“The purpose of a preliminary injunction is merely to preserve the relative positions of the parties until a trial on the merits can be held.” Univ. of Texas v. Camenisch, 451 U.S. 390, 395 (1981). “Crafting a preliminary injunction is an exercise of discretion and judgment, often dependent as much on the equities of a given case as the substance of the legal issues it presents.” Trump v. Int'l Refugee Assistance Project, 137 S. Ct. 2080, 2087 (2017) (per curiam) (citations omitted).

Preliminary Injunction for Noncompetition Agreement

Jafar Abbas entered into confidentiality, noncompetition, and nonsolicitation agreements with Stryker Employment Company, LLC, a spinal implant company, in 2013 and again in April 2022. Michigan law governed the agreements.

            Section 6.3(a) of the Agreement contains a noncompetition provision prohibiting Abbas from rendering services for “any Conflicting Organization in which the services [he] may provide could enhance the use or marketability of a Conflicting Product or Service by application of Confidential Information which [he] had access to during [his] employment” for one year after leaving Stryker. Id. at Page ID #37. The Agreement defines a “Conflicting Organization” as “any person or organization which is engaged in or about to become engaged in research on, consulting regarding, or development, production, marketing, or selling of a Conflicting Product or Service.” Id. at Page ID #34. It defines “Conflicting Product or Service” as “any product, process, technology, machine, invention or service of any person or organization other than Stryker in existence or under development which is similar to, resembles, competes with or is intended to resemble or compete with a product, process, technology, machine, invention or service upon which” Abbas worked or was knowledgeable about within the last two years of his time with Stryker, “or while providing products or services to a Stryker customer.” Id.

Abbas resigned from Stryker in May 2022 to take a newly developed “sales role” with Alphatec Spine, Inc., a competitor to Striker that also manufactures and sells implants for use in spinal surgeries. Striker alleged that Alphatec has been systematically raiding Stryker's key sales personnel.

In June 2022, Striker filed a lawsuit to prohibit Abbas from working for Aphatec.

The Western District of Michigan granted a preliminary injunction that prohibited Abbas from working or rendering services in any capacity for Alphatec. The district court found that Abbas worked for Stryker in both sales and finance, and that he had persistent and unfettered access to Stryker's sensitive customer, sales, and financial information. The district court also found that the Alphatec projects on which Abbas will be working were similar to the work he had performed for Stryker.

“Flexible” Preliminary Injunction Affirmed on Appeal

The Sixth Circuit affirmed the preliminary injunction. Striker Emp. Co. LLC v. Abbas, No. 22-1563 (6th Cir. Feb. 16, 2023). The issue on appeal was not the validity of the noncompetition agreement, but whether the scope of the preliminary injunction in prohibiting Abbas from working or rendering services in any capacity for Alphatec was too broad.

            Abbas' argument that the preliminary injunction's noncompetition prohibition was overly broad fails for at least three reasons. First, the district court selected its language with the knowledge that Abbas often worked beyond “the scope” of his official position while on the job. Hr'g Tr., R. 17, Page ID #351. Thus, the court, in its discretion, used broad language to maintain the status quo. Second, and more importantly, the district court's issuance of the preliminary injunction came with the proviso that it encouraged Abbas to work with Alphatec and Stryker to craft a job agreement that would not violate the Agreement. It also said that it would entertain a subsequent motion to vacate the preliminary injunction if Alphatec crafted a new position that Stryker still found unacceptable. In other words, the district court crafted a preliminary injunction to preserve the status quo, and it reserved the possibility of considering whether other prospective jobs Abbas might be offered are consistent with the terms of the Agreement. Third, as the Court discusses below, the preliminary injunction seeks only to enforce the Agreement. And because Abbas' argument that the preliminary injunction amounts to an industry-wide ban does not comport with the district court's flexible approach to preserving the status quo, and because the preliminary injunction is consistent with the Agreement, Abbas' argument fails. See Int'l Refugee Assistance Project, 137 S. Ct. at 2087.

The Sixth Circuit affirmed the district court's conclusion that the record supports the preliminary conclusion that Abbas's prior and current positions are in conflict, and that Striker will likely succeed on the merits of a breach of contract claim. Also, “[t]he district court correctly observed that the public interest lies in enforcing contracts,” and “the balance of equities tips in [Striker's] favor because they simply seek to enforce their contractual rights.”

Thomas P. Howard, LLC litigates nationwide including in Colorado.