IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 13-10829

SOFTWARE DEVELOPMENT TECHNOLOGIES, 

 Plaintiff - Appellant

v.

TRIZETTO CORPORATION, 

 Defendant - Appellee

Appeal from the United States District Court

for the Northern District of Texas

USDC No. 4:13-CV-423

Before STEWART, Chief Judge, and BENAVIDES and OWEN, Circuit Judges.

PER CURIAM:*

This appeal is from the denial of a motion for preliminary injunction 

sought by Plaintiff-Appellant Software Development Technologies (“SDT”) 

against Defendant-Appellee TriZetto Corporation (“TriZetto”). SDT provided 

software testing services to TriZetto from 2012 to 2013 using its “Software 

Testing in the Real World” (“STRW”) methodology and courseware. In the 

course of conducting business, disputes arose over the use and licensing of the 

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not 

be published and is not precedent except under the limited circumstances set forth in 5TH 

CIR. R. 47.5.4.

United States Court of Appeals

Fifth Circuit

FILED

November 5, 2014

Lyle W. Cayce

Clerk

 

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STRW methodology and courseware, leading to this action in which SDT 

brought claims against TriZetto for misappropriation of trade secrets, breach 

of contract, and conversion. The case was originally filed in Tarrant County 

District Court in Fort Worth, Texas, and removed to the Northern District of 

Texas, Fort Worth Division. TriZetto filed a motion to dismiss for improper 

venue, motion to transfer, and motion to compel arbitration per the parties’ 

Master Contractor Services Agreement. SDT filed a motion for preliminary 

injunction. Specifically, SDT sought to enjoin TriZetto’s

use of the SDT intellectual property1 . . . in the TriZetto Testing 

Automation Framework [“TAF”] and to prevent TriZetto from 

selling, distributing, advertising, marketing, providing or 

otherwise releasing or demonstrating to any other person or 

company any product, software, business solution or other tangible 

item that contains, uses, references, or incorporates the SDT 

intellectual property pending trial on the merits of this lawsuit.

Br. Supp. Mot. Prelim. Inj. 1. The parties filed motions to conduct expedited 

discovery in connection with the preliminary injunction motion. 

On July 2, 2013, the district court called counsel to schedule a telephone 

conference for later that day. The motions before the court were the motion to 

transfer venue, motion for preliminary injunction, motions from each party for 

leave to conduct expedited discovery relating to the preliminary injunction, 

and motion to compel arbitration. The conference call included the district 

court and both parties’ counsel. Neither party had been told what the 

conference call would cover. During the telephone conference, which lasted 

eleven minutes, there was no presentation of evidence for the district court’s 

consideration. The district court denied the motion to transfer, denied the 

motion for preliminary injunction, denied the motions for expedited discovery, 

1 SDT IP is defined by SDT as “[t]he contents of the STRW disks and associated 

methodologies and concepts disclosed in the STRW materials.” Br. Supp. Mot. Prelim. Inj. 2.

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and granted the motion to compel arbitration. That same day, the district court 

entered a written order consistent with the telephone conference, without 

further elaboration. Arbitration is now ongoing. On appeal from the denial of 

a preliminary injunction, SDT argues that the district court did not enter 

findings of fact and conclusions of law in compliance with Federal Rule of Civil 

Procedure (“FRCP”) 52(a), did not hold an evidentiary hearing in compliance 

with FRCP 65, and improperly denied its motion for preliminary injunction.

We agree.

This Court reviews a district court’s denial of a preliminary injunction 

for abuse of discretion. PCI Transp., Inc. v. Fort Worth & Western R.R. Co., 418 

F.3d 535, 545 (5th Cir. 2005) (citing Lake Charles Diesel, Inc. v. General Motors 

Corp., 328 F.3d 192, 195 (5th Cir. 2003)). To obtain a preliminary injunction, a 

plaintiff must show that it “is likely to succeed on the merits, that [it] is likely 

to suffer irreparable harm in the absence of preliminary relief, that the balance 

of equities tips in [its] favor, and that an injunction is in the public interest.” 

Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008).

FRCP 52(a)(1) states, “In an action tried on the facts without a jury or 

with an advisory jury, the court must find the facts specially and state its 

conclusions of law separately.” Fed. R. Civ. P. 52(a)(1). We have applied this 

rule in the context of preliminary injunctions. See Petrello v. Nath, 350 F. App’x 

887, 890-92 (5th Cir. 2009); Sierra Club, Lone Star Chapter v. F.D.I.C., 992 

F.2d 545, 551-52 (5th Cir. 1993).

In the instant case, all we have to review of the district court’s decision 

is its comments on the matter during the telephone conference:

I can see that there at least would be a fact issue as to whether or 

not the contract’s violated, but that’s a different proposition from 

concluding that a preliminary injunction should be granted.

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There are a lot of factors to take into account to decide whether or 

not, ultimately, there would—a breach of contract would be found 

to exist, such as, whether or not there’s a possibility for some relief 

besides injunctive relief, such as the recovery of damages.

I haven’t found anything in the papers to indicate to me that the 

defendant couldn’t respond to a judgment in damages, if required 

to do so.

I don’t—I don’t think a preliminary injunction is necessary or 

appropriate in this case, so I’m going to deny that request.

Tr. Telephone Conference 7, July 2, 2013. TriZetto characterizes this portion 

of the conference as findings on the record in compliance with FRCP 52, but 

this interpretation is flawed. In the second paragraph, the district court begins 

as if it is considering factors regarding the likelihood of succeeding on the 

merits (i.e., “whether or not, ultimately, there would—a breach of contract 

would be found to exist”) but then notes, as an example, the availability of 

damages as a remedy, which is not a factor for deciding whether the contract 

was likely breached. TriZetto interprets this portion of the conference as 

indicating that the district court “ultimately decided nothing in the parties’ 

briefings supported SDT’s claim that it suffered irreparable harm,” Appellee’s 

Br. 17, but the record is unclear. Given that the second paragraph ends with 

the district court speaking about the adequacy of damages, it is possible that 

the subsequent statement in the third paragraph was a conclusion with respect 

to the adequacy of damages—that is, that damages would be an adequate 

remedy if SDT received a favorable judgment. Since a failure of any one of the 

four requirements for a preliminary injunction would be a sufficient basis to 

deny the preliminary injunction, finding damages to be an adequate remedy 

would allow the district court to deny the application on the basis that no 

irreparable harm would result from a denial of a preliminary injunction. 

However, the statement itself seems to relate more to TriZetto’s ability to 

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respond to a judgment in damages, which does not relate to whether damages 

would be an adequate remedy. See Janvey v. Alguire, 647 F.3d 585, 600 (5th 

Cir. 2011) (“[T]he mere fact that economic damages may be available does not 

always mean that a remedy at law is ‘adequate.’”). Though the district court 

did subsequently memorialize the telephone conference in a written order, it 

did not elaborate to include any specific findings. We find that the district court 

failed to enter findings of fact and conclusions of law in compliance with FRCP 

52(a) in its ruling on the preliminary injunction motion. Thus, we vacate the 

judgment denying the preliminary injunction.

Because we must vacate the judgment of the district court on the basis 

of its failure to comply with FRCP 52(a), we need not consider whether the 

judgment should also be vacated on the basis of FRCP 65. Accordingly, we 

VACATE the judgment of the district court denying the request for a 

preliminary injunction, and REMAND for further proceedings as may be 

necessary. VACATED and REMANDED.

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