, et seq., and committed trademark and copyright infringement. Digital also brings a breach of contract claim and several other state law claims. Dkt. # 1. On January 24, 2018, the Court granted Digital's Motion for Temporary Restraining Order. Dkt. # 35. On February 12, 2018, the Court held a hearing on whether the temporary restraining order (“TRO”) should be converted into a preliminary injunction.

         II. LEGAL STANDARD

         A preliminary injunction is an “extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 22 (2008). To obtain a preliminary injunction, Digital must show that (1) it is likely to succeed on the merits, (2) it is likely to suffer irreparable harm in the absence of preliminary relief, (3) the balance of equities tips in its favor, and (4) an injunction is in the public interest. Stormans, Inc. v. Selecky, 586 F.3d 1109, 1127 (9th Cir. 2009). “A preliminary injunction is appropriate when a plaintiff demonstrates that Dkt. # 1 ¶ 3. Defendant Valere Morissette is Vice President of Ovivo USA, LLC. Id. ¶ 6. Defendant Marc Barbeau is President of Ovivo USA, LLC, and President and CEO of Ovivo, Inc. Id. ¶ 7. For the purposes of this Motion, the Court will refer to all of the Defendants collectively as “Ovivo”.

         serious questions going to the merits were raised and the balance of hardships tips sharply in the plaintiff's favor.” All. for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1134-35 (9th Cir. 2011). This is only appropriate as long as the plaintiff also shows there is a likelihood of irreparable injury and that the injunction is in the public interest. Id.

         III. DISCUSSION

         A. Likelihood of Success on the Merits

         1. Defend Trade Secrets Act Claim

         Under the DTSA, “[a]n owner of a trade secret that is misappropriated may bring a civil action . . . if the trade secret is related to a product or service used in, or intended for use in, interstate or foreign commerce.” 18 U.S.C. § 1836(b)(1). A trade secret is defined as:

all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether or how stored, compiled, or ...

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