Opinion
2:20-CV-89-NR
09-16-2022
MATTHEWS INTERNATIONAL CORPORATION, Plaintiff, v. ANTHONY A. LOMBARDI, et al., Defendants.
MEMORANDUM ORDER
J. NICHOLAS RANJAN, UNITED STATES DISTRICT JUDGE.
Presently before the Court is Plaintiff Matthews International Corporation's motion to modify the Court's preliminary-injunction order. ECF 232. For the reasons that follow, the Court denies the motion without prejudice.
On February 25, 2021, the Court issued a preliminary injunction, ordering Defendants to (among other things) “return to Plaintiff all documents and information that belong to, or originated from, Plaintiff by March 23, 2021,” which included “all documents and information that is in Defendants' possession, custody, or control, and includes all originals and duplicate copies.” ECF 170, ¶ 2. The Court also ordered the parties to confer and execute a “joint remediation protocol” to purge Defendants' systems of all Matthews's information. Id. at ¶ 3. Matthews then timely filed a notice of appeal as to the preliminary-injunction order (ECF 184) on March 26, 2021. Almost concurrently, Matthews twice moved for sanctions-first on March 27, 2021 (ECF 185) and again on March 30, 2021 (ECF 192)-alleging Defendants had failed to abide by the Court's order. After a lengthy evidentiary hearing on the matter, the Court agreed in part, held Defendants in contempt, and imposed a sanction essentially enjoining Defendants pursuant to the original preliminary injunction (ECF 228, 7). Three months later, Matthews moved to modify the preliminary injunction, which is the subject of this order. ECF 232.
Whether the Court may grant Matthews's requested relief depends, at the outset, on whether the Court retains jurisdiction to modify the preliminary injunction pending appeal. “It is well established that ‘[t]he filing of a notice of appeal . . . confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal.'” Sheet Metal Workers' Int'l Ass'nLocal 19 v. Herre Bros., 198 F.3d 391, 394 (3d Cir. 1999) (quoting Griggs v. ProvidentConsumer Disc. Co., 459 U.S. 56, 58 (1982)). Federal Rules of Civil Procedure 62(d) provides an exception to this rule, however. That is, “[w]hile an appeal is pending from an interlocutory order or final judgment that grants, continues, modifies, refuses, dissolves, or refuses to dissolve or modify an injunction, the court may suspend, modify, restore, or grant an injunction on terms for bond or other terms that secure the opposing party's rights.” Fed.R.Civ.P. 62(d).
But the jurisdiction afforded to district courts to modify an injunction is not absolute. Ortho Pharm. Corp. v. Amgen, Inc., 887 F.2d 460, 464 (3d Cir. 1989). “The district court has continued authority . . . to enforce its orders to maintain the status quo pending disposition of the appeal and to preserve the integrity of the judicial process[.]” Smith v. Township of Aleppo, No. 05-71, 2005 WL 4984381, at *3 (W.D. Pa. Aug. 24, 2005) (Schwab, J.); see also Audi of Am., Inc. v. Bronsberg & HughesPontiac, Inc., No. 16-2470, 2017 WL 11573354, at *1 (M.D. Pa. Sept. 15, 2017) (Federal Rules of Civil Procedure afford district courts jurisdiction “to maintain the status quo during the pendency of an appeal”).More specifically, “[m]odification of an injunction is proper only when there has been a change of circumstances between entry of the injunction and the filing of the motion that would render the continuance of the injunction in its original form inequitable.” Favia v. Indiana Univ. of Pa., 7 F.3d 332, 337 (3d Cir. 1993).
A court's modification of a preliminary injunction may disrupt the status quo when such modification becomes necessary to preserve the integrity of proceedings in the court of appeals. Amgen, 887 F.2d at 464.
It is therefore Matthews's burden (as movant) to show that the circumstances underlying the original preliminary injunction have changed in such a way that renders continuation of the original injunction order inequitable or that modification is now necessary to preserve the integrity of its appeal. In support of its motion, Matthews offers 14 exhibits that it characterizes as proving the “preliminary injunction order does nothing to eliminate the unfair advantage Implant/IR had from the thousands of Matthews' documents they have used to compete with Matthews.” ECF 234, 18. Having reviewed the exhibits and accepting as true for the purposes of this motion only that they do show changed circumstances, the Court finds that the alleged changed circumstances do not rise to such a level that would provide this Court with jurisdiction to modify the injunction.
The preliminary injunction and the contempt order together create sufficient safeguards against the inappropriate use of Matthews's information. Initially, the preliminary injunction commands Defendants to “not use, access, disclose, or transmit any documents or other information that belongs to, or originated from, Plaintiff, unless such documents or information is publicly available or Plaintiff has consented to Defendants' use, access, disclosure, or transmittal of the documents or information” and to return “all documents and information that belong to, or originated from, Plaintiff.” ECF 170, 1. Then, the contempt order reinforces the injunction via a sanction enjoining Defendants from competing with Matthews. ECF 228, 7. Given the breadth of this protection, as well as the Court's obligation to maintain the status quo pending disposition of Matthews's appeal, the Court finds that the proposed changed circumstances do not render the injunction inequitable.
For the same reason, modification of the injunction is not necessary to preserve the integrity of these proceedings on appeal in the Third Circuit. Indeed, to grant Matthews's requested relief would itself disrupt the integrity of the appeal by altering or mooting the issues that have been briefed to the Third Circuit in the pending appeal. See Amgen, 887 F.2d at 464 (district court has jurisdiction to entertain motion for modification “in furtherance of preserving the integrity of the appeal”).
Absent a showing that changed circumstances necessitate modification of the preliminary injunction or that modification is necessary to preserve the integrity of the appeal, the Court must conclude that it lacks jurisdiction to modify the preliminary injunction.
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Accordingly, it is hereby ORDERED that Matthews's Motion to Modify Preliminary Injunction Order (ECF 232) is denied without prejudice for lack of jurisdiction.