Opinion ID: 1028123
Heading Depth: 2
Heading Rank: 1

Heading: Overbreadth of the Injunction

Text: The relevant portion of the district court’s Order granting equitable relief to Western provides as follows: Melanie Moore is hereby ENJOINED from (1) providing any form of financial assistance, including a loan guarantee, to any competitor of Western Insulation, Inc., or to Stephanie Schulkamp or David Barnes personally; (2) engaging in any financial control or oversight of American Insulation, Inc. (“American”) or Empire Insulation, Inc. (“Empire”); and (3) exercising any option agreement and security agreement that she entered with American, entering any option agreement or security agreement with Empire, or obtaining any other form of ownership or business interest in American or Empire, for a period of two years, ten months, and seventeen days from the date of this Order. J.A. 852-53. Melanie contends this language is impermissibly broad because sections (1) and (2) are unlimited in duration and thus are indefinite time restrictions on her. She also avers that section (1) exceeds the scope of her Agreement by precluding even personal financial assistance to either Barnes or Schulkamp. We find Melanie’s arguments unavailing. A plain reading of the Order’s language indicates the time limitation applies with equal force to all three sections, not just the last prohibition against exercising options and agreements with American or Empire. Moreover, the Order itself 9 makes clear that the district court’s rationale is “explained in the Memorandum Opinion accompanying this Order.” J.A. 852. In its Memorandum Opinion the district court stated that Melanie has breached her [Non-Compete Agreement] for a total of two years, ten months, and seventeen days – the period from March 5, 2005 to the date of this Memorandum Opinion. Accordingly, the Court will issue an injunction that will, in effect, extend her obligations under her Agreement for a period of that length. J.A. 845 (emphasis added). The reference to “obligations,” in plural form, provides additional evidence that all of the prohibitions in the district court’s order were subject to the time limitation. The district court’s Order and the record show unequivocally, contrary to Melanie’s strained interpretation, that she is enjoined from all the enumerated activities for a period of two years, ten months, and seventeen days from January 22, 2008. Melanie also contends that the district court’s prohibition against personal financial assistance to Barnes or Schulkamp goes beyond the terms of her Agreement with Western. However, if Melanie had not breached the Agreement by providing substantial financial assistance to establish businesses in direct competition with Western, as she had agreed not to do, she would remain free to offer personal financial assistance to Barnes or Schulkamp if she wished. As the district court no doubt realized, equitable relief prohibiting direct financial 10 assistance to Empire and American but permitting a virtually unlimited subsidy for the personal expenditures of those companies’ principals would naturally and impermissibly accrue to the benefit of Empire and American by simply moving funds from one pocket to another. The relief designed by the district court was “no more burdensome to the defendant than necessary to provide complete relief to the plaintiffs.” Califano v. Yamasaki, 442 U.S. 682, 702, 99 S.Ct. 2545, 61 L.Ed.2d 176 (1979). As such, the district court did not err.