This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (2000).

 

 

STATE OF MINNESOTA

IN COURT OF APPEALS

C2-01-1715

 

The Gorgen Company, Inc.,
Respondent,

vs.

Nicholas Paul Brecht, et al.,
Appellants.

 

Filed May 14, 2002

Reversed

Peterson, Judge

 

Hennepin County District Court

File No. 0113037

 

 

Richard D. Snyder, Leo G. Stern, Fredrikson & Byron, P.A., 1100 International Centre, 900 Second Avenue South, Minneapolis, MN  55402 (for respondent)

 

 

Kay Nord Hunt, Seth M. Colton, Lommen, Nelson, Cole, & Stageberg, P.A., 1800 IDS Center, 80 South Eighth Street, Minneapolis, MN  55402 (for appellants)

 

 

            Considered and decided by Peterson, Presiding Judge, Halbrooks, Judge, and Foley, Judge.*

U N P U B L I S H E D  O P I N I O N

PETERSON, Judge

In this appeal from an order denying their motion to dissolve a temporary restraining order (TRO), appellants argue that the TRO does not meet the requirements of Minn. R. Civ. P. 65.01, 65.04 and that the district court erred by granting respondent attorney fees.  We reverse.

FACTS

Respondent The Gorgen Company, Inc., is a manufacturer’s representative for manufacturers of heating, ventilating, and air-conditioning products.  Appellants Nicholas Paul Brecht and Jason Kelly are former Gorgen employees.  They were employed as sales representatives and had contact with Gorgen’s customers and with manufacturers who sold products to Gorgen.  Appellant Heating and Ventilating Solutions, Inc., (HVSI) is a corporation controlled by Brecht and Kelly.  It was incorporated in June 2001.

On July 2, 2001, Brecht resigned from Gorgen and terminated his employment without giving any advance notice.  On August 1, 2001, Kelly gave notice that he would be resigning from Gorgen on August 16, 2001, and assuming a position with Brecht at HVSI. 

            Gorgen brought an action against appellants asserting eight causes of action.  The gist of the action is that Brecht and Kelly, while employed by Gorgen, misappropriated Gorgen’s confidential business information.  Before serving the complaint, Gorgen obtained an ex parte order granting its motions for a TRO and for expedited discovery.[1] The TRO stated:

IT IS FURTHER ORDERED that [appellants], and each of them, shall not dispose of, destroy, damage, mutilate, transfer, relocate, change, alter, modify, copy, or delete information from any of the documents--electronic or otherwise--pertaining to the subject matter of [Gorgen’s] complaint, including, but not limited to, documents relating in any way to their competitive activities with [Gorgen], whether created before or after the resignations of * * * Brecht and Kelly;

 

IT IS FURTHER ORDERED that [appellants], and each of them, their agents and servants are temporarily restrained and enjoined during the pendency of this action from using the confidential business information of [Gorgen] in any manner whatsoever;

 

IT IS FURTHER ORDERED that [appellants] by close of business on August 31, 2001, shall deliver and return to [Gorgen] * * * all of [Gorgen’s] materials, property, manuals, and documents of any sort or kind in [appellants’] possession or under their control, obtained on account of their employment whether generated by [Gorgen], [appellants] or others which in any way relate to [Gorgen’s] business including, without limitation, electronic documents or those in hard copy;

 

IT IS FURTHER ORDERED that as a condition of this order, [Gorgen] shall file a bond approved by this Court in the sum of $100.00 for payment of such costs and damages as may be incurred or suffered by any party who is found to have been wrongfully enjoined or restrained.

 

            Appellants moved to dissolve the TRO and sought a protective order quashing Gorgen’s request for documents.  The district court denied appellants’ motion and ordered them to produce the documents outlined in the TRO or be held in contempt of court.[2]  The court also ordered appellants to pay Gorgen’s attorney fees incurred up to the time of the hearing.

D E C I S I O N

“A TRO is an extraordinary remedy, and the plaintiff has the burden of demonstrating that it is entitled to such relief.”  Minneapolis Urban League v. City of Minneapolis, 650 F.Supp. 303, 305 (D. Minn. 1986).

The analysis that the trial court must complete in granting a TRO is the same as that to be shown before a temporary injunction is issued.  The court must consider:  “(1) The relationship between the parties before the dispute arose; (2) the harm plaintiff may suffer if the injunction is denied, compared to the harm inflicted on defendant if the injunction is granted; (3) the likelihood that the party will prevail on the merits; (4) public policy considerations; and (5) administrative burdens imposed on the court if the [TRO] issues.”

 

Bio-Line, Inc. v. Burman, 404 N.W.2d 318, 321 (Minn. App. 1987) (citations omitted) (alteration in original) (quoting M.G.M. Liquor Warehouse Int’l, Inc. v. Forsland, 371 N.W.2d 75, 77 (Minn. App. 1985)).

            A temporary injunction should be granted only when it is clear that the rights of a party will be irreparably injured before a trial on the merits can be held.  The issue on review is whether, viewing the facts most favorably to the prevailing party, the trial court clearly abused its discretion by a disregard of either the facts or applicable principles of equity.

 

Webb Publ’g Co. v. Fosshage, 426 N.W.2d 445, 448 (Minn. App. 1988) (citations omitted).

            In addition, Minn. R. Civ. P. 65.01 states:

            A temporary restraining order may be granted without written or oral notice to the adverse party or that party’s attorney only if (1) it clearly appears from specific facts shown by affidavit or by the verified complaint that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party or that party’s attorney can be heard in opposition, and (2) the applicant’s attorney states to the court in writing the efforts, if any, which have been made to give notice or the reasons supporting the claim that notice should not be required.  * * *  On written or oral notice to the party who obtained the ex parte temporary restraining order, the adverse party may appear and move its dissolution or modification, and in that event the court shall proceed to hear and determine such motion as expeditiously as the ends of justice require.

 

            Because Gorgen applied for a TRO without notice to appellants, the application could be granted only if it clearly appeared from specific facts shown by affidavit or by the verified complaint that Gorgen would suffer immediate and irreparable injury, loss, or damage before appellants or their attorney could be heard in opposition to the application.  The affidavit of Gorgen’s attorney that accompanied the application contains no specific facts showing that Gorgen would suffer irreparable injury.  The only portion of Gorgen’s verified complaint that refers to irreparable harm is paragraph 18, which states:

Brecht’s and Kelly’s unfair competitive actions have caused and are causing Gorgen irreparable harm and will continue to cause irreparable harm unless enjoined by this Court.

 

But this allegation is only a conclusory statement; it contains no specific facts showing that immediate or irreparable injury will occur.  Even in its findings of fact, conclusions of law, and order denying appellants’ motion to dissolve the TRO, the district court does not identify any immediate, irreparable harm that Gorgen would suffer if the TRO were not granted.

            The district court abused its discretion by granting the TRO ex parte when it did not clearly appear from specific facts in the affidavit and complaint that Gorgen would suffer immediate and irreparable injury before appellants could be heard in opposition to the application.  The court also abused its discretion by denying appellants’ motion to dissolve the TRO when there was still no determination that immediate and irreparable injury would occur.

            Minn. R. Civ. P. 65.04 states:

            Every order granting an injunction and every restraining order shall set forth the reasons for its issuance; shall be specific in terms; shall describe in reasonable detail, and not by reference to the complaint or other document, the act or acts sought to be restrained; and is binding only upon the parties to the action, their officers, agents, servants, employees, and attorneys, and upon those persons in active concert or participation with them who receive actual notice of the order by personal service or otherwise.

 

            The TRO does not comply with this rule in at least three respects; it does not set forth the reasons for its issuance, it is not specific, and it describes the acts to be restrained by referring to the complaint. 

The TRO directs appellants to do, or to refrain from doing, certain things.  The TRO contains no explanation of the reasons for its issuance.  The TRO restrains appellants from using Gorgen’s “confidential business information,” but it does not specifically indicate what information is confidential business information.  It is not apparent whether the order applies to all business information that appellants possess or only some of it.  Finally, the TRO restrains appellants from destroying or changing documents “pertaining to the subject matter of [Gorgen’s] complaint,” which plainly violates the prohibition against describing the acts to be restrained by reference to the complaint.

Because the TRO does not satisfy the requirements of rule 65.01 and rule 65.04, the district court abused its discretion by issuing the TRO and by denying appellants’ motion to dissolve it.  Although the TRO seems reasonable on its face because it only tells appellants that they cannot use something that is not theirs, this issue cannot be resolved at this early stage of the litigation without a showing of irreparable harm or without complying with the rules of procedure.

The district court did not state any basis for awarding Gorgen attorney fees.  Because Gorgen is no longer a prevailing party, and we are not aware of any authority for the attorney-fee award, the award is reversed.

Reversed.



*   Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.

[1] This court previously ruled by order of the special term panel that the discovery portions of the order are beyond the scope of this appeal.

[2] This court previously ruled by order of the special term panel that the failure of the district court to issue a protective order is beyond the scope of this appeal.