Opinion
Case No. CIV04-298-S-EJL.
June 14, 2004
TEMPORARY RESTRAINING ORDER
Upon consideration of the Complaint, Plaintiffs' Motion for a Temporary Restraining Order, and Memorandum of Law and affidavits submitted in support thereof, the Court makes the following Findings of Facts and Conclusions of Law:
FINDINGS OF FACT
1. Plaintiffs Guidant Corporation and Guidant Sales Corporation ("GSC") are Indiana corporations with their principal place of business in Indiana.
2. Plaintiff Cardiac Pacemakers, Inc. ("CPI") is a Minnesota corporation with its principal place of business in Minnesota.
3. CPI is a wholly-owned subsidiary of Guidant Corporation, and GSC is a wholly-owned subsidiary of CPI. Guidant Corporation, GSC and CPI are referred to collectively in this Order as "Guidant."
4. Guidant develops, manufactures, markets and sells cardiac rhythm management devices, including pacemakers (which are used to treat bradycardia, or slow heart-rate) and implantable cardioverter defibrillators ("ICDs") (used to treat ventricle tachycardia and ventricle fibrillation, or fast heart-rate) (sometimes collectively referred to as "CRM Devices").
5. Guidant is in the final stages of developing an Advanced Patient Management ("APM") system, called LATITUDE, and sought feedback from certain physicians and health care providers (mainly cardiologists and electrophysiologists) attending the NASPE/Heart Rhythm Society ("NASPE Conference") conference during the week of May 17, 2004, in San Francisco.
6. Guidant's new APM technology and system constitutes a valuable trade secret. The APM system has not yet been made publicly available and will be submitted to the FDA for approval. It embodies innovative, proprietary technology not generally known in the industry. Guidant has made reasonable efforts to protect the confidentiality of material information relating to its APM system and the technology used in that system.
7. Defendant Provizio, Inc. ("Provizio") is a competitive intelligence company apparently founded in 1999 in Idaho. Provizio holds itself out as "an industry leader in primary competitive intelligence."
8. Defendant Timothy Rhodes ("Rhodes") is the founder and original CEO of Provizio; he is currently Provizio's president. Provizio's website indicates that "Rhodes' background includes military and government intelligence experience coupled with both management and operations experience in competitive intelligence for a Fortune 500 company."
9. Rhodes gained access to Guidant's secured feedback area at the NASPE Conference by representing that he was a cardiologist in private practice and affiliated with a hospital in Boise, Idaho, and that he was interested in Guidant's newest technology, including the APM system, for use in his private practice and for his patients.
10. At the NASPE Conference, Guidant had established a separate and secured area to solicit feedback regarding its new APM system. This area was located in a corner of the conference floor, away from Guidant's main booth. Entry to the area was monitored by Guidant personnel. Only persons who were pre-screened and had executed a non-disclosure agreement (the "NDA") were allowed admittance to the secured area.
11. Before being admitted to the secured feedback area, Rhodes was pre-screened. Part of that pre-screening process involved a review of his NASPE Conference credentials that Rhodes presented to Guidant personnel. Those credentials represented that Rhodes was an M.D. from Boise, Idaho, affiliated with a hospital, and was 1-5 years from residency.
12. After pre-screening Rhodes' credentials and before being admitted to the secured feedback area, Rhodes signed the NDA. In executing the NDA, Rhodes acknowledged that he "desire[d] to receive certain secret and proprietary information regarding Guidant's [APM] Program . . ." In consideration of being provided access to this "secret and proprietary information," Rhodes agreed that "[a]ny trade secrets, confidential information or proprietary concepts received or learned by Recipient (including his/her employees, servants, or agents) . . . shall be deemed the exclusive property of Guidant and shall remain the valuable scientific, trade, and engineering secrets of Guidant." Rhodes further agreed "to maintain in confidence information received from Guidant . . . and not to disclose such information to any third parties or use such information for the benefit of third parties."
13. After executing the NDA, Rhodes spent approximately one and a half hours in Guidant's secured feedback area. During that time, Rhodes asked numerous questions about Guidant's APM technology, as well as about the pacemaker and defibrillator devices that work with the APM system. During the course of that conversation, Rhodes had access to and obtained Guidant's valuable confidential information and trade secret information regarding the APM system and other Guidant technology. Throughout the course of Rhodes' presence in the secured feedback area, Rhodes led Guidant personnel to believe that he was a cardiologist and an M.D. affiliated with a Boise, Idaho hospital, interested in Guidant's technology for use in his private medical practice.
14. On June 2, 2004, Guidant received a voicemail message from someone purporting to be "Dr. Rhodes." In that message, "Dr. Rhodes" again represented that he was a "cardiologist" calling from a "heart clinic" in Boise, Idaho, and expressed an interest in obtaining further information regarding the new Guidant technology and as a follow up to the information that he had obtained at the NASPE feedback area.
15. After receiving this voicemail, Guidant personnel searched for Rhodes on the internet. This search disclosed Rhodes' true identity as the president and founder of Provizio. Guidant personnel also checked with St. Luke's hospital in Boise, the Idaho Medical Board, the American Board of Internal Medicine, and the American College of Cardiology. None of these institutions had any record of a Dr. Timothy Rhodes.
16. Rhodes' interest in Guidant's trade secrets at NASPE was not an isolated incident. In February 2004, a Sales Representative for Guidant in Boise, Idaho was contacted by a person purporting to be an electrophysiology physician named "Dr. Warren Tyler." This person told the Guidant sales representative that he was planning to move from New Mexico to the Boise area to start practicing EP medicine and that he was interested in how Guidant medical devices and products might help him set up and build his medical practice. To this end, he solicited information from the Guidant sales representative regarding Guidant's valuable confidential information and trade secrets. "Dr. Warren Tyler" was particularly interested in Guidant's newest technology, not yet released to the market. Guidant later learned that the person purporting to be "Dr. Warren Tyler" was in fact Rhodes, and Guidant also discovered that a telephone number that "Dr. Tyler" had provided to Guidant was in fact an answering service for Provizio.
CONCLUSIONS OF LAW
1. The test for determining whether a temporary restraining order is appropriate in this Circuit requires consideration of the following requisites: "(1) that the moving party have a strong likelihood of success on the merits; (2) that the balance of irreparable harm tips in favor of the moving party; and (3) that the public interest favors granting the injunction." Gawron v. James, No. Cv 94-0057-S-EJL, 1994 U.S. Dist. Lexis 21340, *6 (D. Idaho 1995); accord Am. Motorcyclist Ass'n v. Watt, 714 F.2d 962, 965 (9th Cir. 1983); Churchwell v. Robertson, 748 F. Supp. 768, 777 (D. Idaho 1990). The standard is the same regardless of whether a party seeks a preliminary injunction or a temporary restraining order. See Am. Motorcyclist Ass'n, 714 F.2d at 965 (noting that the standard applies to requests for "injunctive relief" in general).
2. Here, Guidant is likely to succeed on the merits with respect to all of the Claims asserted in its Complaint.
3. Guidant will suffer irreparable harm if a Temporary Restraining Order is not entered.
4. Rhodes and Provizio will suffer no significant harm from entry of a temporary restraining order.
5. The public interest supports entry of a temporary restraining order.
IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED that:
Rhodes and Provizio are each restrained and enjoined, pending completion of a hearing on a preliminary injunction, from directly or indirectly using, retaining, or further disclosing any of Guidant's confidential information and trade secrets that were acquired as a result of the above-described actions, and defendants shall return immediately to Guidant all notes and any other tangible items in their possession relating to that confidential information and those trade secrets. Plaintiff shall deposit security in the amount of $5000.00 with the Clerk of Court on or before June 16, 2004 pursuant to F.R.Civ.P. 65(c).
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that:
Defendants Rhodes and Provizio shall show cause on the 23rd of June, 2004 at 1:30 p.m. o'clock, or as soon thereafter as counsel may be heard, at the United States District Court House in Boise, Idaho, why an Order should not be issued granting plaintiffs a preliminary injunction, pursuant to Rule 65(a) of the Federal Rules of Civil Procedure, which shall extend, during the pendency of this suit, the injunctive relief granted by this Temporary Restraining Order.