Court Opinion

ID: 9384502
Source: CourtListenerOpinion
Date Created: 2023-04-04 00:00:33.754799+00
Date Added: 2024-06-11T17:17:53.909636
License: Public Domain

Case: 22-50442      Document: 00516698574         Page: 1     Date Filed: 04/03/2023

            United States Court of Appeals
                 for the Fifth Circuit                                 United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                                                           April 3, 2023
                                   No. 22-50442
                                                                         Lyle W. Cayce
                                                                              Clerk
   Direct Biologics, L.L.C.,

                                                             Plaintiff—Appellant,

                                       versus

   Adam McQueen; Vivex Biologics, Incorporated; Vivex
   Biologics Group, Incorporated,

                                                          Defendants—Appellees.

                   Appeal from the United States District Court
                        for the Western District of Texas
                               USDC 1:22-CV-381

   Before Davis, Dennis, and Higginson, Circuit Judges.
   James L. Dennis, Circuit Judge:
          Direct Biologics, LLC (“DB”) brought claims for breach of covenant
   to not compete and misappropriation of trade secrets against Adam
   McQueen, DB’s former employee, and Vivex Biologics, Inc. (“Vivex”),
   McQueen’s new employer. After granting DB a temporary restraining order
   based on its trade secret claims, the district court denied DB’s application for
   a preliminary injunction. Finding that DB’s claims were subject to
   arbitration, the district court also dismissed DB’s claims against McQueen
   and Vivex and entered final judgment. For the following reasons, we
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                                        No. 22-50442

   VACATE the district court’s orders denying DB’s motion for a preliminary
   injunction and dismissing DB’s claims, and REMAND for further
   proceedings consistent with this opinion.
                                             I.
                                             A.
          DB is a biotechnology company in the field of regenerative medicine,
   which develops and manufactures pharmaceutical products derived from
   biological sources. It offers two main product lines. The first, AmnioWrap, is
   an allograft skin substitute used for tissue repair and regeneration, with
   applications for slow-healing wounds, burn injury, and general surgery. The
   second, ExoFlo, is a proprietary extracellular vesicle (“EV”) product similar
   to stem cell therapy, with applications in the treatment of severe COVID-19.
   Understanding how to navigate Food and Drug Administration (“FDA”)
   regulatory channels is an important aspect of DB’s business. In 2021, DB had
   to withdraw ExoFlo from the market after the FDA announced that EV
   products had to undergo formal approval as “drugs and biological products”
   under section 351 of the Public Health Service Act (“PHSA”). This spurred
   a race among DB and its competitors to secure FDA approval for their
   products. At the time this appeal was briefed, DB’s product was undergoing
   the final phase of clinical trials to become the first purely biologic EV drug to
   receive commercial approval for use in the United States.
          DB hired McQueen as its third employee in 2018. During his four
   years at DB, McQueen held various senior titles and became an equity
   member of DB. McQueen served as an Executive Vice President at DB from
   April 30, 2018, until March 28, 2022, when he resigned from DB.1 His

          1
               McQueen’s employment with DB was formally terminated for cause on March
   29, 2022.

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   responsibilities included participating in intellectual property and product
   development, sales initiatives, operations, regulatory and compliance as well
   as   clinical   aspects   of   DB’s    business.    McQueen’s      wide-ranging
   responsibilities and equity member status allowed him access to DB’s
   confidential and trade secret information. DB alleges that McQueen, as a
   high-level executive, was one of only a handful of individuals at the company
   intimately involved with both the AmnioWrap and ExoFlo product lines, and
   who knows the company’s most closely guarded secret: the formula and
   production specifications for its flagship technology, ExoFlo.
                                          B.
          McQueen and DB are party to two key agreements: an Employment
   Agreement, governed by Texas law, and an Operating Agreement, governed
   by Wyoming law. Each agreement contains: (i) a non-competition covenant
   temporarily prohibiting McQueen from accepting certain employment with
   enterprises that compete with DB, and (ii) a confidentiality covenant
   prohibiting McQueen from using or disclosing confidential information he
   acquired from DB. The Employment Agreement’s non-compete provision is
   narrower than that of the Operating Agreement. While the Employment
   Agreement only prohibits McQueen from providing “services . . . similar to
   that which [he] provided to [DB],” the Operating Agreement more broadly
   prohibits any employment with a competitor.
          The Employment Agreement also includes an arbitration provision
   requiring McQueen and DB to arbitrate any “controversy or claim” arising
   from the agreement, their employment relationship, or the termination of
   such a relationship. While the provision requires arbitration of “all issues of
   final relief,” it also includes a carve-out allowing either of the parties to seek
   preliminary injunctive relief in federal court.

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                                                 C.
           Following his resignation from DB in March 2022, McQueen joined
   Vivex as Vice President of Product Strategy. Vivex is a direct competitor of
   DB that sells and markets allograft products and develops EV products. DB
   contends that Vivex is one of only a few companies with the “resources,
   infrastructure, and commercial motive in place to immediately and
   wrongfully exploit” the confidential DB information that McQueen carried
   over with him to Vivex. In addition, DB alleges that as a senior manager at
   Vivex, McQueen is well-positioned to help Vivex compete with DB’s
   AmnioWrap product line and guide Vivex through accelerated development
   and FDA approval of new EV products.
           DB further alleges that after McQueen began working for Vivex, DB
   discovered that while McQueen was still working for DB, he had linked his
   personal Dropbox2 account to DB’s online accounts. DB contends that
   McQueen, using Dropbox, deliberately misappropriated to his personal
   control numerous documents containing DB’s confidential information and
   trade secrets, including some of the company’s most sensitive proprietary
   information. DB asserts that it never authorized McQueen to link his
   personal Dropbox account to its cloud-based corporate accounts or place
   company documents or information on his personal cloud storage account,
   and that conduct violates express company policy. DB further alleges that
   McQueen has shared this confidential trade secret information with Vivex to

           2
             “Dropbox is a company that hosts an off-site virtual storage application . . . [a]fter
   creating an account, users may place items in a Dropbox folder and then access them
   remotely through the application[.]” United States v. Rivenbark, 748 F. App’x 948, 950
   (11th Cir. 2018).

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   “destroy [DB’s] hard-earned competitive advantage” in the allograft and EV
   technology spaces.
          McQueen contends that he has complied with his contractually agreed
   covenants and works for Vivex in a non-competitive role. McQueen also
   denies that he has used or disclosed DB’s confidential information and
   asserts that he has “repeatedly sought to return all information and
   documents to Plaintiff.” McQueen further claims that he began using a
   personal Dropbox account when he first started working for DB because DB
   had not yet given him a company-owned computer or access to a company-
   controlled filesharing or storage platform. McQueen states that he has not
   modified any DB document linked between his personal and company
   Dropbox accounts since July 2, 2021. While Vivex’s Vice President for
   Research and Development testified that McQueen does not work on any
   “area[s] of competition” between DB and Vivex, McQueen testified that the
   responsibilities of his new job included helping with the launch of “an
   allograph tissue product” at Vivex.
                                            D.
          As relevant to this appeal, DB brought various causes of action3
   against McQueen and Vivex: (1) state-law breach of contract based on the
   non-compete covenants; (2) trade secret misappropriation under the federal
   Defend Trade Secrets Act (DTSA), 18 U.S.C. § 1836 et seq.; (3) trade secret
   misappropriation under the Texas Uniform Trade Secrets Act (TUTSA),

          3
             DB also brought state-law claims for breach of contract based on McQueen’s
   alleged breaches of the non-solicitation covenants in the Employment Agreement and
   Operating Agreement; breach of contract based on McQueen’s alleged breach of the duty
   of loyalty under the Employment Agreement; breach of fiduciary duty; and tortious
   interference with contract. These claims were unpreserved or abandoned as a basis for
   obtaining a preliminary injunction.

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   Tex. Civ. Prac. & Rem. Code §§ 134A; and (4) state-law breach of contract
   based on McQueen’s confidentiality covenants.
            On April 25, 2022, DB moved for a TRO to (1) compel McQueen to
   comply with his noncompete covenants and (2) return and stop accessing,
   using, or sharing DB’s “confidential and trade secret information.” DB
   simultaneously moved for a preliminary injunction requesting the same
   relief. The district court granted the requested TRO on May 4, 2022,
   ordering McQueen to cease working for Vivex and to not use or disclose DB’s
   confidential or trade secret information. See Direct Biologics, LLC v.
   McQueen, No. 1:22-CV-381-SH, 2022 WL 1409984 (W.D. Tex. May 4,
   2022) (“DB I”). However, on May 24, 2022, after an evidentiary hearing,
   the court denied the requested preliminary injunction. See Direct Biologics,
   LLC v. McQueen, No. 1:22-CV-381-SH, 2022 WL 1693995 (W.D. Tex. May
   26, 2022) (“DB II”). The district court denied DB’s motion on the ground
   that DB failed to demonstrate irreparable harm. See DB II, 2022 WL 1693995,
   at *6.
            In a separate part of its order, the court concluded that all of DB’s
   claims were subject to the parties’ arbitration agreement. See id. at *9. The
   court then dismissed the case, relying on Fifth Circuit precedent which holds
   that where all the plaintiff’s claims must be arbitrated, dismissal rather than
   a stay pending arbitration is appropriate. See id. (quoting Alford v. Dean
   Witter Reynolds, Inc., 975 F.2d 1161, 1164 (5th Cir. 1992)). This appeal
   followed.
                                         II.
            A preliminary injunction is an “extraordinary and drastic remedy.”
   Holland Am. Ins. Co. v. Succession of Roy, 777 F.2d 992, 997 (5th Cir. 1985). A
   party seeking a preliminary injunction “must establish [1] that he is likely to
   succeed on the merits, [2] that he is likely to suffer irreparable harm in the

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   absence of preliminary relief, [3] that the balance of equities tips in his favor,
   and [4] that an injunction is in the public interest.” Winter v. Nat. Res. Defense
   Council, Inc., 555 U.S. 7, 20 (2008). To issue such relief, a court “must
   balance the competing claims of injury and must consider the effect on each
   party of the granting or withholding of the requested relief.” Id. at 24
   (quoting Amoco Prod. Co. v. Vill. of Gambell, AK, 480 U.S. 531, 542 (1987)).
   Only when the movant has “clearly carried the burden of persuasion” should
   a court grant preliminary injunctive relief. Anderson, 556 F.3d at 360.
          The ultimate decision for or against issuing a preliminary injunction is
   reviewed under an abuse of discretion standard. Bluefield Water Ass’n, Inc. v.
   City of Starkville, Miss., 577 F.3d 250, 253 (5th Cir. 2009) (quoting Guy
   Carpenter & Co. v. Provenzale, 334 F.3d 459, 463 (5th Cir. 2003)). “The
   district court abuses its discretion if it relies on clearly erroneous factual
   findings in deciding whether to grant a preliminary injunction or relies on
   ‘erroneous conclusions of law.’” Atchafalaya Basinkeeper v. United States
   Army Corps of Engineers, 894 F.3d 692, 696 (5th Cir. 2018). The factual
   findings rendered by the district court must be left “undisturbed unless
   clearly erroneous.” Bluefield, 577 F.3d at 253 (quoting Guy Carpenter, 334
   F.3d at 463). Conclusions of law are reviewed de novo. See id.
                                          III.
          The district court denied DB’s motion for a preliminary injunction
   based on the absence of irreparable harm. DB argues on appeal that the
   district court erred in declining to apply a Texas law presumption of
   irreparable harm, and in finding that DB had not presented sufficient
   evidence of irreparable harm because DB in fact demonstrated that McQueen
   had already disclosed trade secret information to Vivex. McQueen and Vivex
   respond that the district court properly denied the motion for preliminary
   injunction because DB was not entitled to the Texas law presumption of

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   irreparable harm, and in any event, did not adduce any evidence of irreparable
   harm.
           This appeal thus turns on (1) whether the district court should have
   applied a presumption of irreparable harm under Texas law based on
   McQueen’s ongoing breach of the non-compete covenants, and (2) assuming
   the district court properly declined to apply the presumption, whether it
   erred in holding that DB failed to demonstrate irreparable harm. Because the
   parties acquiesced to Texas law before the district court, see DB I, 2022 WL
   1409984, at *8 n.3, and before this court, we will apply Texas law in
   evaluating the irreparable harm factor in connection with DB’s claims that
   McQueen breached the non-compete and confidentiality covenants of the
   Employment Agreement, as well as its claim under the TUTSA.
                                                 A.
           The district court first analyzed DB’s invocation of a Texas doctrine4
   providing that “proof that a highly trained employee is continuing to breach
   a non-competition covenant gives rise to a rebuttable presumption that the
   applicant is suffering irreparable injury.” DB II, 2022 WL 1693995, *6
   (quoting Cardinal Health Staffing Network, Inc. v. Bowen, 106 S.W.3d 230,
   236 (Tex. App.—Houston [1st Dist.] 2003, not pet.)). In declining to apply
   the presumption, the district court found insufficient evidence that: (1)

           4
             Though the parties did not provide a choice of law analysis, it is unclear whether
   federal courts should apply a state-law ‘presumption of irreparable harm’ when
   determining whether a preliminary injunction should issue in federal court. Compare Heil
   Trailer Int’l. Co. v. Kula, 542 F. App’x 329, 336-38 (5th Cir. 2013) (vacating the denial of a
   preliminary injunction in part on the basis that Texas courts presume irreparable harm
   where trade secrets have been misappropriated) with Daniels Health Sciences, L.L.C. v.
   Vascular Health Sciences, L.L.C., 710 F.3d 579, 585 (5th Cir. 2013) (citing only federal
   authorities in finding no error in the district court’s conclusion that irreparable harm was
   likely).

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   McQueen actually “us[ed] the experience he acquired from DB to compete
   with it,” such as by “market[ing] products in direct competition with DB,”
   or (2) “McQueen has disclosed confidential or trade secret information to
   Vivex.” Id. at *7. DB argues on appeal that it demonstrated that McQueen is
   in violation of the non-compete covenants, and as such, DB was entitled to a
   presumption of irreparable harm under Texas law.
           The district court did not abuse its discretion5 by declining to presume
   irreparable injury based on McQueen’s breach of his non-compete
   covenants. As previously explained, the Employment Agreement broadly
   prohibited him from providing “similar” services to Vivex that he provided
   to DB. See DB II, 2022 WL 1693995, at *2. The Operating Agreement
   covenant was even broader. See id. at *3. Thus, McQueen could have
   breached these covenants even without actually using or disclosing DB’s
   confidential information or trade secrets. But the district court found that DB
   was still required to present some evidence of harm 6 apart from the breach
   to merit a presumption of irreparable harm. DB II, 2022 WL 1693995, at *7.
           In declining to apply the presumption, the district court found that
   evidence did not “conclusively demonstrate that McQueen has disclosed
   confidential or trade secret information.” DB II, 2022 WL 1693995, at *7. In

           5
            “The decision to grant or deny a temporary injunction lies within the trial court’s
   sound discretion.” Communicon, Ltd. v. Guy Brown Fire & Safety, Inc., 2018 WL 1414837,
   at *7 (Tex. App.—Fort Worth Mar. 22, 2018, no pet.).
           6
             DB also argues that “the district court erroneously required Direct Biologics to
   ‘conclusively demonstrate’ that it has already been injured by McQueen’s violation of his
   noncompete obligations.” It suggests that the district court’s opinion was in tension with
   the prospective nature of an injunction. DB is incorrect. As just discussed, the district court
   merely held that DB must produce evidence of ongoing (and, therefore, past) harm in order
   to obtain a presumption of irreparable injury should an injunction not issue. See DB II 2022
   WL 1693995, at *7. Outside of that context, the district court did not require DB to show
   past harm.

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   fact, the court found that DB failed to produce “any evidence that McQueen
   actually is . . . using the experience he acquired from DB to compete with it,”
   such as by “market[ing] products in direct competition with DB.”7 Id.
   (emphasis added); see also Communicon, 2018 WL 1414837, at *7 (“employer-
   movant for a temporary injunction in a suit to enforce a noncompete
   agreement must come forward with evidence that the high-level employee is
   actually breaching the noncompete agreement in order to trigger the
   presumption”). Some Texas courts have declined to apply the presumption
   in the absence of independent proof of harm. See, e.g., DGM Servs., Inc. v.
   Figueroa, No. 01-16-00186-CV, 2016 WL 7473947, at *4 (Tex. App.—
   Houston [1st Dist.] Dec. 29, 2016) (declining to apply presumption because
   “well-settled Texas Supreme Court law makes clear an applicant bears the
   burden to plead and adduce proof of probable, imminent, and irreparable
   injury to obtain a temporary injunction”) (citing Butnaru v. Ford Motor Co.,
   84 S.W.3d 198, 204 (Tex. 2002)).
           Moreover, the district court could have found the presumption
   rebutted by Vivex’s evidence that McQueen was not in fact competing with
   DB through his work for Vivex. Vivex’s Vice President of Research and
   Development testified that individuals can “work at Vivex effectively
   without sharing information about any of Direct Biologics’ plans or
   processes;” that “McQueen specifically [has] been precluded from working
   in the area of competition between the two companies,” including

           7
              Different non-compete agreements may be geared towards protecting different
   interests, which may factor into whether a district court chooses to infer irreparable harm
   from the mere fact of a breach. EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693, 697-98
   & n.4 (Tex.App.—Houston [14th Dist.] 2004) (presumption did not apply where “the sole
   purpose of the noncompete clause was to enforce the nondisclosure clause” and there was
   no evidence that defendant “was currently violating the nondisclosure clause or that there
   was any likelihood that she would in the future;” in the alternative, if the presumption
   applied, it was rebutted).

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   allographic products; and that McQueen “abided by that separation.”
   Moreover, DB’s president conceded that he had no knowledge of improper
   disclosure. To overcome the foregoing evidence, DB pointed to the job
   description at Vivex that McQueen applied to, which states that the
   individual selected will “[a]ssist in the further launch of ViaDisc,” an
   “allograft product.” DB also highlighted testimony by McQueen in which he
   is asked about this document, and answered affirmatively when asked
   whether “you are expected to assist in the further launch of ViaDisc.” But
   McQueen may have simply been confirming what the document said, and as
   just noted, the court could have credited the testimony of Vivex’s Vice
   President of Research and Development that McQueen was sequestered
   from allographic products that compete with DB.
         Thus, the district court did not abuse its discretion in declining to
   apply a presumption of irreparable harm based on McQueen’s breach of the
   non-compete agreement.
                                         B.
         After it determined that Texas’ presumption of irreparable harm did
   not apply, the district court denied DB’s motion on the ground that it
   “proffered no evidence to show that a monetary remedy would be inadequate
   compensation for any injury allegedly incurred as a result of McQueen’s
   alleged misconduct.” DB II, 2022 WL 1693995, at *8. However, the court:
   (i) did not make any findings as to whether it was likely that McQueen would
   use or disclose DB’s confidential and trade secret information during the
   pendency of the lawsuit (finding only that there was no evidence that he
   already used or disclosed such information); and (ii) did not make any
   assessment as to whether money damages would be easy or difficult to

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   quantify.8 See id. at *6-*8; Cardoni v. Prosperity Bank, 805 F.3d 573, 590 (5th
   Cir. 2015) (applying Texas law and affirming district court’s denial of
   preliminary injunction based on its “individualized assessment of whether
   disclosure had occurred or was likely to occur in this case.”); Allied Mktg.
   Grp., Inc. v. CDL Mktg., Inc., 878 F.2d 806, 810 n.1 (5th Cir. 1989) (“We
   have recognized that a finding of irreparable harm is appropriate even where
   economic rights are involved when the nature of those rights makes
   establishment of the dollar value of the loss especially difficult or
   speculative.”) (cleaned up).
          The district court found insufficient evidence that use or disclosure of
   DB’s confidential or trade secret information had occurred, DB II, 2022 WL
   1693995, at *7, yet it did not make an “individualized assessment of whether
   disclosure . . . [is] likely to occur” between now and final judgment. Cardoni,
   805 F.3d at 590 (emphasis added). For instance, the court did not state
   whether it credited testimony that McQueen was not involved in any allograft
   work. And, as noted, there was some testimony from McQueen from which
   a contrary inference could be made. Moreover, although the court noted
   McQueen’s testimony that “he has sought to return DB’s confidential
   information,” it did not say whether it credited that testimony. DB II, 2022
   WL 1693995, at *7. DB, for its part, asserts that McQueen has not yet
   returned the files and instead intends to delete the files without properly
   preserving important metadata. The district court erred in failing to examine
   “items of evidence in the record and articulate[] reasons that would explain”
   its apparent conclusion that irreparable harm would be unlikely to occur

          8
            In addition, the court did not separately analyze DB’s claims under the non-
   compete covenants, confidentiality covenants, DTSA, or TUTSA. DB II, 2022 WL
   1693995, at *8.

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   during the pendency of this litigation. Heil Trailer Intern. Co. v. Kula, 542 F.
   App’x 329, 335 (5th Cir. 2013).
           The district court also gave short shrift to the fact that, if McQueen
   does misappropriate DB’s trade secrets or confidential information during
   the pendency of the proceedings, any damages resulting therefrom would be
   difficult to quantify. See DB II, 2022 WL 1693995; Sharma v. Vinmar Intern.,
   Ltd., 231 S.W.3d 405, 427 (Tex.App.—Houston [14th Dist.] 2007, no pet.)
   (“The misuse of trade secrets leading to the loss of an existing business is
   another example of irreparable harm entitling an applicant to injunctive
   relief.”). On appeal, McQueen notably does not defend the district court’s
   position that any harm caused by McQueen’s violations of the non-compete
   or misuse of trade secrets would be adequately compensable by monetary
   damages, but rather asserts that the evidence showed that he was not likely
   to cause competitive harm to DB or misuse such information. Given that
   Texas courts have found that “[l]ost opportunity to create or gain control of
   a new market may result in unquantifiable losses for which there is no
   adequate remedy at law,” the district court erred in failing to analyze whether
   the disclosure of DB’s trade secrets during the pendency of this dispute
   would cause damages that are easily quantifiable. See, e.g., Allied Mktg. Grp.,
   878 F.2d at 810 n.1; Garth v. Staktek Corp., 876 S.W.2d 545, 549 (Tex.
   App.—Austin 1994, writ dism’d w.o.j.); T-N-T Motorsports, Inc. v. Hennessey
   Motorsports, Inc., 965 S.W.2d 18, 24 (Tex. App.—Houston [1st Dist.] 1998,
   pet. dism’d) (“The only effective relief available to appellee is to restrain
   appellants’ use of its trade secrets and confidential information pending
   trial.”).
           Remand is thus proper to allow the district court to make
   particularized findings regarding irreparable harm; specifically, the
   likelihood of misuse of DB’s information, see Cardoni, 805 F.3d at 590, and
   the difficulty of quantifying damages should such misuse occur, see Heil

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   Trailer, 542 F. App’x at 335-37 (remanding denial of preliminary injunction
   where “the district court examined no items of evidence in the record and
   articulated no reasons that would explain this result”). Should the district
   court determine that irreparable harm is likely, it should proceed to evaluate
   the remaining preliminary injunction factors in the first instance. See Guy
   Carpenter, 334 F.3d at 469 (remanding so district court could consider
   additional preliminary injunction factors not decided below).
                                                 C.
           Because we remand this case so that the district court can consider
   whether a preliminary injunction should issue in this case, we must also
   vacate the district court’s order dismissing DB’s claims against McQueen
   and Vivex. The parties do not dispute that DB’s claims must ultimately be
   submitted to arbitration, DB II, 2022 WL 1693995, at *9, or that the
   arbitration provision contains a specific carve-out allowing courts to rule on
   requests for preliminary injunctive relief. However, because the dismissal
   below constituted a final judgment, a preliminary injunction cannot be
   entered unless that judgment were vacated. See Auto Parts Mfg. Miss., Inc. v.
   King Const. of Houston, L.L.C., 782 F.3d 186, 191 (5th Cir. 2015)
   (“Permanent injunctions survive dismissal of the case; preliminary
   injunctions do not.”). 9 We therefore vacate the district court’s dismissal of
   DB’s claims and entry of final judgment.

           9
             Under the Federal Arbitration Act, a court “shall . . . stay” the proceedings upon
   finding that any issue is arbitrable. 9 U.S.C. § 3. The statute makes no reference to
   dismissal. Nevertheless, our precedent demonstrates that “dismissal is appropriate when
   all of the issues raised in the district court must be submitted to arbitration.” Adam
   Technologies Int’l S.A. de C.V. v. Sutherland Global Servs., Inc., 729 F.3d 443, 447 n.1 (5th
   Cir. 2013). If, on remand, the district court determines that a preliminary injunction should
   issue to preserve the status quo while the arbitration is pending, it should stay the

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                                               IV.
           Based on the foregoing, we VACATE the district court’s orders
   denying DB’s motion for a preliminary injunction and dismissing DB’s
   claims. We REMAND this case with instructions to conduct further
   proceedings in accordance with this opinion.

   proceedings in lieu of dismissal, 9 U.S.C. § 3, so as to preserve jurisdiction to enforce its
   injunction.

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