# MMR Constructors, Inc. v. JB Group of LA, LLC

> District Court, M.D. Louisiana · April 26, 2022

URL: https://www.frixlaw.com/law-library/cases/10192243

## Case

- **Court:** District Court, M.D. Louisiana
- **Decided:** April 26, 2022
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA

MMR CONSTRUCTORS, INC. CIVIL ACTION
VERSUS
JB GROUP OF LA, LLC, ET AL. NO. 22-00267-BAJ-RLB

RULING AND ORDER GRANTING MOTION FOR TEMPORARY
RESTRAINING ORDER AND SETTING STATUS CONFERENCE TO
DETERMINE DATE OF PRELIMINARY INJUNCTION HEARING
In this action, Plaintiff MMR Constructors, Inc. (“MMR”) seeks damages and
injunctive relief against JB Group of LA, LLC d/b/a Infrastructure Solutions Group
CISG”) and former MMR employee David Heroman. (Doc. 1). Now before the Court
is MMR’s Motion For Temporary Restraining Order And To Set Preliminary
Injunction Hearing (Doc. 2), seeking immediate injunctive relief prohibiting
Defendants from accessing, using, disclosing, or disseminating MMR’s trade secrets
and confidential business information. For reasons to follow, MMR’s Motion will be
granted and a temporary restraining order (TRO) will be issued. Further, the Court
will set a telephone status conference for Wednesday, April 27, 2022 at 3:30 p.m. to
determine a date for a preliminary injunction hearing and to discuss what discovery
will be allowed prior to any such hearing.
I. BACKGROUND
A. Allegations
For present purposes the Court accepts as true the following allegations set
forth in MMR’s verified Complaint (Doc. 1):

MMR and ISG are competitors in the telecommunications market. (Doc. 1 at
{| 15, 25). Each provides electrical and instrumentation services to clients in
Louisiana and further afield. (See id.).
MMR is based in Baton Rouge, Louisiana, and is now one of the largest
electrical and instrumentation contractors in the United States, providing services to
public and private customers. Ud. at § 1). To develop and maintain customer
relationships, MMR researches customer needs, develops marketing strategies,
creates financial forecasts and business forecasts, and develops proprietary pricing
structures and estimating tools. Ud. at { 16). These efforts, which are dependent on
the accumulation, application, and secrecy of MMR’s confidential business
information, are crucial to MMR’s success in the competitive market. ([d.). Thus,
MMBR’s confidential information—and particularly its customer lists and customer
pricing information (including costs and labor rates)——has substantial value to MMR.
MMR’s competitive position depends on protecting its confidential business
information, and MMR takes various steps to keep its information out of its
competitors’ hands. (/d. at § 17). Among other things, MMR requires its employees to
sign and agree to various employment policies and procedures designed to protect the
confidentiality of its information. Ud. at { 18). MMR requires employees to sign and
acknowledge its Business Code of Ethics, which requires employees to “protect not
only the assets of MMR, but also its clients, vendors, suppliers and other third
parties[,|” including “tangible assets and intangible assets, such as confidential and
proprietary information.” (/d.). MMR also requires employees to sign and

acknowledge its Rules of Conduct, which prohibits employees from “Theft or
unauthorized removal of any property belonging to @) MMR, (ii) the workplace, (iii)
the job site, Gv) fellow employees, or (v) clients, contractors, suppliers, or vendors of
MMR.” Gd.). Further, MMR requires employees to sign and abide by its “Employer
Loyalty/Confidentiality/Trade Secrets/Conflict of Interest Agreement.” (/d.). Through
this agreement, employees agree that:
[djuring and after the term of his employment, the EMPLOYEE agrees
to hold as confidential all knowledge and information he has acquired in
connection with his/her employment with MMR, and which is not
otherwise generally available to the public or third parties, including
but not limited to customer lists, financial information, pricing
information, marketing material, technical data, drawings, memoranda,
notes, programs, electronic gear, personnel records, policies, other
items, and papers and reproductions (all of which is deemed
“Confidential” and a trade secret) thereof relating the business of MMR.
(Id.).
Defendant ISG is based in Gonzalez, Louisiana, and also provides industrial
electrical and instrumentation services to public and private customers. (Id. at 4 24).
ISG was not always a direct competitor of MMR, but that changed in July 2021 when
ISG recruited long-term MMR Project Manager Jason Yates away from MMR to join
ISG in a “key management role, with an ownership stake in the company [ISG].” Ud.
at 26). Since landing Yates, ISG has successfully recruited five additional employees
away from MMR: Travis Dardenne, Walter Huffman, Tiffany Medine, Kasey Kraft,
and, most recently, Defendant David Heroman. (id. at 4] 27-28).
In addition to targeting MMR’s personnel, ISG has endeavored to obtain
MMR’s confidential and proprietary information. MMR first learned of these efforts
in late March 2022, when it caught former MMR Project Engineer (and current ISG

employee) Kasey Kraft transferring documents from his MMR work computer to an
external storage device. Ud. at {[ 32). When confronted about the file transfer, Kraft
initially claimed that he was merely transferring personal information, not MMR’s
trade secrets and confidential business information. (/d.). MMR’s own review of the
external storage device showed otherwise: “Kraft had attempted to steal trade secrets
but was thwarted when caught in the act.” (Id.).
Unfortunately for MMR, it was not so lucky when former MMR Project
Manager (and current ISG employee) David Heroman abruptly resigned just days
later, on April 8, 2022. Following his resignation, MMR engaged a third-party
computer forensics firm to determine what, if any, trade secrets Defendant Heroman
took with him. (Ud. at § 36). 38. The forensic analysis revealed that in the month
before his resignation, Heroman downloaded over 1,500 files from MMR’s systems to
several electronic storage devices and personal Google Drive account. (/d. at § 38).1
Included among these are hundreds of files believed to contain MMR’s trade secrets
and confidential business information, specifically including MMR’s “confidential
bids, pricing, and estimating tools.” Ud. at | 43; see generally id. at [9 40-58). “Taken
together, the misappropriated information essentially provides [ISG] with the
blueprints to replicate MMR’s business, without investing any of the substantial
time, money, effort, and manpower needed to create the information,” with
potentially “devastating” consequences to MMR. (/d. at 59).

1Tn total, the initial forensic analysis identified 14 external storage devices that were plugged
into Heroman’s work computer during the March-April, 2022 timeframe. Among these, only
4 external storage devices have since been returned to MMR. (/d. at J 39).

B. Procedural History
On April 25, 2022, MMR initiated this action against ISG and Heroman,
seeking damages and temporary and permanent injunctive relief prohibiting
Defendants from accessing, using, disclosing, or disseminating MMR’s trade secrets
and confidential business information. (Doc. 1). Most relevant here, MMR’s verified
Complaint alleges that Defendants’ usurpation of its trade secrets and confidential
business information violates the Defend Trade Secrets Act, 18 U.S.C. § 1836, et seg.
(“DTSA”), and its Louisiana counterpart, the Louisiana Uniform Trade Secrets Act,
La. B.S. § 51:1431, et seg. “LUTSA”).
Minutes after filing its verified Complaint, MMR filed the instant Motion For
Temporary Restraining Order And To Set Preliminary Injunction Hearing
(Doc. 2). MMR also filed a Motion for Expedited Discovery (Doc. 3), requesting the
opportunity to conduct a forensic analysis of ISG’s computers prior to a preliminary
injunction hearing, to determine whether (and how far) its trade secrets and
confidential business information may have spread.
IL ANALYSIS
A, Standard
Federal Rule of Civil Procedure (“Rule”) 65(b) sets forth what requirements
must be met before the Court may issue a TRO.
(1) Issuing Without Notice. The court may issue a temporary
restraining order without written or oral notice to the adverse party or
its attorney only if:
(A) specific facts in an affidavit or a verified complaint clearly show that
immediate and irreparable injury, loss, or damage will result to the
movant before the adverse party can be heard in opposition; and

(B) the movant's attorney certifies in writing any efforts made to give
notice and the reasons why it should not be required.
(2) Contents; Expiration. Every temporary restraining order issued
without notice must state the date and hour it was issued; describe the
injury and state why it is irreparable; state why the order was issued
without notice; and be promptly filed in the clerk's office and entered in
the record,
Fed. R, Civ, P. 65(b)(1)-(2). Additionally, the party requesting the TRO must provide
“security in an amount that the court considers proper to pay the costs and damages
sustained by any party found to have been wrongfully enjoined or restrained.” Fed.
R. Civ. P. 65(c).
B. Discussion
i. MMR has satisfied the procedural requirements for
obtaining a TRO
As an initial matter, the Court. finds that MMR has satisfied the procedural
requirements for obtaining a TRO. Specifically: (1) MMR has submitted a verified
complaint establishing a substantial likelihood of immediate and irreparable injury
if injunctive rehef is not granted (for reasons explained below), (see Doc. 1 at pp. 27-
30); (2) MMR’s counsel has submitted a detailed certification establishing that he has
undertaken reasonable efforts to provide copies of the verified Complaint and the
Motion for Temporary Restraining Order to MMR through its registered agent, as
well as through MMR’s member-manager Jason Yates, and to Defendant Heroman
personally, (Doc. 2-2); and (8) the Court is satisfied that MMR’s proposed security of
$1,000.00 is sufficient to protect Defendants’ interests during the pendency of the
TRO, in the event the Court ultimately determines that the TRO was improperly
issued (see Doc. 2-3 at 8).

ii. MMR has satisfied the substantive requirements for
obtaining a TRO
A TRO is simply a highly accelerated and temporary form of preliminary
injunctive relief, requiring that movant establish the same four clements for
obtaining a preliminary injunction: (1) a substantial likelihood of success on the
merits, (2) a substantial threat of irreparable injury if the injunction is not issued, (3)
that the threatened injury if the injunction is denied outweighs any harm that will
result 1f the injunction is granted, and (4) that the grant of an injunction will not
disserve the public interest. See Garza v. Starr Cty., 309 F. Supp. 3d 454, 456 (S.D.
Tex. 2018) (Crane, J.) (quotation marks and citations omitted). The Court examines
each element in turn.
a. Likelihood of success on the merits
To establish a likelihood of success on the merits, a plaintiff “need not show
that success is an absolute certainty. He need only make a showing the probability of
her prevailing is better than fifty percent.” Eng v. Smith, 849 F.2d 80, 82 (2d Cir.
1988). For reasons set forth below, MMR has satisfied its burden for its claims under
the DTSA and the LUTSA because MMR’s verified Complaint shows that ISG and
Heroman misappropriated MMR’s trade secrets.
The DTSA states that an “owner of a trade secret that is misappropriated may
bring a civil action” in federal court “if the trade secret is related to a product or
service used in, or intended for use in, interstate or foreign commerce.” 18 U.S.C. §
1836(b). The DTSA defines “misappropriation” as “(A) acquisition of a trade secret of
another by a person who knows or has reason to know that the trade secret was

acquired by improper means; or (B) disclosure or use of a trade secret of another
without express or implied consent by a person who,” among other things, “used
improper means to acquire knowledge of the trade secret.” 18 U.S.C. § 1839(5)(A)-(B).
Under the DTSA, prohibited “misappropriation” includes the acquisition of a trade
secret by improper means, as well as its use or disclosure. See id. at § 1839(5)(A)-(B).
The D'TSA defines “improper means” as including “theft bribery, misrepresentation,
breach or inducement of a breach of a duty to maintain secrecy, or espionage through
electronic or other means.” Id. at § 1839(6)(A). Significantly, “the definitional sections
of the DTSA and [the LUTSA] are very similar.” Source Prod. & Equip. Co. v. Schehr,
No. 16-17528, 2017 WL 3721548, at *2 (E.D. La. Aug. 29, 2017) (comparing 18 U.S.C.
§§ 1836, 1839, with LUTSA § 1).
The DTSA, moreover, defines a “trade secret” as:
all forms and types of financial, business, scientific, technical, economic,
or engineering information, including patterns, plans, compilations,
program devices, formulas, designs, prototypes, methods, techniques,
processes, procedures, programs, or codes, whether tangible or
intangible, and whether or how stored, compiled, or memorialized
physically, electronically, graphically, photographically, or in writing if
(A) the owner thereof has taken reasonable measures to keep such
information secret; and (B) the information derives independent
economic value, actual or potential, from not being generally known to,
and not being readily available through proper means by, another
person who can obtain economic value from the disclosure or use of the
information.
18 U.S.C. §1839(8). And, again, the LUTSA defines the term “Trade Secret”
similarly. La. R.S. 53:1431(4).
The allegations of MMR’s verified Complaint, accepted as true, establish that
Defendant Heroman’s actions shortly before leaving MMR qualify as a

“misappropriation” that was achieved through “improper means.” Specifically, with
knowledge that MMR’s customer pricing, financial, estimating, and employee
information was confidential and not to be disseminated other than to authorized
employees of MMR, Heroman transferred this information to external storage devices
and to his personal cloud-based storage account and then took steps to hide this
activity. See AUA Private Equity Partners, LLC v. Soto, No. 17-8035, 2018 WL
1684339, at *7 (S.D.N.Y. Apr. 5, 2018) (explaining that, like here, improper
acquisition through downloading information establishes lability and collecting
cases where “[mlisappropriation by acquisition has been found under other state
UTSAs in similar circumstances”). Further, Heroman—now an ISG employee—
maintains dominion and control over this information, making it highly likely that
MMR’s trade secrets and confidential information will be transmitted to ISG.
Additionally, the misappropriated information qualifies as trade secret under
the DTSA and LUTSA. The copied files and folders identified through MMR’s third-
party forensic investigation contain highly sensitive business information that is not
generally known and gives MMR a competitive edge. Further, MMR took reasonable
efforts to maintain the secrecy of this information by requiring employees to sign
agreements and acknowledging policies protecting the confidentiality of the
information; by limiting employee access to certain confidential business information
and password protecting that information; and by monitoring transfer of confidential
information through data loss prevention software. See Unif. Trade Secrets Act §
1(4)G1) emts. (drafters of Uniform Trade Secret Act, on which the LUTSA is based,

explain that “reasonable efforts to maintain secrecy” may include advising employees
of the existence of a trade secret or limiting access to a trade secret on a “need to know
basis”).
Finally, MMR’s efforts to maintain the confidentiality of this information gives
it “independent economic value.” A direct competitor would benefit greatly if it had
access to the information that Heroman allegedly misappropriated, particularly with
respect to customer-specific pricing information and estimating tools.
In sum, MMR has carried its burden of establishing a high likelihood of success □
on the merits of its DTSA and LUTSA claims because Heroman misappropriated, by
improper means, MMR’s information and data, which qualify as trade secrets.
b. Likelihood of irreparable injury
MMR has also carried its burden of showing that it has suffered, and will
continue to suffer, irreparable harm if the requested relief is not granted. Irreparable
injury is harm that “cannot be undone through monetary damages” ~~ that is, harm
for which money damages are inadequate or for which money damages are “especially
difficult” to compute. Deerfield Med. Ctr. v. City of Deerfield Beach, 661 F.2d 328, 338
(5th Cir. 1981); Allied Marketing Group, Inc, v. CDL Marketing, Inc., 878 F.2d 806,
810 n,1 (5th Cir. 1989).
The U.S. Fifth Circuit Court of Appeals instructs that irreparable harm can be
established where “the rights are economic, but because of their nature or the
circumstances of the case, establishment of the dollar value of the loss is especially
difficult or speculative.” Mississippi Power & Light Co. v. United Gas Pipe Line Co.,

10

760 F.2d 618, 630 n. 12 (th Cir. 1985) (citing State of Texas v. Seatrain Int'l, S.A.,
518 F.2d 175, 179 (6th Cir. 1975)).
Both the United States Congress and the Louisiana legislature recognize that
irreparable injury arises from the misappropriation of trade secrets. It is clear under
the DT'SA and LUTSA, that even the threat of misappropriation may be enjoined. 18
U.S.C. § 1836 (b)(8)(A)@); La. R.S. § 51:1432(A).
Accordingly, to satisfy the irreparable injury element, MMR need only show
that the ““defendant possesses the trade secrets and is in a position to use them.”
Lifesize, Inc. v. Chimene, No. 1:16-cy-1109-RP, 2017 WL 8751921, at *1 (W.D. Tex.
Apr. 27, 2017).2.
Here, MMR has established that it faces a substantial threat and actual
irreparable harm ifthe Court does not enter a temporary restraining order. Heroman
improperly took and retained MMR’s trade secrets, at the very least, on external
storage devices and through a cloud-based storage platform, shortly before

2 See also Newsouth Comme □□ Corp. v. Universal Tel. Co., No. 02-2722, 2002 WL 31246558,
at *21 (E.D. La. Oct. 4, 2002) (citing Union Carbide Corp. v. UGI Corp., 731 F.2d 1186, 1191—
92 (th Cir. 1984) and FMC Corp. v. Varco Intl, Inc., 677 F.2d 500, 503 (5th Cir. 1982))
(recognizing that using or disclosing even one trade secret to a competitor of the employee’s
former employer may create a substantial threat of irreparable injury); Picker Int'l, Inc. v.
Blanton, 756 F. Supp. 971, 983 (N.D. Tex. 1990) Gnjunctive relief is the “only way use of the
[trade] secret by the former employee can be prevented”); Computer Mgmt. Assistance v.
Robert F. deCastro, inc., 220 F.3d 396, 408 (5th Cir. 2000); Reingold v. Swiftships, Inc., 126
F.3d 645, 648 (5th Cir. 1997)); Am. Express Fin. Advisors, Inc. v. Scott, 955 F. Supp. 688, 693
(N.D. Tex. 1996) (when, as in this action, “trade secrets and goodwill are involved, the threat
is significant that the harm experienced by the misappropriation or misuse of trade secrets
will be irreparable”); TransPerfect Translations, Inc. v. Leslie, 594 F. Supp. 2d 742, 757 (S.D.
Tex. 2009) (The use of an employer's confidential information and the possible loss of
customers is sufficient to establish irreparable harm.” (citing Unisource Worldwide, Inc. v.
Valenti, 196 F. Supp. 2d 269, 280 (E.D.N-Y. 2002); Ecolab Ine. v. Paolo, 753 F. Supp. 1100,
1110 (E.D.N_Y, 1991)),
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terminating his employment. ISG is now in a position to use the trade secrets to
MMR’s detriment. With MMR’s trade secrets and proprietary information readily
accessible, ISG and Heroman can unfairly compete against and harm MMR, resulting
in injuries that will prove difficult to measure with monetary precision.
c. Balance of harms
MMR seeks narrowly tailored relief designed to protect its legitimate business
interests and to ensure misappropriated information cannot be used further to
unfairly compete. If the Court does not intervene, MMR stands to lose its valuable
trade secrets, confidential business information, and intellectual property to ISG. In
contrast, ISG and Heroman will suffer no undue hardship, as they merely need to
comply with their legal and contractual obligations not to disclose MMR’s confidential
information and to comply with trade secret law. See Dish Network L.L.C. v. Ramirez,
No. 15-04712, 2016 WL 3092184, at *7 (N.D. Cal. Jun. 2, 2016) (balance of hardships
tips in favor of plaintiff seeking injunction when it would “do no more than require
Defendant to comply with federal and state laws”). Thus, the Court finds that the
equities favor issuing the requested relief.
d. Public interest
Finally, enjoining ISG and Heroman from using MMR’s trade secrets will not
disserve the public interest. Instead, the requested relief will promote fair
competition, ethical behavior, honest work, and innovation. Bank of Am., N.A. v. Lee,
No. 08-5546, 2008 WL 4851348, at *7 (C.D. Cal. Sept. 22, 2008) (finding that public
interest is served by enabling the protection of trade secrets).

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TI. CONCLUSION
Accordingly,
IT IS ORDERED that MMR’s Motion For Temporary Restraining Order
And To Set Preliminary Injunction Hearing (Doc. 2) be and is hereby
GRANTED, and that a temporary restraining order be and is hereby ENTERED,
ENJOINING AND PROHIBITING Defendants JB Group of LA, LLC d/b/a
Infrastructure Solutions Group (“ISG”) and David Heroman, and those persons or
entities in active concert or participation with them, from:
1. Disclosing, disseminating, or using MMR’s trade secrets and confidential
business information, including, but not limited to, all files (and the
information contained therein) that reside on any electronic storage device,
cloud-based file repository or file-sharing account, and/or email account used
by Mr. Heroman, or any other former MMR employee that now works for ISG,
during their employment with MMR or in their possession, custody, or control
during his employment with MMR or in his possession, custody, or control;
2. Accessing, studying, copying, or taking notes about MMR’s trade secrets and
confidential business information, including, but not limited to, all files (and
the information contained therein) that reside on any electronic storage device,
cloud-based file repository or file-sharing account, and/or email account used
by Mr. Heroman, or any other former MMR employee that now works for ISG,
during their employment with MMR or in their possession, custody, or control;

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3. Destroying, altering, erasing, secreting, or failing to preserve any and all of
MMnR’s trade secrets, business materials, property, proprietary information,
confidential information, and/or any and all record or documents that may be
relevant to this lawsuit; wherever located, and in whatever form, including but
not limited to any document, email, report, software, files, electronic data,
tangible evidence, financial records, and any and all communications between
Heroman and any employee, member, investor, or consultant of ISG and its
parent companies, subsidiaries and affiliates;
4, Failing to return the information and external storage devices identified in the
verified Complaint (Doc. 1), and any other documents/devices that contain
MMW’s confidential business information.
IT IS FURTHER ORDERED that the issuance of this temporary restraining
order be and is hereby conditioned upon MMR promptly furnishing ONE
THOUSAND AND NO/100 ($1,000.00) DOLLARS in security, and that MMR,
through its counsel, be and is hereby authorized to deposit into the Registry of the
Court, associated with the above captioned matter, the sum of ONE THOUSAND
AND NO/100 ($1,000.00) DOLLARS, pending further orders of this Court.
IT IS FURTHER ORDERED that this temporary restraining order, unless
extended for good cause and/or by the agreement by the parties, shall EXPIRE by its
terms fourteen days from the date and hour of its issuance.
IT IS FURTHER ORDERED that MMR’s counsel shall (1) immediately
provide notice of this Order to Defendants and/or Defendants’ counsel; and (2)

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therewith, shall provide Defendants and/or Defendants’ counsel copies of this Order;
and (3) not later than April 27, 2022 at 11:00 a.m., shall file a certification into the
record setting forth what efforts have been made to provide notice and copies of this
Order to Defendants and/or Defendants’ counsel.
IT IS FURTHER ORDERED that a telephone status conference be and is
hereby SET for Wednesday, April 27, 2022 at 3:30 p.m. for the purpose of selecting a
date for a preliminary injunction hearing, and to discuss MMR’s Motion for Expedited
Discovery (Doc. 3) in advance of said hearing. Dial-in instructions will be provided to
counsel prior to the status conference. Plaintiff's counsel shall provide notice of
the telephone conference and the dial-in information to Defendants and/or
Defendants’ counsel.
Baton Rouge, Louisiana, this 26th day of April, 2022
Be
JUDGE BRIAN A: KSON
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10192243. Public record. Not legal advice.