Court Opinion

ID: 181913
Source: CourtListenerOpinion
Date Created: 2010-12-29 01:01:52+00
Date Added: 2024-06-11T17:25:57.314357
License: Public Domain

FILED
                              NOT FOR PUBLICATION                             DEC 28 2010

                                                                          MOLLY C. DWYER, CLERK
                      UNITED STATES COURT OF APPEALS                        U.S. COURT OF APPEALS

                              FOR THE NINTH CIRCUIT

LUKE RICHEY, JENNIFER RICHEY,                    No. 10-35459
husband and wife,
                                                 D.C. No. 2:10-cv-00020-LRS
                Plaintiff-counter-defendant -
Appellee,
                                                 MEMORANDUM*
  v.

METAXPERT LLC, a Washington limited
liability company; et al.,

                Defendants-counter-claimants
- Appellants,

  and

CHARLES MANNING; et al.,

                Defendants,

  v.

GRAVITY JACK, INC.,

                Third-party-defendant -
Appellee.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                    Appeal from the United States District Court
                      for the Eastern District of Washington
                   Lonny R. Suko, Chief District Judge, Presiding

                     Argued and Submitted December 10, 2010
                               Seattle, Washington

Before: BEEZER, O’SCANNLAIN, and PAEZ, Circuit Judges.

      Appellants (collectively “Manning”) challenge the district court’s denial of

preliminary injunctive relief against: (1) Appellees (collectively “Richey”)

designing smart phone gaming software, and (2) Richey’s continued control of a

RentACoder.com account. We have jurisdiction to review the district court’s order

pursuant to 28 U.S.C. § 1292(a)(1).1 We review the district court’s grant or denial

of a preliminary injunction for abuse of discretion. Southwest Voter Registration

Educ. Project v. Shelley, 344 F.3d 914, 918 (9th Cir. 2003) (en banc). For the

reasons set forth below, we conclude that the district court did not abuse its

      1
        The district court’s order was titled “Order on
Defendants/Counterclaimants’ Motion for Temporary Restraining Order.”
Temporary restraining orders are not appealable, but “[i]t is the essence of the
order, not its moniker, that determines [the court’s] jurisdiction.” Bennett v.
Medtronic, Inc., 285 F.3d 801, 804 (9th Cir. 2002). The essence of the district
court’s order in this case is not that of a temporary restraining order because it is
unlimited in temporal scope and was entered after adversarial processes. Id.
Therefore, we treat the order as a preliminary injunction over which we have
jurisdiction.
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discretion in denying the requested preliminary injunctive relief. We therefore

affirm.

      1.     Manning first argues that the district court abused its discretion by not

entering a preliminary injunction enjoining Richey from designing smart phone

gaming software. Before Richey started working for Manning’s company, he

signed an employment contract which included a non-competition agreement

stating that he would not compete with Manning in “the computer gaming

business” for a two-year period following his departure from Manning’s company.

The parties did not define the term “computer gaming business” in the non-

competition agreement. After Richey left Manning’s company, he started

designing software for smart phone games.

      Manning argues that a smart phone is a “computer” within the meaning of

the non-competition agreement and that Richey is violating the terms of the non-

competition agreement. Richey argues that the term “computer” does not include

smart phones. The district court concluded that the term “computer gaming

business” is ambiguous and that the issue is therefore “appropriately resolved by

the finder of fact upon further hearing at trial.” Richey v. Metaxpert, LLC, 2010

WL 1608887, *2 (E.D. Wash. 2010).

                                          3
      “A contract provision is ambiguous when its terms are uncertain or when its

terms are capable of being understood as having more than one meaning.” Mayer

v. Pierce County Med. Bureau, Inc., 909 P.2d 1323, 1326 (Wash. Ct. App. 1996).

Under Washington law, if a court cannot resolve the ambiguity through the

objective manifestation theory or the context rule, then the meaning of the

ambiguous provision is a question of fact to be determined by the trier of fact. See

BNC Mortgage, Inc. v. Tax Pros, Inc., 46 P.3d 812, 819-20 (Wash. Ct. App. 2002).

      Here, we agree with the district court that the term “computer gaming

business”—without any further definition by the parties in their 2007

agreement—is “capable of being understood as having more than one meaning.”

Mayer, 909 P.2d at 1326. Indeed, the term “computer” itself is ambiguous in light

of the objectively blurry line between personal computers and devices like smart

phones which can perform many of the same functions—including the capability to

support games—but remain popularly understood as distinct devices. Because

these terms are ambiguous and their meaning must be decided by the trier of fact,

the district court did not abuse its discretion when it denied Manning preliminary

injunctive relief on the ground that he failed to meet his burden to demonstrate a

likelihood of success on the merits.

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      2.     Manning also argues that he is entitled to ownership of a

RentACoder.com account that Richey currently controls. Manning urges us to

conclude that the district court abused its discretion in declining to require Richey

to surrender the account to him. When Richey started working for Manning’s

company, they agreed that if Richey’s employment terminated within less than two

years, Manning would transfer the RentACoder.com account to Richey. The

agreement conditions the transfer on the execution of a release containing certain

enumerated terms. Manning argues that Richey was terminated after more than

two years, and that even if he was terminated within two years, Richey did not sign

the release. Manning argues that he therefore has no obligation to transfer the

account to Richey. Richey maintains he was terminated after less than two years

and that he tried to execute such a release, only to be rebuffed by Manning.

      The district court concluded that the “evidence is conflicting and incomplete

as to the date of termination of Richey’s employment . . . and the current

ownership of the original RentACoder account.” Richey, 2010 WL 1608887, *2.

Our review of the record comports with the district court’s conclusions. There is

significant evidence suggesting that Richey was terminated within two years of

entering the agreement. It is also unclear whether Richey or Manning is to blame

for the fact that Richey did not sign the necessary release. Accordingly, Manning

                                          5
failed to meet his burden to demonstrate a likelihood of success on the merits, and

the district court did not abuse its discretion in concluding the same and denying

relief.

AFFIRMED.

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