In non-compete and trade secret litigation, the preliminary injunction often is the most important part of the case. This is true for a number of reasons. In some cases, the decision at the preliminary injunction stage is dispositive. A sweeping injunction can cripple defendants financially and force a settlement. Conversely, when an injunction is denied, plaintiffs often come to the table and seek a quick resolution. Even if litigation continues after the injunction has been decided, that decision as a tremendous impact on the parties’ resources, the future trajectory of the case and the dispute’s ultimate outcome. In light of this, litigants on both sides must recognize the importance of the preliminary injunction phase.
A critical part of preliminary injunctions is notice. Let’s unpack this. Under Florida law, a plaintiff can seek can temporary restraining order. A temporary restraining order or TRO is an expedited, temporary form of a preliminary injunction. Plaintiffs seek TROs in situations that they deem emergencies. A plaintiff seeking a TRO can do so on an ex parte basis. In other words, a plaintiff can go to the court and request a temporary restraining order without providing notice to the defendants. Under the rules, however, this ex parte approach is permissible only in limited instances. Specifically, courts will issue an ex parte temporary restraining order only where the plaintiff can show immediate and irreparable harm and explain why the defendant did not receive notice. Courts are generally hesitant to grant this sort of ex parte relief.
Sidenote: Florida state law refers to everything as a temporary injunction. You can get an ex parte temporary injunction and then – after notice and a hearing – a temporary injunction. That’s unnecessarily confusing. Federal law is much neater. Federal law distinguishes between a TRO and a preliminary injunction. For clarity sake, I am using the federal naming convention because it is easier to follow.
Even when a court does grant an ex parte temporary restraining order, that relief – as the name suggests – is only temporary. TROs are meant to maintain the status quo only as long as necessary to hold an evidentiary hearing on a preliminary injunction. In contrast, a preliminary injunction generally lasts until trial. So, as noted above, TROs can be issued without notice to the defendant. But a formal preliminary injunction requires notice. This notice has two parts: First, the plaintiff must give defendant notice that they are seeking a preliminary injunction. This allows the defendant time to file a written response. Second, the plaintiff must notify the defendant of the time and date for the preliminary injunction hearing. The plaintiff must give the defendant sufficient notice of the hearing. This raises the following question: How much notice is necessary?
Consider the following hypothetical: Luxury Limo Co. is a limousine service that caters to ultra high-end clientele in Miami, FL and surrounding areas. Joe is a regional manager of Luxury Limo Co. Joe plans to leave the company and start his own limo service. On his last day at Luxury Limo, he downloads a database containing all of Luxury Limo’s clients to an external hard drive. The next day, he starts his own limo service, Miami Limo. He immediately blasts an email to all of Luxury’s clients offering special introductory pricing to all clients who make the switch from Luxury to Miami. Luxury sues, gets a TRO and then gets a hearing on a preliminary injunction.
What happens next depends on whether the case is in state or federal court. Plaintiffs in state court often have more control over scheduling than plaintiffs in federal court. Let’s deal with federal court first: In federal court, the court schedules the hearing. Generally, the court sets the hearing several weeks out, giving both parties an opportunity to engage in some discovery in advance of the hearing. But state court is entirely different. State court is like the wild wild west. When a plaintiff files a motion for a preliminary injunction in state court, the court does not automatically schedule a hearing. In fact, if the plaintiff simply sits back and waits, nothing will ever happen. In order to get an evidentiary hearing on that motion, the plaintiff must contact the court about scheduling a hearing. Preliminary injunction hearings generally last a few hours. In state court lingo, a long hearing of this sort is a “special set” hearing. So, the plaintiff must request and schedule a special set hearing.
Back to the hypothetical: Luxury Limo sued Joe and Miami Limo in state court, got an ex parte TRO and is now seeking a preliminary injunction. At this point, Joe and Miami Limo have been served with the complaint, the motion for a TRO and the order granting the TRO. Luxury Limo is now seeking an evidentiary hearing for the full-blown preliminary injunction that will last until trial. As noted above, in state court, the plaintiff has a great deal influence over the timing. Provided the court has time available, the only consideration is notice. How much notice is enough?
In this context, plaintiffs should be aggressive in terms of scheduling the hearing, but not so aggressive as to create grounds for an appeal. If the plaintiff sets an evidentiary hearing on two days’ notice and succeeds in getting an injunction, the defendant has a strong procedural argument for reversal on appeal. Here’s a good rule of thumb: Give the defendant at least a week’s notice prior to the preliminary injunction hearing. This gets the motion heard quickly while at the same time providing sufficient notice to the defendant.
Jonathan Pollard is a trial lawyer and business litigation attorney based on Fort Lauderdale, Florida. He focuses his practice on competition law and has extensive experience litigating non-compete, trade secret and antitrust claims. He is licensed in all Florida federal and state courts and routinely represents clients in Miami, Fort Lauderdale, West Palm Beach, Fort Myers, Tampa, Orlando and Jacksonville. His office can be reached at 954-332-2380.