Saini v. International Game Technology
| Citation | 434 F.Supp.2d 913 |
| Decision Date | 16 May 2006 |
| Docket Number | No. 3:05-CV-00253-ECRVPC.,3:05-CV-00253-ECRVPC. |
| Parties | Baljit SAINI, Plaintiff, v. INTERNATIONAL GAME TECHNOLOGY, Defendant. |
| Court | U.S. District Court — District of Nevada |
Kenneth J. McKenna, Reno, NV, for Plaintiff.
Bruce R. Laxalt, Angela Bader, and Janice H. Jensen, Laxalt & Nomura, Ltd., Reno, NV, for Defendant or Respondent.
Defendant and Counterclaim Plaintiff International Game Technology ("IGT") moves for a preliminary injunction ordering Plaintiff and Counterclaim Defendant Baljit Saini ("Saini") to refrain from disclosing confidential information and trade secrets in violation of two confidentiality agreements with IGT and to return confidential and proprietary documents that Saini removed from IGT.
For the reasons stated below, IGT's motion will be GRANTED.
On April 27, 2005, Saini filed a Complaint and Jury Demand (# 2) alleging race and age discrimination and wrongful discharge. On September 30, 2005, IGT filed counterclaims (# 20) alleging breach of contract by Plaintiff and counterclaim Defendant Baljit Saini ("Saini"). On September 14, 2005, IGT filed the current Motion for Preliminary Injunction (# 16). Saini opposed (# 19) on September 28, 2005, and IGT replied (# 21) to the opposition on October 17, 2005. On April 27, 2006, we heard oral arguments and received additional evidence. Having examined the submitted evidence and considered the arguments, we now rule on the motion (# 16).
IGT's request for a preliminary injunction stems from Saini's alleged breach of a confidentiality agreement he entered into while an employee of IGT. IGT hired Saini as a technical trainer on July 14, 1997. (Complaint ¶ 4.) Saini entered into an Invention and Secrecy Agreement with IGT prior to starting his employment, on June 23, 1997. (Ex. A.)
As part of the Invention and Secrecy Agreement, Saini agreed to the following confidentiality provisions:
(a) That during his employment and thereafter he will hold in strictest confidence, and not disclose to any person, firm, or corporation, without the express written authorization of an officer of [IGT] any information, manufacturing technique, process, formula, development or experimental work, work in process, business, trade secret, or any other secret or confidential matter relating to the products, sales, or business of [IGT] or its affiliates or subsidiaries except as such disclosure or use may be required in connection with [Saini's] work for [IGT].
. . . . .
(e) That upon request or at the time of leaving the employ of [IGT], he will deliver to [IGT], and not keep or deliver to anyone else, any and all drawings, blueprints, notes, memoranda, specifications, devices, documents, and in general any and all materials relating to [IGT]'s business.
(f) To regard and preserve as confidential all information obtained by Saini pertaining to [IGT]'s business and products, whether patented or unpatented, and not to publish or disclose to others during the term of employee's employment or thereafter such confidential information obtained while in the employ of company.
(Id.)
Later, on June 19, 2000, Saini entered into an "Employee Incentive Stock Option Agreement" (Ex. B) contained the following additional confidentiality clause:
. . . nor shall the Employee at any time after termination disclose, discuss, copy, or otherwise use or suffer to be used, in any manner, in competition with or contrary to the interests of the corporation or any of its subsidiaries, the customer list, product research, engineering data or other trade secrets of the Corporation or any of its subsidiaries.
(Id.)
On March 12, 2004, IGT fired Saini. (Complaint ¶ 20.) Saini contends his termination was motivated by race and age discrimination. (Id. ¶¶ 4-24.) IGT alleges that it terminated Saini because it suspected he was removing confidential information from IGT without permission. (Countercl.¶¶ 8-41.) Saini acknowledges that IGT informed him that it believed he was taking documents without permission when it terminated him. (Saini Dep. 33:19-22, Dec. 16, 2005 (Ex. J).)
In April or May of 2004, Saini read about a breach of contract dispute between IGT and The Siena Hotel Spa and Casino ("The Siena") in a newspaper. In that case, IGT sued The Siena to collect on unpaid invoices, and The Siena responded by asserting that the products in question were defective. (Mot.3.) Saini needed a job, so he contacted The Siena's owner, stating that he had an opinion of the causes for the defective equipment. (Saini Dep. 35:6-24, Dec. 16, 2005 (Ex. J).) Saini has admitted that he would not have offered his services to The Siena if IGT had settled his employment suit. (Id. 36:7-9.)
Saini subsequently entered into an expert witness agreement with The Siena and provided The Siena with an expert report and deposition testimony in support of its case. (Saini Expert Report (Ex. D); Saini Dep., Feb. 8, 2006 (Ex. H); Saini Dep., Aug. 9, 2005 (Ex. I); Saini Dep., Dec. 16, 2005 (Ex. J.).) In his expert report and depositions on The Siena's behalf, Saini provided several different categories of evidence, including:
(5) factual testimony from Saini alleging that he had tried to get IGT to fix the problems he had identified above (See, e.g., Saini Dep. 11:9-12, Aug. 9, 2005), and
(6) factual testimony from Saini alleging that IGT placed used parts in IGT products that were sold as new. (Id. 81:14-17.)
At least one document disclosed by Saini's expert report, the re-work instructions, was labeled on its face as confidential. (See IGT CVT + Re-Work Instructions, Feb. 3, 2003 (Ex. D attachment B).) Saini distributed the expert report and the above-mentioned documents to other experts hired by IGT, including at least one person who also works for an IGT competitor. (Johnson Dep. 7:9-16, 18:24-19:12, August 9, 2005 (Ex. K); Bandall Dep. 43:16-44:9, Aug. 11, 2005 (Ex. L).)
Following Saini's August 9, 2005, deposition, IGT filed the pending motion for a preliminary injunction, alleging that Saini's testimony and disclosure of documents violate Saini's employee Invention and Secrecy Agreement with IGT. (Mot.8-9.) At the hearing on the motion, IGT also asserted that Saini breached the Incentive Stock Option Agreement. In response, Saini contends that he has not breached the confidentiality agreements because he is disclosing a wrong committed by IGT and that information is not properly the subject of the confidentiality agreements. (Opp'n 4-7.)
A party seeking a preliminary injunction must meet one of two tests: traditional or alternative. Stanley v. Univ. of S. Cal., 13 F.3d 1313, 1319 (9th Cir.1994). The traditional test requires the movant to show that:
1. the moving party will suffer irreparable injury if injunctive relief is not granted;
2. the moving party will probably prevail on the merits;
3. in balancing the equities, the nonmoving party will not be harmed more than the movant is helped by the injunction; and
4. granting the injunction is in the public interest.
In the alternative, a court may issue a preliminary injunction if the movant shows either:
[1.] a combination of probable success on the merits and the possibility of irreparable injury; or
[2.] that serious questions are raised, and the balance of hardships tips sharply in his favor.
Id. (formatting altered).
Although phrased as such, the alternative test is less an either/or formulation as it is a type of sliding scale. The two prongs represent "`extremes of a single continuum,' rather than two separate tests." Sun Microsystems, Inc. v. Microsoft Corp., 188 F.3d 1115, 1119 (9th Cir. 1999) (quoting Benda v. Grand Lodge of Int'l Ass'n of Machinists & Aerospace Workers, 584 F.2d 308, 315 (9th Cir.1978)). That is, the more the balance of hardships tips in favor of the plaintiff, the less probability of success must be demonstrated. Walczak v. EPL Prolong, Inc., 198 F.3d 725, 731 (9th Cir.1999).
Whichever test is applied, a preliminary injunction should only be granted if the movant does not have an adequate remedy at law. Stanley, 13 F.3d at 1320 (citing Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 506-07, 79 S.Ct. 948, 3 L.Ed.2d 988 (1959)). A preliminary injunction is an "extraordinary and drastic remedy, one that should not be granted unless the movant, by a clear showing, carries the burden of persuasion." Mazurek v. Armstrong, 520 U.S. 968, 972, 117 S.Ct. 1865, 138 L.Ed.2d 162 (1997) (quoting 11A Charles Alan Wright & Arthur Miller, Federal Practice & Procedure § 2948 (2d ed.1995)). "The cases best suited to preliminary relief are those in which the important facts are undisputed, and the parties simply disagree about what the legal consequences are of those facts." Remlinger v. State of Nev., 896 F.Supp. 1012, 1015 (D.Nev.1995).
Movant IGT alleges that Saini's disclosure of confidential documents and facts irreparably injures...
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