Opinion ID: 2995202
Heading Depth: 3
Heading Rank: 2

Heading: Specificity of the Permanent

Text: Injunction On February 9, 2000, the district court partially granted 3M’s request for a permanent injunction. The court ordered that Accu-Tech and its founders were permanently enjoined from disclosing to any third party (1) the operating procedures, quality manuals, process standards, and operator notes for using plaintiff’s equipment that makes resin sheeting; (2) plaintiff’s customized resin formulations that enhance the sheeting and thermoforming capability of resin and give it properties needed in the electronic industry; (3) plaintiff’s slitting technology and experiment results including the design and setup of slitters; and (4) plaintiff’s winding methods used to compensate for variations in film calipher. However, contrary to 3M’s request, the district court did not enter an order permanently enjoining the defendants from using 3M’s operating procedures and manuals or customized resin formulation. Rather, the court decreed that once the defendants had paid the plaintiff $270,500 in partial satisfaction of the jury verdict (or provided security in an amount sufficient to assure full payment and subsequent costs), defendants were free to use the two aforementioned trade secrets./3 On appeal, both parties assert that the district court committed error in its February 9 order. Accu-Tech and its founders, focusing on the court’s injunction against disclosure of 3M’s operating procedures and manuals, contend that the court’s order is too vague, and thus does not comply with Fed. R. Civ. P. 65(d). For its part, 3M maintains that the court incorrectly relied upon defendants’ payment of damages as justification for not permanently enjoining the defendants from using 3M’s misappropriated trade secret--an argument we will address in Part B3. We review the district court’s grant or denial of a permanent injunction for abuse of discretion. Knapp v. Northwestern Univ., 101 F.3d 473, 478 (7th Cir. 1996). Factual determinations are reviewed for clear error and legal conclusions are given de novo review. A factual or legal error may be sufficient to establish an abuse of discretion. Id. The requirements for a valid injunction are found in Fed. R. Civ. P. 65(d), which provides, so far as pertinent here, that [e]very order granting an injunction . . . shall set forth the reasons for its issuance; shall be specific in terms; shall describe in reasonable detail, and not by reference to the complaint or other document, the act or acts sought to be restrained. As the Supreme Court has noted, the specificity provisions of Rule 65(d) are no mere technical require ments. The Rule was designed to prevent uncertainty and confusion on the part of those faced with injunctive orders, and to avoid the possible founding of a contempt citation on a decree too vague to be understood. Schmidt v. Lessard, 414 U.S. 473, 476 (1974). Thus, district courts must endeavor to strike a balance, framing orders that provide plaintiffs with the appropriate level of protection while still placing defendants on notice of the prohibited conduct. See American Can Co., 742 F.2d at 333. The defendants here contend that the injunction against disclosure entered by the district court must be vacated because, as a matter of law, the terms are too vague to give them fair notice of the prohibited conduct. In so arguing, Accu-Tech and its founders propound that 3M has not identified what information within the 500-plus pages of manuals it considers to be secret, and that much of the information contained in those pages is either generalized business information or information relating to the manufacture of carrier tape, rather than resin sheeting. The problem of framing an appropriate order may be particularly acute in trade secrets cases, see id. at 332, and it for that reason that courts have often set aside trade secrets injunctions as failing to comply with Rule 65(d)’s specificity requirements, see, e.g., E.W. Bliss Co. v. Struthers-Dunn, Inc., 408 F.2d 1108, 1113-17 (8th Cir. 1969) (reversing, as too vague, an order enjoining defendants from using or disclosing trade secrets and confidential technical information of plaintiff); Brumby Metals, Inc. v. Bargen, 275 F.2d 46, 49 (7th Cir. 1960) (finding language in injunction that prohibited defendant from selling furniture incorporating plaintiff’s design feature as offered in the current sales literature of Schoolco, Inc., or any variation thereof to be overly vague); cf. PMC, Inc. v. Sherwin- Williams Co., 151 F.3d 610, 619 (7th Cir. 1998) (district court’s injunction ordering Sherwin-Williams to take full responsibility for the future remediation of the PMC facility remanded for redrafting because the term full responsibility was hopelessly vague). However, the challenges to the injunctions in those cases are very different from the challenge raised by the defendants here. In this instance, the defendants do not truly find error in the scope of the injunction as protecting disclosure of items beyond that which has previously been determined to be the applicable trade secret. Rather, to the extent that defendants find fault with the district court’s order, it is because they argue that 3M cannot have a valid trade secret in the operating procedures and manuals. We found that argument unpersuasive above, and simply because defendants have refitted it as a challenge to the district court’s permanent injunction does not add any merit to it. Here, the district court’s order does nothing more than prohibit the defendants from disclosing the trade secret. In its memorandum, the district court acknowledged that defendants had sought a more narrow injunction, identifying specific secrets not to be used. However, the court determined that, in part to curb the misconduct and evasive action of defendant Pribyl, no opportunity for loopholes should be allowed. We agree with the district court’s decision that more specificity in the injunction is not mandated. Rule 65(d) does not require the impossible. There is a limit to what words can convey. The more specific the order, the more opportunities for evasion. Scandia Down Corp. v. Euroquilt, 772 F.2d 1423, 1431 (7th Cir. 1985). If narrow literalism is the rule of interpretation, injunctions will spring loopholes, and parties in whose favor injunctions run will be inundating courts with requests for modification in an effort to plug loopholes. Schering Corp. v. Illinois Antibiotics Co., 62 F.3d 903, 906 (7th Cir. 1995) (internal citation omitted). Further, Rule 65(d)’s specificity requirement does not demand that the court issuing the injunctiondisclose the trade secrets in its order. See Synthex Ophthalmics, 701 F.2d at 683. We are aware that certain materials falling within the trade secret are public information. However, we believe it sufficient protection against the fear of unfair surprise embodied in the cases discussing Rule 65(d)’s specificity requirement that injunctions are construed narrowly, with close questions of interpretation being resolved in the defendant’s favor. See Schering, 62 F.3d at 906. As such, we cannot hold that the district court abused its discretion in granting this permanent injunction against disclosure.