Court Opinion

ID: 4510268
Source: CourtListenerOpinion
Date Created: 2020-02-25 20:00:28.019831+00
Date Added: 2024-06-11T12:13:25.425192
License: Public Domain

RECOMMENDED FOR PUBLICATION
                                Pursuant to Sixth Circuit I.O.P. 32.1(b)
                                       File Name: 20a0056p.06

                    UNITED STATES COURT OF APPEALS
                                   FOR THE SIXTH CIRCUIT

 RADIANT GLOBAL LOGISTICS, INC., a Washington                ┐
 corporation,                                                │
                              Plaintiff-Appellee,            │
                                                             │
                                                              >        No. 19-1297
        v.                                                   │
                                                             │
                                                             │
 CHARLES FURSTENAU, JR., an individual and Michigan          │
 resident; BTX AIR EXPRESS OF DETROIT, LLC, a                │
 Connecticut limited liability company,                      │
                                 Defendants-Appellants.      │
                                                             ┘

                          Appeal from the United States District Court
                         for the Eastern District of Michigan at Detroit.
                      No. 2:18-cv-12783—Paul D. Borman, District Judge.

                                   Argued: December 3, 2019

                             Decided and Filed: February 25, 2020

                    Before: MOORE, CLAY, and SUTTON, Circuit Judges.
                                  _________________

                                            COUNSEL

ARGUED: Andrew F. Marquis, SCOPELITIS, GARVIN, LIGHT, HANSON & FEARY, PLC,
Detroit, Michigan, for Appellants. Patrick F. Hickey, HICKEY HAUCK BISHOFF
& JEFFERS, PLLC, Detroit, Michigan, for Appellee. ON BRIEF: Andrew F. Marquis,
SCOPELITIS, GARVIN, LIGHT, HANSON & FEARY, PLC, Detroit, Michigan, Kurt M.
Kobiljak, PENTIUK, COUVREUR & KOBILJAK, PC, Wyandotte, Michigan, for Appellants.
Patrick F. Hickey, Benjamin W. Jeffers, Stefanie R. Reagan, HICKEY HAUCK BISHOFF
& JEFFERS, PLLC, Detroit, Michigan, for Appellee.

       The court delivered a PER CURIAM opinion. SUTTON, J. (pg. 6), delivered a separate
concurring opinion.
 No. 19-1297                 Radiant Glob. Logistics v. Furstenau                         Page 2

                                      _________________

                                           OPINION
                                      _________________

       PER CURIAM.         Charles Furstenau managed the Detroit office of Radiant Global
Logistics. When he joined a competitor, Radiant sued him for misappropriation of trade secrets,
seeking a preliminary injunction against Furstenau and his new logistics company, BTX Detroit.
The district court granted Radiant’s request, enjoining Furstenau and other former Radiant
employees from using Radiant’s trade secrets, and from contacting certain customers and carriers
for a six-month period. The six-month requirements have come and gone. We dismiss the
appeal as moot.

       Radiant is a third-party logistics company. It helps customers move things from one
point to another, using other companies to provide the shipping services. Furstenau was the
manager of Radiant’s Detroit office. He became frustrated with the company over his pay and
its use of a new software system. In February 2018, he reached out to one of Radiant’s
competitors, BTX Logistics, about joining them as the head of a new BTX office in Detroit.
Furstenau prepared a business plan and budget for the new office and provided a list of
employees who would join him. During the months before the move, he allegedly forwarded
emails from his Radiant account to his personal account with data on revenues, profit margins,
costs, and financial projections, as well as information about shipments the office handled, and a
spreadsheet showing Radiant’s preferred shippers.

       In late August, Furstenau left Radiant on a Friday and opened BTX Detroit the next
Monday. Most of the other Radiant employees in Detroit joined him that day or soon after.

       Radiant sued Furstenau and BTX for misappropriation of trade secrets. A week later,
Radiant moved for a preliminary injunction. After expedited discovery and a two-day hearing,
the district court granted Radiant’s request. Furstenau and the other former Radiant employees
who had joined BTX were preliminarily enjoined from (1) contacting certain customers and
carriers they had worked with at Radiant for a period of six months and (2) from “disclosing
 No. 19-1297                  Radiant Glob. Logistics v. Furstenau                          Page 3

and/or using any Radiant confidential information and/or trade secret information” for an
indefinite period. R. 52 at 44–45.

       BTX appealed and sought to stay the preliminary injunction while the appeal was
pending. This court denied the stay request. That meant the six-month contact restrictions ran
their course and expired. BTX did not object to the trade-secret restriction of the injunction.

       Article III of the United States Constitution limits the federal judicial power to “Cases”
and “Controversies.” U.S. Const. art. III, § 2, cl. 1. Under this requirement, parties invoking the
jurisdiction of federal courts must show that they have a “legally cognizable interest” at stake in
the outcome. Genesis Healthcare Corp. v. Symczyk, 569 U.S. 66, 71 (2013). This “cradle-to-
grave” requirement must be satisfied through the life of the dispute. Fialka-Feldman v. Oakland
Univ. Bd. of Trs., 639 F.3d 711, 713 (6th Cir. 2011). If during litigation the claimant loses a
personal stake in the outcome, or it becomes “impossible for the court to grant” meaningful
relief, there is no longer a case or controversy and we must dismiss the case as moot. Church of
Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992).

       Measured by these principles, this appeal is moot.            The six-month noncompete
restrictions expired in August, and today “require[] nothing of” and “mean[] nothing to” BTX.
Fialka-Feldman, 639 F.3d at 714. We cannot turn back the clock on the preliminary injunction
and thus have no way to grant relief as to that part of the order. That makes BTX’s challenge to
these terms moot. Id.; see also Univ. of Tex. v. Camenisch, 451 U.S. 390, 397–78 (1981).

       That leaves the injunction’s ongoing restriction on the use of Radiant’s trade secrets. But
BTX never objected to that part of the preliminary injunction. Any potential fight over that part
of the injunction is not a live case or controversy either. See U.S. Bancorp Mortg. Co. v. Bonner
Mall P’ship, 513 U.S. 18, 20–21, 25–26 (1994).

       BTX tries to poke holes in this conclusion. It claims that a mootness exception applies—
that the dispute is “capable of repetition, yet evading review.” Spencer v. Kemna, 523 U.S. 1, 17
(1998). But this narrow exception applies to disputes that by their nature will become moot
before litigation runs its course, such as a college graduation date, and thus are “likely forever”
to evade appellate review. Lewis v. Cont’l Bank Corp., 494 U.S. 472, 481–82 (1990). In this
 No. 19-1297                  Radiant Glob. Logistics v. Furstenau                          Page 4

case, a live controversy remains as to the merits of Radiant’s claims, and so BTX would still
have the opportunity for its day in court—including this court—once the district court enters a
final judgment. There is nothing about trade secret claims in general, or about this trade secret
claim in particular, that would stand in the way of eventual appellate review.

       BTX worries whether the preliminary injunction covers “something more than the emails
at issue,” including the knowledge inside their employees’ heads. BTX Supp. Br. 5–6. Having
chosen not to challenge that part of the injunction, it must ask the district court whether there is
anything to its fears. That said, the district court noted that “the general knowledge of an
employee does not constitute a trade secret.” R. 52 at 21.

       BTX also notes that the district court, at one point in the order, said that the parties
should “continue with discovery.” Id. at 45. But that sentence relates to discovery in preparation
for an eventual trial on the merits, not the preliminary injunction phase of the case. Such
discovery orders cannot be challenged on an interlocutory appeal. See, e.g., Mohawk Indus., Inc.
v. Carpenter, 558 U.S. 100, 108 (2009) (noting that generally there can be no interlocutory
appeal from an adverse discovery order); United States ex rel. Pogue v. Diabetes Treatment Ctrs.
of Am., Inc., 444 F.3d 462, 471 (6th Cir. 2006) (same).

       This leaves one final remedial matter. Must we vacate the district court’s order as part of
our mootness resolution, or may we simply dismiss the appeal for want of jurisdiction and leave
the district court’s order untouched? BTX argues for the former, Radiant the latter.

       We agree with Radiant and decline to vacate the district court’s order. For one, vacatur is
an equitable remedy subject to the strictures of waiver and forfeiture. See United States v.
Munsingwear, Inc., 340 U.S. 36, 39–41 (1950). And here, BTX did not even request vacatur
until after oral argument and so plainly “slept on its rights,” to its detriment.        Id. at 41.
Moreover, even if BTX hadn’t forfeited its right to request vacatur, vacatur still would be
inappropriate under the circumstances. Vacatur exists to protect a losing litigant from having “to
live with the precedential and preclusive effects of [an] adverse ruling without having had a
chance to appeal it.” Fialka-Feldman, 639 F.3d at 716. But as Judge Posner has explained, this
concern matters little when the mooted appeal is of a preliminary injunction in an ongoing
 No. 19-1297                  Radiant Glob. Logistics v. Furstenau                          Page 5

litigation—as is the case here—because “[a] preliminary injunction has no preclusive effect—no
formal effect at all—on the judge’s decision whether to issue a permanent injunction.” Gjertsen
v. Bd. of Election Comm’rs, 751 F.2d 199, 202 (7th Cir. 1984); see also Fleming v. Gutierrez,
785 F.3d 442, 448–49 (10th Cir. 2015) (describing dismissal without vacatur as “the usual
practice” in the preliminary-injunction context); 13C Charles Alan Wright, et al., Federal
Practice and Procedure § 3533.10.3 (3d ed. 2019) (same). This conclusion holds especially true
when the prevailing party did nothing to cause the mootness on appeal, as is also the case here.
Cf. Azar v. Garza, 138 S. Ct. 1790, 1792 (2018) (per curiam) (vacating a temporary restraining
order when the prevailing party took “voluntary action that moot[ed] the [underlying] dispute”
(quoting Arizonans for Official English v. Arizona, 520 U.S. 43, 75 (1997))).

       For these reasons, we dismiss the appeal for lack of jurisdiction. We express no view on
the merits of the district court’s decision or on Radiant’s likelihood of success going forward.
 No. 19-1297                  Radiant Glob. Logistics v. Furstenau                         Page 6

                                       _________________

                                       CONCURRENCE
                                       _________________

        SUTTON, Circuit Judge, concurring. I agree that this appeal is moot and that BTX
forfeited its request for vacatur by failing to raise the issue in its appellate briefs. But I would
leave it at that.