Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_15-cv-02491/USCOURTS-azd-2_15-cv-02491-0/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 18:1964 Racketeering (RICO) Act

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WO NOT FOR PUBLICATION 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

America Greener Technologies Incorporated, 

et al.,

Plaintiffs,

v.

Enhanced Life Water Solutions LLC, et al.,

Defendants.

No. CV-15-02491-PHX-JJT

ORDER

REDACTED

 At issue is Plaintiffs’ Application for Temporary Restraining Order and 

Preliminary Injunction (Doc. 2, hereinafter “Motion”). Plaintiffs, America Greener 

Technologies, Inc., American Greener Technologies Corporation and AGT Softwave, 

Inc. (collectively, “Plaintiffs”), filed this lawsuit and their Motion on December 9, 2015. 

(Doc. 1, Compl.; Mot.) In Plaintiffs’ Motion, they request that the Court issue a 

temporary restraining order (“TRO”) and preliminary injunction to “enjoin Defendants 

from their current actions which include infringement of Plaintiffs’ patent rights, 

misappropriation of Plaintiffs’ trade secrets, violation of the Confidentiality clauses of 

their employment agreement and the unjust enrichment of Defendants.” (Mot. at 1–2.) 

The Court held a preliminary injunction hearing on January 28, 2016 (see Doc. 82), at 

which Plaintiffs’ counsel stated the motion for a preliminary injunction would be limited 

to the patent infringement and violation of the confidentiality and nondisclosure 

agreement claims (Doc. 85, Tr. at 14). In advance of the hearing, the parties filed Bench 

Briefs (Doc. 84, Pls.’ Bench Br., filed under seal; Doc. 81, Defs.’ Bench Br.), and the 

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parties also filed Closing Briefs after the hearing (Doc. 103, Pls.’ Closing Br., filed under 

seal; Doc. 100, Defs.’ Closing Br.). The Court has considered the briefing filed in this 

matter and evidence presented at the preliminary injunction hearing and, for the reasons 

set forth below, denies Plaintiffs’ Application for Temporary Restraining Order and 

Preliminary Injunction. 

I. BACKGROUND 

A. Inventors and Assignment of the Patent 

Plaintiffs are a conglomerate that, among other things, provides water treatment 

services. Defendant Gary Wilson and Michael Brown are the inventors of the patent 

entitled “Apparatus for Generating a Multi-Vibrational Field,” registered with the United 

States Patent and Trademark Office (“PTO”) as Patent No. 8,477,003 (“Patent ‘003”) 

dated July 2, 2013. (Defs.’ Bench Br., Ex. 1, Patent.) Plaintiffs sought to acquire Patent 

‘003 and the technology, clients, and other assets of Soft Wave Innovations, Inc. 

(“SWI”), of which Mr. Wilson was CEO and principal shareholder. (See Tr. at 27–31.) 

On September 10, 2014, Mr. Wilson and Mr. Brown executed an Assignment Agreement 

for Patent ‘003 to American Greener Technologies Corporation, represented by CEO 

Michael Boyko (Defs.’ Bench Br., Ex. 3, Assignment Agreement), and the Assignment 

was recorded with the PTO on September 15, 2014 (Defs.’ Bench Br., Ex. 4). Plaintiffs 

and SWI continued to engage in business negotiations and entered into other agreements 

regarding the assignment of Patent ‘003, royalty payments to Mr. Wilson and others, and 

the sale of SWI and its assets to Plaintiffs. The Court only specifically addresses the 

contracts relevant to its determination of the issues currently before it at this preliminary 

injunction stage. 

 A series of actions occurred in the fall of 2014, further uniting the individual 

Defendants and Plaintiffs. On October 31, 2014, Plaintiffs entered into an Asset Purchase 

Agreement (“APA”) with SWI, under which Plaintiffs purchased SWI’s customer 

contracts. (Defs.’ Bench Br., Ex. 11, APA.) Plaintiffs also hired individual Defendants 

Gary Wilson, Brian Barker, Bruce Baker, and Stephen Clausi (Tr. at 46, 142, 144, 154), 

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and they each signed a “Mutual Non-Disclosure and Confidentiality Agreement”1 with 

Plaintiffs. (Defs.’ Bench Br., Exs. 7, 8, 9, 10, NDAs.) 

 Plaintiffs fired all four individual Defendants on May 15, 2015. (Pls.’ Hr’g 

Ex. 25.) Defendants later formed and began providing water treatment services through 

the companies Defendant Enhanced Life Water Solutions, LLC, a/k/a EL+ Solutions 

(“ELWS”) and True Water Services, and they provided clients with the apparatus (the 

“Accused Device”) that Plaintiffs claim infringes on Patent ‘003. (See Tr. at 154; Defs.’ 

Closing Br. at 10–11.) 

B. Patent ‘003 

Patent ‘003 teaches an electromagnetic water treatment apparatus that delivers 

multi-vibrational electromagnetic fields (“MVEM”), which are applied to water flowing 

through a waterway. (Patent at 2.) MVEM fields are independent but may work 

simultaneously and can be used for various applications including eliminating calcium 

buildup in pipes, reducing soap usage in laundry, and reducing chlorine use in pools. 

(Patent at 2.) Patent ‘003 has 17 claims including claim 1, which in part claims “an 

apparatus comprising: a plurality of rods” and “a flexible spacer strip connecting ends of 

each of the plurality of rods,” and claim 9, which claims “[t]he apparatus of claim 1, 

further comprising a flexible housing containing the plurality of rods.” (Patent at 13–14.) 

Claim 11 states “[a] method for generating a multi-vibrational electromagnetic field, the 

method comprising moving current through a plurality of copper wire coils, each of the 

copper wire coils wrapped around a rod, each of the rods being connected to a flexible 

spacer strip, and each of the rods being disposed substantially parallel to each other.” 

(Patent at 14.) Claim 12 provides, “[t]he method of claim 11, further comprising: 

encasing the plurality of rods in a flexible housing; and wrapping the housing around a 

pipe.” (Patent at 14.) Patent ‘003 includes drawings of the claims and further detail. 

 

1

 The Court refers to all four Mutual Non-Disclosure Agreements, which are exactly the same except as to the parties, collectively as the “NDAs.” 

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C. The Preliminary Injunction Hearing 

 1. Development and Sale of the Accused Device 

Mr. Wilson, as co-inventor of Patent ‘003, built the original units with SWI, which 

Plaintiffs later acquired. (Tr. at 138.) Mr. Wilson, now acting as a consultant of ELWS, 

also builds the Accused Devices, for which there is a pending patent application listing 

him as the sole inventor. (Tr. at 140–41, 147; Doc. 86, Sealed Tr. at 5–6.) Mr. Wilson 

stated devices built under his new patent compete with Plaintiffs but that he did not 

disclose to Plaintiffs he was building his own units or that he filed a patent application. 

(Tr. at 141, 145–46.) He did not recall exactly when he developed the idea for the 

Accused Device, but he filed the patent application after signing the NDA, Letter of 

Intent, and APA with Plaintiffs. (Tr. at 140–44.) He stated he most likely filed the patent 

application before Plaintiffs terminated him and built a few Accused Devices prior to his 

termination. (Sealed Tr. at 14.) Mr. Wilson stated he did not use any of his knowledge 

from Patent ‘003 in making the Accused Device. (Sealed Tr. at 7.) He stated the Accused 

Device creates a different electromagnetic field than the ‘003 Patent. (Sealed Tr. at 8.)

 Bruce Barker’s company, True Water Services, conducts the sales and services for 

ELWS of the Accused Device, and Mr. Clausi is a subcontractor for True Water Services 

responsible for service on the devices and service reports. (Tr. at 153, 170–71.) After 

Plaintiffs fired him, Bruce Barker, via True Water Services, entered into contractual 

relationships with Plaintiffs’ clients. (See Tr. at 155, 157, 160–61.) 

2. Marketing Materials, Customers and Service Contracts

Russell Corrigan, Director of Operations and custodian of records for America 

Greener Technologies, Inc. and AGT Softwave (Tr. at 24) testified that he believed 

Defendants had taken several of Plaintiffs’ marketing materials. Mr. Corrigan testified 

that Plaintiffs’ investor pitch deck was available to the individual Defendants while they 

were employees of Plaintiffs and the document was marked as confidential. (Tr. at 68–

69.) After viewing ELWS’s promotional video that included a Powerpoint slide that 

showed ELWS’s customers, Mr. Corrigan stated he believed the slide was taken from 

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Plaintiffs’ marketing files, but it was not clear whether he believed the slide was taken 

from the pitch deck marked confidential (Pls. Hr’g Ex. 34) or a similar client list slide not 

marked as confidential (Pls. Hr’g Ex. 33). (Tr. at 67–69.) Bruce Barker, Defendant and 

former employee of Plaintiffs, testified that three of the entities listed on the ELWS 

customer list slide in their promotional video were not ELWS customers, and he did not 

know why they appeared on the slide. (Tr. at 175–76.) 

In 2015, Plaintiffs began to receive termination letters from their then-current 

clients who were previously SWI’s clients and whose contracts Plaintiffs had acquired 

through the APA. (See Tr. at 69–70, 87–92.) Plaintiffs received termination letters from 

the following six clients: the Church of Jesus Christ of Latter-day Saints on June 23, 2015 

(Tr. at 70, Pls.’ Hr’g Ex. 35), True Leaf Farms on August 27, 2015 (Tr. at 71, Pls.’ Hr’g 

Ex. 38), Growers Ice Co. on September 24, 2015 (Tr. at 73, Pls.’ Hr’g Ex. 40), Western 

Precooling on September 28, 2015 (Tr. at 76, Pls.’ Hr’g Ex. 44), City of Thousand Oaks 

on September 28, 2015 (Tr. at 77, Pls.’ Hr’g Ex. 45), and BC Systems, Inc.2

 on 

January 19, 2016 (Tr. at 82–83, Pls.’ Hr’g Ex. 48). (See also Tr. at 175–76.) Of these 

clients, Western Precooling made up the largest source of revenue and was the “backbone 

of [Plaintiffs’] customers.” (Tr. at 76.) All but one of the clients who submitted 

termination letters to Plaintiffs were clients of ELWS/True Water Services at the time of 

the hearing. (Tr. at 175–78.) 

 Bruce Barker also testified that Crown Cooling, a client that was part of the APA, 

was Defendants’ client at the time of the hearing. (Tr. at 176–77.) With regard to another 

client, Nucor Steel, Mr. Corrigan testified he believed that Nucor continued to be 

Plaintiffs’ client (Tr. at 58, 66), but Bruce Barker testified that Nucor was ELWS’s client 

and Plaintiffs’ equipment had been taken off Nucor’s plant (Tr. at 175). In addition, in 

January 2016, one of Plaintiffs’ customers, Dole Foods, contacted Plaintiffs requesting 

more favorable contract terms, which Mr. Corrigan believes was in response to 

 

2

 BC Systems, Inc. was not a SWI client transferred to Plaintiffs, as evidenced in the APA. (See APA at 23–24.) It is unclear whether BC Systems, Inc. was a client of ELWS/True Water Services at the time of the hearing.

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Defendants’ business proposals to Dole. (Tr. at 83–84.) After reaching out to the 

customers from whom Plaintiffs received notices of termination, Plaintiffs learned that 

clients were receiving the same type of services from a competing company owned, at 

least in part, by the four individual Defendants. (Tr. at 78–79.) 

 Bruce Barker also testified regarding the actions he took with Plaintiffs’ clients 

referenced above. He stated that Dole initially approached him, and only then did he 

engage with the company. (Tr. at 175.) He also began a business relationship with True 

Leaf Farms around June 15, 2015 and thereafter removed Plaintiffs’ units, replacing them 

with Accused Devices without Plaintiffs’ knowledge or permission. (Tr. at 155, 157.) 

Bruce Barker provided Growers Ice with a proposal for the same services Plaintiffs were 

providing in July 2015 (Pls.’ Hr’g Ex. 50; Tr. at 160–61), and he engaged in business 

negotiations with Western Precooling prior to the termination date of its contract with 

Plaintiffs (Tr. at 166).

When SWI and Plaintiffs entered into the APA, Plaintiffs took over the SWI client 

contracts without making any changes to the contracts. (Tr. at 181–82.) With regard to 

previous knowledge of the terms and provisions of Plaintiffs’ client contracts, Bruce 

Barker stated he was aware of the provisions from his previous work with SWI and 

SWI’s client contracts entered into in 2012. (Tr. at 181.) He stated he possessed this 

knowledge prior to when he signed the NDA, and SWI never instructed him to keep 

information related to the client contracts confidential. (Tr. at 181.) Also, as a former 

employee of Plaintiffs, Bruce Barker testified he did not believe Plaintiffs’ contracts with 

customers were confidential. (Tr. at 151.)

 3. The APA, NDAs and Confidentiality 

 At the hearing, the parties disputed whether the APA and NDAs included 

provisions that would have made the individual Defendants’ actions with regard to 

marketing materials, client lists, and other information a breach of those contracts. As for 

the APA, it included no provision requiring SWI to keep former client identities 

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confidential after the APA and/or sale was concluded, and it also did not include a noncompete provision. (Tr. at 92–93.)

With regard to the confidentiality of various materials, Plaintiffs’ representative, 

Mr. Corrigan, stated that none of the client lists, service contracts, or accounting records 

disclosed as Plaintiffs’ hearing Exhibits 3 and 4, and Exhibit 1.1 to the APA, were 

marked as confidential. (Tr. at 94–96.) He was also not aware of any confidentiality 

agreements between SWI and the individual Defendants. (Tr. at 94–96.) He further stated 

he was aware that the individual Defendants and SWI attended various trade shows, 

where they displayed the same list of clients that Plaintiffs had acquired. (Tr. at 96–99.) 

Mr. Corrigan stated that because of this public disclosure and the individual Defendants’ 

past relationships with the clients, there was no basis on which Defendants should have 

reasonably understood that the client information should remain confidential. (Tr. at 98–

99.) He also stated that, for those same reasons, the identity of customers could not be 

considered confidential. (Tr. at 98–99.) 

4. The Expert Report, Inspection of the Accused Device and Expert 

 Testimony 

Prior to the hearing, the parties agreed upon and retained a neutral expert witness, 

Christopher Nicklaw, an electrical engineer with over 35 years of experience (Pls.’ Hr’g 

Ex. 112), to conduct an inspection of the Accused Device.3

 (See Doc. 28.) Prior to the 

inspection, both parties exchanged and provided Mr. Nicklaw with their respective 

proposed claim constructions and list of questions for Mr. Nicklaw to address in his 

report. (See Doc. 41.) On January 7, 2016, Mr. Nicklaw heard presentations from the 

parties and inspected the Accused Device at one of Defendants’ clients’ locations in 

Yuma, Arizona. (See Docs. 31, 41, 62 at 3.) At the hearing, the parties stipulated that 

Mr. Nicklaw is a qualified expert in the art, and the Court, Bruce Barker, and 

Mr. Nicklaw together examined the Accused Device. (Sealed Tr. at 24, 28–29.) 

 

3

 The Court issued an Order on January 5, 2016 setting forth the parameters of Mr. Nicklaw’s inspection and evaluates his opinion and report as they conform to those 

parameters. (See Doc. 41.) 

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 In his Expert Report, Mr. Nicklaw examined and compared a device owned and 

utilized by Plaintiffs and the Accused Device.4 (Docs. 62, 73, Expert Report,5 filed under 

seal at 14, 17.) He stated that both Plaintiffs’ device under Patent ‘003 and the Accused 

Device are comprised of inductive coils that are sleeved onto a water pipe, and that a 

voltage signal unit, electrically connected to the inductive coil, is used to generate an 

electromagnetic field to treat the water flowing through the pipe. (Expert Report at 14.) Mr. 

Nicklaw opined that the construction of coils in Plaintiffs’ device under Patent ‘003 is 

different than that in the Accused Device. (Expert Report at 17.) Upon inspection, he stated 

that Plaintiffs’ device uses a plurality of coils to generate an electromagnetic field with 

copper wire wrapped around partially insulated rods and the end of such rods connected to 

a DC power supply to form a circuit. (Expert Report at 17.) He stated that in contrast, the 

Accused Device uses one continuous wire wrapped around a “taped” sheet where the 

varied density of the copper wire forms coils and the ends of the copper wire are connected 

to a DC power supply. (Expert Report at 17.) Mr. Nicklaw concluded that the physical 

water treatment devices he inspected would produce different electric and magnetic fields 

in the pipes that they are wrapped around. (Expert Report at 17.) Mr. Nicklaw also 

provided comments within Defendants’ proposed claim construction chart, but it is not 

clear whether his comments reflect his comparison of the Patent ‘003 claims or Plaintiffs’ 

device that he inspected with the Accused Device.6

 (See Expert Report at 33–60.) 

 

4

 For the infringement analysis, the relevant comparison is between the ‘003 Patent and the Accused Device, not between a device owned by Plaintiffs that is one 

embodiment of Patent ‘003. 

5

 References to page numbers of the Expert Report refer to pages in Doc. 62. 

6

 Mr. Nicklaw testified that he considered his task “as the claims of construction 

against the patent . . . and against the patent history,” and that he examined units owned 

by Plaintiffs and Defendants. (Sealed Tr. at 34.) In some parts of his testimony, it is not 

entirely clear whether Mr. Nicklaw is discussing his comparison of the Accused Device 

to the Patent ‘003 claims or, rather, to Plaintiffs’ device, a device the parties did not 

dispute is one embodiment of Patent ‘003. (See Sealed Tr. at 34.) Again, the Court did not consider Mr. Nicklaw’s opinions that went beyond his defined role to provide an 

explanation of the technology and compare Patent ‘003 and the Accused Device. 

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 At the hearing, Mr. Nicklaw testified that the Accused Device and Plaintiffs’ 

device under Patent ‘003 both create electromagnetic fields in whatever they are wrapped 

around, but that they are different and utilize distinct core materials. (Sealed Tr. at 34–

35.) He stated that due to the differences in construction in the two devices, they create 

different electromagnetic fields in terms of intensity, which can be tested with certain 

software. (Sealed Tr. at 35–36.)

 Mr. Nicklaw testified that he compared the Accused Device to claim 1 of Patent 

‘003 and found the Accused Device did not use rods or connection of a plurality of rods, 

but creates an electromagnetic field in a different way. (Sealed Tr. at 37.) He stated that 

when comparing the Accused Device to claim 1, the Accused Device also did not use 

flexible spacer strips. (Sealed Tr. at 37.) Mr. Nicklaw testified regarding claim 11 and 

stated the Accused Device does not conform to the elements in claim 11, but rather uses a 

construction based on a steel core with notches on the top, which wire is wrapped around 

and held in place by tape. (Sealed Tr. at 39–40.)

 With regard to claim 16, Mr. Nicklaw testified that Patent ‘003 teaches the use of 

interconnected rods to form a “closed hoop” of current, and that the Accused Device uses 

a continuous coil or wire run that avoids the “issue of handling individual rods,” and 

“operate[s] effectively at a lower voltage and maintain[s] . . . resistance lower and 

maintain[s] a different current level for . . . a different magnetic field.” (Sealed Tr. at 42.) 

He further stated the Accused Device does not need the interconnected multiple rods and 

multiple wires that Patent ‘003 teaches because the Accused Device uses a continuous 

loop of wire around the metal sheet core. (Sealed Tr. at 42–43.) Finally, Mr. Nicklaw 

concluded that the Accused Device is different from what Patent ‘003 claims. (Sealed Tr. 

at 43.)

Mr. Nicklaw generally stated that Patent ‘003 and the Accused Device are the 

same “in terms of principle, when they [Plaintiffs] take a metal rod and wrap it and then 

they [Defendants] space it with spacers to do the same thing . . . It’s just how they do it is 

different and, again, it’s because he [Defendants] chose to do a flat surface and the other 

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guy [Plaintiffs] went individual rods.” (Sealed Tr. at 40.) Finally, in response to 

questioning, Mr. Nicklaw stated the way the devices accomplished their goal was 

“substantially different.” (Sealed Tr. at 40.)

II. LEGAL STANDARD 

 In order to obtain a preliminary injunction, Plaintiffs must show that “(1) [they 

are] likely to succeed on the merits, (2) [they are] likely to suffer irreparable harm in the 

absence of preliminary relief, (3) the balance of equities tips in [their] favor, and (4) an 

injunction is in the public interest.” Garcia v. Google, Inc., 786 F.3d 733, 740 (9th Cir. 

2015) (citing Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 9 (2008)). The Ninth 

Circuit, employing a sliding scale analysis, has also stated “‘serious questions going to 

the merits’ and a hardship balance that tips sharply toward the plaintiff can support 

issuance of an injunction, assuming the other two elements of the Winter test are also 

met.” Drakes Bay Oyster Co. v. Jewell, 747 F.3d 1073, 1078 (9th Cir. 2013) cert. denied,

134 S. Ct. 2877 (2014) (quoting Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 

1132 (9th Cir. 2011)). It is under this standard that the Court evaluates Plaintiffs’ patent 

infringement claim and their claim for violation of confidentiality and the non-disclosure 

agreements.

III. ANALYSIS 

As a threshold matter, the Court’s decision herein is based on the limited 

information before it at the preliminary injunction stage. The Court has reviewed the 

parties’ briefing, the Expert Report, and the evidence presented at the hearing, but the 

Court does not have the benefit of the parties’ full discovery, leaving it with incomplete 

information. The Court “remain[s] mindful that all findings of fact and conclusions of 

law at the preliminary injunction stage are subject to change upon the ultimate trial on the 

merits.” Jack Guttman, Inc. v. Kopykake Enters., Inc., 302 F.3d 1352, 1361 (Fed. Cir. 

2002) (internal quotations omitted).

The Court does not consider Plaintiffs’ argument regarding their rights under a 

“Secondary Assignment,” which they argue assigned to them nearly all of the water 

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treatment technology Mr. Wilson developed, rather than just Patent ‘003. (See Pls.’ Hr’g 

Ex. 11; Tr. at 39–41.) Plaintiffs first raised this theory at the preliminary injunction 

hearing – they did not reference the Secondary Assignment in their prior briefing. (See

Docs. 1, 50.) Citing to Federal Rule of Civil Procedure 15, Defendants properly objected 

to Plaintiffs’ introduction of the Secondary Assignment. (Tr. at 18–19.) Rule 15 provides 

that leave to amend a complaint should be freely granted “when justice so requires.” Fed. 

R. Civ. P. 15(a)(2). “The power to grant leave to amend, however, is entrusted to the 

discretion of the district court, which ‘determines the propriety of a motion to amend by 

ascertaining the presence of any of four factors: bad faith, undue delay, prejudice to the 

opposing party, and/or futility.’” Serra v. Lappin, 600 F.3d 1191, 1200 (9th Cir. 2010) 

(quoting William O. Gilley Enters. v. Atl. Richfield Co., 588 F.3d 659, 669 n.8 (9th Cir. 

2009)). The Court finds that Plaintiffs are not entitled to amend because, by not raising 

the Second Assignment theory until the preliminary injunction hearing, Defendants were 

prejudiced by the lack of notice of the theory. In addition, the Court did not have notice 

of such theory. Accordingly, because of Plaintiffs’ delay and the resulting prejudice to 

Defendants, the Court, in its discretion, will not consider the Secondary Assignment 

argument at this time. Plaintiffs may be able to later amend their Complaint to add this 

theory, but the Court does not consider it in deciding the preliminary injunction motion.

 A. Patent Infringement 

 Plaintiffs argue that the Accused Device infringes on Patent ‘003 because it is 

substantially similar to Patent ‘003. (Pls.’ Closing Br. at 10.) The Patent Act authorizes 

district courts to grant injunctions to prevent the infringement of patent rights, but the 

owner of a valid and infringed patent is not entitled to an injunction as a matter of right. 

See 35 U.S.C. § 283. The four-factor Winter test applies to disputes arising under the 

Patent Act. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 390 (2006). A district court 

has the discretion to grant an injunction “in accordance with the principles of equity . . . 

on such terms as the court deems reasonable.” See 35 U.S.C. § 283; see also eBay Inc.,

547 U.S. at 391. The Supreme Court and the Federal Circuit have cautioned that “a 

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preliminary injunction is a drastic and extraordinary remedy that is not to be routinely 

granted.” Intel Corp. v. ULSI Sys. Tech., Inc., 995 F.2d 1566, 1568 (Fed. Cir. 1993); see

Munaf v. Geren, 553 U.S. 674, 689 (2008). A preliminary injunction “should not be 

granted unless the movant, by a clear showing, carries the burden of persuasion.” 

Mazurek v. Armstrong, 520 U.S. 968, 972 (1997). 

1. Likelihood of Success on the Merits 

 In order to obtain a preliminary injunction, Plaintiffs must first show they are 

likely to succeed on the merits. See Winter, 555 U.S. at 9. Determining patent 

infringement is a two-step process, wherein courts first construe the patent claims and 

then determine whether every claim limitation, or its equivalent, is found in the accused 

device. Roche Palo Alto LLC v. Apotex, Inc., 531 F.3d 1372, 1377 (Fed. Cir. 2008). A 

party can allege infringement literally or under the doctrine of equivalents. Frank’s

Casing Crew & Rental Tools, Inc. v. Weatherford Int’l, Inc., 389 F.3d 1370, 1378–79 

(Fed. Cir. 2004). “[L]iteral infringement requires that each and every limitation set forth 

in a claim appear in an accused product.” Id. at 1378. Under the doctrine of equivalents, 

“a product or process that does not literally infringe upon the express terms of a patent 

claim may nonetheless be found to infringe if there is ‘equivalence’ between the elements 

of the accused product or process and the claimed elements of the patented invention.” 

Warner–Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 21 (1997) (citing Graver 

Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 609 (1950)). 

 Here, based on Plaintiffs’ briefing (see Pls.’ Closing Br. at 10) and the parties’ 

respective claim constructions (see Defs.’ Bench Br., Exs. 16, 17), Plaintiffs do not 

appear to argue that the Accused Device literally infringes, and the parties have not raised 

any dispute regarding the meaning and scope of claim terms. Rather, Plaintiffs allege that 

the Accused Device is “substantially similar” to Patent ‘003 and “almost all of the 

attributes of Patent ‘003 are present in the Accused Device.” (Pls.’ Closing Br. at 10) 

(emphasis added.) Accordingly, the Court construes Plaintiffs’ argument as one of 

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infringement under the doctrine of equivalents, not literal infringement, and focuses the 

analysis on whether Plaintiffs’ device and the Patent ‘003 claims are substantially similar. 

 Plaintiffs argue that the difference in form/material between the Accused Device 

and the Patent ‘003 claims do not relieve Defendants of liability for patent infringement, 

and the minor modifications of the Accused Device fall under the doctrine of equivalents. 

(Pls.’ Closing Br. at 10–13.) A patentee may invoke the doctrine of equivalents if the 

accused device performs “substantially the same function in substantially the same way 

to obtain the same result . . . even though [the devices] differ in name, form or shape.” 

Graver Tank, 339 U.S. at 608. “What constitutes equivalency must be determined against 

the context of the patent, the prior art, and the particular circumstances of the case.” Id. at 

609. The Federal Circuit has also required that the patentee prove “insubstantial 

differences between the claimed and accused products or processes.” See Hilton Davis 

Chem. Co. v. Warner-Jenkinson Co., 62 F.3d 1512, 1521–22 (Fed. Cir.) supplemented, 64 

F.3d 675 (Fed. Cir. 1995), and rev’d on other grounds, 520 U.S. 17 (1997), and adhered 

to, 114 F.3d 1161 (Fed. Cir. 1997). The Supreme Court has stated that the wording of 

these various standards “is less important than whether the test is probative of the 

essential inquiry: Does the accused product or process contain elements identical or 

equivalent to each claimed element of the patented invention?” Warner-Jenkinson Co.,

520 U.S. at 40. Two legal doctrines limit the determination of infringement under the 

doctrine of equivalents: the “all elements” rule and prosecution history estoppel. DePuy

Spine, Inc. v. Medtronic Sofamor Danek, Inc., 469 F.3d 1005, 1013 (Fed. Cir. 2006). 

 a. All Elements Rule 

“Each element contained in a patent claim is deemed material to defining the 

scope of the patented invention, and thus the doctrine of equivalents must be applied to 

individual elements of the claim, not to the invention as a whole.” Warner-Jenkinson Co.,

520 U.S. at 29. “An analysis of the role played by each element in the context of the 

specific patent claim will thus inform the inquiry as to whether a substitute element 

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matches the function, way, and result of the claimed element, or whether the substitute 

element plays a role substantially different from the claimed element.” Id.

 Plaintiffs fail to apply the doctrine of equivalents to each individual element of the 

patent claim and only apply the doctrine to the invention as a whole. For example, Patent 

‘003 claims as individual elements “a plurality of rods” and “flexible spacer strips.” 

(Patent at 1, 13–14.) Plaintiffs do not argue or identify specific elements of the Accused 

Device as equivalent to these elements. The Court notes that the Accused Device utilizes 

a metal sheet around which copper wire is wrapped and that this metal sheet, at first 

blush, could appear to be a substitute element that matches the function, way, and result 

of the claimed “plurality of rods” in Patent ‘003. The expert witness’s testimony and 

report shows, however, that this structural difference is not insubstantial because it 

creates a difference between how a device under Patent ‘003 and the Accused Device 

would perform in the form of generating different MVEM fields, such that the two 

devices’ functions are “substantially different.” See Graver Tank, 339 U.S. at 608. While 

the Accused Device’s notches at the top of the metal sheet core that secure the wire 

wrapped around it might be construed as playing the same role as the flexible spacer 

strips claimed in Patent ‘003, again, the expert witness’s testimony and report indicate 

that this difference in construction is not insubstantial because it changes the way the 

devices function and the resulting MVEM fields. 

 The Court finds Plaintiffs have failed to apply the doctrine of equivalents to the 

individual elements of each claim, and the expert witness’s testimony and report show 

that even if the elements in the Accused Device could be construed as substitutes, 

Plaintiffs have produced no evidence to show they match the function, way, and result of 

the claimed elements in Patent ‘003. See Warner-Jenkinson Co., 520 U.S. at 29; Hilton

Davis Chem. Co., 62 F.3d at 1521–22. Accordingly, Plaintiffs have not shown a 

likelihood of success on the merits of proving that the Accused Device infringes on 

Patent ‘003 under the doctrine of equivalents. 

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 b. Prosecution History Estoppel 

 Plaintiffs are also subject to prosecution history estoppel, which “requires that the 

claims of a patent be interpreted in light of the proceedings in the PTO during the 

application process.” Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 535 U.S. 

722, 733 (2002). Prosecution history estoppel precludes a patentee from claiming 

infringement and regaining, through litigation, subject matter or a purported equivalent 

alleged to infringe, when the patentee narrowed the claim in response to a PTO rejection. 

Festo Corp, 535 U.S. at 733–34 (quoting Wang Labs., Inc. v. Mitsubishi Elecs. Am., Inc.,

103 F.3d 1571, 1578 (Fed. Cir. 1997)). When the PTO rejects a patent application, it is 

because the patent examiner believes the original claim cannot be patented. Id. at 734. 

Although an amendment to a patent application is not an absolute bar to a later claim of 

infringement, when a patentee forgoes his or her appeal and submits an amended 

application, courts may interpret such as a concession that the invention as patented does 

not reach as far as the original claim. Id. In other words, estoppel arises when an 

amendment is made to secure the patent and the amendment narrows the patent’s scope. 

Id. at 736. 

 The patentee has the burden to show that an amendment was not for purposes of 

patentability, and where no explanation is established “the court should presume that the 

patent application had a substantial reason related to patentability for including the 

limiting element added by amendment.” Id. at 739–40 (quoting Warner-Jenkinson, 520 

U.S. at 33.) The court should also “presume that the patentee surrendered all subject 

matter between the broader and narrower language.” Id. at 740. 

 Plaintiffs, as the moving party asserting infringement of Patent ‘003, have the 

burden of proving the amendments made in response to the PTO’s rejection of an earlier 

patent application do not surrender the alleged equivalents in question. See id.; (see 

Doc. 69, Patent History at 73–80.) In June 2012, the PTO rejected the patent application 

and all claims, 1-18, citing to 35 U.S.C. § 103(a) and finding that differences between 

existing patents – the “Godoy Patent” and the “White Patent” – and the patent application 

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would have been obvious to one of ordinary skill in the art at the time of the invention. 

(See Patent History at 74–79.) In response, the inventors traversed the rejections and 

submitted amendments. (See Patent History at 59–67.) The inventors added the following 

language to claim 1: “and a flexible spacer strip connecting ends of each of the plurality 

of rods” (Patent History at 59), and in describing the method for generating MVEM fields 

in claim 12, added the underlined language: “each of the rods being connected to a 

flexible spacer strip, and each of the rods being disposed substantially parallel to each 

other” (Patent History at 61). Claim 17 was also amended to include “flexible” describing 

the “spacer strip attached to each end of the elongated rods.”7

 (Patent History at 62.) 

 Plaintiffs do not address prosecution history estoppel in their Bench or Closing 

Briefs, let alone provide an argument against the presumption that the patentee’s 

amendment of the claims in response to the PTO’s rejection is a general surrender of the 

territory between the original claim and the amended claim. See Festo Corp., 535 U.S. at 

740. The prosecution history indicates that the amendments were made to address the 

PTO’s previous rejection on the basis of obviousness by including the more specific term 

“flexible spacer strip” and emphasizing the “plurality of rods.” (See Patent History at 65.) 

In the remarks submitted to the PTO with the amendments, the patentee specifically 

addresses the “Godoy Patent,” explaining that it fails to teach and would not have 

rendered obvious amended claim 1 “a flexible spacer strip connecting ends of each of the 

plurality of rods,” and amended claims 12 and 17 also referencing the rods and flexible 

spacer strip. (See Patent History at 65–66.) Based on the record before the Court, where 

Plaintiffs have not addressed Defendants’ prosecution history estoppel argument and the 

patent prosecution history shows the narrowing of claims, the Court cannot say Plaintiffs 

 

7

 The Court notes that the patentee’s remarks submitted with the amendments to the patent include the statement “any amendments herein that are not specifically made 

for the purpose of patentability are made for other purposes, such as clarification, and that 

no such changes shall be construed as limiting the scope of the claims or the application 

of the Doctrine of Equivalents.” (Patent History at 66.) Without further detail by the 

patentees as to which amendments were not specifically made for patentability, and given 

only this boilerplate language, the Court does not find this statement material to its 

analysis.

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have rebutted the presumption that estoppel applies and the alleged equivalents at issue 

have been surrendered. See id.

 At this stage, because Plaintiffs have not shown they are likely to overcome the 

limitations of the all elements rule and prosecution history estoppel, they have failed to 

show a likelihood of success on the merits that the Accused Device infringes upon Patent 

‘003 under the doctrine of equivalents.8

B. Unauthorized Use of Plaintiffs’ Confidential and Proprietary 

 Information 

 Next, Plaintiffs argue that Defendants violated the NDAs and engaged in 

unauthorized use of Plaintiffs’ confidential and proprietary information. (Pls.’ Closing 

Br. at 13.) Specifically, Plaintiffs argue that Defendants’ use of their marketing materials, 

service reports, and customer lists violated the NDAs. (Pls.’ Closing Br. at 13–14.) 

Plaintiffs request that the Court enjoin Defendants’ continued use of Plaintiffs’ 

confidential and proprietary information. (Pls.’ Closing Br. at 1.)

 The Court notes that it has federal question jurisdiction over this matter where 

Plaintiffs bring claims that arise under the laws of the United States, including the patent 

infringement claim. See U.S.C. § 1331; 35 U.S.C. § 281. The Court has supplemental 

jurisdiction over Plaintiffs’ Arizona state law claims because they also involve the 

alleged unlawful use of Plaintiffs’ technology related to Patent ‘003 and related 

confidential and proprietary information. See 28 U.S.C. § 1367(a).9

 As such, Plaintiffs’ 

 

8

 Defendants argue that Plaintiffs have not established they are entitled to enforce Patent ‘003 because Plaintiffs’ ownership is based on an assignment that is in turn 

contingent on a royalty agreement with Mr. Wilson, and Mr. Wilson has not yet received 

any royalty payments. (See Defs.’ Closing Br. at 16 n.61.) Because the Court does not find likelihood of success on the merits for Plaintiffs’ patent infringement claim at this 

point, it need not address Defendants’ argument regarding Plaintiffs’ ownership of Patent 

‘003 at this time. 9

 Defendants admit that this Court has subject matter jurisdiction and personal jurisdiction over Defendants. (Doc. 97, Am. Compl. at 3.) Because the Court is applying 

basic contract principles, the choice of law was not critical to the Court’s decision in this 

instance. The parties are advised they will need to demonstrate why Arizona law applies 

to any claims going forward. See Barba v. Seung Heun Lee, No. CV 09-1115-PHX-SRB, 

2009 WL 8747368, at *9–10 (D. Ariz. Nov. 4, 2009) (citing Restatement (Second) of 

Conflict of Laws (1971) § 145(1) cmt. d). 

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state law claims are closely related to the patent infringement claim and form part of the 

same case or controversy. See id.

 1. Likelihood of Success on the Merits 

 When interpreting contracts, such as the NDAs at issue here, courts seek to 

ascertain and enforce the parties’ intent. ELM Ret. Ctr., LP v. Callaway, 246 P.3d 938, 

941 (Ariz. Ct. App. 2010). To determine intent, courts “look[s] to the plain meaning of 

the words as viewed in the context of the contract as a whole.” Id. at 941–42. 

 In the NDAs, “Confidential Information” is defined as “all information (in written, 

oral or electronic form) that is disclosed between the parties and that is conspicuously 

marked by the disclosing party . . . as being confidential, or should have been reasonably 

understood by the receiving party . . . to be confidential.” (NDAs at 1.) The NDAs further 

state:

Confidential Information shall include, without limitation, business, 

financial, accounting and marketing information, analyses, forecasts, 

predictions or projections, as well as technical information, software, 

demonstration programmes, routines, computer systems, techniques, 

documentation, designs, procedures, formulas, inventions, improvements, 

concepts, record files, memoranda, reports, drawings, plans, price lists, 

customer lists or other account information, trade secrets, know-how, 

and/or other intellectual property. 

(NDAs at 1.) The NDAs also provide that certain information shall not be considered 

Confidential Information, including that which: 

“(a) is or becomes public domain through no action on the part of the 

Receiving Party; (b) is lawfully obtained from any other source other than 

the disclosing party (the “the Disclosing Party”), without an obligation to 

keep it confidential; (c) is previously known to the Receiving Party without 

an obligation to keep it confidential, as can be substantiated by written 

records . . .; or (f) is independently developed by the Receiving Party.” 

(NDAs at 2.)

 The Court finds that it is unlikely that Plaintiffs will succeed on the merits of their 

claim that Defendants violated the NDAs and engaged in unauthorized use of Plaintiffs’ 

confidential and proprietary information. First, none of the items Plaintiffs argue 

Defendants engaged in unauthorized use of – marketing materials (Pls.’ Hr’g Ex. 32, 33, 

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34), service agreements (see, e.g., Pls.’ Hr’g Exs. 39, 41, 50, 118–123), and customer 

lists10 – were Confidential Information under the NDAs by being conspicuously marked 

as confidential. (See also Tr. at 94.) To the extent Plaintiffs argue Defendants used 

Plaintiffs’ investor pitch deck, specifically the slide listing Plaintiffs’ clients, which was 

marked as confidential, the client identities listed therein are not confidential under the 

NDA for the reasons discussed below. Second, before SWI entered into the APA and 

transferred its related interests to Plaintiffs, the individual Defendants working for SWI 

attended various trade shows and displayed the names of their customers, which are the 

same customers that Plaintiffs claim are confidential. (Tr. at 96–99.) Because Plaintiffs’ 

clients’ identities were shown to the public at trade shows, and because of the individual 

Defendants’ long-term relationships with their previous clients via SWI, Mr. Corrigan, 

Director of Operations for Plaintiffs, stated there was no basis on which Defendants 

should have reasonably understood the client identities, as produced in the client lists 

used as marketing materials, were confidential. (Tr. at 98.)

 The materials Plaintiffs claim are confidential also fall into the specific categories 

outlined in the NDAs as information that shall not be considered Confidential 

Information. With regard to marketing materials, ELWS’s promotional video includes a 

Powerpoint slide with logos of customers that Plaintiffs allege Defendants took from 

them. (Pls.’ Hr’g Ex. 32.) The customers included on the Powerpoint slide are the same 

customers that were displayed to the public at the trade shows referenced above, and thus 

the content of the marketing materials was in the public domain and is not Confidential 

Information. (See NDAs at 2.) In addition, the marketing materials are not Confidential 

Information under the NDAs because the identity of the clients was previously known to 

the individual Defendants where those same clients were customers of SWI, with whom 

 

10 Plaintiffs’ Closing Brief does not cite to specific exhibits when it refers to “AGT’s customer list” that Plaintiffs allege Defendants used in violation of the NDAs. 

(See Pls.’ Closing Br. at 13–14.) The Court notes that Plaintiffs’ hearing exhibits 3, 4, 33, 34 and 130 include lists of Plaintiffs’ and SWI clients. In addition, the APA with the list 

of former SWI clients was included as an exhibit to Defendants’ Bench Brief. (APA at 

23–24.) The Court considers these various customer lists in its analysis. 

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Defendants worked, and the individual Defendants were under no obligation to keep the 

client identities confidential. (See Tr. at 94–96, 100; APA at 2.) Similarly, the second 

type of material Plaintiffs allege Defendants engaged in unauthorized use of – client lists 

– is non-Confidential Information as identified in the NDAs for the same two reasons. 

The client lists and identities were put in the public domain at the trade shows and were 

previously known to the individual Defendants without an obligation to keep that 

information confidential.

 As to the service contracts to which Plaintiffs cite, because the individual 

Defendants worked for and/or with SWI, they were previously aware of the service 

contract terms, and there is no evidence showing a separate confidentially agreement 

between SWI and the individual Defendants requiring Defendants to keep the service 

contract information confidential. (See Tr. at 94–96, 100, 103–05; NDAs at 2.) 

Accordingly, the service contracts are also not Confidential Information. In addition, 

although it is unclear which individual Defendant may have been responsible for initially 

creating the customer service contracts while working for and/or with SWI, it is likely 

that the individual Defendants “independently developed” those contracts that were later 

transferred to Plaintiffs, further establishing that the service contracts are not Confidential 

Information under the NDA. (See NDAs at 2.)

 Plaintiffs point to the first clause in the NDAs and argue it expressly states the 

primary purpose of the NDAs was to protect the parties from disclosure of “all 

proprietary, technical and financial information and documentation.” (Pls.’ Closing Br. at 

15) (emphasis in original.) However, the clause does not include the word “all,” and the 

NDAs’ more specific provisions defining Confidential Information are clear and not 

supplanted by the general opening clause. 

 Plaintiffs failed to show that their marking materials, service reports and contracts, 

and customer lists were conspicuously marked as confidential or that the individual 

Defendants should have reasonably understood they were confidential. Rather, the 

present state of the evidence shows that the client lists and marketing materials should not 

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be considered Confidential Information because they were in the public domain and were 

previously known to the individual Defendants without any obligation between SWI and 

Defendants to keep the information confidential. The service contracts were also 

previously known to the individual Defendants without an obligation to keep the 

information confidential. Accordingly, Plaintiffs are unlikely to succeed on their claim 

that the individual Defendants violated the NDAs. 

C. Arizona Uniform Trade Secrets Act 

Plaintiffs argue that Defendants’ disclosure of Plaintiffs’ customer lists violated 

the Arizona Uniform Trade Secrets Act, A.R.S. §§ 44-401–407. (Pls.’ Closing Br. at 14.) 

“To establish a claim for misappropriation of a trade secret, the claimant must first prove 

a legally protectable trade secret exists.” Calisi v. Unified Fin. Servs., LLC, 302 P.3d 628, 

631 (Ariz. Ct. App. 2013). When determining whether a trade secret exists under Arizona 

law, courts first focus on whether the subject matter of the information is secret, and 

second, whether reasonable efforts have been taken to keep the information secret. See

id.; A.R.S. §44-401(4). Contrary to Plaintiffs’ assertion that customer lists are always 

considered trade secrets, courts consider a number of factors in making that 

determination. See Calisi, 302 P.3d at 631–34. 

 Here, the subject matter in the customer lists – the identity of the customers – was 

not secret, and Plaintiffs did not make reasonable efforts to keep the information secret. 

Plaintiffs were aware that prior to the APA, the individual Defendants had previously 

shared the names of customers at trade shows and Plaintiffs shared their customer list in 

their own marketing materials, and thus the client information was publicly available. 

Plaintiffs also did not provide evidence tending to establish any of the factors that courts 

consider when determining whether a customer list is a trade secret. See id. at 631–32. 

Accordingly, at this preliminary injunction stage, Plaintiffs fail to show that the customer 

lists are legally protectable trade secrets and that Defendants have violated the Arizona 

Uniform Trade Secrets Act. See id. at 631; A.R.S. §44-401(4). 

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D. Irreparable Harm, Balance of Hardships and Public Interest 

For both their patent infringement and violation of confidentiality and NDA 

claims, Plaintiffs have failed to satisfy their burden of demonstrating they have met the 

first of the four elements of the preliminary injunction test, and the Court need not 

consider the remaining three. See DISH Network Corp. v. F.C.C., 653 F.3d 771, 776 (9th 

Cir. 2011); see also Garcia, 786 F.3d at 740. However, in some cases, the Ninth Circuit 

has employed a sliding scale analysis weighing the four factors and has stated that 

likelihood of success per se is not an absolute requirement. See Drakes Bay Oyster Co.,

747 F.3d at 1085 (quoting Cottrell, 632 F.3d at 1132). The Court finds that Plaintiffs also 

fail to satisfy their burden under this standard.

 Plaintiffs allege they will suffer irreparable harm due to loss of control over their 

trade secrets, damage to their business goodwill and reputation, and loss of significant 

market share. (Pls.’ Closing Br. at 15–17.) Plaintiffs also allege the balance of hardships 

tips in their favor because Defendants have been and will continue to take Plaintiffs’ 

clients while infringing on Plaintiffs’ patent and providing identical services. (Pls.’ 

Closing Br. at 17–18.) Plaintiffs do not set forth an argument as to the public interest 

factor. (See Pls.’ Closing Br.) The Court finds that under the sliding scale analysis, the 

balance of hardships, irreparable harm to Plaintiffs, and public interest considerations are 

not so significant as to outweigh Plaintiffs’ failure to meet their burden to show serious 

questions going to the merits or likelihood of success on the merits. Cf. Cottrell, 632 F.3d 

at 1135 (stating “environmental injury, by its nature, can seldom be adequately remedied 

by money damages and is often permanent or at least of long duration”); Shell Offshore, 

Inc. v. Greenpeace, Inc., 709 F.3d 1281, 1291 (9th Cir. 2013) (finding serious risk of 

harm to human life constitutes an injury that would be irreparable). Unlike in other cases 

where courts have found irreparable harm, such as the environmental injuries in Cottrell

and the potential of death and physical pain in Shell Offshore, Plaintiffs’ have not shown 

such significant injury or that their alleged injuries can only be protected through a 

preliminary injunction rather than monetary damages. See L.A. Mem’l Coliseum Comm’n 

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v. Nat’l Football League, 634 F.2d 1197, 1202 (9th Cir. 1980) (monetary injury is not 

considered irreparable). The Court concludes that likelihood of success on the merits of 

Plaintiffs’ claims “is too remote to justify the extraordinary remedy of a preliminary 

injunction.” Drakes Bay Oyster Co., 747 F.3d at 1085. 

IV. CONCLUSION

 Plaintiffs are not entitled to a temporary restraining order or preliminary injunction 

as to their patent infringement and violation of the confidentiality and NDA claims where 

they did not, by a clear showing, carry their burden of persuasion. See Mazurek, 520 U.S. 

at 972. Plaintiffs did not satisfy their burden as to the first element of the preliminary 

injunction test – likelihood of success on the merits – and because a preliminary 

injunction is a drastic and extraordinary remedy never awarded as of right, the Court will 

not grant an injunction here. See Drakes Bay Oyster Co., 747 F.3d at 1085; Intel Corp.,

995 F.2d at 1568. 

 IT IS THEREFORE ORDERED denying Plaintiffs’ America Greener 

Technologies, Inc., American Greener Technologies Corporation, and AGT Softwave, 

Inc. Application for Temporary Restraining Order and Preliminary Injunction (Doc. 2).

 IT IS FURTHER ORDERED that, while the Court enters this Order under seal 

in consideration of the parties’ confidential information, the parties shall file under seal 

joint proposed redactions to this Order by April 4, 2016. The Court will then enter a 

redacted version of this Order on the public docket. 

 Dated this 23rd day of March, 2016. 

 

 Honorable John J. Tuchi 

 United States District Judge 

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