Proline Prods., L.L.C. v. McBride

• Decision Date: 17 March 2014
• Docket Number: No. 111590.,Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 3.,111590.
• Parties: PROLINE PRODUCTS, L.L.C., Plaintiff/Appellee, v. Tim McBRIDE and Cameron McBride, Defendants/Appellants.
• Court: United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma

324 P.3d 430

PROLINE PRODUCTS, L.L.C., Plaintiff/Appellee,

v.Tim McBRIDE and Cameron McBride, Defendants/Appellants.

No. 111590.Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 3.

Court of Civil Appeals of Oklahoma,

Division No. 3.

March 17, 2014.

Appeal from the District Court of Logan County, Oklahoma; Honorable Louis A. Duel, Trial Judge.

AFFIRMED.

Ryan S. Wilson, Derek B. Ensminger, Hartzog, Conger, Cason & Neville, Oklahoma City, Oklahoma, for Plaintiffs/Appellee.

Phillip L. Free, Blake Lawrence, Hall, Estill, Hardwick, Gable, Golden & Nelson, P.C., Oklahoma City, Oklahoma, for Defendants/Appellants.

BRIAN JACK GOREE, Judge.

¶ 1 Defendant/Appellants, Tim McBride and Cameron McBride, seek review of the trial court's order granting the motion of Plaintiff/Appellee, ProLine Products, L.L.C. (ProLine), for a temporary injunction preventing them from using any portion of the ProLine formulas to create an asphalt cold-patch additive. We hold the trial court's fact findings are not clearly against the weight of the evidence, and it did not abuse its discretion in determining there is a likelihood of success on the merits of ProLine's claim for misappropriation of a trade secret.

¶ 2 Tim and Cameron are the son and grandson, respectively, of ProLine's owner and president, Don McBride. ProLine sued Tim and Cameron, alleging they had misappropriated ProLine's formulas in violation of Oklahoma's Uniform Trade Secrets Act (Act), 78 O.S.2011 85–94, causing damage and irreparable harm to ProLine. ProLine sought to recover damages and to enjoin Tim and Cameron from using the ProLine formulas for any purpose. It moved for a temporary injunction, asserting that Tim and Cameron's continued misappropriation of the formulas was causing irreparable harm.

¶ 3 After an evidentiary hearing, the trial court granted the motion, finding that (1) ProLine owned two confidential formulas used to make asphalt products called ProLine Cold Patch and ProLine Bunker Material, (2) the formulas derived independent economic value from not being generally known or readily ascertainable, (3) the formulas are subject to reasonable efforts to maintain their secrecy, (4) the formulas are trade secrets, and (5) Defendants were privy to the formulas when they were employees of an affiliated company. The trial court ruled that (1) ProLine was likely to succeed on the merits, (2) irreparable harm to ProLine would result if the Defendants were not enjoined from misappropriating the formulas, (3) the effect of injunction on the Defendants is slight but failure to grant an injunction would have a substantial effect on ProLine, and (4) public policy weighs in favor of granting injunctive relief. The trial court enjoined Tim and Cameron from using the formulas in any manner and from disclosing them to third parties. It stated:

This injunction is intended to encompass any attempt by Defendants to use any portion of the ProLine Formulas, even with independent improvements or modifications, to sell or create a cold patch additive for use in the asphalt industry or bunker material if any such additive or the process used to create it is substantially derived from the ProLine Formulas.

Tim and Cameron appeal from this order pursuant to 12 O.S.2011 952(b)(2), contesting the sufficiency of the evidence.

¶ 4 In reviewing a trial court's order granting or denying injunctive relief, we will examine and weigh the evidence, but we will not disturb the trial court's judgment unless the trial court has abused its discretion or the decision is clearly against the weight of the evidence. Sharp v. 251st Street Landfill, Inc., 1996 OK 109, ¶ 4, 925 P.2d 546, 549. The grounds for issuing a temporary injunction in Oklahoma are: (1) the likelihood of success on the merits, (2) irreparable harm to the party seeking injunctive relief if relief is denied, (3) relative effect on the other interested parties, and (4) public policy concerns arising out of the issuance of injunctive relief. Daffin v. State ex rel. Oklahoma Dep't of Mines, 2011 OK 22, ¶ 7, 251 P.3d 741, 745. In contesting the sufficiency of the evidence, Tim and Cameron appear to be challenging the trial court's determination of the first factor, likelihood of success on the merits.

¶ 5 Tim and Cameron first argue that ProLine failed to prove the existence of a trade secret. Pursuant to the Uniform Trade Secrets Act, 78 O.S.2011 86(4), a trade secret means:

[I]nformation, including a formula, pattern, compilation, program, device, method, technique or process, that:

a. derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and

b. is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

¶ 6 Don McBride testified that he and a chemist spent four years working on a formula for cold-patch formula, sending materials to each other and testing them. He said they found a special...