Showcoat Solutions, LLC v. Butler

          RECOMMENDATION OF THE MAGISTRATE JUDGE ^[1]

          STEPHEN M. DOYLE UNITED STATES MAGISTRATE JUDGE

         Pending before the Court is Plaintiff's Emergency Motion for Immediate Hearing and Expanded Interlocutory Relief (Doc. 62). On May 8, 2019, the undersigned Magistrate Judge held a hearing on the motion. For the reasons that follow, it is the recommendation of the undersigned that Plaintiff's Motion for Expanded Interlocutory Relief (Doc. 62) be denied.

         I. DISCUSSION

         Showcoat Solutions, LLC, (“Plaintiff”) is a company that sells hair-growth products in the agricultural industry. See generally (Doc. 76) at 4-5. This case arises from allegations that Defendants stole Plaintiff's product formulas and used those formulas to manufacture and sell their own products, under the name of Code Blue, as well as allegations that Defendants created and sold counterfeit goods using Plaintiff's name, likeness, and intellectual property. See generally (Doc. 76).

         Contemporaneous with its Complaint, Plaintiff filed a Motion for Temporary Restraining Order (Doc. 2), which alleged irreparable and immediate harm resulting from Defendants' alleged counterfeiting and sale of Plaintiff's products. The United States District Judge previously assigned to the case held a hearing on the Motion, but was unable to conclude the hearing in the time allotted. Therefore, the District Judge entered an interim Order, which was agreed to by the parties, and continued the hearing for a later date. See (Docs. 11, 12). On the day before the hearing was to continue, the parties filed a Joint Motion for Order to Cancel Hearing and Enter Consent Interlocutory Injunction (Doc. 18). The Court granted the parties' request, cancelled the hearing, and entered the proposed Interlocutory Injunction, which reads, in relevant part:

1. All Defendants shall cease using the name “ShowCoat, ” “Volumax, ” “Pop Shot, ” or using the ShowCoat or similar marks in the manufacture, marketing, or sale of any goods, or acting in concert with others to do the same;

2. All Defendants shall not manufacture, market, or sell any products developed in whole or in part from the ShowCoat formula or acting in concert with others to do the same;

3. All parties shall preserve and demand the preservation of all computers, computer tablets, phones, smart phones, external media (CDs, thumb drives, external hard drives, and the like), servers, cloud-based storage, and email accounts on which they have stored any communication or information with, about, referring to and/or relating to ShowCoat, ShowCoat's marks, ShowCoat's formula;

4. All parties shall preserve and demand the preservation of all materials related to the manufacture, marketing, or sale of livestock hair-enhancement products. Nothing herein prevents any party from carrying on its normal business operations except as otherwise prohibited by this order;

5. Plaintiff, its agents, officers, and members shall refrain from using Defendants' names or disclosing identifying information about Defendants in connection with this matter, or acting in concert with o thers to do the same. In addition, Plaintiff shall delete, destroy, or remove, to the extent possible, all press releases, announcements, social media posts, or any other public materials it has produced using Defendants' names or disclosing identifying information about Defendants in connection with this matter. Nothing herein prevents Plaintiff from informing the public that Wilson and Butler are no longer dealers for Plaintiff, nor that there may be counterfeit products in circulation in the market, but such information shall not be presented in a way that implicates Defendants or associates them with wrongdoing;

6. No security will be required at this time;

7. This order shall remain in effect during the pendency of this litigation and until further order of the court[.]

(Doc. 19).

         Plaintiff asserts that the Interlocutory Injunction should be expanded based upon evidence Plaintiff has acquired during discovery that purportedly establishes that Defendants stole and used Plaintiff's proprietary formulas and destroyed key pieces of evidence in the case. See generally (Doc. 62-1). Specifically, Plaintiff asks the Court to “[a]llow Plaintiff to identify the Defendants as the Counterfeiters of ...