Ardis Health, LLC v. Nankivell

Citation
Ardis Health, LLC v. Nankivell, 2011 WL 4965172 (S.D.N.Y. October 19, 2011) (full-text).

Factual Background
Defendant worked for Plaintiff as “Video and Social Media Producer,” and had duties and responsibilities to the company including the maintenance of certain websites, blogs, and social media sites for the purpose of online marketing. In carrying out these responsibilities, Defendant maintained the passwords, login information, and email accounts associated with these sites.

At the start of her employment, Defendant signed a “Work Product Agreement” that stated that all work created or developed by Defendant “shall be the sole and exclusive property of CYC, in whatever state of development or completion,” and that it “will be prepared as ‘work-for-hire’ within the meaning of the Copyright Act of 1976.” This agreement also required Defendant to return all confidential information upon request and stated that “actual or threatened breach of [the agreement] will cause [Plaintiff] irreparable injury and damage.” All accounts at issue were created during Defendant’s employment, and Defendant was also provided with a laptop computer for use in the performance of her job duties.

Upon Defendant’s termination, Plaintiff requested the return of the laptop and the login and account information described above. In addition to refusing to return this material, Defendant began displaying content she had created during her employment alongside other projects she was involved with on her personal websites as part of her design portfolio.

Trial Court Proceedings
Plaintiff sued for a preliminary injunction requiring Nankivell (1) to return login information for various websites; (2) to return a laptop allegedly owned by Plaintiff and the content thereon; and (3) to refrain from using any of the Plaintiff’s proprietary content and trademark or copyrighted works.

A party seeking a preliminary injunction must show (1) a likelihood of irreparable harm in the absence of the injunction; and (2) either a likelihood of success on the merits or sufficiently serious questions going to the merits to make them a fair ground for litigation, with a balance of hardships tipping decidedly in the movant’s favor. Monserrate v. N.Y. State Senate, 599 F.3d 148, 154 (2d Cir. 2010). In ruling on Plaintiff’s motion, the court acknowledged that the Plaintiff relies heavily on its online presence for marketing and sales purposes. As a result, the inability to access its online accounts had an unquestioned negative impact on the Plaintiff’s business.

While the Defendant argued that the sites in question had not been updated recently, the court pointed out that such updates were her responsibility and refused to allow that to form a basis for her to oppose the motion for an injunction. As a result, the court granted Plaintiff’s motion with respect to the return of the online account information. The court did find Defendant’s argument that the material on the laptop computer had been synced with desktop computers in the Plaintiff’s possession to be much more convincing. Taking that argument as true, the court was unable to find sufficient likelihood of irreparable harm to order the return of the computer.

Finally, with respect to Plaintiff’s material posted on Defendant’s websites, the court noted that irreparable harm may not be presumed in matters of copyright and trademark infringement. See Salinger v. Colting, 607 F.3d 68, 79-80 (2d Cir, 2010). As a result, and because of the credible innocent arguments in Defendant’s favor for using the material in her portfolio, as well as the unlikely event that potential customers would be confused by Defendant’s portfolio, Plaintiff’s motion with respect to the Defendant’s websites was denied.